Kiwi tech startups seize global opportunities

With the right support and hard work, Kiwi tech startups have shown it takes little time to develop a compelling product and enter offshore markets. Tim Dacombe-Bird has more.

I work every day with innovative Kiwi startups who have a ‘go global’ mentality.

This is essential in a domestic market as small as New Zealand, where companies need to develop ideas with international appeal, and go after early offshore expansion to achieve scale, attract investment, and build sustainable businesses.

This dynamic creates a unique and exciting challenge for our startups, and they are meeting it head-on; thriving, growing, and attracting the attention of global venture capitalists.

The New Zealand Ministry of Business, Employment and Innovation’s 2019 investor guide to the technology sector (known as the TIN100 report), shows extraordinary growth in the export technology sector. Total revenue from the top 200 technology companies measured in the report, jumped by more than a $1 billion, to $11.1 billion in 2018. That places technology as the country’s third largest export earner, after dairy and tourism, and ahead of meat and forestry.

The TIN100 Report showed private equity and venture capital funds invested $1.1 billion in Kiwi businesses. Angel investors also injected a record $99.1 million in early stage New Zealand technology companies – a 31 per cent jump from the year before.

For more than seven years, Amazon Web Services (AWS) has been enabling local startups as they bring New Zealand into the digital age, helping companies like Xero, Vend, and PushPay in the fintech space, who are now well-established, highly-respected global players.

New Zealand organisations have found that cloud technology gives them access to the latest technology, and allows them to build scalable, resilient, and highly secure platforms – all of which means they are better placed to innovate for their customers. 

For example, during its two-year migration, Xero added nearly half a million new customers, improved gross margin by 81 percent, and transformed into a leading global company. In the past, on-premises information technology infrastructure to support an operation of this scale would have taken months to procure, more months to go-live, and cost millions of dollars to operate. 

Now these barriers have been removed, startups have instant access to a staggering range of technology services, which is rapidly changing their business models.

An example of a Kiwi startup which has achieved rapid success is Ambit, which creates digital employees, like virtual customer service teams, to help companies better connect with their customers. Running on a wide range of AWS services to build its Artificial Intelligence (AI) technology, Ambit digital employees help customers buy products, exchange, and refund among other things, and are getting smarter all the time.

In its first two years of operations, Ambit started working with customers like major retailer Glassons and energy provider Vector, reaching $1 million in turnover and expanding its international presence in Australia. It achieved this by providing a realistic and automated chat experience to customers 24/7 on any channel, and is now planning for future growth planning its expansion into the US market.

Ambit’s co-founder Tim Warren says to succeed as a startup in the fast-paced technology environment, you need to be able to focus on refining your product and expansion. He notes, “AWS provided the global infrastructure and specialist support that was vital in the growth of the business offshore.”

It’s clear that the old barriers to international expansion are down, and now is a prime time to be part of New Zealand’s export technology expansion story.

As the TIN100 report reveals, our nation is uniquely positioned and globally connected. The country has a healthy environment for investment with low cost of entry, and high levels of entrepreneurship.

At AWS, we recognise the huge potential of the startup market here and focus on nurturing technology talent.

Our team regularly mentors, runs workshops, and events around the country, about topics such as Machine Learning (ML) and AI. At TechWeek19, we held 20 events across New Zealand ranging from AWS Cloud 101 training sessions, to in-depth workshops exploring how to use ML across an amazing array of use cases, including saving endangered native birds and wildlife.

With the right backing, support, and hard work, Ambit and other startups have shown it takes very little time to develop a compelling product and export offshore.

If you are looking to bring an innovative tech product to market, or to invest in a technology startup, we believe there hasn’t been a better time than now.

Tim Dacombe-Bird (pictured) is New Zealand Country Manager for Amazon Web Services.