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Angel investment in New Zealand: Making it rain or drying up?

With the Angel Association set to hold its 10th Anniversary Summit at the end of this week, results for the first half of 2017 show angel investors are putting up money at rates on par with previous years – continuing an overall upward trend in investment in Aotearoa.

That was evident at 7th New Zealand Angel Investment Showcase. The glitzy event – put together by The Icehouse and held at Auckland’s Viaduct Events Centre – saw 16 companies pitch to a crowd of several hundred potential investors. Those investors had an estimated $25 million between them to invest – not including larger investment funds potentially worth billions they might have been attending to represent.

Translation: there was big money in the room.

Other angel outfits also appear to be thriving. Reporting on the activity of its members tracked by the NZ Venture Investment Fund, Angel Association chair Marcel van den Assum says $20.2 million was invested in 29 deals in the first six months of the year. “The level of deal flow being generated by accelerators such as Wellington’s Lightning Lab, the Manawat?’s Sprout and Auckland’s Flux together with the establishment of new networks this year such as Zino Ventures, Angel Investors Marlborough and Hawkes Bay Angels bodes well for another record year of investment,” he says. “When record keeping began in 2006, only 30 deals were done and $21m was invested. Annual investment has now exceeded $50m per annum for the last four years and grown by an average of $5m a year to reach nearly $70m in 2016.”

Then there are the big recent purchases. Last Wednesday, tech giant Apple announced it had bought Auckland-based PowerbyProxi for an undisclosed sum. The company, founded by Auckland entrepreneur Fady Mishriki, develops wireless charging technology. While the amount PowerbyProxi was bought for wasn’t disclosed, considering Apple is one of the most valuable companies in the world, it could be up to a billion – yes, “billion” with a “B” – dollars.

The Icehouse had a two percent stake in PowerbyProxi. Icehouse chief executive Andy Hamilton said he was “excited” by the purchase.

According to the Angel Association, about $500 million have been invested into nearly 1,000 deals involving Angel Association members in the past decade. Ten years ago, there were just four angel networks with about 100 members. Today there are a dozen networks operating from Dunedin to Auckland with over 600 angels contributing capital, connections and expertise to about 100 ventures a year. 

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