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New Investment: Vend

The Vend investment was announced today. The deal terms were as described in the shareholder vote material, where we combined a $2 million cash investment with an issue of Punakaiki Fund shares (to myself) to purchase Vend Shares.

The NBR has covered this story but it is behind the paywall. Here are some excerpts:

Vend founder and chief executive Vaughan Rowsell has confirmed recent capital raise rumours — and restructure rumours. “We have raised $12 million, mainly from existing investors, with the notable addition of Punakaiki Fund to our shareholder register. In this round it joins Point Nine Capital, Peter Thiel’s Valar Ventures, Square Peg Capital, Rowan Simpson and Sam Morgan – some of the world’s leading SaaS investors,” Mr Rowsell says.

Mr Rowsell also confirmed rumours his Auckland-based cloud point-of-sale company has cut staff in New Zealand as it refocuses on overseas markets where 85% of its sales are made. “We achieved 1,100% revenue growth in our first three years, 100% in our last financial year, and the rapid growth is continuing. But scaling the team to keep up with and stay ahead of this kind of growth is a challenge to get right, and frankly we grew our costs too quickly,” the Vend boss says.

Tough times mean attractive price
“…Vend still exemplifies what a great SaaS [software-as-a-service] business should be,” Mr Wiggs tells NBR. “They are growing strongly, occupying a great space and have an amazing team. “There were tough times – every high growth company has these – and it meant that the investment opportunity was attractively priced for the fund. “Given also that we raised over $4.7 million in June we were well placed to invest. It’s our largest holding, but we are unafraid of taking large holdings where we see value.”

We are delighted to be on board with Vend, and were the largest New Zealand-based investor in this round. We look forward to years of growth ahead. I am also very happy that my own investment interests are more obviously aligned with yours as a Punakaiki Fund shareholder.

Thank you to all shareholders for your help with this transaction.