Powerhouse Ventures

A unique opportunity to invest in an established and expanding portfolio of science and engineering-based companies originating from New Zealand’s universities and research-intensive institutions.

Minimum investment: $5,000.00

$1,764,192
Funded
Max target: $3,000,000 (11.51% equity) Equity offered: Fully paid ordinary shares
Ended Tue, 16 February 2016 9:00pm (NZST)
154 Number of investments
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$1,764,192 Funded
$5,000 Min investment
$3,000,000 Max target (11.51% equity)
$0 Still available for investment
Offer closed Tue, 16 February 2016 9:00pm

Overview

Powerhouse brings world-class technology that exists in New Zealand’s universities and research institutes to market through a portfolio of start-ups.

Key investment merits include:

  • an established portfolio of 18 companies - some approaching exit
  • proprietary process to commercialising intellectual property
  • portfolio internal rate of return of 29% per annum
  • strong management and board
  • New Zealand-wide access to investment opportunities
  • a growth strategy that includes expansion to Australia and planned listing on the NZX Main Board and ASX

Powerhouse works with research intensive organisations to create start-up companies. Through capital investment, Powerhouse holds significant interest in the companies created. Over time, Powerhouse invests further capital and provides hands-on support with the intention of growing the value of these stakes.

Through the application of this model, Powerhouse has an established and expanding portfolio of science and engineering based companies, with some approaching exit.

This Snowball Effect public offer is based on the Powerhouse Information Memorandum issued on the 24th November 2015 (IM). This document can be downloaded from the Offer Tab.

Any material updates since that date are, and will be, disclosed in the Updates Tab.

[1] Historical internal rate of return as at 30 June 2015 - independently recalculated by Ernst & Young to the extent of Agreed Upon Procedures. See Glossary in the IM for further details.

Our Investment Portfolio

Investments are focused on our key areas; environmental and agritech, engineering and cleantech, healthcare and medical devices and information and communication technologies.

A recent independent valuation by Edison Investment Research Limited (Edison) valued the investment portfolio at $17.2 million against a carrying value of $12.15 million.


Download Edison report

Business Model

Powerhouse was established to commercialise scientific innovation from Canterbury’s universities and research intensive institutions. The company pioneered the concept of a long term partnership model with universities and has arrangements covering a number of New Zealand’s leading universities and research intensive organisations. The close interaction with universities provides a strong pipeline of investment opportunities and is central to the Powerhouse business model.

The model is based on similar successful models in Europe and is designed to build a robust portfolio of successful post-seed companies, ultimately realising value from investments through the creation of exit opportunities by way of trade sales, initial public offerings or the creation of profitable businesses paying dividends to shareholders.

Powerhouse has expanded to become a nationwide organisation with a current portfolio of 18 companies.

Powerhouse’s growth strategy includes expansion to Australia and a planned listing on the NZX Main Board and the ASX.

Powerhouse’s core KPI is to maintain a sustained investment portfolio internal rate of return above 30% per annum.

Purpose of the offer

Powerhouse is seeking to raise capital to:

  • Expand the Investment Portfolio by making investments in new companies;
  • Increase investment in the current Investment Portfolio; and
  • Facilitate delivery of the business strategy, including aiding its preparation for a potential listing of its shares in New Zealand and Australia.

Wholesale and retail investors

This offer is being made to both "wholesale" and "retail" investors.

The terms of the offer, including the class of shares on offer and price per Share, are the same for both wholesale and retail investors. However the offer is being made pursuant to different regulatory frameworks, and certain information does not apply in each case.

Retail investors

The offer to retail investors is being made pursuant to Snowball Effect's market services licence granted by FMA, and the equity crowdfunding regulations contained in the Financial Markets Conduct Act 2013 and corresponding Regulations.

Through this offer page, retail investors can access the Information Memorandum dated 24 November 2015. The Information Memorandum was prepared for an offer to wholesale investors (defined as “Eligible Investors" in the Information Memorandum). The eligibility criteria in the Information Memorandum and the Important Dates on page 11 of the Information Memorandum do not apply to retail investors. The dates relevant to retail investors are set out in the Offer tab.

Below is the prescribed warning statement which must accompany offers made to retail investors through a licensed equity crowdfunding provider.

Warning statement about crowd funding:

Equity crowd funding is risky. Issuers using Snowball Effect’s facility include new or rapidly growing ventures. Investment in these types of businesses is very speculative and carries high risks. You may lose your entire investment, and must be in a position to bear this risk without undue hardship. New Zealand law normally requires people who offer financial products to give information to investors before they invest. This requires those offering financial products to have disclosed information that is important for investors to make an informed decision. The usual rules do not apply to offers by issuers using this facility. As a result, you may not be given all the information usually required. You will also have fewer other legal protections for this investment. Ask questions, read all information given carefully, and seek independent financial advice before committing yourself.

Wholesale investors

The offer to wholesale investors is not being made pursuant to Snowball Effect's market services licence granted by FMA, and the equity crowdfunding regulations contained in the Financial Markets Conduct Act 2013 and corresponding Regulations.

The team

The Powerhouse Board collectively possesses considerable investment, commercial and financial experience, with particular expertise in the development of research-generated innovation.

The Board is supported by an experienced management team that has the primary responsibility for sourcing, shaping and building new, early-stage opportunities.

This team has specialist expertise that spans Powerhouse’s four main investment sectors and provides a direct interface between Powerhouse and each of New Zealand’s eight universities. In addition, Powerhouse leverages its extensive network of highly-experienced individuals with relevant financial, technical and industry- sector expertise to build and strengthen the boards of Portfolio Companies.

