New Zealand startups are flourishing in an energised ecosystem, with record growth in the number of deals and the amount
of capital invested, according to the latest Startup Investment report from PwC and the Angel Association (AANZ).
In the first half of 2021 there were 66 recorded deals and nearly $60m invested by early stage investors in the
ecosystem. Compared with the same period in 2020, this represents a 60% increase in deal volume and an 80% increase in
dollars invested. Additionally, New Zealand based VCs put a further $200m in those deals, bringing the total invested to
just under $260m. These record levels of activity mirror what is being seen in other venture investment markets around
the world. NZC
Anand Reddy, Partner PwC New Zealand, says the startup ecosystem is thriving and this year is on track to be one of the
most active in the last 15 years, for the period the data has been collected.
Reddy says that while software continues to receive the largest proportion of total investment, this is now closely
followed by deep tech, which received 42% of total funding during the first half of 2021. He also points to an emerging
“One area of the New Zealand startup ecosystem that has the potential to “go big” is gaming and virtual reality. While
small when viewed against the global scale, New Zealand gaming companies are already making their mark, and there is
considerable potential for the sector to expand.”
Suse Reynolds, Chair of the Angel Association, describes the data as hugely encouraging and applauds New Zealand’s
enthusiasm for early stage venture investment.
“We need more of it. Kiwi founders have so much to offer the world when it comes to solving our big problems and early
stage venture investors play a crucial role in providing the capital and support to enable founders, and their ventures,
to flourish,” she says.
Although capital is currently abundant, Reynolds says early stage venture investors must be discerning about where they
invest. When the market inevitably resets, it will be the investors that made genuinely value-based decisions, investing
in companies solving the world’s big problems - particularly climate change and social equity - that will continue to
get backing and generate the returns expected of the asset class.
“If Aotearoa New Zealand’s venture investors do this, the good news is that there’s no shortage of these sorts of
companies entering the pipeline.”
James Pinner, Acting CEO of NZGCP says the data backs-up what NZGCP is seeing through its own Aspire Fund and the
investments being made by the funds in which Elevate - the fund to support and drive investment in New Zealand’s venture
capital market - has backed.
“Whilst we still have a long way to go in New Zealand by global benchmarks, there are some clear signs that we are
moving in a really positive direction. The growth we have seen in the number and quality of startups (together with the
deeper pools of money and talent to support them) is definitely beginning to accelerate which is incredibly exciting.
“Our job isn’t done yet and there are still hurdles to clear, including ensuring kiwi companies can access the best
talent globally and getting more investors into startups and venture capital but if we all work together, we can really
set NZ up for great future success.
“We can’t wait to see some of the emerging startups that have been backed in this report evolve into large global
companies, inspiring the next generation of amazing New Zealand founders.”A deeper dive
Companies founded in Aotearoa have an excellent and well-earned reputation for their ability to punch above their
weight. The latest Startup Investment report takes a closer look at the growth journeys of Dawn Aerospace and UBCO, both
founded with similar globally-focused “Go Big or Go Home” aspirations.
The report includes commentary from Jobloads founder Candice Pardy and early stage investor Kirsty Reynolds. Jobloads
aspires to achieve meaningful societal change and is an example of a values-based venture which harnesses the tools of
private equity to make a positive impact. Pardy and Reynolds share their insights into the importance of the founder /
investor relationship in a value-based venture, and the mindset each party should bring.
The report also identifies the different mindset required for investing in the gaming sector, which is attracting
international investor interest. Companies such as Grinding Gears, KiwiNinja, MYTONA and RocketWerkz are among those
that have achieved success and raised New Zealand’s profile.
While the potential for New Zealand gaming ventures is significant, investors used to traditional models based on
research or product will need a new approach. CODE’s Tim Ponting and the Founders of Metia Interactive and Beyond, share
their insights in the report.
Reddy says that investment in gaming is about people, not product.
“Not all games will be successful and even those with great promise may be scrapped, but it’s a sector that generates
new IP quickly, and in that respect it’s similar to film, but achieved at a lower cost.”