We are proud to announce that $45m has now been committed to Pacific Channel Fund II; an NZ$50m early-stage investment fund focused on science and advanced engineering ‘deep-tech’ companies in New Zealand. The $45m includes a NZ$20m commitment from Elevate NZ Venture Fund; a NZ$300m fund of funds managed by NZ Capital Growth Partners, which was established by the Guardians of New Zealand Superannuation Fund to generate returns and grow innovative, knowledge‐intensive businesses. We expect to fully close the fund after securing the final $5m in the coming weeks.
We have raised Fund II off the back of the success of Pacific Channel Fund I, which made investments in 31 companies and delivered a realised IRR of 22% and an unrealised IRR of over 50%, including exits at 75x, 24x and 3x cash; and four failures from which we have derived significant learnings.
Pacific Channel’s management is investing $6m in Fund II, which provides strong alignment with our co-investors who include family offices, high net worth individuals, and a further institutional investor with significant private and public company investments. Investors to date are from New Zealand, Australia and the US with strong connections in these markets as well as to the UK, Germany, India and Greater China. We are pleased that our investor group includes some significant world-class investors that are making their first investment in New Zealand – we are proud to be introducing these parties to the local early-stage ecosystem.
Fund II will enable Pacific Channel to make substantial investments into around 25 kiwi deep-tech companies focused on commercialising ground-breaking science or advanced engineering innovation over the next several years. The fund will be multi-staged, with a focus on making both Seed and predominantly Series A investments.
We are excited to now be able to provide both a significant capital pathway and specialist expertise to deep-tech companies aiming to turn their innovative technology into a commercial success. We believe these companies have the potential to make an impact here and globally to improve our daily lives.
Early-stage investment in deep technology is critical for driving productivity and economic growth. Pacific Channel Fund II, which is the largest dedicated deep-tech fund ever formed in New Zealand, will create high value jobs, and help to keep these companies in New Zealand, with local ownership, at a much-needed time for our country.
We hope that our capital, hands-on approach and ability to leverage a proven eco-system of co-investors and proven experts will give our deep-tech portfolio companies the resources, expertise and networks necessary to accelerate growth and navigate the complex commercialisation pathway required to achieve success in global markets.
We aim to close the fund with the full $50m in the coming weeks. Please get in touch if you are a wholesale investor and wish to learn more about participating in Fund II.