Tauranga angel network launches new crowdfunding platform for sophisticated investors

Tuesday 27th September 2016

Tauranga's Enterprise Angels network of investors in early stage companies has launched a new crowdfunding platform to make it easier for sophisticated investors to access those opportunities.

The country's newest crowdfunding platform, AngelEquity, will seek to broaden investments previously limited to angel networks to include people who qualify as wholesale investors, says Enterprise Angel executive director Bill Murphy. Enterprise Angels funded the construction of the site, which Murphy sees as providing a national investment service for offers that have previously been restricted by geography.

"It's not an initiative that could be driven by industry as a whole, it needed somebody," Murphy told BusinessDesk. "Enterprise Angels has funded the site to this point, where we go from here depends."

Angel investments reached a record $61.2 million across 94 companies last year, taking total funds raised since the Young Company Finance Index was set up by the Angels Association NZ in 2006 to $414.7 million.

Enterprise Angels' Murphy said he has met with the North Island organisations and will visit the South Island groups next week to see how the platform can leverage their existing networks, and that the feedback so far was positive.

"This will enable wholesale investors right across the country to invest in some quality deals we do," he said.

Murphy expects the platform will launch about one offer a month, though the existing investment portfolios of the angel groups means that will include follow-on funding rounds.

"We have a portfolio of companies looking for follow-on funding, so it's not just brand new deals, it's deals that are already invested being made available," he said. "That's attractive to wholesale investors because some of the early stage risk has been mitigated."

All offers will have to go through the angel group's due diligence process and will have a minimum 25 percent of angel investment in their funding rounds.

The first offers include Roholm, which has developed a hair conditioning system using sub-zero temperatures instead of heat and is seeking $500,000 to $1 million with the ability of oversubscriptions to take it up to $1.5 million, milk protein application developer Quantec, which wants to raise $750,000, and EA Fund 2, which houses a portfolio of early stage companies.

Roholm has already raised $1.9 million in earlier rounds, and chose to use the AngelEquity platform to build on its existing relationship with Enterprise Angels, while Quantec is hoping to attract high quality investors to its register.

BusinessDesk.co.nz

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