Exiled entrepreneur helping put money where his mouth is
Silicon Valley entrepreneur Mihai Dinulescu caught one of the final flights from San Francisco to Auckland before the pandemic closed our borders.
While bunkered down in Auckland, he partnered with Ao¯ Air, a local startup that’s producing a $500 mask with a built-in air purifier, and helped it raised millions toward getting its product to market.
Now he’s helping two other startups, and says New Zealand is a paradise of pandemic stability, and economic stability, in a world upended by the virus. He’s calling on the Government to open its doors and let in more immigrants on the investor visa programme, and mount a “call for talent” so that other entrepreneurs follow in his footsteps and beat a path to NZ.
On March 12, Dinulescu decided to pull the plug on the cryptocurrency startup he was launching to flee to the remote country. “My fear was it was now or never as I thought they might start closing borders,” the 34-yearold says.
While Covid-19 was still in its early days, he saw bad portents. Things felt wrong. He had a flashback to his childhood. “I was pretty paranoid early on, when I saw China shut down,” he says.
“I was born in a Communist country [Romania] and Bucharest is just downwind from Pripyat [near] Chernobyl. My grandfather was a firefighter and he spent the days after the incident spraying water over our apartment building. You don’t shut down the country without there being some really, really good reason.
“So when I saw the aerial views of China with just no pollution, I was like, ‘Something is extremely scary in the world right now’.”
Dinulescu packed his bags and left his furniture, television, paintings and other belongings with friends. He bought the earliest plane ticket available and within 12 hours the Harvard University alumnus and his wife were on a 7am flight bound for Auckland. In San Francisco, “the entire international section of the airport was empty — except for one flight to New Zealand”, Dinulescu says. “In a time when pretty much all planes were running on a third occupancy, this thing was booked solid.”
Four days later, New Zealand closed its borders to foreign travellers. Dinulescu says he has connected with about 10 people in New Zealand who made the jump before the shutdown, but “a lot of venture capital people I know were not afraid enough in time for the border close”, he says. “And now they can’t get in.”
Dinulescu and his wife ended up renting a three-bedroom home on Waiheke Island for around $3500 per month — or about a third of what they had been paying in San Francisco.
“Frankly, we were billionaire hunting,” Dinulescu said. “We wanted to figure out where all the other Silicon Valley people would be.”
Had they chosen to bunker down in New Zealand, then US billionaires like James Cameron (Wairarapa) and Peter Thiel (Queenstown) would have been further south. Dinulescu plumped for Waiheke because a Unilever executive he knew had a house going there. And in any case, Auckland was better for bumping into startups.
The San Francisco exile was soon in touch with Dan Bowden, founder and chief executive of Ao¯ Air — maker of the prototype Atmos mask.
The Herald had stumbled on Bowden, too, in January this year as he exhibited his mask at the giant Consumer Electronics Show in Las Vegas.
Then, he was pitching the Atmos — with its twin mechanical filters that bounce fresh air off a mask in front of your mouth — as a tool for those fighting the bushfires in Australia (anyone remember that disaster?).
Dinulescu was impressed that Bowden — a one-time head of real estate at AXA Investment Managers — had partnered with AUT’s BioDesign Lab to develop the Atmos.
Research done by Master of Engineering student Bradley Nixon evaluated and validated the performance of the air filtration system for the new facemask.
“While there is a strong relationship, it is not a commercial relationship,” Bowden says.
“The relationship is very much independent. For example, we are not allowed on university property when testing is being undertaken. AUT was engaged to validate the Ao¯ Air base technology and we are starting to tap their wider network for talent, new ideas and are hoping to make some new announcements soon with other parts of AUT.”
That was then
Back in the New Year, Bowden said, “air pollution now kills more people than smoking every year.
“Anyone who has endured the wildfires in Australia or California, attempted to exercise during a pollution warning in Seoul, worked on a construction site in New York or danced at Burning Man knows the current technology is flawed and hasn’t changed in more than 60 years.”
Compared to conventional filtration facemasks, which use an unreliable physical face-seal to prevent infiltration of polluted air, Atmos instead uses fans to draw air through a filter and pressurise the mask space in front of a user’s mouth and nose, before venting around the mask perimeter, Bowden said.
This is now
With the pandemic, Ao¯ Air has made the obvious pivot and repositioned its Atmos mask as an alternative to N95 or P2 cloth masks for Covid-19 protection.
Now, things have skipped along. With Dinulescu onboard as a strategic adviser, Ao¯ Air raised US$1.8m ($3.5m) from Australian venture capital company Blackbird Ventures last month.
It’s now taking pre-orders for the Atmos at a US$280 earlybird price. The regular price will be US$350 (around $500), which Dinulescu pitches as a competitive alternative to buying a year’s worth of N95-grade disposable masks.
And Bowden says that unlike a traditional mask, where the filtration becomes slightly less effective with every breath you take, the Atmos maintains the same level of protection.
Huge demand
Pre-pandemic, Ao¯ Air was aiming for a commercial launch in July this year.
“With the changes in geopolitics, supply chain, redomiciling the team back in New Zealand and given our focus on quality of product we have moved our product delivery out to the first quarter of next year,” Bowden says.
The founder — who had been based in New York but relocated home to join his company’s core team in Parnell, Auckland, for the lockdown — says another factor has been huge demand. “The respiratory assault that is 2020 has led to overwhelming demand and inquiries from across the world,” Bowden says.
“We have received requests to purchase over half a million units — despite stopping all sales and marketing activities in early 2020 in order to focus on product delivery and starting to adapt the Atmos for the challenges of Covid-19 protection.”
That equates to a US$250m pipeline.
Bolstered by the AUT partnership, Bowden has been able to get away with just half a dozen staff so far, but the Blackbird money will be used to increase numbers.
The US$1.8m will “all be deployed in Aotearoa”.
Separately, however, Dinulescu says manufacturing will probably be in the US, to ease the way for regulatory approvals there. In any case, at this point, pre-orders are only open to US and South Korean residents.
But looking at the broader picture, Dinulescu says his and Blackbird’s investment in Ao¯ Air should be just the tip of the iceberg, if New Zealand plays its cards right.
The entrepreneur says he’s regularly in touch with contacts in the US, and there are two themes: growing despair that Covid-19 is only spreading, and New Zealand being constantly in the news as an island of sanity and stability.
“A lot of the former stalwarts of economic stability, London, New York, are looking a lot shakier than Auckland, and it would be foolish not to take advantage of that.”
We should open our arms to venture capitalist and those with hightech skills — and make allowances for the current world situation, he says. An investor visa requires at least $2.5m be invested within three years. But Dinulescu says if a high-net-worth individual has, say, a house in San Francisco worth $5m, they might not want to sell it for a long time.
His message: Be flexible. Be open to talent. And if we build such policies, the rich will come.?
“And [rich] people attract other rich people,” he says.
“That’s how Monaco got to be Monaco.”
A lot of the former stalwarts of economic stability, London, New York, are looking a lot shakier than Auckland. It would be foolish not to take advantage of that. Mihai Dinulescu, silicon valley entrepreneur (above)