This year Enterprise Angels celebrates 15 years of angel investing. Based in Tauranga, it has become one of New Zealand’s largest, most active, and best resourced Angel networks in New Zealand. Enterprise Angels offers a unique model of early stage investing in New Zealand with a professional management team, 20+ partner organisations, 200+ Angel investors, and 150 wholesale investors. To date it has facilitated the investment of over $65m in 107 New Zealand startups across a variety of industries, supporting over 1600 jobs.
Founding of Enterprise Angels
Enterprise Angels was founded by Bill Murphy who launched the organisation in 2008, then named Western Bay of Plenty Investors’ Forum (a bit of a mouthful).
“I originally started Enterprise Angels to provide an avenue for startups to successfully raise capital and get more than just money. Back in the day, founders came to me due to my involvement with the local EDA. I realised we had to get a better system in place; the only early-stage capital at the time was contacting the local rich guy… We’ve certainly come a long way. The growth path of a startup can be affected dramatically by having successful business angels as investors. They connect founders to potential clients, other investors, future staff and more. They help guide founders in areas that they have experience in either informally or as a director, and sometimes they just provide moral support.”
In 2019 Bill stepped down to lead the Purpose Capital Impact Fund, and Nina Le Lievre became the country’s first female angel network Chief Executive. Nina had been working alongside Bill at Enterprise Angels for 6 years prior to this. Bill continues to support Enterprise Angels in a part time capacity as Executive Chair.
Portfolio Overview
The existing portfolio is impressive with the majority of companies being in high growth mode. A number of these portfolio companies are making a name for themselves the world over, such as Fuel50, Spoke, Parrot Analytics, Lawvu, UBCO, FileInvite and Datagate Innovation. Many have attracted significant further investment from later stage investors including both NZ and international venture capital and private equity firms. Understanding where and who the next stage funders are for our companies is a critical part of the equation. Companies often need more than angel money to be globally successful.
Most of the portfolio companies are software (39%), hardware (26%), or agtech (23%), with the majority being based in Auckland (41%), Bay of Plenty (18%) and Wellington (18%).
Since formation Enterprise Angels has had 32 exits. 15 companies have provided positive investment returns – 12 of these were acquired or listed. Investors have seen some very profitable returns from portfolio companies: GreenButton, SwipedOn, Volpara, Engender, Merlot Aero and more recently Moxion. The IRRs range from 24% with Merlot Aero to 194% with SwipedOn.
As expected with the high risk nature of investing in startups, there have been a fair share of negative returns too. 17 portfolio companies have failed for various reasons – timing, capital, product, resourcing. Something that’s never easy for investors, or for founders! Enterprise Angels has used these failures as learning opportunities to detect potential problems earlier and better support founders to grow.
Enterprise Angels success has come from combining the strengths of its Angel network (members’ breadth and depth of experience and expertise) with the strengths of a fund (coordinating and streamlining the investment decision process) to attract better deals and deliver a better result for investee companies and investors. EA Fund 1, 2 and 3 are fully invested and Enterprise Angels continues to provide this important funding option for entrepreneurs and investors with the recently launched EA Fund 4.
Traversing through turbulent times
Periods of economic uncertainty haven’t stopped Enterprise Angel members investing. They may be more vigilant when undertaking due diligence, however risks and challenges create opportunities. Experience has shown us that good founders will thrive in environments where medicore ones fail. Recessions help clear the market of poor performers leaving more market share for the best companies. Many great companies have grown in uncertain times – think AirBNB, Uber, Slack, Square and Glassdoor.
With their strong member network Nina believes Enterprise Angels is well positioned to face the current economic downturn.
“We need to continue to look to the fundamentals and value proposition of the opportunities that we consider. We’ve honed this over the last few years and believe that there will be some very good opportunities in these challenging times. These companies (as well as existing portfolio companies) will continue to need our support to grow. It’s not just capital (although that does help a lot!), but connections and expertise are increasingly important when navigating turbulent environments. “
Behind the scenes the Enterprise Angels team is always looking to drive efficiency and has recently launched its online investor portal (using Syndex), member directory and founder support directory. The team’s key values of collaboration, continuous improvement, authenticity and accountability see them well placed to continue to support founders and investors who want to make a positive impact on the world.
Get in touch!
We welcome engagement from anyone interested or involved in the early stage investment market – Investors, Angel Members, Strategic or Corporate Partners, Founders, Incubators or Accelerators, Deal Referrers, Acquisition Partners etc.