Angel Association New Zealand (AANZ) is the country’s champion for early-stage investment nationwide and holds the ecosystem together by actively demonstrating what it espouses: that it takes a whole country to grow a business.
That work has resulted in Global Entrepreneurship Network New Zealand (GEN NZ) receiving the GEN Country of the Year Compass Award from the Global Entrepreneurship Network for going to extraordinary lengths in challenging conditions to remove barriers to entrepreneurship and create opportunities for startups.
We speak with AANZ Executive Chair Suse Reynolds, who is also a trustee for Global Entrepreneurship Network New Zealand, and Executive Director Bridget Unsworth about how the Association has made New Zealand angel investing synonymous with world-class practices and investor returns.
Tātaki Auckland Unlimited: So, what’s Angel Association’s reason for being and how do you operate?
AANZ: Our aim is to increase the quantity, quality and success of angel investment in New Zealand, and in doing so, create a greater pool of capital for innovative startup companies. We place high value on building relationships. Growing and scaling tech companies is really, really hard work, and you need high-trust, high-empathy relationships to do this well. People from abroad often comment on the degree of connectivity we have with each other across the country.
Our tri-annual Runway Event (the next one is on 22 July 2022) brings 40 investors and 40 founders together to network. The focus is on building community, not pitching. We suggest to each founder a list of five investors they should meet during the day, as well as doing a bit of fun speed dating at the end so that everyone can mingle as much as possible. It’s all about exposure.
We also engage through an annual summit and international conferences, as well as receiving ‘warm’ introductions overseas through our close partner the Edmund Hillary Fellowship. Our bi-annual magazine is data-rich, and our website resources include things like an industry definitions sheet.
Tell us about your membership?
AANZ: Our members include angel networks, as well as venture capital firms and early-stage tech and founder incubators up and down the country. Individual Kiwi angel investors are very much like their counterparts offshore: successful entrepreneurs, corporate veterans, people who made their money in traditional industries and others looking for diversification and participation in deep tech, climate tech – the same sectors that attract angel investors in the US, India, broader Asia and Europe.
Like angel groups offshore, we syndicate our deals. It’s very rare that just one investor is involved. To help with that, we have a monthly call where we share information about deals we are all considering. Spreading that intelligence is a way of collaborating across the country and that’s fairly unique.
Members get the quarterly newsletter where we list deals that have closed in the last three months and deals that are in progress. It’s a pretty simple list, just the names of those companies with hyperlinks but it does mean you can quickly get a sense of the deal flow in New Zealand without having to make your own inquiries. We’re quite unique in having that high degree of cohesion and collaboration.
We encourage investors to join angel groups around the country – each is different, reflecting the vision of their founding members and regional strengths. So, we have a network of networks where like-minded people are actively involved.
What are the Association’s values?
AANZ: We place high value on deep empathy for people and the planet. We’re passionate about well-being and building start-ups sustainably. Value-based investing – as opposed to momentum-based investing, which is anchored in growth at all costs – is important to us and the country. Ambition is also something we foster, so our most recent summit was anchored under the theme ‘Go big or go home’.
The notion of being collaborative and mutually supportive is important. It might seem like being kind is the right thing to do, but it’s actually a very important component of any business model – working to create value involves mutual support and understanding what all your stakeholders are looking for and bringing the right people together with the right attitudes to grow ventures. Early-stage venture investment has been compared to a marriage – investors are there to support the business for the whole ride and this can be a decade or more.
There’s a very NZ Inc. ethos to this, growing intergenerational wealth and value. Our awards recognise how we go about doing this, including our Kotahitanga Award for the person who has contributed to the community beyond investment, and our Puwaitanga Award, which recognises what can be achieved by working together for the exemplary angel-backed venture.
What are the trends you’re seeing in the New Zealand angel ecosystem?
AANZ: There’s an increasing focus on deep tech, those opportunities that use significant intellectual property, that are strongly research-based. These are often focussed on tackling the big long-term problems the world is facing, such as climate change, environmental, health and supply chain issues...
