Christchurch raw dog food manufacturer, K9 Natural, the fastest-growing manufacturer in the country according to Deloitte, is seeking to raise $2.5 million from new investors.

The Christchurch company has grown from a small business with $650,000 of sales to $5m turnover and to 22 staff in the past three years through an export focus. The United States, Canada, Japan and Hong Kong are its main overseas markets.

The almost 800 per cent growth in the past three years has won K9 the accolade of the fifth-fastest growing business in the Deloitte New Zealand's Fast 50 in 2011 and the fastest growing manufacturer in the country.

Chief executive, Calvin Smith, is a former international currency trader who returned to New Zealand and invested in K9 two years ago and has ended up running it.

Smith said investing in new businesses was his passion although currency trading had been a lot of fun.

K9 Natural was formed almost five years ago by police dog handler, Geoff Bowers, who spent three months in the freezing cold of Alaska monitoring the raw food diet of grey wolves, very similar DNA-wise to dogs, and Bruce Mayhew.

Smith and Chris Stewart, now the chairman, took stakes two-and-a-half years ago. The four men own 25 per cent each.

Smith said New Zealanders did not realise how strong the pet food industry was. In the United States a huge amount of private equity was flowing into it and the industry was one of only five that had been growing since the global financial crisis.

K9 was breaking even and the aim was to raise sales and lower unit production costs to grow profitability.

While most of its export efforts had brought the rapid growth, it was ironically selling more now in New Zealand as Kiwis learnt about its overseas successes and the company put more effort in here.

"It's a lot easier for us to sell in New Zealand by saying we are in 19 countries.

"Before, we would rock up and someone would say what's so special about this dog food."

The Deloitte top-50 placing two years in a row – in 2010 it was number eight – had given legitimacy to the brand. Calls were coming in from businesses wanting to stock it, especially among veterinary practices that had been slow to pick up on raw feeding.

"It's the Kiwi psychology. We always think that somewhere out of New Zealand is better but often some of the great things are here at home. We need someone offshore to tell us."

Opportunities were dropping on to its plate and were wide ranging so it was raising capital to take advantage. A small portion of the $2.5m would be invested in the factory but most of it would be used to drive more sales by setting up a team in the North Island and in the US, developing its website and probably employing a full-time social media staff member. It was also examining a retail franchise model.

Smith said the company spent a lot of time going to overseas expos and trade fairs in Europe and North America last year to build its export business. Many customers first made contact through K9's website reflecting the power of the internet. The first five export markets were all contacts through the website.

The company now had to set up a sales team in the United States to support the distributors because that was what was expected there. The distributors had so many choices of product that if one was not easy to sell they could promote another. K9 earned its highest prices there.

- BusinessDay.co.nz