Entries from March 2009 ↓

Neville Modlin contacted me recently asking if I knew any attorneys who were interested in working on a startup for sweat equity.

He’s looking for an attorney in Auckland that understands
(a)  the entrepreneurial spirit
(b)  property law
(c)  angel investment

If you know anyone who might be interested, please contact Neville directly -
Phone: 021 285 3236
Email: neville@keado.co.nz

Can you scrape up $100K to help take an innovative young company led by an energetic entrepreneur producing high-value products from NZ-sourced raw materials to the world?  Read on…

The Pitch:

In July 2007 REVEL Design Ltd launched its New Zealand merino clothing label REVEL at the self-named online store.  REVEL entered into the on-line market on the smell-of-an-oily rag; not the best strategy and a raw one in the eyes of fashion industry.  Its e-commerce store is rough and ready but innovative in that it immediately launched the label to the world – you see REVEL was always intended to be a brand New Zealand would recognise but also one the off-shore market would stand up and take notice of.  Building the trust of an “unknown” brand proved difficult through the online store concept and common market reaction was purchasing through a retailer was preferred; the physical presence of REVEL in store enabled touching, seeing and emotional connection thus obtaining “first-base” trust with the consumer.

REVEL is ready to stamp its mark on the world and yell from the top of the Southern Alps that “the REVEL has arrived”.  Dedicated to building and exposing the REVEL brand to national and international markets and enhancing the online e-commerce site to support retailers and build ongoing relationships with customers from anywhere in the world.

We stand up proud and ask for what we want – join us now on a stunning journey as we take flight.

cool wool + hot designs – REVEL blends fashion design with quality, purpose and integrity which is demanded for by our conscious consumer

Accomplishments to date:

• Launched online e-commerce site July 2007
• Pitched to two significant European companies who were almost secured until Icebreaker showed up for the party and installed a distribution warehouse at their backdoor
• Designed and developed a range of 20 styles
• Developed a strong foundation range which enables easy modification to maintain seasonal/new-range  offerings to customer (e.g. colour, screen print design)
• Attended the Outdoor Retail Trade Show in Utah, USA to gain an understanding of industry developments, changes and opportunities
• Have a captive audience of 84 subscribers to REVEL newsletters
• Opened REVEL to the European market only to be quickly closed-down by Icebreaker (proved that we were clearly seen as a competitor)
• Media exposure locally and in NZ Business
• Page Loads on website increased from 1,094 in 07/08 to 7,754 in 08/09 – total of 69,473 hits to site since launch

Development plans:

• Brand – develop the REVEL brand to reflect the quality and niche market placing.  This includes innovation around the website to include a retailer/distributor only secure area where information, pricing structures, marketing & sales strategies and personal information can be stored and communicated directly. Packaging has been developed and further investment is required to produce a sustainable/recycled option for stacking/storing and presenting.  A 2 x year catalogue to be developed and used as a resource for retailers and customers.
• Revenue – secure NZ retailers and at least 1 international.  The Swiss market has shown interest and we are currently pursuing this opportunity.
• Export – following the successful placement in the New Zealand market REVEL’s focus will be on securing off-shore distributors. To date the opportunities appear significant although further research needs to be carried out.  Merino wool is still relatively unknown in the off-shore market which provides opportunities to showcase the benefits of using such a fabric, particularly in today’s environment where there is a strong focus on environmentally friendly, sustainable products and traceability.
• Traceability – work with NZ merino supplying to implement this into REVEL’s brand/culture
• Clothing system concept – develop a clothing system that offers solutions.  REVEL offers foundation pieces and is developing designs that fit with the existing range offering a stand-alone piece or pieces that could be worn together.  Targeting markets such as travel, career women, gift for the un-giftable etc

Key Challenges:

• Supply contracts – areas of unknown particularly around Levana Textiles and the limited quantity of NZ merino available.  Word on the street is that some companies are using blends of NZ merino and merino from other countries and REVEL needs to ensure that its merino supply is not compromised.
• Key advisors & support for Director – particularly around sales and marketing, branding and mentoring
• Securing Retailers without the package sorted (i.e. branding, web, packaging etc)
• REVEL brand has had limited exposure in the market
• Has survived on a DIY approach, Director’s skills are in design, project management and relationships, other resources are required

Principals & Previous Experience:

Leanne Mulcahy
You would think that the award-winning “Vegetable Creation” in Waipukurau in 1976 along with the Dominion Exhibition – Illustration award around 1980 would have convinced this chick that she had some creative talent to cash in on! However a career in Administration Management prevailed spanning a good 20 years providing the arty-farty chick with solid skills in areas of staff management, contractor management, employment relations, financial management, process development and event management.  This led to a business opportunity whereby process development, event management, financial auditing and management services were pimped out predominantly to small businesses who found themselves in a pickle.  The creative bug was diagnosed in 2006 and research into the clothing industry commenced with the single-handed launch of the new NZ merino clothing label REVEL in July 2007.  Running the two businesses in tandem enabled time to reflect on what needed to happen to take REVEL to a higher level.  This has prompted Leanne to depart full-time employment to dedicate her time fully to REVEL.

