New Zealand's fledgling venture capital industry remains unsustainable without Government support, a new report says.
Venture capital is private money invested in start-up companies.
It is considered one of the highest-risk investment areas - but can provide some of the highest returns.
The report - commissioned by the Ministry of
Research, Science and Technology and prepared by global expert services firm LECG - says that before the foundation of the Government's $100 million venture capital fund (NZVIF) in 2002 there was "a virtual absence" of venture capital funds in this country.
Although New Zealand venture capital was now growing, no new funds had been set up without NZVIF backing.
"Thus the goal of self-sustainability appears to be still some way off," the report says.
It also raises concerns about the lack of venture capital deals originating from universities and crown research institutes.
Overall, the report was a timely endorsement of the Government's programme, said NZVIF chief executive Franceska Banga.
Crown institutes and universities were working on ways to commercialise research. She said that process would accelerate as success stories filtered through.
