Overview
Balex aims for its Automatic Boat Loader (ABL) to become the new benchmark for the launch and retrieval of trailer-boats. Balex aspires for this remotely controlled system to become what garage door openers are to garages, and dishwashers are to kitchens – once thought an unnecessary luxury, but now the standard.
The ABL is a truly disruptive technology, first to market with no direct competition. This product is specified for alloy and fibreglass hulled boats in the 5-9m range up to 2500kg.
Balex’s ABL presents a clear point of difference and value proposition to marine dealers, boat and trailer original equipment manufacturers (OEM) and end consumers in the marine industry. Over time with scale and cost-out the technology has the potential to move from high-end to mainstream consumer pricing brackets.
“Once you use it, you will never go without it! The Balex ABL is innovation at its finest, it takes the final pain out of fishing.” - Milan Radonich, TV-Host, Big Angry Fish, TV 3, Extreme Boat & Voyager Trailer.
The Balex ABL is now in market in NZ and loved by its users. Balex have established an extensive Reseller network in NZ and is actively working with 12 marine dealers, 3 trailer manufacturers and 5 boat manufacturers. More than 20 different boat brands have received ABL installations to date and 100 ABL units are now in market. The product and business has received considerable press from multiple trade magazines and key influencers and is being featured on TV shows the Big Angry Fish from July, and Fishy Business in November of 2016.
The core market for the ABL is the international recreational boating market made up of 29 million boats. 60% of this market is within Balex’s sweet spot of 5 to 9m boats, providing an addressable market of 16 million boats. NZ, Australia, North America, UK and the top 7 European countries represent 96% of the total global recreational trailer boat market representing Balex's primary focus.
In 2016, Balex were accepted into NZTE’s Focus 700 program. NZTE Business development managers based in Washington, Sydney and London have been appointed and are assisting with market validation and key introductions.
Balex is making good progress with Australian market entry strategies having recently exhibited at the Sydney International Boat Show. Balex have now appointed resellers in Sydney & Brisbane, and is in ongoing discussions with marine dealers & Trailer manufactures in the Goldcoast, Melbourne, Tasmania, Darwin and Perth.
Balex has signed an exclusive distribution agreement with Forge Group in the UK. The ABL will make its European debut at the South Hampton Boat Show in September 2016, and the Marine Equipment Trade Show (METS) in Amsterdam in November 2016.
A carefully staged capital approach has been followed to protect shareholder value. $2.2m has been raised to date from founders and investors to fund market research, product & IP development, recruit key resource and fund first production. The business has also received very good support from Kiwibank & Callaghan Innovation.
At this stage the Board believes the longer term market development strategy for international markets will require either a strategic industry cornerstone investor, and/or an IP or manufacturing licensing model to execute into these markets.
Balex has a target of $750,000 for this current capital raising round, with over subscriptions of up to $1.5m (over subscriptions subject to shareholder approval). Existing shareholders have already taken up pre-emptive rights to the value of approximately $453,000, with the balance now available to Snowball Effect investors.
Notes on Investment
Balex/Suelex
Balex Marine Limited (“Balex”) is the operating company which undertakes the entire commercialisation of the ABL including all sales and marketing functions. Balex’s sister company, Suelex Limited (“Suelex”) owns the registered and unregistered intellectual property rights in the ABL (including the patents and trade marks). Suelex licences the intellectual property to Balex under exclusive licensing arrangements.
Under the Shareholders’ Agreements for Balex and Suelex, it is a requirement that each party that holds shares in Balex must hold the same number of shares in Suelex (which are issued for nil consideration). The shares in Balex and Suelex are “stapled” which means that the shares in each entity cannot be sold, transferred or otherwise dealt with separately from each other. The current directors of Balex are also directors of Suelex.