John Snook
A bloody-minded individual who pushes the boundaries and doesn’t take no for an answer. Specialist areas include Business Development, Innovation, Education, Sports Jock, Champion Kayaker and conversationalist – he has a tonne of experience and contacts.

What they want from an investor:

REVEL needs an investment injection – $100k to be precise.  In return you get to share in the ecstasy of owning a piece of this company, a piece of New Zealand.  You’ll need to have some guts – REVEL is exciting, it has big potential and big opportunity and a strong stomach to handle the peaks and troughs is important when you take the leap with us.  Marketing/Sales/Branding experience goes a long way with us too – we just may hug you if you bring this knowledge and experience to the mix.  Connections in the fashion industry here and off-shore would be awesome.  A melting pot, eclectic mix, street savvy, and a “whatever it takes attitude” is what we’re looking for – the perfect challenge!

Dave’s commentary:

These guys clearly want to be the next IceBreaker, and have a core product line with potential and an online shop.  Like many young companies they could benefit from input from someone who has taken an NZ-based product business overseas.  With the right assistance and cash, this business could turn into a major exporter, and help NZ achieve our aspirations of selling products with a high local value-add, rather than unfinished raw materials.

Contact details:

Leanne Mulcahy
REVEL Design Ltd
P O Box 1252, Palmerston North 4440
Tel. 027 433 1270
leanne@revel.co.nz

Computerworld ran a great article last week on what makes start-ups successful and how new companies should deal with the global economic crisis, featuring Nick Gerritsen, Sigurd Magnusson (SilverStripe),  Martyn Levy (RoamAD), Ivan Seselj (Promapp), James O’Hare (voeveo) and Miles Valentine (Zeacom).

Key points:

• Local start-ups should be open to collaboration
• Some of the largest and most significant global companies were actually established right in the middle of a depression
• Silverstripe “open sourcing its software … opened the door to the international market”
• You have to go and visit people [overseas] to make deals
• The falling NZD will be make NZ-sourced products and services more attractive
• New Zealand companies generally underestimate how much it costs to go offshore.

Two studies from North Carolina State University show that project managers can get much better performance from their team when they treat team members with honesty kindness and respect, and that product development teams can reap significant quality and cost benefits from socializing with people who work for their suppliers.

In other words, “nice guys finish first”.

Dr Jon Bohlmann, the author of the first study says his results show that if a team’s leader was perceived as “basically being a nice guy,” then “team members showed a significant increase in commitment to the team’s success and to the project they were working on.”

The second study, led by Dr Rob Handfield, showed that significant cost and quality benefits can result from informal socializing between employees of a product-development company and those companies that supply the product developers with material and labor.

It does sound like common sense, but it’s nice to know that good business behaviour has tangible returns.

The Economist issued a report this week on entrepreneurship around the world.  It asserts,

The world now glories in dozens of would-be Silicon Valleys: Silicon Alley in New York, Silicon Glen in Scotland and even, depressingly, Silicon Roundabout in London.

So far so good … Silicon Welly escaped their attention!  They continue,

Siliconitis is the most common example of what is now an almost universal search among policymakers, local as well as central, for the secrets of entrepreneurial success. It is also the most instructive. A few attempts to replicate Silicon Valley, most notably in Israel, have succeeded. But most are embarrassing failures.

One of the big problems is that “you can build as many incubators as you like, but if only 3% of the population want to be entrepreneurs, as in Finland, you will have trouble creating an entrepreneurial economy.”  So true.  In order to foster entrepreneurial behaviour, they say, we need to have vibrant higher education institutions and be open to outsiders.  I believe that as a country we only really scoring “achieved” on these counts, rather than “merit” or “excellence”.

The article does praise New Zealand though:

New Zealand, despite its geographical isolation, has turned itself into an entrepreneurial powerhouse, leading the world in the creation of small and medium-sized enterprises, thanks in part to enlightened government policies. It has done particularly well with applying innovation to woollen underwear. Its Icebreaker brand is popular with young, image-conscious outdoor enthusiasts.

All I can say is that from perspective of the rest of the world, I hope we can break out of the underwear drawer eventually.  And that our enlightened government policies eventually bootstrap the rest of the ecosystem into investing in, valuing, and taking risks on innovation.

