The Business Herald’s markets and banking reporter.

NZ tech start-ups offered funding boost

Andy Hamilton from Icehouse said the call has gone out to start-up companies looking for funding. Photo / Supplied
Andy Hamilton from Icehouse said the call has gone out to start-up companies looking for funding. Photo / Supplied

Auckland business incubator The Icehouse and angel investment group Sparkbox ventures have teamed up to create a multi-million dollar fund that will invest in New Zealand technology start-ups targeting offshore markets.

The Global from Day One Seed Fund aims to raise $4 million from investors.

Icehouse chief executive Andy Hamilton said the investors would be high net worth individuals, such as corporate executives and members of angel investment networks.

He said $1.4 million had already been raised and the fund was now "operational".

"Now we're putting the call out to start-up companies who are looking for funding," Hamilton said.

Sparkbox and the Icehouse-linked Ice Angels investor group are also aiming to draw on their existing partnerships with the Government-backed New Zealand Venture Investment Fund, which they say could make 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," said Sparkbox chairman Andrew Duff.

"We see considerable opportunities in companies with disruptive technologies - a completely new idea which can change the dynamics of a market."

He said the domestic market was too small for many technology concepts to succeed.

Booktrack - a company which adds music and other ambient audio to novels or short stories being read on tablet devices - was one example, Duff said.

"From day one [Booktrack's] potential markets lay offshore ... To succeed, its founders needed an international focus."

Duff said that through their global focus, the companies the fund invested in would grow much quicker than domestically focussed firms and provide faster returns to investors.

"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 a new level."

Icehouse chief executive Andy Hamilton said the fund would focus on start-ups in sectors such as high-tech manufacturing, IT and social media.

"To meet the fund's criteria, the start-up can be from anywhere in New Zealand, have a vision to take technology into global markets, be open to working incredibly hard while also being prepared to have a partner in their business," Hamilton said.

- NZ Herald

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