Influencing New Zealand's future with Tech - The New Zealand technology sector and listing with NZX. All you need to know - NZX.com
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Influencing New Zealand’s future with Tech The New Zealand technology sector and listing with NZX. All you need to know. www.nzx.com/products/insights
$7.3
billion
in tech exports
9%
of total NZ
exports
are tech
104% 21,870
tech enterprises in
growth in tech 2019, with 555 being
exports compared new in the last
with 2015 12 months
110,000
New Zealanders
employed in tech
2
Foreword
When you look across the
S&P/NZX 50 there’s no escaping
the importance of technology
– from healthcare, nutrition
and telecommunications to
transport, infrastructure,
energy and retirement living.
While retaining the very essence of what Technology has never been more important
we’ve always celebrated in New Zealand – to our country, as the fastest growing
individuality and a quiet determination to earn export sector in 2019 and particularly as the
success – Kiwi companies have shed the Government considers how the evolving
old “No.8 Wire” mentality to become a global global situation with COVID-19 might impact
showcase for technology benchmarks. some industries that have long been at the
core of New Zealand’s economic success.
We are defining our place, rather than looking
to the rest of the world for validation. This is There is a tremendous opportunity in applying
an important evolution among the standout innovation and technology to what we already
examples – tapping into global trends and do very well, so that we build on traditional
growth opportunities, with New Zealanders strengths to ensure we have the long-term
backing them along the way, and turning local resilience we need in our economy, which
revenues into the foreign earnings that drive delivers high-value jobs and contributes to
our economy. the wellbeing of all New Zealanders.
In this report we put the spotlight on At NZX, we’re passionate about our role
technology, some of the key trends, and in capital formation in New Zealand, and
feature on two of our listed companies who working with you to support your growth and
are global leaders, Rakon (NZX: “RAK”) and ambitions – helping shape a brighter future,
Pushpay (NZX: “PPH”), taking that Kiwi and create what’s next.
can-do and hard graft to be the very best
in the world at what they do.
Mark Peterson
Chief Executive
NZX
3
Kiwi ingenuity is a phrase we often
hear to describe our collective ability
to roll up our sleeves and solve a
problem, despite the challenges
in front of us. It is a character trait
that is interwoven into the fabric
of New Zealand, which has helped
us to build, innovate, disrupt and
challenge, for decades.
4
Introduction
The Kiwi tech sector is this
ingenuity in-action. Thousands of
lightbulb moments take place each
and every day, with any one of
them turning into the next big idea
and potentially the launchpad for a
new global business.
At NZX, we are recalibrating
our focus to become part of
the tech ecosystem, helping
provide our brightest minds with
an environment in which ideas
can be nourished and cultivated.
Access to sufficient funding is the
cornerstone to this objective.
It is important for the gatekeepers
of capital at all stages to ensure
both current and future tech
leaders are properly informed of
these levers of scale. This includes
early stage venture capital, private
equity, bank funding, as well as
both public and private markets.
This report seeks to provide a
snapshot of the tech sector in New
Zealand and demystify the listed
market. We truly believe that the
public markets can provide a long-
term and viable avenue for profile,
investability and scale, whilst
providing stakeholders with access
to a liquid secondary market.
Sarah Minhinnick
Head of Issuer Relationships
NZX
5
Thinking
global,
benefiting
local
The tech sector was Figure 1: Exports Revenue Generated from the Tech Sector
New Zealand’s fastest
growing export sector in 2019. 11,000
The impacts of COVID-19 10,000
to date have significantly 9,000
accelerated the importance 8,000
Exports Value ($m)
of this sector’s contribution 7,000
to rebuilding New Zealand’s 6,000
economic future. 5,000
4,000
3,000
Figure 1 shows the tech sector’s 2,000
share of exports has increased 1,000
over the past five years. The ICT
0
industry has demonstrated some 2015 2016 2017 2018 2019 2020 2021 2022 2023
rapid growth and is expected to
ICT (Actual) Manufacturing (Actual) Total Tech Sector (Actual)
be a key driver for future growth,
ICT (Projection) Manufacturing (Projection) Total Tech Sector (Projection)
compared to dairy and tourism,
two of New Zealand’s historically
strong export performers.