HT: @gnat

Philanthropy New Zealand is holding its annual conference in Wellington later this week (Wednesday 18/3 and Thursday 19/3), themed around “passion, pragmatism, and possibilities”.  This year’s conference has attracted a number of high profile local and international speakers, including Luc Tayart de Borms (MD, King Baudouin Foundaton), Rupert Meyer (Chair, Myer Family Company, Murray Edridge (CEO, Barnardos), Jenny Gill (CEO ASB Community Trust), and John Todd (Chair, Todd Corporation and Todd Foundation).  The conference will also be addressed by the Prime Minister, John Key.

The programme covers topics such as critical issues for New Zealand’s economic and social future and the role of philanthropy, partnership between government and philanthropic organisations, philanthropy and social innovation, and responsible investment.

In a recession, the vulnerable are hit first and hardest, so it’s an important time to give.  It’s even harder in these particularly turbulent times as investment returns from equity markets are negative, which means that a number of organisations have less to give, or curtailed giving to protect their asset base.

If you’re interested in learning more about philanthropy, the Philanthropy New Zealand web site is a good place to start; if you’re serious about philanthropy, then the conference is a “must attend”.

The New Zealand Venture Investment Fund is investing up to $20 million into a new private equity fund being established by Endeavour Capital Ltd which is aiming to invest $100-$150 million into early expansion New Zealand companies.

Endeavour Capital chairman Neville Jordan said the Endeavour Growth Fund hopes to attract up to $100-150 million from New Zealand institutions and investors which will be earmarked for New Zealand investments, particularly those based on high quality research and development.

NZVIF chief executive Franceska Banga said NZVIF’s commitment of up to $20 million will be co-invested with the Endeavour Growth Fund into young New Zealand companies with high growth potential.

“There are some very promising New Zealand companies in the early expansion stage which will be requiring capital to fund their next stage of growth. The Endeavour Growth Fund will provide capital for high growth companies which will be the mainstay for New Zealand’s future growth.

“NZVIF and Endeavour Capital have track records of supporting investment into high growth potential companies. I hope New Zealand institutions and investors support this positive initiative.”

Neville Jordan said Endeavour Capital has previously raised and managed two earlier funds.

“We have considerable experience and success in investing into sectors such as cleantech, biotechnology, software and life sciences. This is an ideal opportunity for investors – both New Zealand and overseas – looking for opportunities in the New Zealand market. It will also be of great assistance for young companies facing the difficult prospect of raising capital in the current economic climate.

“At the Jobs Summit and since, there has been much discussion around private equity funds investing into New Zealand companies. This is a substantial initiative which will help a number of high growth companies – including some small and medium sized enterprises – to grow. Having taken this step, the challenge is now for other institutional and private investors to put talk into action.

“The companies we will focus on are creating the highly productive jobs which New Zealand needs to generate. A New Zealand-based fund will help to keep these companies here in New Zealand as they grow, and protect New Zealand jobs.”

Mr Jordan said the fund also aims to attract another US$270 million from offshore investors which will be focused on offshore investments, particularly in the Asia Pacific region.

Prior to establishing Endeavour Capital, Neville Jordan was the founder of MAS Technology, the only New Zealand private company to list on the NASDAQ main board. He was awarded the CNZM for services to telecommunications and export in 1999.

The Angelsoft blog ran this item today, which was so very good, I thought I’d repost it… I really couldn’t think of anything to add or subtract from it.  So good work, Angelsoft … I’d recommend that if you like the nzangels.com blog, you’ll probably want to take a feed from the Angelsoft blog as well.

Update: Paul Graham himself has written an excellent article on How to be an Angel Investor summarising the learnings from Angelconf… by all means read it!

–

This past week, Paul Graham (the wizard behind yCombinator) threw a get-together in Silicon Valley for people interested in becoming angel investors. It was attended by a standing-room only crowd (including Angelsoft’s Man in the Valley, Evan Bartlett) there to hear words of wisdom from a who’s who of West Coast power-angels, including folks like Ron Conway, Aydin Senkut, Ariel Poler and many others.

A great write-up of the sage (and virtually unanimous) advice from the participants has been posted on VentureBlog by August Capital’s David Hornik (host of the annual Lobby conference.) Here’s the distilled summary of his summary:

