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


NZ angels told to broaden portfolios: Lightning Lab

NZ angels told to broaden portfolios as start-ups pitch at Lightning Lab

By Paul McBeth

May. 28 (BusinessDesk) - New Zealand angel investors are backing too few start-ups and should broaden their portfolios if they want to improve their chance of a return, according to Angel Association chairman Marcel van den Assum.

The success of software companies such as Wellington-based Xero had helped foster an environment where start-ups can flourish, though local angel investors have been reluctant to expand their portfolios, van den Assum, who was part of the successful sale of local software firm GreenButton to Microsoft earlier this month, told an audience at the Lightning Lab demo day in Wellington yesterday.

"A lot of angel investors looking to hit home runs and that places unreasonable pressure on ventures and boards," van den Assum said. "We need to start encouraging angels to broaden their portfolios, and as they start to build the portfolio, it improves their chance of ultimately achieving a successful return."

Van den Assum warned against getting too carried away by the success of the local digital sector, with last year's listings of Wynyard Group, SLI Systems, GeoOP,and the upcoming initial public offerings of Gentrack and Serko.

"We need to be careful we're not marching ahead of expectations," he said.

Van den Assum spoke ahead of pitches by nine start-ups which went through the Lightning Lab's digital accelerator programme to prepare early stage companies for investors. Of the nine companies pitching, eight sought a total of $2.24 million from investors, of which five had already received commitments of $740,000.

Common Ledger, which developed a platform allowing accountants to integrate different accounting software, sought the biggest amount, asking for $550,000, of which half was already subscribed, on a pre-money valuation of $1.75 million to help fund the completion of an enterprise deal with a major accounting firm and boost sales and distribution.

Cloud Cannon, which developed a platform makes it easier for web designers to deploy and maintain websites, asked for $450,000, of which half was committed, to expand its customer base and develop new add-on products. GlassJar, whose software allows shared rentals to better manage their finances, asked for $400,000, with $110,000 in soft commitments, to fund the next 12 months when it plans to develop mobile apps, integrate bank fees into the software and secure 20,000 users before advancing into the US.

CoachSeek, whose software helps sports coaches manage their programmes, asked for $450,000, of which $100,000 was committed at a pre-money valuation of $1 million to fund the next 18 months. Twingl, which developed software to track a secondary school student's learning process, sought $90,000 in a convertible note, with commitments of $30,000, to fund a pilot programme in New Zealand and push into the US.

Floc, whose software allows restaurants to forecast customer traffic, was seeking $100,000 in a convertible note. Keen, whose software connects social media users to meet up for activities offline, sought $150,000. Mish Guru asked for $50,000 in convertible notes to build a platform allowing corporate users to manage social media sites such as Snapchat.

Cogo Digital, whose software helps manage institutional knowledge built up by staff, didn't ask for a specific amount in its pitch.


© Scoop Media

Business Headlines | Sci-Tech Headlines


Land & Water Forum: Fourth Report On Water Management

The Land and Water Forum (LWF) today published its fourth report, outlining 60 new consensus recommendations for how New Zealand should improve its management of fresh water and calling on the Government to urgently adopt all of its recommendations from earlier reports. More>>



Welcome Home: Record High Migration Stokes 41-Year High Population Growth

New Zealand annual net migration hit a new high in October as more people arrived from than departed for Australia for the first time in more than 20 years. More>>


Citizens' Advice Bureau: Report Shows Desperate Housing Situation Throughout NZ

CAB's in-depth analysis of over 2000 client enquiries about emergency accommodation shows vulnerable families, pregnant women and children living in cars and garages, even after seeking assistance from the Ministry of Social Development and Housing New Zealand. More>>


Speaking For The Bees: Greens Call For Neonicotinoid Pesticide Ban

The National Government should ban the use of controversial pesticides called neonicotinoids after evidence has revealed that even at low doses they cause harm to bee populations, the Green Party said today. More>>


Get More From Scoop

Search Scoop  
Powered by Vodafone
NZ independent news