Figure 2: Exports Growth Rate in Tech, Dairy and Tourism
Figure 2 shows that the tech
sector’s forecast growth rate has 30%
the potential to align with dairy
exports rate of growth in 2020.
20%
This will be part of the solution to
plugging the export revenue hole
felt in tourism. To stimulate or 10%
even maintain the rate of growth
in the tech sector, we need to 0%
ensure that there is designated
focus and strategic investment in
-10%
innovation that creates scalable
and globally relevant solutions.
20%
2015/16 2016/17 2017/18 2018/19 2019/20
Dairy Tourism Tech
6 Sources: Fig. 1 Stats NZ and NZ Tech, Fig. 2 Stats NZ and NZ Tech
Rethinking NZ’s
future, stimulating
investment 2019 R&D funding
in tech $570 million,
indicating that the potential
opportunities for further
growth in the tech
sector are significant.
R&D investments and export
Figure 3: R&D Expenditure in the Tech Sector as a Percentage of Exports
performance both influence the
competitiveness of an industry.
15%
Although independent of each other,
the limited amount of investment in
R&D within NZ could drive start-up 10%
innovation offshore. There have been
a number of examples where NZ tech
5%
companies have sought R&D support
offshore and these companies
are often sold early to overseas 0%
companies, removing the future 2015 2016 2017 2018 2019
export revenue streams from NZ.
While NZ’s R&D investment in tech has Figure 4: Number of Individual Investors in the Tech Sector
been reasonable [Figure 3], strategic
Sellers
positioning for R&D investment 4000
Buyers
in globally relevant solutions will
help fuel further growth. Continual
Individual Investors
3000
innovation improvement is important
for NZ to gain and maintain a global 2000
competitive advantage in the sector.
1000
Investment behaviour in NZX-listed
tech companies sharply increased
0
from early 2020, and was sustained Jan 17 Jan 18 Jan 19 Jan 20
throughout the COVID-19 lockdown
period [Figure 4]. The significant jump
Figure 5: IT Sector Index Returns Compared to S&P/NZX 50 Returns
in the number of buyers over sellers
illustrates new investors prefer to buy IT
75%
and hold. This supports the possibility S&P/NZX 50
of a broadening tech investor base and 50%
opportunity for increased liquidity and
25%
new investors over time. As shown
in Figure 5, S&P/NZX 50 listed tech 0%
companies collectively outperformed
the S&P/NZX 50 over the past three -25%
years. While falling more substantially
-50%
during NZ’s COVID-19 lockdown, Jan 18 Jul 18 Jan 19 Jul 19 Jan 20 Jul 20
they also recovered faster and
continue to outperform.
Sources: Fig. 6 Fonterra Annual Financial Results and Stats NZ, Fig. 9 NZX Data, Fig. 10 S&P Global 7
Case Study
Feature
thinking
big in an
extra-
ordinary
space
For a Kiwi company founded in a garage Rakon is a world leader in the rarefied
domain of high-precision frequency
in Auckland two years before the control products (FCP), a supplier
to the world’s largest telcos, space
Apollo 11 moon landing in 1969, it’s a agencies, aircraft manufacturers, and
innovators in autonomous vehicles.
pretty big achievement to have your
“Each has its own challenges,” says
tech on the Rosetta space probe mission CEO, Brent Robinson – someone
who thrives on the constant pace
to Jupiter – a mission that resulted in of the technology cycles and loves
nothing better than winning the
the first-ever landing on a comet. global race to find a solution.
