Author: Joe Rouse
Published: 21 DEC 2021
Technology
FinTech

Continuing our profile series on Tāmaki Makaurau Auckland venture capital firms, we speak with Aisha Ross, General Partner at Hillfarrance Venture Capital, about the company, its AI-first approach, and the way values from te ao Māori (the Māori world view) are implemented into the business model.

Hillfarrance Venture Capital
Rob Vickery (Managing Partner and Founder) & Aisha Ross (General Partner), Hillfarrance Venture Capital

AI-first for competitive advantage

Hillfarrance Venture Capital is a seed-stage firm investing in founders “solving hard problems that matter”. Founded by entrepreneur-turned-VC Rob Vickery, its focus is on tech startups and AI-first companies that have machine learning and/or natural language processing built into the business core. Sector areas of interest include advanced enterprise technology, SaaS, media and gaming, climate change, and future of work solutions.

As Ross explains, “AI can contribute far greater value for both the company and their customers. The ability to build deeper insights means businesses can be more efficient and make decisions faster, creating a distinctive competitive advantage.”

 

Investing in people – Te Anga Whakamaioha

Central to the Hillfarrance Venture Capital strategy and investment choices is its deep interest in the founders behind the business. “We’ve named this Te Anga Whakamaioha – our people-centred approach,” says Ross, who is of Ngāruahine, Ngāti Ruanui, Te Atiawa, and Taranaki descent.

“In addition to using traditional VC tools and approaches, Te Anga Whakamaioha provides a robust framework to complete our screening and due diligence processes. The guiding principles are derived from te ao Māori and provide a wide lens to support our assessments of founders and their ventures. It enhances our selection process and fosters a unique and deep connection with Aotearoa New Zealand.”

This supports how Hillfarrance identifies likely investees; assesses their integrity, empathy, and commitment; evaluates their potential; and then conducts its business with them.

 

The importance of the founder

“When we look at founders, we want to know who they are, where have they come from, their character and what problem they are trying to solve,” says Ross. “They might have spent 10 to 20 years in a sector and identified a problem and want to know whether they have the subject matter expertise, emotional intelligence, experience and career x-factor to tackle that problem.”

One of the principles embedded in the approach is that of Whanaungatanga.

“It is about creating connections and building authentic relationships. A strong ability to build and retain relationships is essential, as this applies to acquiring new customers, how the team is formed, and new hires,” explains Ross.

Another principle, Mana Rangatira, is a critical quality Hillfarrance seeks in founders. Ross says it reflects the founder’s ability to take risks and demonstrates leadership in taking a very simple MVP product to market.

“It also provides confidence in their ability to be an effective leader of the company through its growth stages, but founders need to be ready for the startup life – the ability to live on a ‘fish and chips’ style budget until they hit a hyper-growth stage – and, critically, to listen to reason, feedback and provide guidance.”

On the principle of Kaitiakitanga, Ross comments, “It’s important to us that founders have a broader view of success – not only economic, but also in the sense of making positive contributions to the sustainability of our planet. Are the founders committed to enhancing future generations? For example, by generating high levels of employment, training and development, internships, and income creation.”

On Manaakitanga, Hillfarrance assesses whether founders are committed to improving not only their own quality of life, but also that of their whānau (extended family) and communities. The concept of Koha – respect and reciprocity – is assessed in the degree of product–market fit: whether the business has created a good value exchange between the business and its customers and stakeholders.

“As a venture capital firm, to introduce a kaupapa Māori approach into our investment logic is a step towards honouring the value of te ao Māori within this sector,” notes Ross.

 

Building a village of founders and limited partners

Hillfarrance Venture Capital provides investment from seed to bridging round (New Zealand series A) for companies seeking to raise at each stage range – up to NZ$1–6 million. On top of funds, it provides a suite of resources, templates and toolkits to help startups build and navigate the growth stages.

“We take a partnered approach with founders – we’re an active investor, and support and work alongside them in that way,” says Ross. “We’re building a village of founders who all enjoy giving back and supporting one another. Founders can reach out and draw on shared insights and experiences, connections and expertise, and encouragement from our village.”

