info@powerhouse-ventures.co.nz
(03) 364 2987 ext 6219
Incubator
39 Creyke Rd
Ilam
Christchurch
University of Canterbury
NZi3 Building
69 Creyke Rd
Christchurch
Post
PO Box 161
Lincoln 7608
Why powerHouse?
powerHouse combines the activities of an angel syndicate, a venture capital firm and business incubation. Our new approach to early stage investment, we believe, will offer substantial returns to investors and being locally focused, will offer major benefits to the Canterbury region.
Our approach to making investments
Pre-investment
- Sourcing deals
- Our investors are persons who fit within the specific exceptions set out in the Securities Act as not being required to receive a prospectus or investment statement prior to investing. powerHouse seeks deals, attracts deals and receives referrals. We pro-actively seek deals, through our operating partnerships and by locating powerHouse staff on campuses with Canterbury’s leading producers of innovation. Owing to our track record, we consistently attract investment opportunities from early stage companies requiring capital. In the city, the incubator attracts entrepreneurs providing additional high quality deal flow. Our investors and networks also refer a steady stream of deals.
We are well-connected with New Zealand’s developing venture capital community, which also provides co-investment opportunities, giving broader reach outside of the region.
- Screening & due diligence
- Initial screening is carried out by the powerhouse management team — we review more than one hundred opportunities per annum. We undertake our own comprehensive due diligence, minimising external costs, although we utilise experts when needed. We place an extra focus on strategic factors that will influence company growth potential and likely achievements, (e.g. validation of market, technology and assumptions behind the business model and financials). The capability of the entrepreneur or investee company management team is also assessed. Our investors often provide expert input to the due diligence process, especially when they have industry knowledge or contacts.
- Structuring deals
- An emphasis is placed on carefully structuring deals to protect investor interests using a range of techniques — in particular, methods to protect the principal and manage any potential downside. We also put in place milestones that ensure that investee companies focus on validating untested assumptions and reaching self-sustainability.
Post-investment
- Managing the investment
- powerHouse’s hands-on approach to investment applies resource and expertise throughout the period of an investee company being part of the portfolio. A requirement upon investment for investee companies is their appointment of a powerhouse-selected non-executive director, who provides governance, influence and often sector expertise.
Investee companies take part in our incubation programme, which provides start-up know-how and entrepreneurial guidance. We help companies to focus on sales; manage their cashflow; build their own networks; enlist mentors; and attract and build their management teams. powerhouse actively encourages Syndicate members who have relevant experience to become involved in supporting investee companies. Opportunities for members include mentoring, advising, consulting and non-executive directorships.
- Follow-on funding
- Additional funding is often required to enable our investee companies to reach their full potential. Follow-on funding plans are normally put in place from the outset. The larger funds required at this stage are sourced from co-investment partners, which include Syndicate members, corporate partners, institutional investors and larger venture investment funds. We especially seek those in a position to add strategic value through sector knowledge or links to international markets.
- Exit
- powerhouse places particular focus on exit strategies for individual investments, actively considering future exit opportunities even before investments are made. This typically means assessing potential options for trade sale or major follow-on financing rounds. We also consider IPO for the right companies.
Talk to us for more information on any of the above options.