Uni's tech firm backed by canny investor

PowerbyProxi specialises in 'unplugged' solutions.

A technology company spun out of Auckland University's engineering school has won backing from the investment group who were the first to plough outside money into internet auction website Trade Me.

PowerbyProxi was set up in August 2007 to commercialise a wireless power technology invented by scientists at the university to eliminate the need for physical cables.

Now it has attracted the attention of Movac, a group of eight Wellingtonians who mentor and invest in start-up businesses.

PowerbyProxi chairman Greg Cross would not reveal how much the investment was for fear of competitors getting their hands on the information but said the first external investment was an important step for the company.

"We have got to the point where we have developed significant IP [intellectual property], done research - it's a case of needing the funding to go to the next level."

Cross said the money would help the business establish a presence in the United States, to get close to the customers it was now working with, and to pursue more research and development.

Last year PowerbyProxi secured farming equipment manufacturer John Deere as a client and it has installed the technology in the group's Tokoroa engineering plant.

Cross was hoping to get other US firms on board and said the business was focused on niche markets where it could help companies cut costs and gain a competitive advantage.

Revenues for the company were under a million dollars last year but it aimed to push them up to $2 million to $3 million in the next 12 to 18 months.

"Our focus is on growing and on building revenue streams in as many niche markets as we possibly can," he said.

Movac partner David Beard said it co-invested with Evander Management to try to ensure PowerbyProxi had all the money it would need to get it to a break-even stage without having to go out for more funding in a very difficult market for business to raise money.

Beard said it had been attracted to the business because it saw the potential for a good investment return - typically 30 times the investment, had strong protection for its intellectual property and the application potential for the product was diverse.

Beard said investing in intellectual property like PowerbyProxi was attractive because it was a weightless export which did not need to be manufactured in New Zealand.