Simmonds Stewart has provided a look into the differences in capital funding between New Zealand and Singapore, directly comparing the number of start-ups funded from various sources. The difference is stark – a much higher reliance on angel investors and groups in NZ, while more VC funds are taking the action in South-east Asia. Read more here: https://idealog.co.nz/tech/2019/02/what-can-we-do-about-new-zealands-lack-vc-funding
Brief Commentary: The effect is that while Angels are providing good early capital in NZ, they don’t usually have the resources available in a VC firm to help support and guide businesses on their growth track towards a successful exit. Start-ups are often left to do their own thing, and investors passively hope that good outcomes arise. More recently, a number of small funds have popped up in New Zealand, often backed by Angels – but very few could be considered big enough to have the types of resources needed to pursue big deals. At Matu, we foresee some aggregation of resources in the future, which is in its early stages being seen as an increasing prevalence of syndication (where multiple funds contribute to a round to decrease the risk for each fund).