Powerhouse employs 19 staff. It has a corporate office in Christchurch and additional regional offices in Dunedin, Christchurch, and Wellington.

Photo of Kerry McDonald

Kerry McDonald Chairman, Non-Executive Independent Director

Kerry is a company director and advisor with experience in private and public sector activities in New Zealand, Australia and elsewhere. He is Chairman of Opus International Consultants and of BNZ Wellington Partners, Deputy Chairman of the NZ Institute of Economic Research, a director of Ruapehu Alpine Lifts and the National Army Museum. Kerry recently chaired the 2013/2014 review of the Government’s funding of Centres of Research Excellence and was previously a Rio Tinto Managing Director, Chairman of BNZ, Oceana Gold and State Sector Standards Board and director of National Australia Bank, Leighton Contractors Pty Ltd, Carter Holt Harvey, Comalco NZ, Ports of Auckland, WWF NZ, and others.
Photo of Rick Christie

Rick Christie Non-Executive Independent Director

Rick is a professional Director and company Chairman with appointments in both the private and public sectors. He has had considerable experience as a Chief Executive with his most recent position being CEO of diversified investment company Rangatira Ltd., from which he retired in 2004. Prior to that appointment he had extensive involvement in the export sector, including Tradenz (The New Zealand Trade Development Board) where he was Chief Executive from 1990 to 1996. He is currently Chairman of Ebos Group Ltd., NeSI, the NZ supercomputer network, ikeGPS and Service IQ. Rick is a Director of Southport Ltd., and Solnet Solutions Ltd.
Photo of Stephen Hampson

Stephen Hampson Managing Director, Executive Non-Independent Director

Stephen’s career has been dedicated to transforming new knowledge into commercial success. His commercialisation work in Europe included fast-growth execution and business improvement in several acquired companies he was appointed to lead, including the trade sale of one of these companies and the domination of a global niche in another. Returning to New Zealand, Stephen was inaugural CEO of the award-winning Canterbury Innovation Incubator (Cii) before establishing Powerhouse Ventures Limited in 2006. In this role, he has overseen the incubation and growth of more than 50 new companies. Director of numerous portfolio companies–refer to Directors’ Interests.
Photo of John Hunter

John Hunter Non-Executive Independent Director

John has extensive chief financial officer experience as well as chief operating officer and general management experience, including HR, IT and legal responsibilities. He is familiar with the manufacturing, finance, retail, wholesale, information technology and primary sectors, and with public company reporting and representation. He has extensive board level experience as a senior executive as well as holding board positions as a director and Board chair.
Photo of Dianne McCarthy

Dianne McCarthy Non-Executive Independent Director

Di is the former Chief Executive of the Royal Society of New Zealand and has over 20 years experience in various management and governance roles in the tertiary education, science and health sectors. She currently sits on the Council of the University of Auckland and the Advisory Board of its Centre for Brain Research. She is a Director of the Cawthron Institute and a member of the governance boards of the Dodd-Walls Centre for Photonic and Quantum Technologies, and two National Science Challenges, Ageing Well and Healthier Lives. She is a Trustee of the Malaghan Institute of Medical Research and the Deafness Research Foundation (NZ). She was made an Officer of the New Zealand Order of Merit for her services to education, a Companion of the Royal Society of New Zealand for services to science, and her qualifications include a BA, BSc, MSc (Hons) and PhD.
Photo of John Walley

John Walley Non-Executive Non-Independent Director

John’s background is in research, development, manufacturing and distribution companies operating in the marine, vehicle, electronics and software sectors. He is a director or chair of several companies and has a number of investments in early-stage technology firms. He is a Chartered Engineer, a Fellow of the Institute of Professional Engineers NZ (IPENZ), a Member of The Institution of Engineering and Technology (IET) and a Fellow of the New Zealand Institute of Management. Previously he was Chief Executive of the New Zealand Manufacturers and Exporters Association and other senior management roles. John is a founding shareholder of Powerhouse Ventures Limited and a Director of CRIS Ltd.
Photo of Steve Wilson

Steve Wilson Non-Executive Independent Director

Steve has 33 years experience as CEO of both public and private companies and over 20 years experience in governance across a number of Industry and Academic formal boards and advisory boards. He is currently Executive Director of Talbot Technologies Ltd, a technical plastics manufacturer and exporter. Steve is also a Member of The New Zealand Order of Merit, a Fellow of the New Zealand Institute of Management, a Life Member of Plastics New Zealand and is a director and shareholder of a number of technology companies. He is also a Member of the Advisory boards for Mechanical Engineering, University of Canterbury, of the product Accelerator based at University of Auckland and of the national Science challenge “Science for Technical Innovation”.
Photo of Colin Dawson

Colin Dawson Chief Operating Officer

Colin’s career spans over 30 years with predominant focus being on the human and animal health sectors. Colin is a veterinarian by training. His roles since 1999 have included 12 years as Chief Executive Officer at Otago Innovation Limited, commercialising technology from the University of Otago. Other organisations, many of which have been technology start-up businesses where Colin has held C-level roles or Directorships, include Pacific Edge, BLIS Technologies, Immune Solutions and Medicus Capital.
Photo of Paul Viney

Paul Viney Chief Financial Officer Company Secretary

Paul is a career finance and governance professional. He has worked in Australian industrial and financial services organisations for over 20 years and has specialised in financial and management accounting, value creation, mergers and acquisitions and corporate governance. Prior to joining Powerhouse, Paul was Chief Financial Officer / Company Secretary at diversified ASX listed banking group MyState Limited, which had a market capitalisation of over A$400 million and an asset footprint of around A$5.3 billion.

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.

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