• It’s a small community — if you screw one entrepreneur, you’ll be out of the angel business because entrepreneurs talk (Conway)
• Angel investing is about learning on the job, which means that you can plan on screwing up your first 10 deals at least (McClure)
• If you assume that the money is gone once you’ve invested it — that it is like a lottery ticket — then you will have a better time angel investing (Buchheit)
• Work with other angel investors so that you can get the advantage of their expertise (Zurich)
• There is no rational way to arrive at valuation, so don’t be overly concerned about getting it right (Graham)
• Don’t worry if the idea seems crazy — if it didn’t seem crazy, it would be too late to invest as an angel (Graham)
• The lifeblood of angel investors is deal flow — you need huge deal flow to find enough stuff that is worth investing in (Ravikant)
• The best deals come from other angels (Ravikant)
• Don’t be afraid to throw a little dynamite into the status quo and see what comes out of it — often times interesting stuff emerges (and sometimes nothing does) (Dearing)
• The Rule of 12 — you need to invest in 12 companies to have statistical diversity — invest in fewer than 12 deals and you run the risk of them all failing (Maples)
• Like in the movie “Oceans 11,” you want to pull together the best team of angel specialists there are out there — it increases the likelihood that the company will succeed (Maples)
• Help bring your entrepreneurs together so that they can learn from one another (Poler)
• By being a connector, you will see the most interesting stuff and work with the most interesting people (Senkut)
• Angel investing is all about the syndicate — you can lead if you want to but it can be lonely until others join in the syndicate (Clavier)
• Angel investors need to distinguish themselves from others with money – what do you bring to the table? Contacts. Experience. Advice. (Young)
• Only invest in stuff you actually know something about — otherwise you’re just buying a lottery ticket (Young)

The International Sustainable Cities Forum to be held on 30 March brings together government and business leaders from both China and New Zealand, in conjunction with the first anniversary of the signing of the China-New Zealand Free Trade Agreement.

The overall aim of this Forum is to establish and leverage effective long-term cooperation between Chinese and New Zealand business leaders and high-level government officials. The visiting Chinese entrepreneurs and investors have also expressed interest in exploring commercial opportunities in New Zealand as well as to understand New Zealand’s approach to sustainable development.

The organisers have managed to secure the attendance of approximately 50 senior business and government leaders from China to attend this Forum.  Key Chinese leaders confirmed attending include:

• Wang Shi, the Godfather of Chinese real estate, Chairman of Vanke, with market capitalisation over US$10b, the largest property developer in China;
• Feng Lun, Founder and Chairman of Beijing Vantone Group, significant property developer with market capitalisation over US$1b;
• Xia Gang, President of China International Industry and Commerce Company, significant commercial property developer;
• Zhou Qing Zhi, Chairman of Nandu Holdings, investor, philanthropist;
• Wu Xu, President of Chongqing Sincere Holdings, with interests in property and finance;
• Li Ai-Jun, Chairman, Taoyuan Habitat Group, property developer and investor, philanthropist;
• Meng Gang , Chairman of National Chiao Tung University Real Estate Group, City Union’s rotating presidency;
• Government delegations from Xia Men City in Fujian Province, Chang Xing County in Zhejiang Province, Zhu Jia Jiao Town in Shanghai City, Wu Jin District in Jiangsu Province.

On the New Zealand side, the organisers are expecting a number of senior Government ministers and mayors to be in attendance, in addition to business leaders representing a variety of business to attend.

At this Forum, participants will have unparalleled access to some of the top investors and decision makers in the booming Chinese real estate and investment sectors.

At a glance:

What: International Sustainable Cities Forum
Where: Langham Hotel, Auckland
When: 8am-5pm, Thursday, 30 November

Why attend:

• Unparalleled access to key investors and decisions makers
• Understand economic and political developments in China
• Obtain analysis of China’s future trends and the implications for your business
• Hear the latest updates from successful Chinese corporate and government leaders
• Appreciate Chinese culture and the business of relationships
• Fast track your China ambitions by connecting with China and NZ-based Chinese businesspeople
• Know how to deal with Chinese businesspeople and government officials

Who should attend:

• CEOs / Directors / Business owners who want to explore opportunities in China
• Business development professionals in the property/construction/engineering / design sectors
• Businesspeople who want to understand the mindset of Chinese investors and entrepreneurs
• Businesspeople who want to sell products / services to Chinese firms and need information/ networks
• Management teams seeking investors with capital and connections in China
• Professionals who can contribute expertise towards building sustainable cities
• Government officials desiring to strengthen connections with Chinese government officials

The organisers are anticipating a balanced crowd of approximately 25% Chinese, 25% Chinese New Zealanders and 50% other New Zealanders. This would enable good networking as we expect that attendees will not be at a forum where participants already know one another.

Limited tickets available. Check out: www.sustainablecities.co.nz

For more information please contact:
Kenneth Leong,
Director, Euroasia
09-3040100

Tony Seba is speaking in Wellington later this month on “Building a winner in uncertain times: the 9 fundamental rules of high-tech strategy”.

His book, Winners Take All, is available for free download from his web site.

WHEN:  4:00-6:00 Thursday 26th March 2008
WHERE: Paramount Theatre, 25 Courtney Place, Wellington.
COST:   $225

Drinks and nibbles will be served for half an hour after the session to stimulate networking discussions.

You can book directly on PayPal.