Nominee Shareholding Structure
The shares that will be issued by Balex and Suelex will be issued to Snowball Nominees Limited (“Nominee”). The Nominee will hold the legal title to the shares, which will be held on trust for the beneficial owner of the shares (i.e. the Snowball investor). The full terms on which the Nominee will hold the shares are set out in the Nominee Deed Poll (refer to the offer documents).
The Nominee must:
- Act in accordance with the beneficial owner’s instructions (e.g. in exercising the voting rights attached to the shares);
- Account to the beneficial owner for the amounts it receives from the shares (e.g. payment of dividends); and
- Deliver the notices, documents, reports and other communications that it receives to the beneficial owner.
The beneficial owner must pay for the shares and is liable for any other obligations that arise in relation to the shares. Under the Nominee Deed Poll, the beneficial owner indemnifies the Nominee against any costs or claims that the Nominee incurs as a result of holding the shares (unless the Nominee has been fraudulent or grossly negligent).
Team
Daryl FrenchChairman
Daryl started his career in the ICT industry and undertook activities mainly in sales, marketing and senior management roles. He was a senior manager with IBM Asia Pacific for 12 years with responsibility for the operation and finances of my division. In the course of his career, he has worked across a number of countries, including Japan, China, India and the US. Alongside his corporate career, he has developed new markets in competitive areas and has started and run a number of businesses. He now mentors other entrepreneurs and business leaders and in the last 10 years has made Governance his career and is a Chartered member of the Institute of Directors. Daryl has a very strong background in ICT, but with a diverse portfolio he brings knowledge widely across the SME sector and combines that with a very good understanding of local government and political environments.
Alan BougenIndependent Director
Alan is the co-founder and current Deputy Chairman of NZX50-listed honey and health products company Comvita. He has a background in export and international marketing and significant experience in growing and developing start-up companies including taking them through to public listing. Alan brings a valuable global perspective and relevant governance experience to the Balex Board and is a member of The Institute of Directors.
Tracey SwinehartIndependent Director
Tracey has had 25+ years in lead finance roles across a variety of NZ manufacturers and exporters. She is also Managing Director for Locus Research and involved as interim CFO for start-ups Ubco Bikes and Inverse Hair. She has valuable experience working with angel and venture capital networks for innovative product start-ups.
Paul SymesManaging Director
Paul has more than 25 years’ experience in the Engineering and Steel Construction industry, including 15 years’ experience in export sales with a primary focus on North America. Paul has done it before leading and growing a NZ startup to become a major player in the Australasian and US market. He has extensive executive experience, particularly in business strategy, innovation and product development and the leadership and management of high performance teams.
Paul YarrallSales Director
Paul has extensive, proven experience in sales, export strategy and market development. Over a 15 year period Paul drove sales at Phil&Teds, taking a unique NZ innovative product from 95% NZ domestic sales to 95% export sales, establishing multiple platforms for growth with key industry leaders across markets including Australia, USA, Canada, UK, Europe and Asia. He has a passion for highly innovative NZ products that can be leveraged offshore to world markets. He likes to invest and work with these companies to become leaders in their fields. His goal is to grow Balex to become a leading brand in the international boat trailer industry.
Lance MillerNorth American Marine Advisor
Lance has 20 years’ experience in Senior Management roles in the USA. Lance has been fully immersed in the US Marine Industry for the past 8 years including 5 years as CFO at Legendary Marine, which was the #1 dealership for 2012 & 2013 in North America. Lance has an in depth knowledge of the US market and detailed practical financial experience. Lance is currently consulting to multiple marine dealerships throughout North America.Warning statement
It's crucial for you to understand the characteristics and risks of this investment opportunity. New Zealand law normally requires people who offer financial products to provide in-depth information to investors before they invest. The usual rules do not apply to offers by companies through Snowball Effect. As a result, you may not be given all the information you need to make an informed decision. Investing is risky. Some of the key risks include loss of capital, illiquidity, lack of returns, dilution, loss of key people and customers, and lack of control. You should only invest money that you can afford to lose.