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2018 capital raising numbers

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We’ve crunched the numbers and confirmed that 2018 was by far our busiest year for capital raising activity.

In total we helped clients close 92 deals.   This is a big uptick in activity from 2017, with 67 completed deals.  For the first time, Southeast Asia accounted for more than half of our capital raising activity, with 47 closed deals.

The total amount raised came in at $337m (c.f. $220m in 2017), $116m going to NZ companies (c.f. $67m in 2017) and $220m to Southeast Asian companies (c.f. $151m in 2017).

Average deal size was $2.6m for NZ investments and $4.7m for Southeast Asia, with median deal sizes of $1m and $1.5m respectively. These figures are almost identical to our 2017 numbers.

The average pre-money valuation for NZ deals was $10m with a median of $4.5m, compared to $29m and $6.3m for Southeast Asian deals.  These numbers are also very close to our 2017 numbers.

Comparing lead investors on our NZ deals to our Southeast Asia deals is an interesting exercise.  As the table below shows, the majority of our NZ deals were led by existing shareholders, angels and friends and family, whereas the majority of our Southeast Asian deals were led by VC’s.

Particularly telling is the fact that only 5 of our NZ deals were led by VC’s, whereas 28 of our Southeast Asian deals were led by VC’s, 19 of whom were local investors (compared to only 1 NZ deal led by a local VC).  We think this is a fair, though unfortunate, reflection of the comparative maturity of the NZ and Southeast Asian investment markets.

NZ SEA
friends and family 3 5
existing shareholders 11 0
angels 9 4
family office / HNWs 7 1
onshore VC 1 19
offshore VC 4 9
NZ corporate investor 2 0
offshore corporate investor 4 9
accelerator / incubator 4 0
45 47

So what does 2019 hold in store for our venture capital lawyers?

The outlook is for a similar or higher level of deals.  We started the year with 35 active deals on the books, and as our clients get back to work after the holiday break new deals are coming in the door.

We expect the spread of lead investors to be fairly similar to 2018, with perhaps a higher number of NZ deals led by offshore VC’s as Australian funds in particular get more comfortable investing in New Zealand companies.  Even more capital will flow into Southeast Asia from China and the US with large VC’s likely to set up shop in Singapore.

 

*all $ amounts are NZ$

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