Village News – Welcome to 2023!
Welcome to the first edition of the 2023 Hillfarrance Village News! We hope that you all had a lovely break over Christmas and recharged your batteries for a great year to come. We're starting this year with a banger with lots to announce so keep reading down below 👇
Welcome to the first edition of the 2023 Hillfarrance Village News! We hope that you all had a lovely break over Christmas and recharged your batteries for a great year to come. We're starting this year with a banger with lots to announce so keep reading down below 👇
What we've been up to
Wow. What a year 2023 has been! We are proud to share that Hillfarrance Fund I has officially had its final close and is now oversubscribed above NZ$35 million fund!
We couldn't have done this without the huge support from our Limited Partners/Investors, who supported us right at the beginning of our journey and our founders, who trusted us to take us along for the ride.
Here are a few highlights from our Fund I:
Fund I now has 20 unique portfolio companies;
We're proud to share that 47.37% of our portfolio is Founded/Co-founded by Women founders.
Our portfolio is really going global, boasting customers from startups all the way to fortune 500s organisations.
We have had the pleasure of being the round-the-block a few times when it comes to running venture capital funds.
For those of you who are keen to get into VC and start your own fund, I thought I would share a few thoughts and learnings that I have made over the years.
Here's to seeing a few more new faces in the NZ VC market soon 🍻
Portfolio company updates
Bringing Gameplay Collectables to Life.
It's with great excitement that we can share the 1st investment we have made in 2023!
Introducing In Game Collectables (IGC) 👾
The convergence of traditional media, entertainment and gaming has been a core part of our investment focus. However, the physical world still has its merits. If anything, now having something in the physical world is actually incredibly unique!
IGC crosses that bridge between both the physical and digital worlds by allowing gamers from all over the world to create their own unique collectables of their favourite games, within those games and unlocks new sources of revenue for gaming studios and publishers. This is all accomplished using machine learning wizardry.
We're so excited to be backing Craig Herbison & Constant Meiring, and we look forward to what they can achieve.
Finally, thank you to Ben Skelton and the Tompkins Wake team for working super hard to get this deal done and executed.
Sidenote: If you're a gaming studio or publisher that is looking to unlock new revenue streams with a better UI/UX for your player/fanbase, get in touch with the team here: hello@igc.studio
Next-generation VFX & Animation
Round 2 candidates for Floating Rock's Pitchfest
Floating Rock have just concluded the 2nd round of their coveted Pitchfest: Pitchosaurus Rex! Firstly, we had a great first set of applications from the first round to choose from. Upon review, 10x applicants were chosen to move to the 2nd round to pitch their idea to a full house! It was close, but the votes were in, and the three winners of the Pitchfest were:
"The Unslept" by Mélanie Chatain;
"Essence" by Tom A. & Esteban Jaramillo; and
"Song of Sina by Tikipunk Studios.
What does that mean from here on out? The top 3 each have a budget of $10,000 and work ahead of them. With the help of Floating Rock, they have four months until the next Pitchfest to develop their pitch further with Floating Rock, then present it once more to the audience for the last round of votes to see who moves onto Round 3. Looking forward to seeing what they create together!
https://vimeo.com/784311028 Some bloopers from Floating Rock's initial pitchfest video
Pre-historic action-adventure game
A lot can happen in a year.#TransformationTuesday pic.twitter.com/fIFxceDCyf— Instinction, Prehistoric Action-Adventure (@InstinctionGame) February 7, 2023
2022 was a monumental year for Hashbane and their game, Instinction. The team have posted a recap video of 2022, which shows the progress they have made, the team they have built and finally, some of the exciting things they will be sharing with the public soon!
Deep cooperative gaming
Hey friends - we are expanding the team and looking for awesome people for the following roles. Retweets are extremely appreciated 😊Roles:- Senior Game Producer- Senior Environment Artist- Narrative DesignerMore info on the website 🙌https://t.co/RR5xge1tl6 pic.twitter.com/KTuzITOhHs— Space Rock Games (@SpaceRockNZ) January 31, 2023
Space Rock Games' is making significant progress with their breakout hit, "Criminals Within", a cooperative, action-adventure game set in a medieval fantasy world.
We have some awesome content to showcase in the next few months, so do keep your eyes peeled!
The world's first safety data supply chain
The Scannable team
Last year in late Q4 of 2022, we led Scannable's $2m Seed round after leading their Pre-seed round a year prior!
This round will propel our business into the next growth phase and double down on an active and organically growing customer waitlist and pipeline. We are excited to have NZGCP continue supporting Scannable and some new strategic angel investors.
Bolster is the Shopify for Enterprise data and allows operators to find the data they want, when they want, on any device they want.
The supply chain and logistics world is constantly evolving, and to stay ahead of the curve, it's crucial to keep up with the latest technology. Companies open to fresh perspectives and innovations are likely to thrive.
Bolter offers clients a SaaS shipment tracking module built on a unique platform that can quickly adapt to the ever-changing needs of the import-export industry and improve their business operations and resilience.
Guy Phillips, Co-founder & CEO of Bolster, recently wrote a piece on SaaS and Supply Chain success.
