There are a string of others you may or may not have heard of, like Tracksuit, Sence and Partly. These Kiwi-made companies are climbing to the pinnacle of business, expanding globally, and attracting capital which would have been unheard of even a decade ago.
Last year’s NZ Growth Capital Partners report showed our broader VC-backed tech ecosystem has grown more than six times in value since 2019, outpacing not only Australia, but other tech-havens like Ireland, Israel and Sweden.
If we lined up our ten largest tech startups and put them in the public markets tomorrow, most would be in the top half of the NZX-50.
Digital exports are growing two-and-a-half times faster than the economy at large, according to KiwiSaaS, outperforming the government’s own projections with the top companies doubling their revenue every four years.
Without diminishing the contribution of the primary sector, we may well be approaching the next “gaming is bigger than wool” moment, like in 2023 when Kiwi gaming exports famously surpassed the value of traditional wool exports. Could we one day see tech and digital exports surpass dairy?
What the digital export sector is delivering should give us all enormous hope for how New Zealand is positioned for the future. But hope is not a strategy and we now need to change some of the settings to maximise our chances of success.
The Government should formally recognise digital exports alongside technology as a priority export sector to give it the attention and policy focus it deserves as the country’s third-largest export earner.
This means a dedicated strategy that lays out the path for further growth and the types of infrastructure we must invest in to capture future success, as we did through the transformative ultrafast broadband rollout.
Every day, founders and investors are making decisions on where to build startups or invest capital; formal recognition from the Government is a clear signal New Zealand will support building the next “unicorn” billion-dollar idea.
Second, lock in the reversal of the steady “exodus” of people through effective immigration settings to attract world-class tech talent. People want to move here; we have the natural environment and the lifestyle, but we lack the pathways that make it easy for top talent to migrate. This can be solved through a fast and responsible immigration pathway for skilled tech workers which will keep more high-paying roles here in New Zealand as Kiwi companies decide to go global.
This also includes removing barriers like the foreign investment fund (FIF) tax rules on foreign investments, which ministers have acknowledged place major barriers on some people moving here, including Kiwis who have been successful overseas.
Finally, there are necessary steps to ensure everyone can share in the success of locally grown unicorns through changes to the capital pipeline. Right now, many Kiwis – even those with savings – simply miss out. We need a rising tide that will lift all boats.
This means reviewing the NZ Super Fund mandate to encourage the funds’ “guardian body” to maximise returns with a specific focus on domestic assets and enable late-stage investment in local tech. This would make it easier for KiwiSaver funds to gain exposure to these companies.
Currently close to two-thirds of Kiwisaver funds are invested in international equities or fixed interest investments. Meanwhile, just 0.2% of Kiwisaver is invested in local venture capital, compared to 4.4% of Australian superannuation funds in their companies.
Changing the settings which discourage more early-stage local investment can turn a good decade for local technology into a defining one, so we’re not just producing world-class startups, but backing them, too.
Let’s keep throwing on those T-shirts like Mayor Brown and choose pride, ambition and action for Kiwis.