Icehouse Ventures chief executive Robbie Paul. Photo: Smoke Photography Ltd
Icehouse Ventures says the response to its latest early-stage seed fund has been "phenomenal", raising a record $70 million to help at least 30 ventures get started.
Chief executive Robbie Paul said the market was hot, with new investments continuing to flow from family offices and individuals.
"The venture capital and startup ecosystem is extremely vibrant and I think the reason is that most companies are operating on very long-term time horizons," he said.
"They don't start a company because the market's bad and they don't give up for the same reason.
"They have big missions that they've been thinking about and researching and working on for a very long time, and will continue to pursue those irrespective of who's in power, who's in the White House, what the weather is and anything else."
The fund was capped at $75m, with an end-of-year deadline to raise the last $5m.
"It feels like we'll hit that fairly shortly."
A maturing ecosystem
Paul said Icehouse had been hoping to raise $30m for Seed Fund IV, but quickly attracted investment from 363 investors, with 80 percent based in New Zealand.
He said more than half of the investors were entirely new to Icehouse Ventures, while 147 had backed the firm's prior seed funds, with a core group of 26 invested in all four, and 17 investors from the United States, China, Singapore, India and Germany contributing a combined $22m.
"The success of Seed Fund IV demonstrates a renewed belief in Kiwi entrepreneurs and signals that the startup economy is very much back in motion," Paul said.
He said the investment represented a maturing of the venture capital ecosystem.
Past recipients pay it forward
"The rise of the ecosystem was inevitable because entrepreneurs build businesses over time horizons that far exceed presidential terms and macro-economic swings."
Cheque sizes had grown significantly, with commitments ranging from $25,000 to $5m in Seed Fund IV.
Paul said the most encouraging trend was the rise of founder-investors who have scaled companies of their own and were reinvesting into the ecosystem that backed them.
Nearly a dozen had invested in the latest fund, including the co-founders of award-winning global educational software business, Kami.
"Founders know the difference that early capital and the right partner can make," Paul said.
"Having a large cohort of entrepreneurs in our fund means we can tap into their expertise to help the next generation."
Where the money goes
Seed Fund IV was the largest seed fund in the country's history, with $6.3m already committed to eight NZ-founded startups over the next three years.
The early investments included AI presentation creator, Aether, design collaboration platform, Harth, and industrial engineering software, Spaceproof, and fraud-prevention technology startup, Static Technologies.
"Our goal with the seed fund is to invest as early as possible," Paul said.
"Success for us is finding companies who've never raised money and sometimes are not even established, and to start investing with small amounts at that point, and then to invest further as they achieve technical and commercial milestones."
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