IPO path to NZX for tech companies
26 September 2012
IPO path to NZX for tech companies
The New Zealand Venture Investment Fund wants to see 15 to 20 high growth companies in its portfolio listing on the New Zealand stock exchange over the next decade.
Currently NZVIF has 125 portfolio companies and expects that to grow to around 180 over the next five years. It aims to see 10 percent of those companies listing on the NZX.
NZVIF chief executive Franceska Banga said that establishing a path for technology companies, which can take them from receiving initial investment at the start-up stage, through to expansion and on to listing on the NZX, will assist the development of the growth company eco-system.
“A number of high growth companies have taken the option of an early presence on the NZX, such as Xero. But for many technology companies, a public listing follows a period of development and growth funded from rounds of angel and venture capital investment. New Zealand’s capital markets will be stronger if there is a viable path from that type of private investment through to public markets.
“A major challenge for growth companies
is the lack of follow-on investment capital when they need
$5 million to $10 million. For many companies, strategic
acquisitions by large international competitors are the
preferred way to fund their next stage of development and
that will remain the case. But we need to develop the
domestic IPO market as a practical and viable
“So far, just two NZVIF portfolio companies have a presence on the NZX – Xero and HTS-100 via its acquisition by Scott Technology. A third - Moa Brewing Company – has indicated interest in a possible listing to raise new capital. NZVIF’s goal is to increase that presence. Within five years, we expect to have invested into around 180 companies and our aim is that around 10 percent – 15 to 20 companies – will, over time, list on the NZX.
“For that to happen, we need to work with the investment and brokering community on building the pipeline of prospective listings and map a path forward from early stage private investment to NZX listings.
this can achieved, the NZX will benefit from a deeper,
broader offering to investors from more high growth
technology companies being listed. Secondly, establishing a
viable path to the listed market will open up new deeper
pools of capital for companies to develop, while providing
early stage private investors with another path to realise
value from their investments, which would be reinvested,
strengthening the early stage eco-system.”
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New Zealand Venture Investment Fund Limited
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early stage venture capital market
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