8
“The small pieces
Advancement in 5G will open a
world of opportunity in fields such
of extremely
as robotic surgeries, evolution
of IoT (Internet of Things) and
gaming. Sitting at the pinnacle of
precise, tailored telecommunications, Rakon is one of
the key FCP suppliers to this sector
technology from globally with their components
embedded in these expanding
this New Zealand networks. Network latency has been
reduced 90% over the past ten years
company are to two milliseconds – but Brent and
his team are already focussed on the
finding their next benchmark in performance.
way into an
With each of the four Rakon
The European Space Agency components for the Rosetta space
lander module that touched down mission requiring 2,500 hours of
on the comet 67P/Churyumov–
Gerasimenko (67P) on 12 November
increasing range testing – and accompanied by
hundreds of pages of technical
2014 is a measure of the credentials
of the Rakon team, who are
of applications.” documentation – this was an
important milestone to celebrate.
deeply connected with the needs Then, once the cheering’s done, this
of their customers. When the RAK ticker went live in team of just 950 is back to “being
May 2006 the opportunities were the first”. This could be solving how
Brent attests to the absolute
in global positioning systems (GPS), to provide the precise timing to
importance of understanding your
and that heritage is still inherent to enable satellites and spacecraft to
niche, including your customers’
this ingenuity success story that’s operate perfectly in the extreme
ecosystems and technology
setting itself apart by designing conditions of space, or adding its
standards – in many cases involved
solutions to problems even their advanced processes to tonnes of
in shaping evolving frameworks.
customers don’t know about. sliced and diced quartz crystal such
While Rakon has people based in as unlocking the future of oscillator
Brent says: “To be first, you really
England, France and India, New technology, Quartz XMEMS™.
need to intimately understand what
Zealand is a good country to operate
the challenges are”. Being a little fish in a big pond
from if you “want to be the best in
doesn’t faze Rakon. Brent is a big
the world”, he says. There is still The company’s drive to research and
believer in making the pool smaller
the heart of that family business understand knowledge gaps within
and being the smartest fish in
formed back in 1967, and the values their niche is fundamental. Being
the school – a strategy creating
that they cherish as part of an one of the first companies to learn
unlimited opportunities for a Kiwi
international competitive advantage. early on the attributes needed in the
company that’s quietly getting on
frequency control of GPS – including
This is a team dreaming big – about with transforming the way we live,
environmental conditions, led to
the opportunities in remote medical work and play.
the development of high-reliability
procedures performed by surgeons
products used in the autopilot
on the other side of the globe,
capability featured in many Boeing
driverless cars that react in real-time
and Airbus models today.
to road conditions and hazards. . . Brent Robinson
and, in the words of Buzz Lightyear, Tackling autonomous cars head Chief Executive
this thinking extends “to infinity on, Rakon is drawing from its Rakon
and beyond”. experience with frequency control
in driverless tractors, trucks and
defence applications – to design
products that enable synchronised
information from sensors in real
time with control functions in the
vehicle. The intricate detailing of
these systems will detect obstacles,
reacting with speed and accuracy
to ensure safety.
9
Demystifying
the market
Becoming a publicly listed Investors often focus on the
long-term outlook, market share
company, far from being an Myth: I need to be a and competitive advantage of a
end-game, is the start of a new
large business and I need business, as well as the experience
era in the life of a business.
to be able to raise of the management team.
The rewards of an increased Furthermore, most companies
significant amounts of
profile amongst customers and who consider listing have a good
capital as part of an IPO? growth rate.
peers, access to new sources
of capital and the associated The ‘classic’ IPO is the most well-
opportunity to scale your trodden path, with respect to
business, are only a few of the which engaging with a distribution
The minimum anticipated market
and broker network is key to
many benefits for a publicly capitalisation of a business listing
building out a viable listing and
listed company. on the NZX is $10 million. However,
capital raising proposition. There
the suitability of listing a company
are, however, alternative routes
While listing is an exciting in New Zealand is not necessarily
to market, such as a direct listing
milestone, there are a series driven by the size of the business
(formerly known as a compliance
of common misconceptions or its capital raising plans. This is a
listing), which can offer a more
personalised question, the answer
and urban myths around dynamic and cost-effective
for which is based upon the specific
what listing entails and what stage, scale and growth ambitions of
listing solution.
options are available in a company.
New Zealand. At NZX, we
believe if you are an ambitious
and focused company, the
goal of listing is far more
achievable than you may think.
Time to bust some myths.
