Mark Pavlyukovskyy sees New Zealand as an oasis of stability in a chaotic world. Photo / Supplied
New venture capital operator NZVC has raised $17 million for its first fund and revealed two new investments.
Co-founder Mark Pavlyukovskyy says NZVC has backed KiwiFibre, a Christchurch startup launching its harakeke (flax) based on
composite as a radiolucent, vibration-damping alternative to fiberglass and carbon fiber.
The fund also recently poured money into Curve Biosciences, which is developing technology to detect liver cancer and other high-risk cancers through low-cost blood tests.
Curve is based in California, but Pavlyukovskyy says a trial is underway in New Zealand focusing on Maori and Pasifika populations, who have a higher-than-average incidence of type 2 diabetes, fatty liver disease and other risk factors for diabetes. Liver cancer .
In recent months, NZVC has also poured money into a variety of local startups, including Wellington’s electric ferry technology startup. sea change, pyper vision – an early-stage Christchurch firm that is developing a spray that can absorb moisture from the air quickly, clearing fog from an airport runway in just 10 minutes: Auckland-based subletting startup EasyCrypto EasyRentdrone technician turned audio specialist Dotterel and hospitality online ordering start upstock.
Pavlyukovskyy revealed NZVC’s two new investments as his firm prepared for a portfolio day in Wellington presenting an in-person appearance by one of the fund’s US-based partners and investors, former Disney COO and CFO and current Spotify head Tom Staggs, as well as partners from NZVC based in US Glen Anderson, who led Google’s machine learning group for a decade, and Ajay Gupta, former head of equity trading at Merrill Lynch,
When the Herald last caught up with Pavlyukovskyy, he was based in Queenstown and had arrived in New Zealand on the brink of the pandemic on an Edmund Hillary fellowship.
While some of his peers on the show decided to return to their home countries, Pavlyukovskyy decided that New Zealand was “probably the best place to stay at the moment”.
Now, he plans to stay long-term and has applied for permanent residency. She now lives in Wellington, where she recently moved after a four-month stint in Nelson. His plan is to stay in New Zealand and keep moving around the country, in keeping with his post-pandemic thinking that San Francisco’s venture capital hub and neighboring Silicon Valley are now more of a state of mind than a life. geographic location.
Pavlyukovskyy was born in the Ukraine, but moved with his family to the United States when he was 9 years old.
After studying molecular biology at Princeton, he traveled to Ghana in 2010 on a health fellowship, where he developed a game to help teach children about malaria.
He then became a PhD fellow at the University of Oxford, studying in vivo cancer imaging and machine learning. In addition, he founded Piper, a startup that created an educational toy, based on a Raspberry Pi computer, where a child’s real-life changes in a kit of computer hardware were turned into a Minecraft game.
In 2013, he dropped out of Oxford to focus on Piper. He moved to San Francisco and raised $15 million for his startup from backers, including venture capital veterans such as Anderson and Gupta, who are now also backing NZVC.
Like all Ukrainian expatriates, Pavlyukovskyy closely follows the war. He gets constant updates from his best friend.
He tells the Herald that they used to play war games when they were kids.
When Russia invaded, his friend signed up. “He ended up in a special operations team and was part of the recent liberation of the Kharkov region,” says Pavlyukovskyy.
“It’s terrible what’s going on there. I hope it ends soon, for the sake of people on both sides.”
Threats, and opportunities, in The Big Chill
Recently, a “great chill” has spread across the venture capital scene, with a number of venture capitalists slashing company valuations, bringing them in line with (plunging) the valuations of publicly traded peers as they Recession fears mount.
At the same time, rising interest rates are drawing investors’ money elsewhere.
However, Pavlyukovskyy says that NZVC had completed most of its surge before headwinds emerged.
“A falling market – the best time to invest,” says Pavlyukovskyy.
There is the obvious benefit to any VC: If you have the money, you can now buy a larger slice of a startup at a lower valuation.
But more generally, the Ukrainian sees a recession as a testing ground. During a boom, it’s easier for anyone to look good. In a recession, talent shines.
“The best companies are built during bear markets, and resilient founders perform best in chaos,” he says.
It repeats a list of tech firms founded in a depression, from Microsoft during the oil crisis and stagflation of the late 1970s to the rise of Google and Facebook during the post-2000 “tech shipwreck” to the launch of Airbnb in 2008, just when the GFC hit. .
A haven of stability
Pavlyukovskyy also sees an advantage for New Zealand in the current global chaos.
He cites the example of Skype co-founder and NZVC investor Jaan Tallinn (who will be among those attending Portfolio Day in the capital).
“Jaan is based in Estonia, which has the highest unicorn rate per capita. He understands that a stable, rule-based government and access to larger markets are critical to innovation ecosystems and believes that New Zealand has all the right ingredients.
NZVC’s investor base also includes Brad Feld and Ryan McIntyre of Boulder, Colorado-based Foundry Group. Pavlyukovskyy says they see New Zealand as a regional market like Boulder that will see founders move here for the lifestyle and build global companies from our shores.
“It’s a great time to be in New Zealand and there will be some great businesses coming up during this time,” he says.
Global tech hub potential
Disney alumnus and Spotify director Saggs, who usually resides in Los Angeles but was in Wellington this week to headline NZVC Portfolio Day, already had an idea of the lay of the land before pouring money into the new background.
The American was appointed director of Weta Digital in December 2020 until the company founded by Sir Peter Jackson sold its technology division to US-based Unity Software in November 2021 in a $2.3 billion deal. .
“New Zealand is a hotbed of entrepreneurial activity and the founders of Kiwi are hungry for mentors from globally minded investors to [help] their companies bigger and faster,” Saggs told the Herald.
“NZVC provides the unique bridge to Silicon Valley and has real fund managers who are sympathetic to the founders, helping them with additional fundraising, operational support, recruitment and sales.
“We are delighted with the way NZ has opened its arms to welcome our fund and we are working together with others in the ecosystem to make NZ a global technology hub.”