Revolutionizing the world of insights with game-changing AI products
https://www.youtube.com/watch?v=wFTWXsaI6xc Yabble's Query Product
With the rise in popularity of ChatGPT, organisations are now paying close attention to what AI can do for them and their business. Yabble was one of the first companies in this for the insights industry. Their Query tool allows you to ask questions to your own dataset to generate actionable insights (see the above video).
The core difference between ChatGPT and Yabble's products is that Yabble is built to ingest unique proprietary company data (which can be structured or unstructured), whilst ChatGPT only works on data that it has already been trained on.
Connecting the world's parts
We are thrilled to announce that Tim Grunshaw has joined Team Partly as their Director of Engineering!
Tim brings a wealth of experience to the table, having co-founded his own startup and spending the past seven years at Microsoft, where he most recently served as an Engineering Manager leading a high-calibre team of software engineers and data scientists.
Bringing on world-class talent across our Engineering and Product teams is a critical step in Partly's mission to connect the world’s parts, and we’re delighted to have Tim onboard. We can't wait to see the impact he will make!
From left to right: Nathan Taylor; Evan Jia; Mark Song; Levi Fawcett; Tony Austin
Late last year, Partly also closed their monumental Series A round led by Octopus Ventures in the UK! This was one of the largest Series A rounds our country has ever seen at $37 million NZD, propelling the team to scale globally on their mission to connect the world's parts!
Portfolio company career opportunities
Auckland, New Zealand
Queenstown / NZ / Remote
Expression of Interest
https://youtu.be/PCNLWUSj3kI
New Zealand
New Zealand
United Kingdom
Auckland-based or Remote-based
Wellington-based or Remote-based
Resources
Patrick Campbell, Co-founder & CEO of Profitwell, has been running a landing page study on messaging for the past couple of years. Specifically, how products can "Save you money" or "make you money". What he found was that in times of doubt and recession, the need for cost savings highly outweighs the need to make more money as shown in the graphs above.
Patrick then suggests two key things founders can take away from this:
Re-evaluate your messaging NOW; and
Implement quarterly positioning studies.
Read of the month
One source we've been digesting recently is the research reports from Contrary. This is one of the best starting points for understanding private tech companies and private market research.
Listen of the month
The Lex Fridman Podcast is one of the most popular podcasts globally. Lex has a wide variety of guests and topics discussed; however, since AI has been a huge topic in the media and tech world currently, this specific podcast with Denis Hassabis (Co-founder & CEO of DeepMind) was a real treat.
For those who do not know, DeepMind is an AI research company that was acquired by Google that has published and built some of the most complex AI systems known to man. Some of the most notable systems they have built include:
AlphaZero - the system that can play Chess and Go better than almost every human on the planet; and
AlphaFold 2 - which predicts a protein's 3D structure from its amino acid sequence.
Startup News & Trends
McKinsey has recently released their state of AI report. Here are the main takeaways from the report. TLDR:
AI adoption has more than doubled since 2017;
The use of Natural Language Processing (NLP) has doubled since 2018, with the most common use cases being robotic process automation & computer vision;
Business investment in the use of AI has increased sharply;
S&M, Product development & Strategy are the greatest revenues increases in revenue from AI today;
AI-related cost decreases are most often reported in supply chain management, and revenue increases in product development and S&M;
Key risks of using AI have increased with the increasing adoption of AI, such as Cybersecurity, compliance & privacy;
Companies utilising AI the most efficiently are categorised as having more or equal to 20% of their EBIT from AI use;
Hiring AI talent remains one of the hardest things; and
Data scientists were the most difficult role to hire in the AI talent pool.
Lightspeed is one of the latest VC funds to expand its investments in the video game industry. Moritz Baier-Lentz is now their new Head of Gaming, who has created a thesis around investing in gaming studios and GameTech.
We saw $4.7 billion of venture capital flow into gaming startups in the first year of the COVID pandemic. We suspect that this will not stop and will continue to grow as gaming becomes a mainstream investment area.
Selling a company is one of those things that startup founders may want to do, and how VCs generate returns for their LPs. However, how does one sell a company? Alex Rampell, General Partner at a16z, writes a great thread on how this is done. In summary:
Companies are almost always bought, not sold;
You have to plant an idea of acquisition to a potential buyer;
The are 3 types of acquisitions:
Know your prospective buyers well in advance of ever wanting to be acquired;
People at companies buy companies, not the companies themselves. Build strong relationships with people with P&L responsibilities who want to make a statement at their organisation;
For Trade sales, find out how your product may fit with a potential acquirers stack. How do you make 1+1 =3?
Relationships matter, especially when proposing how your company fits within another and convincing the many stakeholders in the acquirer.
Acquihire - want team, not business or product
Product/Trade Sale - want product or use of the product for their own distribution and repurpose
"Left alone" acquisitions - giving businesses additional resources to grow faster and be left alone.
Generative AI is the hot topic for this quarter. This Pitchbook article gives a good rundown of the good and bad sides of AI, and also gives examples of how VCs are also leveraging AI to spot new investment opportunities.
Bonus clip: All-in podcast besties talking about AI and having a discussion on how more efficient one person can be whilst leveraging the assistance of AI and what that does to companies:
https://youtu.be/PVgBWV2bvLs?t=4361
Notable start-up exits
Funding
Want to get in touch about your startup? Reach out to us at pitches@hillfarrance.com