Another example of the strength of the Hillfarrance village is its Collaborative Carry. It provides 20 per cent of its share of returns (carried interest) to the founders of the Hillfarrance core portfolio companies. In essence, the founders are all investors in each other, with a common purpose of shared success.

A significant part of the Hillfarrance village is its investors, who are limited partners (LPs). “They provide valuable support, advice, and connections for us. For instance, around new customer connections and sector-specific network relationships,” says Ross.

Hillfarrance Venture Capital has offshore LPs in the US, UK and Europe as well as Aotearoa New Zealand. “We’re proud to have other VCs and entrepreneurs, family offices, and Māori investors as our LPs. We’re honoured to be fiduciaries and guardians of intergenerational funds.”

What is unique about Hillfarrance Venture Capital is how it weaves these traditional principles into its support for innovators in cutting-edge technology.

Two recent examples of the startups in the Hillfarrance portfolio are Segna and Mobli.

 

Case study: “Data wrangler” startup Segna

Segna, founded in 2019 by Will Haringa and Aryan Lobie, is a platform that aggregates and sorts multiple sources of data at very high speeds through machine learning. Data is a critical currency in business and tech, such that the data-wrangling market is expected to grow at a compound annual growth rate (CAGR) of about 20 per cent in the immediate future. 

Segna’s aim is to produce data that can yield deeper insights as rapidly as possible for data analysts, data scientists and business analysts. Grounded in AI, the startup presented a perfect fit for Hillfarrance, something Haringa appreciates: “For us, Hillfarrance were an obvious target of our capital-raising strategy. We’ve appreciated their straightforward style and willingness to ‘get stuck in’ if we encounter issues.”

Segna will be part of the W22 cohort of Y-Combinator, one of the world’s most prestigious startup accelerators. Its list of Unicorn companies includes Airbnb, DoorDash, Coinbase and DropBox. Segna is one of only four Kiwi startups to ever be accepted.

 

Case study: Cloud infrastructure for transport by Mobli

Mobli, founded by Martin McMullan (who formerly worked at New Zealand Transport Agency), is an up-and-running business that specialises in providing cloud infrastructure for transportation systems, be they private or public, with a view to reducing infrastructure costs, environmental harm, and complexity. Its more equitable, sustainable approach enables startups and long-term mobility providers to safely innovate using the latest in user-centric design, app-based micro-services and machine learning.

So far, Mobli has been working with transport operators in Australia, and investment from Hillfarrance is helping it to secure contracts in Europe and the US. The world is Mobli’s market, with no limit in sight to its potential to revolutionise mobility and transportation on a global scale.

“This is an essential investment for Hillfarrance and it exemplifies what we look for in startups: the right team, a giant market that is crying out for innovation, a solution that can reduce vehicle pollution, and a future landscape that is likely to need Mobli in a big way,” says Ross.

McMullan is openly optimistic about the future for both Mobli and Auckland. “Tāmaki Makaurau is growing up and it is fantastic to see both the tech sector and venture communities growing with it. Hillfarrance is openly sharing information to demystify the process, and building new communities focused on the issues that will make Tāmaki Makaurau, Aotearoa New Zealand and the world a better place to live, grow and enjoy life.”
 

 

Unique advantages of Aotearoa New Zealand’s tech ecosystem 

“Founders here approach problem-solving differently to, say, founders abroad,” notes Ross. “We’re cut from a different cloth, and tackle solutions from a different values base and culture – like how the All Blacks play rugby.” 

Auckland continues to produce high-quality startups within a thriving connected ecosystem and supportive business environment. Hillfarrance Fund I remains open for new international investors who are seeking a unique and attractive New Zealand-centric investment opportunity.
 

 

Find out more

Contact Investment Specialist Joe Rouse to learn more about venture capital investment opportunities in Auckland, New Zealand.

DISCLAIMER: This article provides general information on potential investment opportunities in Auckland and is not intended to be used as a substitute for financial advice. The views and opinions expressed are those of the relevant author, and do not necessarily reflect the views of Auckland Unlimited. Auckland Unlimited disclaims all liability in connection with any action that may be taken in reliance of this article, and for any error, deficiency, flaw or omission contained in it.