ESG (environmental, social, governance) is often at the forefront of nearly every investor’s mind these days. For example, most term sheets include a diversity, equity and inclusion term. AANZ has a Diversity Taskforce. We’re doing a diversity of thought survey. We’re also tracking all our events to see who’s attending in person and who’s engaging online to get a baseline picture. We’re writing case studies on portfolio companies; for example, comparing the experience of a Māori founder in a regional location with a more traditional urban one, to explore the challenges faced. This market insight will be applied to more systematically address the challenges faced by less-well-represented founders in New Zealand.
In terms of the participation of women in angel investing, about 20 per cent of New Zealand angel investors are women, compared with 22 per cent in the US (The American Angel, US Angel Capital Association). To help address this, there is a growing community of angel investor networks focused on supporting women entrepreneurs in New Zealand, including ArcAngels and a chapter of Coralus (formerly SheEO).
Like other leading angel ecosystems, New Zealand’s has taken an active role in understanding and promoting founder well-being and mental health. Last year we ran Abroad, a four-month programme leveraging the leadership development platform of the same name, along with New Zealand Growth Capital Partners, Callaghan Innovation and New Zealand Trade and Enterprise. The programme was co-facilitated with mana whenua, with ten spots allocated to Māori founders. In keeping with our modus operandi, we put founders and investors in the same room for this workshop, as everyone is facing the same challenges. We have received really inspiring feedback about the impact this has had on those who took part and participants showed marked improvement in key areas of well-being. And we’re looking to scale Abroad up in the coming year.
How can accredited offshore angels invest in New Zealand?
AANZ: Get in contact with us and we’ll refer you. We would first advise people to join their local investor or angel network focussed on investments they’re interested in, to develop some experience in the home market. Of course, this has been mostly online for the last couple of years, but nothing beats face-to-face meetings. We can connect interested investors with groups like Flying Kiwi Angels in Tāmaki Makaurau Auckland and their peers around the country.
We often say it takes a whole country to raise a startup. That means professional service providers, government, academia and private investors. It’s all of us and we all have a role to play in creating a NZ Inc. portfolio. It’s not something that we can rely on one part of the economy to deliver for us. It doesn’t mean we can all be founders, but you can certainly back a start-up by investing in and/or mentoring them, providing professional service advice, or referring them to someone who can more directly support them. Angel Association New Zealand and its members are ambassadors for this, at home and with our overseas partners. We look forward to hearing from interested investors wanting to learn and share.
About Suse Reynolds, Executive Chair
Suse Reynolds is an active angel investor and the Founder of Angel HQ, the Wellington region’s angel network. She currently sits on the board of Angel HQ and is an enthusiastic believer in the ability of angel investment to make the world a better place. Suse was formerly Chief Operating Officer and GM Investment at Grow Wellington. She is on the board of CreativeHQ, the Wellington region’s incubator and innovation catalyst. She is a trustee of Project Crimson Trust, which is using smart tech to save our native trees, and the chair of Narrative Muse.
About Bridget Unsworth, Executive Director
Previously Investment Director at New Zealand Venture Investment Fund (Now New Zealand Growth Capital Partners), Bridget Unsworth serves on the board of Invest South, a private equity fund investing in businesses connected to the south of New Zealand, as well as the board of TracPlus, which provides a real-time tracking and communication platform for first responders, government agencies, militaries, and other critical operators around the world. She is also part of AirTree’s Explorer programme which aims to empower the next generation of diverse and world-class angel investors in Australia and New Zealand through education, networks, and funds to invest.
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DISCLAIMER: This article provides general information on potential investment opportunities in Auckland and is not intended to be used as a substitute for financial advice. The views and opinions expressed are those of the relevant author, and do not necessarily reflect the views of Tātaki Auckland Unlimited. Tātaki Auckland Unlimited disclaims all liability in connection with any action that may be taken in reliance of this article, and for any error, deficiency, flaw or omission contained in it.