Blog 3: The Importance of Investment and Governance When Building Global Businesses
- Kerry Paul
- Jun 3
- 5 min read
Updated: Jun 30
JOURNEY 3 - SERIES 1 - BLOG 3 - A PART OF 9 BLOGS IN SERIES 1 - Reading time: 5 Mins
One of the biggest realities I faced when building start-up businesses was that ideas alone are never enough. No matter how strong the vision or how committed the founders, every business eventually reaches the point where it requires capital to survive, grow, and scale internationally. I came to realise very quickly that investment is the oxygen of a young company. Without it, even the best ideas can suffocate before they ever reach their potential. This case study highlights the international growth of Manuka Honey. The journey also reflects the realities faced by many New Zealand start-up businesses. These lessons provide valuable insights for New Zealand entrepreneurs. The experience demonstrates the challenges and opportunities involved in Building a Global business from New Zealand.
When we established Manuka Health, raising investment was not simply about securing money. It was about finding people who believed in the journey we were trying to create and who understood the uncertainties that come with building a start-up business from New Zealand. The investors we brought into the company became far more than shareholders. They became long-term partners whose support, advice, networks, and confidence helped shape the direction of the business.
Choosing the Right Investors
One of the most important lessons I learnt was that selecting shareholders is just as critical as selecting senior management. Bringing in the wrong investors can damage a business very quickly. If investors do not share the founder’s long-term vision, values, or appetite for risk, the company can become distracted by internal tensions and boardroom conflict rather than focusing on customers, markets, and growth.
Early in my entrepreneurial journey, I understood that I did not simply need investors with capital — I needed investors who genuinely aligned with the direction we wanted to take the company. In my experience, alignment between founders, management, and shareholders becomes one of the hidden drivers of long-term success. When everyone shares the same ambition, decision-making becomes faster, governance becomes constructive, and businesses can move with far greater momentum.
Why Angel Investors Matter
For most start-up businesses, seed funding is one of the most difficult stages to navigate. Traditional banks are generally risk-averse and reluctant to lend against unproven ideas with little cash flow history. This is where angel investors become critically important.
Unlike institutional investors, angel investors typically invest their own money. More importantly, the best angel investors contribute far more than funding alone. They bring business experience, industry networks, commercial judgement, and credibility. I learnt that the strongest angel investors are those who actively engage with the business, support management, and help founders navigate the inevitable challenges that emerge during the early years.
In our case, many of the original shareholders behaved exactly like true angel investors. They progressively increased their investments and remained closely involved with both the board and management team. That close relationship built trust, transparency, and confidence on both sides. It also allowed investors to understand firsthand how rapidly the business was evolving.
The First 12 Months: Escaping the “Valley of Death”
I also learnt that the first 12 months of a start-up are absolutely critical. At the beginning, all you really possess is a concept, determination, and a handful of people willing to believe in the opportunity. However, within a relatively short period, the business must begin proving that the concept can actually work commercially.
For me, the priority was always to de-risk the business as quickly as possible. That meant building key management capability across sales, marketing, operations, and supply chain. It meant securing repeat customers, not simply one-off sales. Repeat sales demonstrate something extremely important — customer trust and loyalty.
At the same time, many non-financial milestones also needed to be achieved. We had to register trademarks, secure research relationships, build supplier networks, establish reliable supply chains, and develop systems capable of supporting future international growth. Every milestone reduced uncertainty and increased investor confidence.
One phrase entrepreneurs often use is the “Valley of Death” — the dangerous start-up period where businesses burn cash without yet generating sustainable revenue. I became acutely aware of how important it was to shorten this phase. The quicker we could demonstrate traction and reduce risk, the easier it became to attract additional shareholders and funding to support expansion.
Governance Is Not Optional
As the business expanded, I learnt that raising investment is only one side of the equation. Governance is the other. Investors are entrusting management with their capital, and maintaining that trust becomes one of the most important responsibilities of leadership.
In my experience, many entrepreneurs underestimate governance in the early stages of a business. They often see it as unnecessary structure or administrative overhead. I came to see governance very differently. Good governance creates discipline, accountability, transparency, and alignment between shareholders and management. It also creates confidence for future investors, banks, international partners, and regulators.
Most importantly, governance only works effectively when investors share the broader vision of the company. If shareholders are constantly pulling management in different directions, decision-making slows and momentum disappears. However, when investors and management remain aligned, governance becomes a source of support rather than obstruction.
The Challenge of Company Valuation
As our businesses grew, another important issue emerged — company valuation. Existing shareholders understandably expected the value of their shares to increase as the company became more successful. At the same time, new investors naturally wanted attractive entry pricing to maximise future upside. Balancing these competing expectations became one of the more delicate aspects of raising capital.
I learnt that valuation is not simply a financial exercise. It reflects market confidence in the company’s future potential. Strong sales growth, international expansion, brand credibility, strategic partnerships, and consistent execution all contribute to higher valuations. However, credibility is critical. Overpricing a business can discourage investors, while undervaluing it can frustrate existing shareholders who took the early risks.
What I Ultimately Learnt About Investment and Governance
Looking back, I now see investment and governance as two inseparable foundations of building global businesses. Investment provides the fuel for growth, but governance ensures that fuel is used wisely and strategically.
Perhaps the most important lesson I learnt is this: entrepreneurs should never chase money at any cost. Investors become part of the DNA of the business. Choosing shareholders who bring alignment, experience, capability, and long-term commitment is every bit as important as the amount of money they contribute.
For New Zealand entrepreneurs trying to build global businesses, attracting capital will always be challenging because of our size and geographic isolation. However, strong governance, credible strategy, measurable milestones, and the right investors can create the platform needed to transform ambitious ideas into internationally successful companies.
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