Hon Trevor Mallard

Minister for Economic Development

2 November 2005 Media Statement

Venture capital market key to innovation

Economic Development Minister Trevor Mallard today released a major study that shows venture capital is an increasingly important part of New Zealand’s innovation system.

Trevor Mallard said the report provides practical and useful insights into a complex area.

"Innovation is vital to economic growth, yet financing young, high-growth firms can be a risky business," Trevor Mallard said.

"In other economies such as the United Kingdom venture capital plays an important role in the commercialisation of innovation and the development of young and emerging firms.

"While the venture capital sector is still at an early stage of development in New Zealand, this report shows that the New Zealand Venture Investment Fund (NZVIF) established by the government in 2002, has been a catalyst for developing the venture capital market here.

"As a result New Zealand venture capital investments are growing in size and number and the report concludes that the fund’s design has meant New Zealand has avoided pitfalls encountered elsewhere.

"In addition it shows that the NZVIF has contributed to the development of a pool of people with skills and expertise in seed and start-up investment."

Trevor Mallard said he welcomed public comment on the report’s findings. Comments should be sent to info@med.govt.nz

The full report will be available on the Ministry of Economic Development website from midday.

http://www.med.govt.nz/irdev/ind_dev/access-to-finance/venture-capital/

ENDS

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