10 nzx.comFlexibility of direct listing How to save costs
A direct listing offers greater Myth: Listing on Aside from NZX’s fees being
flexibility to an aspirational listing the exchange significantly lower than competing
candidate as it avoids the need to exchanges. Direct listings save on
is too expensive
raise capital. However, this route still broker and distribution fees, by virtue
leaves open the opportunity to raise of there being no capital raised.
new funds using the same class
Furthermore, a direct listing only
offer regime after a three-month Listing does have an initial expense, requires a listing profile document
period, during which an issuer has however the potential rewards to be written as part of informing
time to build its profile and network. as a public company are wide- the market of the listing proposal, as
In some respects, this can be the ranging and long-term. Therefore, opposed to a full PDS. This has the
best of both worlds. Pushpay, appropriate resource planning prior potential to be a shorter and simpler
featured in this report, is one such to listing is essential. document, as it does not need to
successful New Zealand tech In respect of an IPO, a business contain information relating to the
company that came to market via will be engaging with financial offer of new shares. This can save on
the direct listing route. and legal expertise as it begins its associated costs.
listing journey, inclusive of running Separately, another driver for cost
a comprehensive due diligence savings is having a good governance
process and preparing the product infrastructure in place at an early
disclosure statement (PDS). stage of the business. Being listed
Brokerage fees will also be paid to on a private market and registry first
the broker syndicate in the form of a (such as Syndex) can create and
percentage of the amount of capital refine these disciplines and thereby
raised, though it is important to save on valuable time and resource
remember this is a cost against new further down the line.
funds the business would not have
otherwise acquired.
11Dual listing
In certain circumstances, a Myth: Being listed in
Myth: If I am to build secondary listing overseas might be New Zealand means
scale globally, I need to considered to build further presence
overseas investors are unable
list in overseas markets within these markets. For example,
being able to raise capital in two
to invest in my business
locations, whilst retaining access to
the New Zealand listed debt market,
The experience of many of our can help diversify funding options. Overseas investment can be a key
listed tech issuers is at odds with the Importantly, under the Trans- driver behind growth and scale,
perception that overseas markets Tasman Mutual Recognition which can correspondingly facilitate
is where a tech business should Scheme, an issuer can raise capital international profile and access
list. In addition to our featured to new markets. However, it is a
in both New Zealand and Australia.
case-studies, businesses such as misconception to think that being
The foreign exempt listing category
Fisher & Paykel Healthcare, Serko, domiciled and listed in New Zealand
also means that an issuer with two
EROAD, Vista, Gentrack and AFT detracts from the ability to build that
listings is not be subject to two
Pharmaceuticals, have built scale overseas interest.
compliance regimes. Compliance
and profile overseas, whilst being
listed in New Zealand. with NZX listing rules is recognised
on the ASX and vice versa.
Overseas investor
As told by our issuers, the real key
driver to building and growing a We do suggest, however, that ownership contributed
successful tech business is having
a clear focus on creating a viable
the potential benefits of building
presence in Australia should be
to around 38%1 of
and scalable product solution for carefully weighed up against NZX listed equities
consumers. There is no reason why
this objective cannot be fulfilled on
some key considerations. These
include exposing the company in 2019. This is higher
a global scale, whilst retaining and
building presence in New Zealand.
to a much more litigious
environment, additional listing and
than other major
regulator fees, increased insurance international
costs and other requirements.
exchanges.
12 1 JBWere (NZ) Pty Ltd 2019, Equity Ownership Survey New Zealand
2019; www.jbwere.co.nz/media/ykzgga2c/jbwere-2019-equity-
ownership-survey-final-publish-updated.pdfMyth: There is little
Myth: The process of Myth: The compliance
or no advice or guidance
listing on the exchange burden of being a listed
to support my
takes too long company is far too great
listing objectives
The time it takes to go through Becoming a listed company Come and talk to us!
the process of listing has a wide coincides with important
Our team at NZX is always
variation and is dependent on the responsibilities focused on
type of business, investors, strategy, protecting investors and keeping happy to have a confidential
objectives (whether or not to raise the market informed. This a key discussion around your
capital), as well as its current legal driver behind the trust that the requirements, and we will work
and governance structures. public markets can help create. closely alongside you throughout
As a very rough guide, an IPO can It is important to note, however, your journey to provide expert
typically take 4-12 months, whereby that following the Listings Rules advice and support.
