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BoosterNovember 17, 20234 min read

BIF Capital Raise Q&A

Since its creation in 2021, Booster Innovation Fund (BIF) has been on a mission to grow. In the upcoming months, it is looking to welcome a fresh wave of early-stage innovation and tech start-ups into its fold. 

Its sights are firmly set on helping more Kiwis invest in the world of innovation and tech right here in New Zealand.

BIF has thrown its support behind companies striving to tackle global challenges and craft exceptional businesses.

Melissa Yiannoutsos Booster Innovation Fund manager To give you a peek into its exciting journey, we caught up with Melissa Yiannoutsos, the Booster Innovation Fund manager. 

Join us as we delve into the fund's latest capital raise and its ambitions for the future. 

 

1. What are the ambitions BIF has for this capital raise? What do you want to do with the money?

We want to make New Zealanders aware of just how innovative Kiwi companies are and help them secure more support. We’re a micro fund right now and not many investors know about us yet, but to make a significant impact and achieve long term returns, we need to grow and achieve scale. This will come from building a steady flow of capital inflows, ideally $2m per year.

This will also help us to continue backing existing companies in the portfolio, some of which are gaining momentum and winning in offshore markets. 

2. Are you proud of what BIF has been able to do so far by investing in New Zealand companies?

Absolutely. Helping all New Zealanders back young Kiwi companies is vital and provides an important option for everyone’s investment portfolio. Many of the ambitious companies we support are tackling real world challenges too. Being able to help them is super rewarding. 

Since listing the fund, only two years ago, we’ve achieved a lot. When we listed, the fund was valued at $5m. Now it’s valued at about $17m  This growth has been enabled by investing fund’s from Booster’s own balance sheet, allocations from our managed investment funds, and our portfolio companies hitting important milestones. 

These include Allegro’s strategic partnership with ASX-listed Origin to scale up its long duration storage batteries as well as InsituGen’s strategic partnership with Berlinger, a global leader in cold chain management. We’re proud of each of the 36 companies we support, even the three that have not quite made it. Having built a diverse portfolio over the last couple years, has helped ease the anticipated failures of an amount of companies and dampen the impact of losses.


3. What do you think are the major opportunities for investment here in New Zealand?

Many of the companies in BIF come from New Zealand’s universities and Crown Research Institutes.  

This has resulted in a portfolio rich in focus on areas such as climate change, food security and healthcare access. There are also opportunities in what I refer to as light-weight export businesses, namely software-based firms that are driving efficiencies and disrupting traditional industries.

Our diverse portfolio, when examined in this way, hints at some of the emerging investment trends in New Zealand. 

4. How do you hope these investments will help BIF members and other New Zealanders?

BIF is at the riskier end of the investment spectrum. With that comes potentially higher returns for those that take a longer-term view. To really achieve returns from venture investment, investors should expect the investment to be a longer-term play.

Given the risk involved, exposure to early-stage investment is often only a small portion of an individual’s wider investment portfolio. 

From a macro perspective, deploying more New Zealand capital into local businesses benefits the country. This can create high-value jobs in export-focused companies, which in turn helps transform the fabric of New Zealand’s economy, ultimately improving the wellbeing of all Kiwis.  

 

5. What do you hope the fund will look like in five years?

It’s important that we continue to achieve scale and significant returns for our members. Today, the 30+ companies we invested in employ over 250 people in high paying jobs. They also represent $500m in enterprise value and our BIF members share in a small slice of this.  

In five years, we aim to have investments in 40-50 companies and our holdings to represent closer to $200m in value, while maintaining returns of 10%-20% per annum. To achieve this, participation from more investors with a passion to support the next generation of New Zealand companies is needed.

Growing capital commitments will increase the pace of help and achieve economic returns faster for investors and, ultimately, all New Zealanders.

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Booster Investment Management Limited is the issuer of the Booster Innovation Scheme, Booster Innovation Fund. Product Disclosure Statements are available at www.booster.co.nz.

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