Ubco, the Bay of Plenty-based offroad electric bike manufacturer, is on track to meet its minimum $1.5 million target in second stage funding and is aiming for a maximum of $2.5 million.
As well, Timothy Allan, founder of Tauranga industrial design and development company Locus Research, which has worked closely with Ubco's co-founders in developing the bike, has now taken on the role of chief executive. Mr Allan will be restructuring his role at Locus in order to commit to the bike company.
"Ubco has been through a thorough due diligence process with Enterprise Angels and the company has good support," said Enterprise Angels executive director Bill Murphy.
Ubco pitched to EA in February. Firm commitments now sit at $1.22 million, said Mr Murphy, who added that EA member Deion Campbell was joining the Ubco board in his capacity as a private investor in the startup. Mr Campbell is general manager generation for Trustpower.
Ubco's funding is expected to come from a mix of EA members, matching funding from the Seed Capital Investment Fund and the angel group's sidecar fund, as well as other wealthy private investors and regional funds.
Mr Allan, who returned on Monday from a trip to China to commission Ubco's second production line and liaise with suppliers, said he was confident the fundraising was building healthily towards the total.
"It's looking pretty good," he said. "I'm hoping we will hit our target of $2.5 million. We've got some other interested investors doing due diligence at the moment, and we've also got interest from a couple of offshore investors."
Mr Allan said Ubco hoped to close its funding round this month.
The company has also recently concluded a partnership with Blackhawk Tracking Systems, which makes advanced GPS tracking systems. "This gives us a technology platform that relates directly to the bike's communication," he said, adding that Blackhawk chairman Keith Oliver would be also joining the Ubco board.
Ubco has now fulfilled its pre-orders and is ramping up production and building up its team. The company recently hired former BMW mechanic Gareth Hills to supervise production. Mr Allen said the company was now recruiting for leadership roles in product and technology, sales and marketing, and operations and logistics.
Co-founder Anthony Clyde, who also runs his own company importing electric bicycles, was likely to scale back a little to more of a director role in the next phase, said Mr Allan. Meanwhile the other co-founder Darryl Neal was expected to serve as a design director.
The next major long term project for the company would be developing a road legal version of the Ubco electric bike.
Locus founder to focus on electric bike firm
Timothy Allan will restructure his involvement with Locus Research, the design and
development company he founded more than a decade ago, to focus on his new role as chief executive of offroad electric bike company Ubco.
"I'm stepping back from my roles at Locus and that is being discussed at the moment with the various parties," he said.
Locus Research, based out of the Newnham Technology Park in Te Puna, Tauranga, is a product development and innovation consultancy. It has become a key player in the Bay's entrepreneurial ecosystem and has been deeply involved in the development of a number of first-to-market products, including the Inverse Hair Treatment System and the Balex Marine Automatic Boat Loader.
Founded by Mr Allan in 2002, Locus has increasingly been taking equity stakes in companies it has worked with, including Ubco. Mr Allan said he estimated he had been spending around half his time on the electric bike company in recent months.
"I think Ubco has wheels, no pun intended," he said, adding that taking on the chief executive role offered a different opportunity for him.
Mr Allan said Locus was evolving and would probably seek outside investment for the first time in order to go after more opportunities where it could become deeply involved in startup companies, rather than just provide contracted services.
"We've been fairly stretched over the last six months with the level of support we've had to supply to all of the startup companies we're involved with," he said.
He envisaged the senior Locus team would be stepping up, and he would be adding a couple more staff. But he will continue to be involved in the company, particularly in terms of selecting companies where Locus will take an equity stake.
The Locus ownership structure would not be changing, and the team had been getting used to his changing role.
"But we will be putting in place an employee share options scheme to make sure the key people have a stake in the outcomes and successes. A lot of them have put a huge amount of time into the various companies," he said.
* Co founders: Whakatane-based Antony Clyde and Wellington-based Darryl Neal.
* Design and development: The founders, together with Tauranga's Locus Research.
* Manufacture and assembly: Core components are built in China and assembled in Tauranga.