-New fund will partner offshore investors with NZ expertise to mentor innovative businesses

The sheer distance between New Zealand and the rest of the world can create an obstacle between overseas investors and the attractive opportunities offered by New Zealand companies, but a new investment fund will bridge that barrier.

Milestone Capital has established the Rutherford Innovation Fund to raise capital and back innovative companies which need financial assistance and business skills to commercialise their brilliant ideas on the international stage.

“The Rutherford Innovation Fund provides offshore investors with an experienced local co-investment partner to bridge the geographic gap to New Zealand as these companies are not on the radar of international investors,” Milestone Capital principal Kenji Steven says.

The Rutherford Innovation Fund sees the best opportunities for investment as being those that benefit from the massive changes being driven by the growth of Clean Tech – products, services and technologies that provide solutions to urgent global problems around energy, water, carbon and pollution.

For forward-thinking investors, Clean Tech is the next big thing. Our world is evolving as innovative companies develop cutting edge technology to deal with the challenges presented by global warming.

New Zealand abounds with Clean Tech ideas, after all New Zealand has a long history of creative engineering and scientific brilliance. That is why the fund is named after Ernest Rutherford, the Kiwi who was the first person to split the atom and the father of modern nuclear physics.

The Rutherford Innovation Fund is the first managed fund in New Zealand with a focus on Clean Tech. It’s a portfolio of private equity companies which include algae fuel manufacturer Aquaflow Bionomic Corporation, carbon sequestration firm Carbonscape and ‘top five’ international climate change website Celsias.

Astounding commercial success has resulted time after time from the right partnerships between overseas capital and New Zealand businesses. From marine navigation to blockbuster films, New Zealand’s legendary culture of innovation and excellence delivers results. “The key limiting factor in New Zealand is capital. For private companies investment capital is scarce so there is attractive pricing and little competition for deals. The capital markets are also under-developed so approximately 80% of the top 200 New Zealand companies are private,” Steven says.

Innovative thinkers don’t necessarily possess business acumen. So Milestone Capital has a new approach which will foster young businesses at the same time as reaping the benefits of astute investment in innovative New Zealand companies.

“This is a new type of capital – action capital,” says Milestone Capital principal Nick Gerritsen.

“The Rutherford Innovation Fund offers the chance to invest in young companies which are starting to achieve international industry recognition. They need guidance,” Gerritsen says.

For an additional investment edge, Milestone Capital’s internationally experienced principals are cornerstone investors and hands-on fund managers. The principals will use their investment knowledge to choose the companies and instil the businesses with their collective entrepreneurial and management experience to nurture and direct the innovators’ creative dreams.

This edge reduces the fund risks and gives investors the opportunity to grow their investment while being environmentally friendly.

“A lot of people will become wealthy by investing in Clean Tech companies, but it is hard to choose which companies will be successful among the plethora of scientific projects working on new ways for the world to live,” Steven says.

There is huge engineering, scientific and technical skill in New Zealand, waiting to be commercialised. The missing ingredients are the business understanding, the networks, the systems and the capital.

“We have real expertise – between us we have established around 150 companies and learned from the successes and failures,” Steven says. Gerritsen is a Clean Tech pioneer in New Zealand and Steven has global institutional investment management experience and currently chairs a US$1 billion plus global alternative investment firm.

“Milestone Capital will choose the businesses and then give them the tools and resources they need to ensure global best practice. We will share our global networks and operational skills and put in place good financial systems and best practice in corporate governance to enhance the chances of being successful,” Steven says.

“We will prepare them to collaborate with the big strategic players because collaboration is the most efficient way of building smart companies. In Clean Tech, some of the biggest companies in the world are collaborating with start-ups.”

Venture capital does not work for these companies because venture capitalism is about cutting a sharp deal and selling on for a profit, Gerritsen says.

“We want to run really fast hand in hand with these creative innovators. It’s like high altitude training – taking these companies into an environment focused on performance,” he says.

“It’s not about one deal – it’s about a portfolio of activity which will continue into the future.”

Ends

NOTE: Just as the cornerstone investors are exceptional, so are their potential investment partners. The Rutherford Innovation Fund requires a NZ$1 million initial investment from institutional investors, who can top that up by another $100,000 on an ad hoc basis for two years if they want to. Others interested in joining the fund need to invest an initial sum of NZ$50,000. They can top up their investment with NZ$5000 on an ad hoc basis also. The fund is targeting a capital raising of NZ$50 million over the next two years.

For more information, see www.milestone-cap.com or please contact:

Kenji Steven on +64 299 778 899

Nick Gerritsen on +64 274 889 836

Janine Ogier, Convergence Communications & Marketing, on +64 277 534 360