The international corporate venturing organisation, Global Corporate Venturing, reported recently on BioPacific Partners’ new regional venturing model as a brand new approach to linking global markets to local innovators.
The below article appeared in the September 2014 issue of Global Government Venturing.
Regional venture models
New Zealand and Australia have had relatively separate indigenous venture capital industries as, while to outsiders the countries look close together on a map, the distance between them is only about a quarter less than that between the UK and US.
But one experimental firm trying to bridge the gap is BioPacific Partners.
BioPacific’s team had run one of the initial VC funds backed by the government’s New Zealand Venture Investment Fund (NZVIF) a decade ago, but its biggest investors at the time were strategic corporates, notably food maker Nestlé, through a co-investment agreement with their corporate venturing fund Inventages, and PGG Wrightson, New Zealand’s largest agricultural business.
But now that team has developed the model, which it calls “regional corporate venturing”, to gain commitments from other corporations. With a team of experienced individuals embedded in the local innovation scene across both Australia and New Zealand, BioPacific is now signing up global corporations that want access to dealflow from that region, at the rate of about one every three months.
The two founders, Andrew Kelly and Margot Bethell, attended the Global Corporate Venturing Symposium in London in May and have been working with about 20 multinationals to model their offering, according to Kelly.
He added: “We went through some classic design thinking last year, figuring out how we could bridge the rich innovations that occur in Australia and New Zealand into global markets.
“We recognised that we had the potential to do a far better job of ‘scouting’ our own region than any talent scout, and at lower cost
“Hunting a smaller region is necessarily inefficient, but if a corporate does not need to bear the whole cost, and if they are willing to cooperate with each other, they not only get access cheaply, but when they get a deal, they have an expert team – ‘arms and legs’ – in the region to help take it forward and keep it healthy.”
Kelly says the question he’s now fielding from his corporate partners is whether BioPacific can cover South-East Asia as well. They’ve just commissioned an on-the-ground research project to begin the expansion of their model to do just that.
This is a truly novel model – you can bet that GCV will ‘watch this space’.