NZTE is offering to help you raise $1-$5m. Apply now.

NZTE (this time joining forces with Callaghan Innovation and the Asian Business Angel Forum who are looking after different categories) are once again helping companies get ready for investment by using a showcase event as a catalyst.

The last one of these was in March 2015, held for Agri-Tech businesses during the Central Districts Field Days, which is in Fielding. This built on a showcase during the Fieldays near Hamilton  in 2015, and has delivered substantially better outcomes for the companies. We are all learning, and the showcase promoted a lot more interaction between high quality companies and pre-qualified investors.

Companies in the program receive three things:

1: Workshops and coaching to help with becoming (more) investable, learning the investment process and about investors, understanding and telling your story and help with compiling a deck and a pitch. This work is done by NZTE capital specialists and external practitioners such as myself. I suspect that most of the value for the program is in this stage – helping companies get ready for investment.

2: Presence at the showcase in Queenstown on the 14th of October, including a booth, most likely, and time for 1-1 conversations with investors before and after the showcase. And of course the chance to present to (and introductions to selected)  200 or so qualified investors, many of who are from offshore.

3: NZTE help with identifying, following up and closing with investors. This, along with help with 1-1 meetings at the event is a very valuable part of the process.

NZTE have been very generous with their time, help and investment in the event in the past, and I suspect the same will apply again this year.

The showcase is a catalytic event – it helps companies move much faster in their process to become investable so that they are introduced to investors in a ready state.

Criteria and Action

NZTE are looking for technology focused companies raising between $1 and $5 million, who ideally already have credible founders and people around them – such as lead investors, advisors, deal-makers and/or board members. Also ideally you’ll be operating in international markets, especially USA and SE Asia,  as many of the investors will be from there.

There are only five slots – so get in fast and fill out the PeakApplication, returning it to bbc@nzte.govt.nz.

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Invest in Punakaiki Fund

We at Punakaiki Fund are very happy to announce our crowdfunding investment offer to the public:

Snowballeffect.co.nz/punakaikifund

We are seeking up to $2 million, the maximum allowable under the applicable law, and will close the offer once we reach that limit.

Larger investors who miss out may be eligible for our private offer, but it is far easier (and on the same terms) to invest through the Snowball platform.

Any questions please ask below, on the Snowball Effect platform (preferably), email me at lance@lwcm.co.nz or call (64) 021 526239.

Posted in NZ Business

Vibe acquires Melbourne based RackCentral

Vibe Communications continue their relentless growth – this time by acquiring RackCentral and bringing on board the much respected Shaun McGuane. Here’s the full press release.

Vibe acquires Melbourne based RackCentral (Cross posted from Vibe)
June 11, 2015
Rudi Hefer

We’re delighted to announce that Vibe Communications has acquired Melbourne based Colocation, Hosting and Virtual Server provider Rackcentral.

We have shown significant growth in New Zealand and Australia through our IP transit, International Layer 2, Access Wholesale and VOIP portfolios and our appetite for growth means we had to look beyond our core bsuienss.

RackCentral plays a unique role in Australia, providing customers with colocation, virtual private servers (VPS), self-managed cloud hosting and physical server hosting on month to month contractual terms, meaning that it generates customer loyalty though service quality and technical capability rather than term contracts.

There are tremendous synergies and value add opportunities for both our customer bases and we’re very excited about the products and services we’ll be able to take to market.

Posted in NZ Business

Punakaiki Fund and Snowball Effect

22 May 2015

Punakaiki Fund will soon be presenting an offer through the Snowball Effect platform.

We are pleased to announce that we have selected Snowball Effect to present our fund raising offer to members of the public. Equity crowdfunding allows us to reach out to people who up until now have been unable to invest in Punakaiki Fund. This includes many of the investors who supported us in the 2013 Public Offer, when we did not reach the minimum.

Since April 2014 Punakaiki Fund has raised over $4 million from private investors, and invested into 10 great companies. We are seeing very strong growth in both revenue from those companies and in the overall value of the investment portfolio. The companies we have invested in are MindscapeBoardingwareVibe CommunicationsTimelyInfluxHQOnceitWeirdlyRedSeedSocial Code and Revert.

The crowdfunding offer will seek to raise up to $2 million (the maximum allowable under NZ law), will be alongside private offers to existing and new Exempt Investors.

Sign up
 to our mailing list and pre-register at Snowball Effect to ensure that you get early access to the investment. We do not expect to make another offer to the public in the next few years, but it is our intention to IPO in 2-4 years time.

Posted in NZ Business | Tagged | 2 Comments

When will electric cars take over?

I’ve been browsing a number of transport presentations from 2015 IPENZ Conference, which was held on 24 March. One, from Andrew Jackson from the Ministry of Transport has the following chart, as an example model of Electric Vehicle uptake.

I’ve previously done my own crude hybrid vehicle modelling, based largely on the uptake in Japan, and our future adoption of their fleet as ours. That resulted in the chart below, and estimated that new vehicle sales would hit 50% around 2025, and that the fleet itself would take a lot longer to transition.

However since then we have also seen the emergence of the Tesla Model S, which shows for me, and many others, that the superiority of the electric car is a foregone conclusion. While the Tesla is expensive, it’s also luxurious, quiet, extraordinarily quick, reliable, safe and has long range. Tesla and other manufacturers (like BMW with the i3 and i8 and an amazing ) are showing that as battery costs continue to decrease in cost and increase in performance the old internal combustion powered cars will become obsolete.

