The partnership, called the New Zealand Innovation Booster, was officially launched on Monday 27 August by Minister of Finance the Hon Grant Robertson. Under the deal, Booster, whose Executive Chairman Paul Foley and Managing Director Allan Yeo are both University alumni, will invest a minimum of $2 million a year for five years.
It marks the first time a New Zealand financial institution has joined forces with a university to invest in its start-up companies.
Welcoming the partnership, Vice-Chancellor Professor Grant Guilford says it reflects the shared commitment of Victoria University of Wellington and Booster to encouraging entrepreneurialism and economic growth.
“This will be a game-changer for each of the spin-outs as well as for the University. It will transform how we nurture businesses formed from our researchers’ ground-breaking thinking,” says Professor Guilford.
“It’s a real vote of confidence in the commercial potential of our start-ups and their value as investment opportunities.
“Booster is a Wellington-based company and this investment increases the chance of start-ups taking root in a city we are both proud to be part of.”
Dr Anne Barnett, Chief Executive Officer of Viclink, says the money the partnership injects will give the start-ups more security during their cash-hungry formative years.
“Having the support of Booster dramatically improves the chances of the start-ups growing faster, making them more attractive to other investors,” says Dr Barnett.
Mr Yeo says the unique arrangement reflects Booster’s commitment to New Zealand by helping innovative ideas become productive businesses.
“Commercialisation of research has long been seen as an opportunity to enhance the contribution of our universities to New Zealand. Historically this financing has relied on angel funding or venture capital, which means opportunities to date have not only been hard to come by, but future commercialisation and growth benefits leave New Zealand,” says Mr Yeo.
“We are excited to be an integral part in growing these innovative Kiwi ideas for the future benefit of New Zealand.”
Viclink currently has equity in nearly 20 start-ups based on Victoria University of Wellington research, including Avalia Immunotherapies, scientific instruments company Magritek and medical diagnostics company Ferranova.
It aims to increase that portfolio to 50 within the next decade.
When the time is right to sell equity in a start-up, Viclink’s financial return is divided equally between the researchers whose work the start-up draws on, their School within the University and Viclink itself. Viclink’s third is then reinvested in further start-ups.
Professor Guilford says that, as a global-civic university and the number one-ranked university in New Zealand for research quality, Victoria University of Wellington places a premium on improving the wellbeing and prosperity of society.
“That means ensuring our research achieves its full potential outside the University. Through licensing and helping to create start-ups, Viclink plays a major part in this, and this partnership with Booster both acknowledges and advances the tremendous work it is doing.”
Professor Guilford adds that ‘Stimulating a design-led, high-value manufacturing region’ is one of Victoria University of Wellington’s distinctive strengths and the new partnership contributes to that.
“It will result in more jobs and add not only to Wellington’s economy but to that of New Zealand as a whole.”