A New Fund Has Entered NZ Venture Capital Market
Media information: June 27 2005
A new fund has entered New Zealand’s venture capital market, focussing exclusively on local companies in key innovation sectors.
The New Zealand Innovation Fund, launched this week, is aiming to invest in up to 15 of New Zealand’s most promising growth companies in ICT, Specialised Manufacturing & Design and Life Sciences.
Peter Maire, Chairman of the New Zealand Innovation Fund’s Investment Committee and Advisory Board member (and founder and Chairman of New Zealand success story Navman) says investing in research and development and maintaining design leadership is pivotal to creating more major Kiwi businesses able to stand on the world stage.
“The New Zealand Innovation Fund has selected the key areas for growth: ICT, Specialised Manufacturing & Design and Life Sciences; all areas where New Zealand has a wealth of small companies quietly going about the business of developing and commercialising products and creating great businesses from leading edge technology with competitive advantage and international application.” “With the New Zealand Innovation Fund, we can set about finding and growing the next Navman!” adds Mr Maire.
Randal Barrett, of the fund’s manager, Pioneer Capital Partners, says the new fund will invest in companies at the international expansion stage of their development, and will also invest in early stage companies with excellent growth prospects.
“Currently there is little capital available to meet the significant demand for expansion stage funding in New Zealand,” says Mr Barrett. “Private Equity firms prefer to focus on opportunities for returns through operational restructuring rather than expansion stage growth that comes from well directed capital and industry expertise, whilst individual angel investors and existing VC funds are generally prevented from addressing this area due to size, or the VIF’s co-investment restrictions on later expansion stage projects.”
“The New Zealand Innovation Fund has a broad sector mandate which is necessary to capture the best opportunities in a small market. We have selected a talented management and advisory team to match with direct experience in the targeted sectors and successful backgrounds as entrepreneurs, executives, financiers and strategic advisors. More importantly the collective investment and management track record of the New Zealand Innovation Fund team is equivalent to upper quartile US VCs and gives us a strong base from which to target superior risk-adjusted returns for our investors.”
Mr Barrett has recently returned to New Zealand from Europe where he advised international telecommunications and technology companies on their global expansion. He has worked with global law firm Baker & McKenzie and investment bank Morgan Stanley, co-founded a growing European telecoms company and sits on the Advisory Board of US VC firm Duke Equity Partners. Mr Barrett is joined by long time associate and ex-UBS Europe director Matthew Houtman along with immigrating Canadian venture capitalist and serial entrepreneur Joe Rouse. In addition to their Auckland base, a Christchurch office will be manned by local technologist Roger Dennis.
Advisory Board member Dr Paul Coleman is president of the Girvan Institute of Technology, a Silicon Valley based NASA–chartered technology consultancy, and a regular advisor to the financial community on high-tech enterprise. Dr Coleman brings a unique link to the New Zealand Innovation Fund, with the Girvan Institute’s global network in place to assist New Zealand companies in their international expansion.
“New Zealand has been on our radar for some time as a country with a rich heritage of innovation and entrepreneurship, but lacking in the type of capital that allows technology companies to grow into global players. Companies in the US have benefited from VC for decades and most of the successful ones have been VC backed. I worked with Kiwis at NASA and in other capacities and am pleased to be getting an opportunity to do so again through the New Zealand Innovation Fund initiative.”
Other Investment Committee and Advisory Board members include IT entrepreneur, investor and mentor Scott Gilmour and BNZ director and former Dairy Board chairman John Storey. US venture capitalist Stanton Dodson is also on the Advisory Board, to which 2-3 more members will be added over time.
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More information: www.pioneercapital.co.nz