Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


Angels soar as tech sector flourishes

Angels soar as tech sector flourishes

Angel investing surged in 2013 with a record $53.2 million invested into young New Zealand companies in 2013, reflecting growing investor confidence in the technology and innovation sector, New Zealand Venture Investment Fund chief executive Franceska Banga said today. 

Releasing the latest Young Company Finance Index, Franceska Banga said that investment activity was up 80 percent on the $29.9m invested in 2012, and, cumulatively, $297.7m has now been invested into young companies by angels since the Young Company Finance Index began measuring activity in 2006. 

“There was a marked surge in investment into software and services.  Companies in the sector attracted $25.4m of investment – an increase of over 140 percent on the $10.5m invested in 2012.  Health sector companies also saw a large rise with $6.9m of investment in 2013 compared with $1.7m the previous year.   

 

“Growing investor confidence in the New Zealand technology sector led to a marked surge in investment 

activity during the year, with software and services leading the charge. While the strong performance of 

NZX listed technology companies such as Xero, SLI Systems and Pacific Edge undoubtedly spurred much of the renewed market appetite, the surge in angel investing also reflects the strong pipeline of new opportunities coming into market. 

“NZVIF’s Seed Coinvestment Fund – which coinvests alongside angel investors  also had its biggest year yet, with $6m invested into 22 new and 31 followon investments.  The private sector invested a further $19m alongside SCIF.  It is heartening to see the angel investing ecosystem in such good health.” 

Angel Association of NZ chair Marcel van den Assum said the substantial increase in investment last year shows the enthusiasm angels have for supporting entrepreneurial endeavour and the economic value this generates.   

“The high level of follow on investment reenforces angels’ commitment to businesses with potential, and recognises that it takes time and effort to achieve results.  

“Because our formal angel community is relatively young, we shouldn’t be surprised to see investment levels and outcomes fluctuate. This reflects the risk of angel investing and reinforces the importance of consistency in policy and process to provide a base of certainty in very uncertain new markets.  

Offsetting risk are the rewards, including the upturn in IPO, venture and private equity activity, which represent successful angel investment outcomes and engender increased confidence in early stage ventures.” 

By the numbers 

2013 saw a larger average deal size ($497,486) than in 2012 ($298.968).  In 2013, 58 percent of investment deals were $250,000 or less compared with 67 percent in 2012.  

Of the $53.2m invested in 2013, 80 percent ($42.8m) was followon investment and 20 percent ($10.5m) was new investments.   

In terms of the stage of investment, $13.8m was seed investment, $29.6m was at the startup stage, and $9.2m at the early expansion stage. 

2013 saw 79 percent of deals syndicated between different angel groups, a continuation of the trend to greater collaboration between angel groups. 

2013 saw 26 percent of investments in the form of convertible loans, 51 percent were ordinary shares, and 22 percent were preference shares.   

Since 2006, by region, 55 percent of investment was in Auckland, 10 percent in Christchurch and in Wellington, 7 percent in Dunedin, and 5 percent in Palmerston North and in Hamilton. 

Since 2006, the software & services sector saw 32 percent of the amount invested, followed by pharmaceuticals/life sciences technology (19%), technology hardware and equipment (12%), and food & beverage (8%). 
Ends

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Media: Fairfax Moves To Create Modern Newsroom

Fairfax Media New Zealand continues its newsroom transformation this week, with a proposal to further organise its editorial operations into focused, local teams and specialist national topic areas. More>>

ALSO:

Dairy: Fonterra Forecast For 2015/16 Season

Fonterra Co-operative Group Limited has today reduced its forecast Farmgate Milk Price for the 2014/15 season to $4.40 per kgMS. Along with its previously announced forecast dividend range of 20-30 cents per share, the change amounts to a forecast ... More>>

ALSO:

BusinessDesk: SkyCity Lifts Minimum Convention Centre Investment To $430M

SkyCity Entertainment Group, the casino operator, has lifted the minimum it will invest in the Auckland International Convention Centre to $430 million and said total costs including land may be $450 million to $470 million. More>>

Statistics: Drop In Dairy Prices Leads Fall In Exports

Total goods exports fell $240 million (5.5 percent) to $4.2 billion in April 2015 compared with April 2014, Statistics New Zealand said today. More>>

BusinessDesk: APN's NZME Sees Future In Paywalls, Growth In Digital Sales

APN News & Media has touted a single newsroom concept for its NZME unit in New Zealand, similar to what Germany's Die Welt uses, saying an 'integrated sales proposition' is helping it win market share, including ... More>>

Labour Party: Global Milk Prices Now Lowest In 6 Years

The latest fall in the global dairy price has brought it to the lowest level in six years and shows there must be meaningful action in tomorrow’s Budget to diversify the economy, says Labour’s Finance spokesperson Grant Robertson. “Dairy prices ... More>>


BusinessDesk: NZ Inflation Expectations Creep Higher In June Survey

May 19 (BusinessDesk) - New Zealand businesses lifted their expectations for inflation over the next two years, sapping any immediate pressure on the Reserve Bank to cut interest rates, and prompting the kiwi dollar to jump higher. More>>

BusinessDesk: Lower Fuel Costs Drive Down NZ Producer Input, Output Prices

May 19 - Producer input and output prices fell in the first quarter, mainly reflecting lower fuel costs and weakness in prices of meat and dairy products. More>>

Media: Fairfax Media NZ Announces Senior Editorial Team

Fairfax Media New Zealand has today confirmed its new editorial leadership team, as part of a transformation of its newsrooms aimed at enhancing local and national journalism across digital and print. More>>

Science: Flavonoids Reduce Cold And Cough Risk

Flavonoids reduce cold and cough risk Research from the University of Auckland shows eating flavonoids – found in green tea, apples, blueberries, cocoa, red wine and onions – can significantly reduce the risk of catching colds and coughs. The research, ... More>>

BusinessDesk: RBNZ House Alert Speech The Catalyst For Government Action

Prime Minister John Key all but conceded that pressure from the Reserve Bank of New Zealand for concerted action on rampant Auckland house prices was one of the main catalysts for the government's weekend announcements about tightly ... More>>

BusinessDesk: How To Fall Foul Of The New Housing Tax Rules: Tips From IRD

Just because you rented out your investment property doesn't absolve you from paying tax, says the Inland Revenue Department in a summary of commonly made mistakes by non-professional property investors when it comes to their tax liability.More>>

Legal: Superdiversity Law, Policy And Business Stocktake Announced

Mai Chen, Managing Partner at Chen Palmer New Zealand Public and Employment Law Specialists and Adjunct Professor of Law at the University of Auckland, today announced the establishment ... More>>

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news