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2017 capital raising numbers

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We’re happy to report that 2017, while not quite reaching the heights of the previous year, was still a great year for our corporate lawyers advising on capital raising deals.

In total, we helped our clients complete 67 capital raising transactions in 2017, compared to 83 in 2016 and 43 in 2015. The total amount of capital raised in those transactions was $220m, compared to an identical $220m in 2016 and $180m in 2015.

NZ companies accounted for close to $70m of this capital raising, compared to $150m in 2016 and $53m in 2015. Our average raise for Kiwi companies in 2017 was $1,550,000, with a median of $700,000.  This compares with $2,450,000 and $950,000 in 2016, and $1,950,000 and $500,000 in 2015.  Although the total capital raised in our 2017 NZ deals was a lot lower than the previous year, we are not reading too much into this as the 2016 number included a couple of IPO’s.

The average raise for our Southeast Asian deals was $6,300,000, with a median of $1,400,000.  This compared with $3,950,000 and $2,050,000 in 2016, and $9,200,000 and $2,500,000 in 2015.

The lead investors on our 43 NZ deals were:

  • friends and family – 4
  • existing shareholders – 3
  • private angels – 6
  • angel clubs – 7
  • family office/HNWs – 5
  • onshore VC – 6
  • offshore VC – 4
  • NZ corporate – 4
  • offshore corporate – 4

These numbers reflect our feeling, at the start of 2016, that corporates and VC’s were going to play a bigger role in the NZ funding ecosystem than had been the case in prior years.

The lead investors on our 24 Southeast Asian deals were:

  • private angels – 3
  • angel clubs – 4
  • family office/HNWs – 1
  • VC – 14
  • corporate investor – 2

The weighting of venture capital in these deals reflect the funding market in Southeast Asia – there are scores more VCs operating in Southeast Asia than in New Zealand.

So what does 2018 have in store for our venture capital lawyers? The significant theme so far is interest in ICOs. We have a couple of NZ clients working hard on utility token ICOs that they expect to launch in the first half of the year, and we are receiving frequent enquiries from NZ companies wanting to understand the legalities of undertaking internationally focussed ICO’s. This trend is about six months behind our Southeast Asian experience, where we have had several clients complete ICOs, including exciting blockchain company bluzelle.  The recent volatility in bitcoin prices certainly hasn’t affected the interest we are seeing amongst tech companies in ICOs.

Although there is a lot of interest in ICOs, we expect that the numbers of NZ companies raising capital via token issues will still be relatively small this year.  Meanwhile, we expect traditional capital raising activity to continue to be busy as it has been over the last 3 years.

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