Established in 2008, Enterprise Angels has been investing in a range of startups leveraging the broad expertise of its membership which has grown to a 200+ strong group of business angels. Its reputation as a collaborative, supportive player in the startup ecosystem means that it attracts a huge number of founders from throughout New Zealand and provides investors access to a range of investment opportunities across a variety of sectors and stages.
Our Fund 4 investment strategy is based on our 15 years’ experience investing in early-stage companies. Our investment focus is on acquiring minority stakes in high growth NZ companies at the early stages of the companies’ life. Our team (together with Enterprise Angels members, partners and EA Fund Limited Partners) support the companies with capital, connections and expertise, unlocking value as these companies grow to disrupt industries and form the businesses of tomorrow.
Enterprise Angels is pleased to announce the launch of its flagship angel fund, EA Fund 4, and offers investment to wholesale investors outside the angel group. Fund 4 is a pillar of the organisation, providing efficient investment parcels to startups and diversification to investors in this exciting but risky investment sector.
EA Fund 4’s inaugural investment is currently being completed in SquareOne, a valued portfolio company of Enterprise Angels since September 2021. Over the last two years we have witnessed first-hand how well founders, Jovan and Jamie, work with key stakeholders, and we have continued to be impressed. SquareOne has revolutionised the financial landscape by creating a digital-first bank that caters specifically to an entire generation. The early user reviews have been outstanding, validating SquareOne's innovative approach and underscoring its immense potential for future growth. This is the start of an exciting portfolio for EA Fund 4.
Why should you invest in EA Fund 4?
The timing is right. Despite the challenges we are seeing in the current market, we believe it is the ideal time to be launching a fund and investing in startups. In recessionary times, we see bold, innovative founders solving difficult problems. Uber, Airbnb and Slack are just a few examples of the ground-breaking innovation that came out of the 2008 recession. Further, company valuations are very appealing having come off the 2021 frothy highs. EA Fund 4 is poised to take advantage of this and reap the benefits of a recovering economy in the coming years.
Leverage our experience. With over 100 investments under our belt, our collective experience in this space is strong. We have undertaken case studies on most of our companies that have exited and a few that are still live. This has helped shape our investment processes and portfolio monitoring. Because of this we have structured EA Fund 4 slightly differently than our previous side-car funds. This means it can invest both on its own and alongside our members, either leading deals or co-investing. This key differentiator will allow the Fund to invest in deals that may not be offered to the angel group for varying reasons, leading to a more diversified portfolio. The Fund will screen, conduct due diligence and invest in opportunities leveraging the extensive expertise from within the membership, including staff, the EA GP Investment Committee and from our wider network, including portfolio founders, corporate and strategic partners, co-investors and next stage investors.
Our experienced team and investment committee consider the following key factors when evaluating an investment (non-exhaustive)
- Is the founder ambitious, self-aware, and coachable?
- Is the timing right for the offering, considering the macro-economic environment?
- Is there a distinct, protectable competitive advantage?
- Is there a large addressable market?
- Does the company have global ambitions with exponential benefit?
Quality dealflow. Our network and strong reputation ensure we see a broad range of quality deals. The Fund will also be able to cherry pick from the best of our current portfolio. These are often companies the team has been able to observe and assess over a number of years. This part of the deal pipeline is very difficult to replicate due to strong demand in these follow-on rounds meaning often only existing investors can access them.
Minimising risk. Diversification is a portfolio construction strategy which substantially increases risk adjusted returns, particularly important in the high-risk startup sector. With a fund, this is done for you.
Why an Angel Fund? Our 200+ membership base consists of professionals nationwide who have expertise our companies require. These ‘Angels’ provide invaluable hands-on support and insight that is not always available to a purely team led fund. Over the years, our Angels have assisted with due diligence in their area of expertise and joined as investor representatives and directors, guiding companies through acquisitions and growth. Having access to a knowledge base such as this is key in securing, supporting, and growing our portfolio companies. Investing in Fund 4 provides you the opportunity to offer more than just growth capital for portfolio companies – we welcome any expertise or connections you may have to make a real difference in the growth journey of our start-ups.
- Minimum Fund size of: $2m, Target: $6m, Maximum: $10m.
- Invest in up to 35 innovative, globally scalable NZ companies (assuming a $10m size fund).
- 30% of capital reserved for follow-on support in the best performing companies.
- Limited Partnership structure.
- 2% application fee.
- 2% management fee and 20% carry with an 8% hurdle.
- Capital called over five years typically in 10c instalments, e.g. for a $50k investment, initial capital called will be $5k plus $1k application fee.
- Minimum investment of $50k ($30k for Enterprise Angels members - click here to find out more about becoming a member).
You can access the pitch recording here and further information in the documents section. If you have any questions or would like a one-one meeting, just let us know.