Pledge Me launches equity offers for computer museum, hovercraft

Friday 26th September 2014

Pledge Me, the online crowd funding platform, has launched its first two equity offers, giving investors the chance to buy into New Zealand's first computer museum, backed by Apple Inc co-founder Steve Wozniak, and a hovercraft ferry in the South Island.

The Wellington-based crowd funder is licensed under the new Financial Markets Conduct Act, which came into effect on April 1, providing a regime where projects can raise a maximum of $2 million offering equity through crowd sourcing platforms. The licensing is part of the Financial Markets Authority's expanded brief to bolster New Zealand's capital markets but the new platforms do carry risks for investors, with reduced compliance obligations for small capital-raisings compared to companies listed on the NZX mainboard.

The first of Pledge Me's offers is Techvana Operating, which is looking to raise a minimum of $250,000 and up to $750,000 to secure a location and build New Zealand’s first computer museum in Auckland. The company, which is hoping to lure investors with its patron Apple's Wozniak, will work with the Techvana Charitable Trust, which will own the displays, including the 1,000 pieces already sourced for exhibition. The trust will then lease it back to the operating company for use in the museum and says the model may be used for future museums across New Zealand and Sydney.

The company is offering a maximum of 15,000 shares valued at $50 a piece with a minimum investment of at least two shares. The company flags a 28 percent return on investment from dividends, promising a $7 dollar dividend in 2017 and 2018, as well as other loyalty discounts at the museum, proportional to the amount invested.

If Techvana reaches its minimum target selling 5,000 shares, 25 percent of the company will be owned by Pledge Me investors, 12.5 percent by "helpers", who have been involved with Techvana, 12.5 percent by seed capital investors and 50 percent by A Cruisy Lifestyle Trust, the founders Katie and Mark Barlow's investment trust. If the maximum $750,000 was raised via 15,000 shares, crowd funders would have a 50 percent stake in the company, with the Barlows, via their trust, at 33.3 percent and seed capital investors and "helpers" at 8.3 percent each.

Techvana expects to make most of its money via sponsorship packages and is hoping to raise $2.5 million annually in sponsorship. It is offering naming rights to one diamond sponsor willing to invest $200,000 over five years. There are five other levels of sponsorship, ranging from five platinum spots at $75,000 each to 100 jade sponsors at $5,000 each. In its business plan it says it already has 3 sponsors worth $60,000 annually committed.

The second offer, H2Explore, is looking to raise a minimum of $250,000 and up to $300,000 to build a Twizel-based hovercraft to capitalise on an expected 7,500 cyclists doing the Alps-to-Ocean cycle trail next year. The minimum amount would see Pledge Me shareholders take a 20 percent stake in the business, with a maximum of 23.1 percent being offered. It is hoping to lure investors by offering shares at $500 a piece, with those investing $1000 plus earning an annual free hovercraft ride as well as paying dividends.

With exclusive rights to operate on the Tasman river and Lake Pukaki for the next 10 years, and the only commercial hovercraft operation in the country, it expects to have an annual profit of $689,487, in the first year of operation which it forecasts will grow to $1.5 million by its fifth year of operation, from which it will pay dividends to shareholders.

H2Explore will make money through its relationship with 10 tour operators in the area, who will charge $100 per ticket. It plans to have 4,000 pre-booked tickets to fund building the first vessel before the season's launch, according to its business plan, and has plans to grow from one hovercraft to a fleet over the years.

Pledge Me's initial offers come after fellow equity crowd funder Snowball Effect's first two offers. Snowball's current live offer, a stake in a new film to be directed by Lee Tamahori, 'The Patriarch' is hoping to raise a minimum of $300,000, with a cap of $500,000, as part of its $9.4 million budget, by offering investors preferred shares at $1 apiece with a 20 percent per annum return. Last week it extended its funding deadline by two weeks and has so far raised $223,100 from 109 investors, since it launched at the start of the month.

Last month, Blenheim boutique beer brewer, Renaissance, the first of Snowball's offers, wooed small investors to fill its order for $700,000 of new capital in just a week and a half, a quarter of the time the novel offer was open for punters to commit funds. Shares were offered with a $500 minimum investment at $2 apiece for 12.28 percent of the company.

BusinessDesk.co.nz

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