a direct listing could be as little as review in 2018, there is now a
6-8 weeks. significantly simplified rules set,
We are well connected with
which was designed to enhance advisors, law firms and sources
the understanding of the of capital throughout New
compliance obligations, whist Zealand, who are able to provide
retaining market integrity and you with specialised expertise
strong investor protections.
within their fields. Furthermore,
Compliance costs have therefore we will also introduce you
been reduced, by virtue of creating to our NZX Regulation team
stronger alignment with legislation, (NZXR), who can provide expert
lowering the amount of resource
assistance on specific matters
that needs to be dedicated to this
important function. around pre and post listing.
13Case Study
Feature
growing
To fully comprehend the
success of Pushpay, you
on tech
only need to look at the
entrepreneurial mindset of the
company’s CEO, Bruce Gordon.
and a
His Kiwi ‘can do’ attitude saw
the launch of New Zealand’s
prayer
first internet merchant banking
platform in the 1990s funded
from a stationary budget.
14“We’ve moved from
Testament to this is how Pushpay
helped churches connect their
brick-and-mortar
congregations virtually through
COVID-19, live-streaming services,
maintaining connections and
banking, to the maintaining the giving so vital
to the work of churches in their
desktop and now a communities.
super-computer in “Just because your church has closed
its door, it doesn’t mean you’ve lost
our back pocket.” your faith,” says Bruce. In some
cases digital reach has enabled a
six-fold increase in attendance, and
opened a new door for Pushpay to
Pushpay’s name belies a company While it wasn’t the done thing in the demonstrate what’s possible.
that is built around a big heart – US, the company’s founders had a
with a focus on strengthening and sense of urgency and pushed on with Having a digital strategy is important
expanding contemporary and good old Kiwi determination. Once whether you’re a retail clothing store
traditional church communities on the ground, they starting listening or a church, and on top of COVID-19,
alike, through digital giving and and learning the vital language of connecting to the younger generation
engagement solutions, made simple “churchies” – which, combined with is a challenge many older, traditional
and intuitive via an app. user-focused product design and churches are facing.
technology, has been core to the And, in a world of tech-native
“It’s not hard to rally a great team success to date.
when you have a vision like ours, younger generations - who
serving customers who build Pushpay has reported continued often strongly focus on giving to
connections with communities,” strong growth, with total giving causes they believe in, creating a
Bruce commented, speaking on volumes processed in the past simple app not only encourages
what drives his team who help knit financial year topping US$5 billion. donations - but encourages repeat
together and grow the congregations Revenues were up 32%, following giving. Appreciation is built in, with
of nearly 11,000 individual church the trend over the past five years, Pushpay’s new “Thank You by Fund”
customers in the US. and operating earnings (EBITDAF) feature allowing a specific note of
increased 1,506% to US$25.1 million. appreciation to be sent to donors
“Some of the biggest churches regarding the initiative or cause that
would fill Eden Park every week,” Listing on the NZX in 2014 was an they supported.
he says. At the other end of the instrumental stepping stone for
scale to the modern gigachurches, Pushpay, helping give credibility to This small team, of less than 500
some are more than 100 years old “the crazy Kiwis with big ideas”, giving in total, has a big reach and a huge
and may have congregations of their largest customer prospects ambition. Pushpay wants to be the
fewer than 100. confidence from their due diligence best for their customers, and for
and creating a sense of transparency. Bruce the energy and passion has
Bruce admits it was audacious to to be driven from the core “creating
have a vision from New Zealand This success story echoes the quality and enjoyable jobs for our
of being the payment processing parable of the “The Wise and people” as they revolutionise the
and community-building platform the Foolish Builders” – Gospel of future of churches one tap at a time.
of choice for US churches. From Matthew 7:24–27, in that Pushpay’s
his experience in the New Zealand rock solid foundation is the natural
banking sector, he is used to place this technology has found at
challenging the status quo. the hub of church communities. Bruce Gordon
From the strategic fit of the mission- Chief Executive
Bruce and the team at Pushpay minded Church Community Builder Pushpay
ignored the prevailing wisdom that acquired in December 2019, to the
“you couldn’t just go up to churches staff volunteering programme that
and win them over”. extends the churches’ reach of
generosity – this is a business with
a higher purpose.
