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New equity crowdfunding platform supports Kiwi start ups

MEDIA RELEASE Tuesday 27 September 2016

New equity crowdfunding platform supports Kiwi start ups

A new online equity crowdfunding platform offers wholesale investors the opportunity to invest in Kiwi start ups alongside seasoned angel investors.

AngelEquity provides wholesale investors with access to a broad selection of early stage investments presented by angel groups from around the country.

“The angel investing model is the best way to invest in early stage companies,” says Bill Murphy, founder of Bay of Plenty angel investor group and the team behind AngelEquity, Enterprise Angels. “Angel investors have a huge amount of experience in early stage investments and we put every investment opportunity through a rigorous pre-selection process including due diligence, negotiating investor terms and company valuation.”

All AngelEquity deals have passed due diligence and already have a minimum of 25% angel investment in their current funding round. “AngelEquity opens these exciting investment opportunities up to the wider market of wholesale investors, on the same terms negotiated by the angels,” says Murphy.

Recent changes to the definition of wholesaler investor in the Financial Markets Conduct Act 2013, mean that more Kiwis now meet the criteria. “We’re not just talking about banks or institutions,” says Murphy. “Many high net-worth individuals, or people with sophisticated knowledge and experience of financial markets are now considered wholesale investors.

Bridget Unsworth, Investment Director of New Zealand Venture Investment Fund, says the AngelEquity intiative will help deepen the pools of capital available, as well as providing investors with the comfort of knowing that deals have been vetted by experienced angel investors. “Angel investment is at healthy levels, but there remains a demand for more capital, particularly as companies develop and need new rounds of investment to maintain their progress.“

Suse Reynolds, Executive Director of the Angel Association of New Zealand, agrees. “Early stage, high growth companies are always looking for capital. Without capital the growth path is exponentially slower.”

Reynolds believes there is still plenty of room for growth and specialisation in this end of the capital markets.

“It’s a highly risky part of the market to play in but absolutely vital for New Zealand’s future economic and social wellbeing,” says Reynolds. “These companies are the Xeros and F&P Healthcare companies of the future. And what these companies need as much as the capital is exposure and support – the expertise and connections that the capital can help deliver.”

Murphy believes that angel investing is now a vital part of the worldwide economy. “For the past several years, angels have invested over $50 million a year in New Zealand companies. And it’s not just about financial return – the most important part is the skills we put in, because that’s where these companies really benefit. We are making a difference by investing our time and money in exciting young companies.”

Visitors to the AngelEquity website are able to view brief information on current and closed deals. To protect the privacy of investors and the confidentiality of the investee company information, only registered and verified wholesale investors and angel group members are able to view full details, including due diligence summaries and investor lists.

Opportunities currently available on the AngelEquity platform include:

Roholm – the developer, marketer and distributor of the world’s first Inverse Hair Conditioning system, which uses sub-zero temperatures to lock in moisture and restore the health, strength, condition and appearance of women’s hair – no chemicals, no heat and no cords. The global shampoo and conditioner market is estimated to be worth US$34B. Roholm is seeking $500K - $1M with a pre-money valuation of $7.84M.

Quantec - Quantec is an agritech company taking its patented discovery of a novel milk protein and developing applications in human and animal health, including:

• The world’s first non-antibiotic, nil-milk withhold treatments for mastitis in dairy cows – the most costly disease on dairy farms worldwide, costing the industry over $1.5B.

• IDP milk protein ingredient, as a naturally-derived anti-microbial and anti-inflammatory for use in supplements and oral care applications, where consumers are seeking naturally-derived alternatives to synthetic active ingredients.

• IDP for use in Skincare for conditions such as acne and eczema. Consumers are seeking clinically-proven, cost-effective products, without harsh chemicals.

Quantec is seeking $750K, with a pre-money valuation of $9M.

EA Fund 2 – A diversified ‘sidecar’ portfolio of investments in early stage companies across a range of industries, spanning seed, start up and expansion phases. Investors will have exposure to a minimum of 15 early stage companies – all of which have passed due diligence and have significant angel investment. This sidecar fund offers an entry point to early stage investing and an opportunity to realise the benefits that come from diversification and is a good entry point to early stage investing.

© Scoop Media

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