I would argue that the pace of change is going to be limited by the availability of batteries, which I also believe will be a highly competitive space, where giant capital investment will deliver temporary market dominance, similar to the computer memory game in the past. The first players to make are move are Tesla themselves, who along with Panasonic are building a so-called Gigafactory to produce batteries in Nevada. Those batteries will have a ready market in Tesla cars, homes (as power packs) and in other manufacturer’s electric vehicles. I anticipate this will be the first of many large battery factories, whether by Tesla or other enterprises.

Given enough gigafactories will we see a faster transition to electric vehicles? Will we see a chart like this?

I hope we will, but it won’t be  for a while. Tesla sold just over 10,000 vehicles in the first quarter of 2015, while about 3 million cars and light trucks are sold each month in the USA. Tesla’s ambition is to sell 500,000 cars a year by 2020, which is still a tiny fraction of the USA market. However I consider the Model S as the Apple iPhone of the car market, with a clearly increasingly superior product, fast development pipeline and the ability to increasingly capture the best segments and highest margins while the rest of the manufacturers scramble to deliver minimum economic volume and at low margins.

There is a very long way to go, and although we are very close to complete superiority of electric cars over internal combustion, let’s not forget how slow moving the car industry really is.

Posted in NZ Business | 3 Comments

Thanks for no insurance Air NZ (really)

It’s excellent to see that Air NZ has removed the default opt-in for travel insurance with their website sell process.  They have replaced the opt-in with the big orange button below.

I’ve tested the process and there is no need to deselect the insurance. The amount of space dedicated to the selling of insurance seems a bit over the top, I guess because internal fighting meant trying as hard as they can to retain the revenue. The issue is that this will introduce/retain more pain to the sales process and thus reduce overall flight sales. Experienced travellers will learn to ignore it.

Two previous posts referring to this insurance.

Posted in NZ Business | 2 Comments

“Arrives late for flight, if known”

It’s not rated as secret, but the Transportation Security Agency behavioural observation checklist and form for detecting possible terrorists has been disseminated on the web.

Unfortunately the checklist contains a large number of factors that are arguably simply normal behaviour when confronted by a wall of security, and the list has very low benchmarks for escalation.

I tried filling out the checklist for my own behaviours when flying. I’m not a good flyer – I don’t like crowds, can’t stand queues and loath inefficient systems. New Zealand’s airline systems are amongst the best in the world, but while going through security is usually a minor inconvenience, I can sometimes be a bit annoyed with it all.

The first section of the form is Observation and Behaviour Analysis for Stress, Fear and Deception Factors. I scored myself with 42 points, which is well above the limit for automatic referral to law enforcement officers of just 6 points.

The form starts badly, with the first item “Arrives late for flight, if known” (1 point) almost an automatic tick for me. The next item is “avoids eye contact with security personnel or LEO” (1 point), which, yes, I almost always do in a bid for efficiency at the security checkpoints. I have no interest in talking about my luggage, don’t want them to touch my stuff and lose 3 points with “Does not respond to authoritative commands” when I ignore the question of whether I have checked my pockets (I have). I can also lose points with the  “cold, penetrating stare” (2 points) that my be interpreted when I blankly ignore any inefficient security staff who are holding up travellers.

I also have my own rules about travelling with luggage – I never let it out of my sight, and don’t go through the personal scanner until my luggage is inside the luggage scanner. That loses me points for “hesitation/indecision on entering checkpoint or submitting to screening process” (2 points) and “does not respond to authoritative commands” (3 points) again, and as is becoming clear “displays arrogance and verbally expresses contempt for the screening process” (2 points) is potentially easy to pick up, especially when I am called out by the bomb screening people for the 5th time in a row.

Two of the easier ones for me to earn points are “scans area, appearing to look for security personnel or LEO” (2 points) which I do to figure out which is the shortest and most efficient queue, and “appears to be confused or disorientated” (3 points),  either because I am thinking about more important things or because the security system is new to me and I am seeking to understand what is happening.

The next part is something called SPOT resolution. I counted a score of 17 between the Signs of Deception and Unusual Items that I could carry. The limit for this section before escalation is just one – if you have tow or more then that law enforcement officer is called.

This part of the form reinforces that essentially everyone has to act to get through security. Travellers transiting from a long distance international flight, for example, could easily exhibit Signs of Deception like “delayed response to questions“, “Excessive comments about screening process“, “excessive perspiration” and, for those who forgot to brush their teeth towards the end of the flight “Covers mouth with hand when speaking“. Remember – any two of these and the law officer is called.

I’ve travelled through a lot of borders, and I do know that the best thing to do is to adopt a polite, submissive yet firm, and efficient yet endlessly patient approach. At some borders and security checkpoints you have to be very strict on yourself, and this form shows yet again that TSA security has very low tolerance for non conformance.

But I would strongly suspect that this list is not used, in practise, as rigidly as it is written, especially by experienced officers who are used to seeing, for example, a plane full of Kiwis transiting through LAX. But then again there is plenty on that list for an officer to escalate pretty much any passenger that they want to the next level. If the officers are experienced, well trained and well managed then that’s a good thing, but the reverse is true as well.

Because the issue here is that the “bad people” know about this list, have trained  for getting through security and tested themselves. Getting caught this way (without outside information) seems very rare – while the TSA brags about finding firearms on occasion, they seldom if ever talk about catching people with firearms who had intent to use them.

And there are giant holes in the system. Airline and sea cargo are the biggest gaps, but sadly in the last two years the major cause of (deliberate) aviation disasters appears to have from  actions from someone in the cockpit.

The economic cost of security, and most of it is borne by the passengers and airlines, needs to be appropriate to the size of the risk. I’m not convinced that we are close, even in New Zealand where our security systems are generally efficient. We are unfortunately, largely at the mercy of the US TSA, which drives international conduct. The TSA in turn is largely at the mercy of the US Congress who probably don’t even realise that they are the only ones that can fix this.

Posted in NZ Business