15www.syndex.exchange
Syndex: Helping
transform
Kiwi ideas
to industry
leading
businesses.
Supporting the innovation Founded by three Kiwi The digital tools also provide
and ingenuity of Kiwi entrepreneurs in 2014, Syndex efficiencies in communication,
looked to solve the issues that compliance and governance services
businesses, private capital
limited the private market from to create stronger investments, with
market specialist, Syndex is its true potential, eliminating the supporting functions for registry
built on a promise to enable frustrations and risk that private management, administration,
growth through access to investors face. compliance and investor relations.
capital - bringing investors At the heart of the solution, That means for tech companies
and businesses together. Syndex created an online needing to scale up at speed, the
investment platform, providing platform functions allow for
the infrastructure to support and ‘click of a button’ reports,
facilitate private market investing, communications and compliance
simplifying shareholder relationship – all drastically reducing distracting
Mike Jenkins management and enabling easy administrative tasks.
Founder & COO transacting for any proportionally-
owned asset. To date, Syndex has eliminated
Syndex
many ‘blind spots’ of the private
markets, opening up many
interesting and innovative assets
Ross Verry in the investor market. In 2019, the
Chief Executive company raised over $30 million,
Syndex predominantly from issues within
this funding range.
16“Nurturing
Kiwi
companies”
-Syndex
“Syndex has over
10,000 private
market investors
While the company began primarily This has been particularly evident
on its platform. In
in the commercial property and
primary sector, Syndex have
in the agri, medical, bio and food-
tech sectors – with a quarter of
the 2019/2020 year,
increasingly expanded its focus into
the tech industry. Syndex caters
market offers in this sector, who are
advancing robotic surgery, improving
Syndex hosted 14
to ‘angel companies’ in the early
stages of business, providing a
farm irrigation, skin cancer detection
devices and plant-based foods. independent capital
stepping stone to raise capital and
find ‘smart investors’; mid stage
Kiwi ingenuity has allowed New
Zealanders’ to achieve amazing
raises introducing
companies looking for growth
funding, succession options or new
feats over the years - especially
within the tech industry. Syndex’s
over $30m into the
shareholders and more mature
companies preparing to transition to
online investment platform not
only unlocks Kiwi potential at the
private markets.
Assets under
the public markets.
beginning of their business lifecycle,
Private markets are now an integral but helps lay the foundations for
part of the capital markets and
essential to the innovators and
future success, transforming Kiwi
ideas to industry leading businesses. administration now
entrepreneurs of the country. And,
with the increased appreciation of exceed $3.3 billion
the innovation and tenacity of tech
companies working hard to solve big across over 200
world problems, interest in private
market investing is on the rise. issuing vehicles.”
17www.tin100.com
GROWTH
THROUGH
INNOVATION
The word ’unprecedented’ The NZ tech export sector has Fortunately, as many tech
has been used a lot this year, grown primarily because of companies achieved scale prior
and for good reason. 2020 technology-enabled business to COVID-19, they not only began
models, rather than the technology to deliver metrics that could be
will always be remembered as
opportunity per se. This has understood by any investor, but
the year the world changed
allowed companies to scale and exhibited qualities that set them
because of a disease called become profitable with strong cash apart from non-tech stocks. In
COVID-19. flows, which in turn has attracted particular, the ‘business as a service’
broadening interest from investors, model delivered high recurring,
In the midst of the global turmoil –
both economic and societal – it’s many of whom were previously predictable revenues, strong
heartening to be in New Zealand reluctant to invest based on the cash flows, sticky customers,
where our (mostly) effective technology opportunity alone. marginal cost of new customer
management of the disease has acquisition, faster growth and
Whilst total revenue for the TIN200
enabled our economy to start greater profitability.
