What Aotearoa’s startup ecosystem can do to level up

New Zealand is punching above its weight when it comes to startups, but there are a couple of ingredients which will help it go to the next level.

MYOB’s State of Startups report provides insights from industry leaders, incubators and investors, as well as data from international surveys.

Together, the results suggest New Zealand is above average in terms of the essentials for a successful startup environment.

According to the World Bank’s Ease of Doing Business Report 2016, New Zealand is second-best globally for managing ongoing compliance requirements, and the Global Information Technology Report 2016 names New Zealand as the number one country to start a business in.

“If you have the passion and drive to do something extraordinary – turning a small idea into a globally marketed product or service,” said MYOB General Manager Carolyn Luey, “New Zealand has the people, facilities and environment to help you get there.

“New Zealand is making some serious inroads [into becoming a startup nation] – with plans for better funding, improvements to tech infrastructure and a growing startup ecosystem – but there’s still a long way for the country to go.”

Luey said while their total economic contribution to New Zealand is difficult to measure, the opportunities startups provide in terms of diversification, employment and long-term global potential make them a vital part of the local economy.

“In New Zealand, we have no shortage of ideas – and entrepreneurial people with the potential to make them really successful,” she said.

“However, we need to keep developing the conditions that nurture and develop the businesses coming through, and couple those startups with frameworks and disciplines that can help turn a good idea into a great [business].”

How NZ can strengthen its startup system

Luey said one of the key pieces missing from the NZ startup system was investors who were willing to take risks.

“New Zealand’s economy is smaller than the likes of the US or the UK, so our investors are slightly more risk-averse. We need a better understanding of the growth-cycle of these businesses,” said Luey.

“A smaller economy also means we have a smaller pool of people and organisations to supply funding. But startups with big and bold ideas need investors who are prepared to back them, despite the risk.”

Luey also said more shared working spaces needed to be created to enable startups to network with mentors and potential investors.

READ: The rise of the co-working space

“Startups require purpose-built creative environments to collaborate and share ideas,” said Luey.

“We’ve seen it all over the world, particularly in places like Silicon Valley.

“By putting creative people in a vibrant environment designed to support the way they work, there has been a rise in the number of creative exchanges – everyone’s learning is greatly accelerated by being in the same place.”

Luey also said technology providers such as MYOB had a role to play in the growth of the sector.

“If today’s startups want to conquer the world, we have a range of tools that can scale up with them,” she said. “MYOB was a startup once. We know what it means to grow and transform how you do business.

“Ensuring New Zealand has a strong startup ecosystem to support growing companies is hugely important for the future of our economy.”

Want more insights on the state of NZ startups? You can download the report here