The new flexible funding option unlocked for Kiwi startups

How Kiwibank's StartUp+ gives early-stage founders access to funding – without needing personal assets as security.

Every successful business starts with a good idea, but bringing that vision to life takes commitment, resources, and sustained effort.

Securing funding can be a fundamental challenge for startups. Some founders choose to bootstrap their businesses, reinvesting profits to support growth, but this can be a slow and frustrating process. Others turn to friends and family for financial support, or use personal assets, each option carrying its own considerations and potential implications.

The optimal funding option is often a business loan from your bank. It’s a formal process, with straightforward terms and reasonably priced.

Startups often can’t tick all the boxes required from traditional lenders around established trading history and reliable revenue, which newer businesses may still be developing. This can narrow the options available, especially for founders who don't own a home or choose not to borrow against it.

“Most bank funding applies standard credit criteria,” explains Rod Morris, general manager of business banking at Kiwibank.

“Banks often want certain forms of security, and potentially a personal guarantee, and they want financial statements for a number of years. The issue is that founders can’t satisfy those requirements.

“When you’ve just started out, you don’t have financial statements. And you might not have a house to secure a loan against. In the past, startups have gone without bank funding, which makes it much harder to grow and scale.”

Kiwibank’s new option for startup funding

From talking to local entrepreneurs, Morris and his team knew that startups struggled to get access to bank funding – so, working with founders and the Ministry of Awesome incubation hub, they designed Kiwibank StartUp+, which launched in late June.

StartUp+ provides eligible early-stage businesses with a package of flexible funding, specialist advice and preferential pricing.

Eligible founders get access to up to $150,000 initially – without needing to put personal assets on the line – with the potential to apply for up to $300,000 in additional funding, unlocked as the business reaches key milestones.

“We wanted to challenge the status quo and unlock opportunities for early-stage businesses,” says Morris. “StartUp+ brings together various products in a tailored way. It works alongside other forms of funding, whether that’s crowdfunding, angel investment or venture capital.

“And StartUp+ works at any point in time, pre- or post-revenue. It might be just a small amount to get you started, or it might be more significant.”

Kiwibank’s business specialists sit down with founders to work through their business plan and figure out how much money they need, and at what points. Together they create repayment plans, and a schedule if extra funding tranches are required.

“StartUp+ provides a different avenue for funding that’s more accessible,” says Morris.

“We’ve created it in a collaborative way, and it’s been received very positively by the startup sector. We’re privileged to be able to offer business lending to startups, because they’re really important for the economy.”

Highest number of new businesses since 2021

It’s been heavy going for Kiwi businesses over the past few years, but that’s not enough to deter our local entrepreneurs.

Morris says he’s been meeting creative and optimistic founders all over the country, who aren’t going to let negative headlines get in the way of their ambitions. The data backs him up: in the year to July, there were 62,061 companies incorporated, the highest number since 2021*.

“It’s cool to see that, even during these quite difficult economic times, people are still championing their ideas and wanting to make a go of them,” he says. “The level of enthusiasm and innovation coming out of New Zealand is really remarkable.”

Early-stage businesses are already benefiting from StartUp+, across a range of sectors including tech, manufacturing, food and healthcare.

For example, there’s Capture the Bug, which provides a clean, fast platform for continuous security testing; Eat Choice, helping customers pick menu options based on their dietary needs; and Delightable, providing an online concierge tool to help shoppers find beauty products that match their preferences.

“We’re backing the promising, not just the proven. We’re taking a forward-looking view, instead of focusing on past performance, financials and assets,” Morris says.

“We want to know: What’s the clear problem that’s being solved? Has the founder looked at the target market and the customers? Can they clearly articulate their business plan? Do they have a rough growth strategy with forecasts and milestones?

“We’re keen to back great ideas at any stage of the product cycle.”

Seeing the volume of applications, and the breadth and depth of ideas, has been inspiring the whole Kiwibank team, Morris adds.

“There’s a real body of innovation and creative thought, right across the motu. It’s that number eight wire mentality – it’s more technological now than in the past, but we’ve still got that Kiwi ‘give it a go’ ethos in the economy.

“It’s super promising, and it will be really exciting to see where it goes over the next few years.”

To unlock funding opportunities for your business, visit StartUp+.