By SIMON COLLINS science reporter
Neville Jordan's Endeavour i-cap has made the first investment from its $39 million venture fund - $500,000 for a superconductor technology company spun out of Industrial Research Ltd (IRL).
The new company, HTS-110, will produce powerful magnets using technology developed at IRL since its scientists discovered a new material which conducts electricity without resistance at relatively "high" temperatures - minus 163C, or 110 degrees above absolute zero.
It will also take over production of high-current power leads for high-tech medical devices for the American Superconductor Corporation in Boston.
Chief executive Geoff Todd said the company started with orders of $1.5 million, and could become a $50 million to $100 million business as the price of superconducting wire dropped in the next few years.
"We are ahead of anyone else," he said.
IRL will take half the 2 million shares in the company.
The Government put an extra $3 million into IRL in December to finance its new ventures.
Endeavour i-cap has 600,000 shares and American Superconductor 400,000.
IRL chairwoman Liz Coutts will chair the new company.
The other directors are IRL chief executive Nigel Kirkpatrick and scientist Dr Bob Buckley, Endeavour general partner Mark Dossor and American Superconductor chairman Dr Greg Yurek.
Dossor said he expected Endeavour i-cap to keep its shares for at least five years.
"The fund is a 10-year fund, and the nature of this company is that it's a long-term investment," he said.
The Endeavour i-cap fund has $13 million from the Government's Venture Investment Fund and $26 million from other investors, including the Accident Compensation Corporation, the Christchurch City Council and Ngai Tahu.
Dossor said it aimed to invest in "science and technology for export".
He expected to announce two more investments in the next two months.
Two of the other three funds backed by the Venture Investment Fund have made investments totalling $15.5 million.
Auckland-based TMT Management has invested in security software firms Esphion and EMS-Global, and Wellington's No.8 Ventures has invested in software businesses EDIS and Right Hemisphere.
The fourth fund, Auckland's iGlobe Treasury Management, has yet to make any investments.
Endeavour's first move aids high-tech spin-off
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