PayPal founder buys into New Zealand technology fund

March 22nd, 2012 - 7:58 pm ICT by IANS  

Facebook Wellington, March 22 (IANS) A US billionaire who was among the early investors in Facebook and PayPal Thursday helped launch a new venture capital fund to finance New Zealand technology companies.

The New Zealand-based Valar Ventures Fund was established with 40 million NZ dollars ($32.36 million) and involved the New Zealand Venture Investment Fund (NZVIF) and Peter Thiel’s Valar Ventures, reported Xinhua.

Thiel co-founded and was chief executive officer of the on-line payment firm, PayPal, before he sold it to eBay, and was the first outside investor in Facebook, said a statement from NZVIF.

Valar Ventures LP would provide growth capital to early-stage New Zealand technology companies for the development of technology and expansion into overseas markets.

NZVIF chief executive Franceska Banga said the partnership brought deep experience in developing world-leading technology companies and significant networks into the US and international markets.

“Peter Thiel is one of the world’s most successful technology investors. He and his team bring a considerable track record of expertise and resources. For young New Zealand technology companies, Valar Ventures’ presence in the New Zealand market is a significant opportunity,” said Banga in the statement.

“Alongside a scarcity of investment capital, the biggest challenge facing early-stage New Zealand technology companies is breaking into international markets. For web-based technology companies especially, the major market is the United States. That is where Valar Ventures’ networks whether in Silicon Valley or on Wall Street will be significant.”

Thiel said New Zealand was an attractive investment proposition.

“Over the last several years, New Zealand has been nurturing more early-stage tech companies,” said Thiel in the statement.

The Valar Ventures LP fund comprised 20 million NZ dollars from NZVIF, about 5 million
NZ dollars from other New Zealand investors, and the balance from Thiel.

Economic Development Minister Steven Joyce said the fund was a very positive development for New Zealand technology companies wanting to expand into large offshore markets.

“These companies require not only capital but also getting access to the right offshore networks in those markets and building their customer base,” Joyce said in a statement.

“Because of the small size of the domestic market, fast-growth New Zealand businesses need access to world markets a lot earlier than a similar company would in the United States. Valar Ventures’ networks to markets and access to capital will help reduce the scale of the challenge in the companies it invests in, in terms of expanding into
international markets.”

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