Companies (NZ’s 200 largest
bouncing back sooner than it might
technology exporters) grew by This move to profitability was almost
have. While significant challenges
10% in 2019 to $12 billion, EBITDA prescient, in how it anticipated
still lie ahead, investors should
take heart from the significant (net income) grew by 16% and by a the cold winds of an economic
opportunities that now exist here staggering 58% for ICT companies. slowdown and ensured these
within our technology sector. Notably, listed companies led that companies either had balance
growth, accounting for 25% TIN200 sheets or investor support to last
revenue in 2019, but 45% of the the COVID-19 economic winter, of
$1.1 billion revenue growth. 18-24 months that is expected.
18Consequently the growth in market
capitalisation of many listed TIN “In future, cloud Kiwi investors are increasingly
voting with their wallets and being
computing
companies over the past 12 months, rewarded for it as our economy
including the COVID-19 period, has morphs through the COVID-19 sea
change. The ultimate outcome of
companies will
been extraordinary. In the 12 months
to 29 July 2020, the following this will be to propel the tech sector
to become the largest export sector
utilise AI (artificial
share price increases for listed TIN
in New Zealand.
companies were observed; Pacific
intelligence) to
Edge +289%, Pushpay +140%, That’s an outcome that’s going to
F&P Healthcare +111%, Xero +48%, have long-term benefits for New
Zealand as a whole – both economic
add even more
AFT Pharmaceuticals +30%.
and societal. Let’s make sure we
This presents an immense don’t lose sight of that in the midst
opportunity for the NZX, because
demonstrating that we can build valuable customer of the current COVID-19 challenges.
really big, resilient successful
companies will attract more insights as the Greg Shanahan
customer network
local and foreign investors in Kiwi Managing Director
technology companies, and that will Technology Investment
Network
ultimately propel the tech sector to
become the largest export sector and volume of
data grows.”
in New Zealand, transforming our *The TIN200 is the combined TIN100 and
Next100 (1-200) companies ranked by
economy as a result. revenue in the annual TIN Report.
19Conclusion Setting the sector up for success Our analysis shows tech has the opportunity to play a significant role in New Zealand’s economic future, particularly with the impacts of COVID-19. To really get the best out of the tech sector we need to set them up for success: 20
If you can’t measure it, you can’t manage it –
Sourcing data relating to the tech sector was like
a treasure hunt, without the fun. Analysing the data
was made even more difficult given the definition of
what a tech company is varies significantly and the
sub industry classifications are not consistent and
don’t appear to align with the global classifications.
To understand success we need to be able to
measure, benchmark and monitor milestones and
enterprise performance. All of this is really hard
to do if there isn’t consistent centralised data.
Key industry and enterprise performance data
points need to be defined and consistently
collected to ensure an appropriate measure
of performance and success.
Turn the talent tap on –
In order to accelerate and maintain growth
within our Kiwi tech sector we need an agile and
dynamic education strategy, with a strong focus
on commercial rewards to entice and engage new
talent. Rather than poaching our talent from similar
industries, we should be focusing on channelling
new ideas, being prepared to take risks and
drawing inspiration from new talent and those with
experience overseas. This will mean working hard to
attract talent home, with possibilities to draw from
initiatives used overseas such as China’s Thousand
Talents Plan, which fund the best capabilities in
industries to move home to China. By taking these
measures, we will not only be encouraging
growth within the sector but helping provide
immediate relief in expertise.
Home is where the heart is –
Let’s make sure we set up the appropriate
investment platforms in NZ to empower scaling
and growth. If companies want to seek overseas
buyers and sell their companies that is their
prerogative, but let’s make it hard for them to
leave. We want our tech companies to have
global relevance and scale in the global market,
and at the same time we want investors to have
the opportunity to recognise NZ innovation.
The tech sector has contributed to more than
2,000 jobs in 2019. It’s about thinking
global, benefiting local.
21Any questions?
Please just ask us...
Sarah Minhinnick Doug Vrame James Sharp Julia Jones
Head of Issuer Relationships Senior Relationship Manager Senior Relationship Manager Head of Analytics
NZX NZX NZX NZX
M: +64 21 813 589 M: +64 27 298 3610 M: +64 27 237 1189 M: +64 27 524 8901
E: sarah.minhinnick@nzx.com E: doug.vrame@nzx.com E: james.sharp@nzx.com E: julia.jones@nzx.comYou can also read
