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Global from Day One seed fund targets startups flying offshore

Global from Day One seed fund targets startups flying offshore
More than ever, tech startups – by necessity – are setting their sights on offshore markets from day one, and a new angel investment fund wants to give them a leg up along the way.

More than ever, tech startups – by necessity – are setting their sights on offshore markets from day one, and a new angel investment fund wants to give them a leg up along the way.

Andy Hamilton, chief executive, The IcehouseThe  Global from Day One Seed Fund aims to raise up to $4 million from investors by the end of August and will be targeting Kiwi tech startups with international ambitions. 

So far, investors have pledged $1.35 million to date

The Global from Day One Seed Fund is apparently already considering investments, and plans to invest into 15 to 25 companies over the next five years in sectors like IT, social media and high-tech manufacturing

The fund was announced today by angel investment group Sparkbox Ventures and the Icehouse business growth centre.

The organisations say the Global from Day One Seed Fund would draw on existing investment partnerships with the New Zealand Venture Investment Fund, which could see up to another $2 million available for co-investment.

"This fund will be targeted at new technology companies which can demonstrate proof of concept and have identified an international opportunity.  We see considerable opportunities in companies with ‘disruptive’ technologies – a completely new idea which can change the dynamics of a market," said
Sparkbox chairman Andrew Duff.

“By taking an international perspective from day one, we see these companies taking a much faster growth path. This will deliver faster returns to investors and also wider benefits to New Zealand in the form of highly productive jobs and recycled capital.  Once companies have taken the step towards internationalisation, we would expect to bring in new investment – such as follow-on angel or venture capital investment – to take companies to the next level.”

Icehouse chief executive Andy Hamilton (pictured) said the fund would not make follow-on investments.

"We see a great opportunity to provide ‘seed money’ coupled with support to accelerate into global markets. The fund will complement existing angel networks across the country, in that it funds the development of concepts and will make companies ‘investible’."

He said accelerators like Y-Combinator and Tech Stars have set the agenda in propelling startups into global markets from day one.

BigLittleBang is a good example of what is possible with seed funding. Sparkbox, K1W1 and NZVIF invested seed money in 2010, which was followed by angel investment from Ice Angels, and now the company is accelerating into the US market. We want many more deals like this from across New Zealand."

Duff said the New Zealand domestic market was too small for a lot of technology concepts, citing Booktrack as an example of a company that took an international focus from day one.