The $260 million Venture Investment Fund is failing New Zealand’s start-ups and needs to be reviewed so that it meets the needs of growing businesses, Labour’s Innovation and Science spokesperson David Cunliffe says.
“The Government’s plan to roll over VIF funding but transfer $12 million from the Seed Capital Investment Fund is recognition this funding isn’t working for start-ups.
“There has been hot debate in the New Zealand tech community since last week’s release of the VIF Performance Report as to whether the fund’s overall rate of return fits with the needs of start-ups and is adequate.
“We need both of these funds to be performing well to assist entrepreneurs looking to start a new business or embrace innovation.
“Many in the sector criticise the Venture Investment Fund for being unwieldy, for not showing sufficient returns and worry that start-ups are still being starved of accessible funding.
"Strengthening follow-on funding for start-ups that meet their milestones, and terminating support for those that don't, are among the issues that the Angel and Venture Capital communities want to see addressed.
“It is time to review the Venture Investment Fund, fine tune it where necessary and then back our innovators to drive the smart economy we need to lift productivity and incomes.
"VIF must be set up for success - creating good jobs, advanced skills and promoting entrepreneurship as well as providing adequate financial returns.
"We need a review into how the fund is run to ensure it is delivering on its investments. Sticking with the status quo just shows a Government that is out of new ideas and treading water,” says David Cunliffe.