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Ventures New Zealand is consistently producing valuable startups - - PowerPoint PPT Presentation
Ventures New Zealand is consistently producing valuable startups - - PowerPoint PPT Presentation
Ventures New Zealand is consistently producing valuable startups More opportunities per capita in New Zealand? Angel Investment Basics We invest for equity. Typically minority positions (10-30%). Active & supportive, but not in
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Angel Investment Basics
We invest for equity. Typically minority positions (10-30%). Active & supportive, but not in management. Long term investments (7+ years). Returns via acquisitions or IPOs. Not: loans, share buy back, dividends.
“At K1W1 we have invested in hundreds of kiwi startups over the last 20 years. We invested in Tuhua in 2016 and have subsequently co- invested with Tuhua in a number of their portfolio startups. Their deal sourcing, team, and investor engagement are first class.” – Sir Stephen Tindall
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Angel Investor Basics
Variety of motivations: stay involved, give back, grow NZ, personal development. Universally: ROI. Typically 1-10% of wealth (over 5-10 years) Passive: $5-25k per round Active (going on board): $50-250k per round Funds: $20 – 250k (divided into 10 – 100 startups) Ice Angels Avg: $47k/year, 2.5 companies/year Most seek to build a portfolio of 20+
“As newer investors to the startup scene, we have loved how Tuhua has enabled us to invest in such a broad range of startups.” – Janene Draper, Co-Founder of Farro Fresh and Tuhua LP/ Ice Angel
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What are we looking for?
Unique insights or perspectives Experienced entrepreneurs that have built and sold businesses Large, growing, and durable markets Breakthrough technology Capital efficiency: the ability to make massive strides with limited resource IP or a defendable competitive advantage Lead Investors that can add value Price, terms, and potential upside in line with stage and risk Prospective acquirer value and an exit strategy
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Breakthrough technology founded on unique insights / Large, growing, durable markets
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IP or a defendable competitive advantage/ Prospective acquirer value
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Experienced entrepreneurs that have built and sold businesses
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Unique insight or perspective / Lead investors that can add value
Market cap: US$9.9B
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- Building product
- Growing team
- Securing IP
- Business development
- OPEX / “cash flow gaps”
- Travel / conferences/ BD
What is investment for?
Not: Large founder salaries Buying out founder shares Paying off debt
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- Failure to diversify / going long on the first startup you fall in love with.
- Apathetic/ indiscriminate follow-on investment.
- Market validation? Hint: You are (probably) not the customer.
- Following the crowd (blindly)… but going alone can be just as bad.
- Invest in over diluted or misaligned management.
- Short-term performance ≠ guaranteed success.
- Getting creative with legal terms focus on innovating in the business,
not the structure.
Common pitfalls?
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- Thanks. Questions?