The last start-up IPOs in New Zealand were in the class of 2007 – Xero, Burgerfuel, and NZ Farming Systems Uruguay; I’d argue that Burgerfuel probably didn’t belong in that class, and that NZFSU was more of a property play than an intellectual property play. Xero is the standout, and have deservedly done well after a hard slog.

Biovittoria’s IPO offers angel investors a lot of hope that it’s still possible to take great ideas through the investment cycle and come out the other end as a listed company.  With backing by Endeavour Capital, ACC, Stephen Tindall’s K1W1 and the NZ Venture Investment Fund (NZVIF) they’ve managed to bring their product to the point where it’s ready for true international expansion.

Biovittoria appear to be in a great position to exploit their market, with exclusive rights the key ingredient in their PureLo artificial sweetener product. PureLo was the first natural sweetener of its type to achieve United States Food and Drug Administration (FDA) regulatory compliance through its Generally Recognised As Safe (GRAS) status.  They expect full FDA approval in February next year.  The global artificial sweetener market is worth over USD 3.5 Billion.

I’m not so sure … Venturebeat recently reported that there were ZERO (sorry about that pun, it couldn’t be avoided for mathematical reasons) IPO’s in the US in the first half of calendar 2008, and that M&A activity was at its lowest level in 20 years.

While we like to believe that we are countercyclical or play by different rules here NZ, it’s suicidal to forget that we’re in a small corner of the global playing field.

My bottom line – entrepreneurs and investors need to put a reality check into that IPO dream for the near future. The best way to succeed is by building a great team, meeting a real market need, and above all running a great business by generating heaps of revenue. IPO’s are not part of the script for 2008. For the short term at least, funding will necessarily come from private equity and operational revenue.