Aroa Biosurgery CEO Brian Ward: IPO on the cards this year. Photo / Supplied
The New Year holds new opportunities for these five local technology startups, each of which is poised major growth in 2020.
High-tech wound-care company Aroa Biosurgery is gearing for a big capital raise this year.
The Auckland startup makes "Endoform" - a kind of artificial skin or "bioscaffold" that helps surgeons deal with serious tissue injuries. It treads quietly, but now employs 120 locally, and another 30 in the US through a product-development partnership with a US company.
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Chief executive Brian Ward told the Herald the raise would be in the order of "tens of millions", and could come through a private round or a listing on the ASX or NZX.
Aroa made a maiden profit in 2019, which ward said was in the "single digit millions" on revenue that jumped 118 per cent to $24.2 million.
Ward saw revenue doubling again this year - which is good news for early investors who include Phil McCaw, Sir Stephen Tindall, Movac and the taxpayer via the NZ Venture Investment Fund (NZVIF).
Just before Christmas, Aroa made another step towards its major capital raise by appointing Australian John Diddams to its board.
Diddams is also a director of the Wellington-based, ASX-listed breast-screening software company Volpara, and Aroa chairman Jim Mclean was not shy of talking up the Australian's experience in managing secondary capital raisings and IPOs.
"Aroa continues to grow strongly and is considering its options for a possible IPO and capital raising in 2020, as it looks to grow to the next level of scale, consolidate its footprint in the US, broaden into other markets and introduce new products," Mclean said.
"Airbnb for parking" startup Parkable got a strong vote of confidence toward the end of 2019 in the form of a $4.6m Series A round led by Spark, with Trade Me alumnus Rowan Simpson, former Vista executive Peter Beguely and early PushPay backer Jason Kilgour also chipping in.
The raise was at a $36m valuation, which Parkable will try to increase in 2020 as it builds on its early efforts to push into Australia and China.
When the Herald first caught up with Parkable in 2015, the three-man startup was using its app to list driveways and off-street parking spaces near Eden Park for an All Black test.
With its latest raise, it's looking to increase its headcount to 65. And while it still lets you rent out a spare carpark (or find one), it's point of difference its new enterprise product, which lets large organisations manage their carparks in terms of wrangling free spots for visitors or "hotdesking" spare spaces. Early clients for the enterprise product - which combines Parkables app with sensors mounted on each parking space - include Datacom, IAG and KPMG.
Today, Parkable has around 60,000 parking spaces on its books across Australia and New Zealand.
Co-founder and chief executive Toby Littin said the nascent move into China - through a joint-venture run by expats familiar with navigating the country's bureaucracy - had already landed two enterprise clients: EV Power, which claims to be China's biggest EV charger provider, and Century Bashi (a large commercial building in Shanghai.
Littin said the China JV had the potential to double the size of Parkable's business this year.
Money from the Series A round will also be used to push into two new markets: Singapore and Canada.
This is no spring chicken startup - the company was founded by former paratrooper Grant Straker and his wife Merryn in 1999.
But since it listed on the ASX in 2018, the Auckland and Gisborne-based Straker Translations has turbocharged its growth by buying rivals in Ireland, Spain, Germany and the US.
While free translation services abound - including Google Translate - Straker seeks to stay ahead of the pack by employing an army of 13,000 contract humans to refine raw results from AI technology.
For 2019, Straker was breakeven on revenue that rose 44 per cent to $24.6m.
But most significantly, it broke into a whole new market in November as it inked a $1m deal with a major US TV production studio - which it's billed as the first of its type.
Co-founder and chief executive Grant Straker wouldn't name the new customer, but says his company's services will be used for adding subtitles (and via a partner, dubbing) for multiple TV series produced by the studio for the Latin American market.
Straker said a team was installed in the LA suburb of Burbank, near Hollywood, specifically to land such deals.
Now, with his first entertainment customer on board, he sees it as a rich new vein of business.
"The media market is the fastest-growing segment of the translation industry and due to its rapid growth, it is hard to estimate but we believe this is a $5 billion market opportunity. It is also the market segment where demand is currently outstripping supply," Straker said.
Two car-sharing insurgents are heading for Auckland in 2020: Wellington-based Mevo, bankrolled by Z Energy, and Christchurch-based Zilch, backed by Genesis.
Both let you unlock a car using an app, then taking it for a whirl, paying by the minute or hour - in a similar fashion to the way you can grab an e-scooter.
And they're on their way after Auckland Transport adopted a new car-share policy in December that saw it embrace the "free-floating" model that was the key to Mevo's success in the capital That is, you can pick up a car in one area and drop it off in another. (Auckland incumbent City Hop fiercely opposed the measure, unsuccessfully pushing its return-to-base model as a better alternative.)
At the same time, AT boosted the number of reserved on-street spaces for car-share operators from 125 to 400, and introduced a 30 per cent discount on those spaces for each approved operator's first 12 months of operation.
While exact plans are still being finalised, Mevo co-founder Erik Zydervelt told the Herald he saw his company setting up a number of home zones around Auckland where its car-share vehicles are clustered, with customers able to pick up a car from one home zone and drop it off at another. Hobsonville Point, Smales Farm, the CBD, Wynyard Quarter and the airport are all on Zydervelt's current target-list for home zones.
Mevo - which charges $15/hour for a petrol car or $23 for an electric vehicle - recently received a $500,000 EECA grant toward 100 new EVs, which Zydervelt says will form the basis of its Auckland fleet - which should be enough to give the Toyota Finance-owned City Hop (150 vehicles) a run for its money.
Zilch claims 50 business and 2000 private customers in Christchurch, where it charges 46c a minute or a flat $22 for a city-to-airport run.
The all-EV operation has already established a beachhead in Auckland, with a CBD-to-domestic terminal planned from mid-year and more expansion to follow.
This time last year, American e-scooter giant Lime seemed set to rule our sidewalks - or pavements, as we call them in these parts.
But first Lime missed out on Wellington's e-scooter trial, then it missed out on a spot for Auckland's first post-trial licensing period.
In both cities, councils plumped for the homegrown Flamingo instead - founded by Wellington's Jacksen Love and Nick Hyland with friends and family money.
The duo - both all of 22 - now have 20 staff and 230 contract "feeders" (Flamingo's equivalent of Lime's retrieve and charge "juicers").
Flamingo now has a license to increase its Auckland fleet to 630 e-scooters (overall, Auckland Council lifted its licensing cap from 1875 to 3200 - even if many of the newcomers won't be on streets until February), plus 400 in the capital and 300 in Christchurch.
The Kiwi startup doesn't have Lime's hundreds of millions in private equity, nor its complement of government relations greasers.
Web developer Hyland created its app, which is used to wrangle off-the-shelf Segway Ninebot scooters as part of its boot-strapped operation.
But despite being labelled "risky" by Lime, Flamingo had the last laugh as Auckland Council decided it had a better safety profile than the US giant.
Hyland and Love won't comment on financials but do say they have not had to tap any new investors to finance the expansion of their fleet.
Flamingo still faces challenges in 2020. While Lime is gone from our largest cities, Jump by Uber and Singapore's Neuron and Beam are on their way to Auckland. But look for Hyland and Love to keep defying the odds.
Auditors PwC: Cited disruptions to operations from that IT upgrade.