"5 Types of Startup Business Funding in New Zealand"
- wisestart
- Mar 12
- 5 min read
Starting a business in New Zealand can be an exciting yet challenging journey. One of the key elements of getting your business off the ground is securing funding. This guide provides an overview of the various options available to startups in New Zealand, how to apply for funding, and tips on managing your startup's financial resources effectively. Below, we will explore the types of financial support available to entrepreneurs and new businesses in New Zealand.
Government Grants and Funding Programs
The New Zealand government offers various funding and support programs for businesses, particularly those focused on innovation, research, and development (R&D), as well as businesses that are creating employment opportunities.
NZTE (New Zealand Trade and Enterprise) Grants
Eligibility: Businesses with export potential or aiming to grow internationally.
Types of Grants: These can include the Capability Development Voucher Scheme, Market Development Grants, and Export Growth Grants.
Regional Business Partner Network (RBPN)
Eligibility: Small businesses located in specific regions of New Zealand.
Support offered: Business advice, mentoring, and funding for business growth. Funding is often used for business development services such as strategic planning, marketing, and research.
Callaghan Innovation
Eligibility: Tech startups or businesses involved in high-tech and R&D.
Support Offered: Provides funding for businesses involved in research and development, including grants such as the R&D Growth Grant.
Manaaki Growth Program
Eligibility: Businesses in need of growth support, particularly focusing on Māori businesses.
Support offered: Strategic advice, mentoring, and some funding options.
New Zealand Research and Development (R&D) Tax Incentive
Eligibility: Businesses involved in R&D activities.
Support Offered: Provides a tax credit for businesses investing in R&D.
Bank Loans and Lending
New Zealand Banks
Banks such as ANZ, ASB, and Westpac offer loans tailored for small and medium businesses.
Eligibility: Typically, banks require a detailed business plan, financial statements, and a good credit history.
Types of Loans:
Secured Business Loans: Loans secured by collateral such as property or assets.
Unsecured Business Loans: Higher interest rates due to the lack of collateral.
Angel Investors and Venture Capitalists
Angel Investors
Angel investors are individuals who provide capital to startups in exchange for ownership equity or debt. Angel investors are often experienced business people who offer mentorship in addition to financial backing.
How to Find an Angel Investor
Look for networks like Angel Association New Zealand.
Attend business pitch events or startup competitions.
Network through business incubators and accelerators.
Venture Capital Firms
Venture capitalists invest larger amounts of money in exchange for equity in businesses that are expected to scale rapidly.
How to Apply: Approach venture capital firms with a strong business plan, growth strategy, and proof of concept.
Crowdfunding
Equity Crowdfunding Involves raising small amounts of money from a large number of investors in exchange for equity in your business.
Popular Platforms: PledgeMe, and Snowball Effect.
Eligibility: You’ll need to create a compelling pitch and be able to sell your idea to potential investors.
How to Apply: Create an account on one of the crowdfunding platforms and follow the process to list your startup.
Reward-based crowdfunding Unlike equity crowdfunding, this method allows backers to support your startup in exchange for non-financial rewards (e.g., products or services).
Popular Platforms: Kickstarter, and Indiegogo.
How to Apply: You’ll need to set up a campaign with a clear goal, timeline, and incentives for backers.
Family, Friends, and Personal Savings
Family and Friends Funding can be a quick and flexible way to raise initial capital for your startup.
How to Approach: Be transparent about the risks and ensure that you have a formal agreement in place.
Tips:
Create a solid business plan to help reassure potential investors.
Consider offering them a share of the business or another form of return.
Personal Savings
Many entrepreneurs begin their startup journey by using their savings or assets.
Considerations: You must be cautious, as using personal savings can have a significant impact on your finances if the business fails.
Work and Income – Business Startup Grants
If you receive a government benefit and have a well-structured business plan, Work and Income New Zealand (WINZ) assists through the Flexi-wage Self-Employment scheme. This program can help cover startup costs, provide financial support during the early stages, and assist with training and development.
✅ Eligibility: Must be on a benefit and demonstrate a viable business plan. ✅ Funding Covers Initial business expenses, mentoring, and ongoing support. ✅
2. Callaghan Innovation – Research & Development (R&D) Grants
For businesses focusing on technological advancements, product development, or research, Callaghan Innovation offers various grants to support innovation-driven companies.
✅ Types of Grants: Project Grants, Student Grants, and Growth Grants. ✅
Best For: Startups working in science, technology, and research fields. ✅
How to Apply: Visit the Callaghan Innovation website and apply.
3. New Zealand Trade & Enterprise (NZTE) – Business Growth Grants
NZTE provides funding and advisory support for businesses looking to scale domestically and expand into international markets. These grants help businesses increase their competitiveness and improve export potential.
✅ Types of Support: Capability Development Vouchers, International Growth Fund. ✅ Best For: Established startups looking to grow beyond local markets. ✅
4. Local Council Grants & Economic Development Agencies
Many regional councils and economic development agencies across New Zealand offer financial support and mentoring programs for small businesses and startups. These grants are often targeted at businesses that contribute to the local economy or create jobs.
✅ Best For: Community-focused businesses, tourism, and local service providers. ✅
How to Apply: Check with your local council or regional business development office.
5. Māori Business Grants (Te Puni Kōkiri, Poutama Trust, and Whānau Ora)
Māori entrepreneurs can access a variety of grants and funding initiatives specifically designed to support indigenous business growth.
✅ Funding Sources:
Te Puni Kōkiri – Funding for Māori business development and training.
Poutama Trust – Investment in Māori-led enterprises and innovation.
Whānau Ora – Business grants supporting family-oriented initiatives. ✅
How to Apply: Visit each organization's website to explore eligibility and funding opportunities.
6. Angel Investors & Venture Capital Firms
If your startup has high growth potential, securing investment from angel investors or venture capital firms might be a viable option. These investors provide capital in exchange for equity and can also offer strategic mentorship.
✅ Popular Investors in NZ:
Icehouse Ventures – Early-stage investment and business acceleration.
NZ Angel Investment Network – Connects startups with angel investors.
GD1 Ventures – Focuses on innovative, high-growth businesses. ✅
How to Apply: Research potential investors and prepare a compelling pitch.
7. Crowdfunding & Peer-to-Peer Lending
Crowdfunding and peer-to-peer lending platforms allow startups to raise capital from public or private lenders.
✅ Crowdfunding Platforms:
PledgeMe – Rewards-based and equity crowdfunding.
Kickstarter – International crowdfunding for creative projects.
How to Apply: Set up a campaign on the relevant platform, outlining your business idea and funding goals.
Preparing for Your Funding Application
Before applying for funding, it’s essential to have a well-prepared business plan, a clear financial strategy, and a strong pitch to present your idea.
Here are some key steps:
🔹 Develop a solid business plan – Clearly outline your objectives, target market, and revenue model. 🔹 Create a detailed budget – Show how the funding will be used and forecast your expenses. 🔹 Perfect your pitch – Whether applying for a grant or pitching to investors, be ready to showcase the value of your business.
💡 Need assistance with your business plan or funding application? Contact us today for expert guidance! 📩 Head to our website to learn more
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