KEY POINTS:
It's getting harder for New Zealand companies to make the transition to the international marketplace with a general vacuum of assistance and support back home.
Government funding programmes such as New Zealand Trade and Enterprise seem to be of little help to the average tech start-up, as their criteria are generally firmly based on export potential. (Although I do know of circumstances where great people in NZTE have assisted, and in these cases their funding has made a transformational difference.)
Foundation for Research, Science and Technology programmes seem to be more focused on supplying public research with additional internal government funding support, rather than funding private sector start-up tech developments. It's all a bit confusing, and I get contacted a lot by innovators looking for "help".
Questions that must be asked
How successful have the New Zealand venture capitalists been? We should be starting to see exits now under our best practice VC model. What about commercialisation from the CRIs and universities? I'm not talking about licensing transactions, which are relatively easy, but properly executed venture deals.
What about new and exciting technology listings on the New Zealand Stock Exchange? What about opportunities for the average Kiwi to invest in and support some really cool New Zealand innovation? How is it that we still lack a clear market-driven response to the opportunities presented by knowledge-based products and services that improve performance, productivity and efficiency, reducing costs, energy consumption, waste and pollution, and which have become known as 'Cleantech'? If there is one massive opportunity for New Zealand to plug into highly mobile global capital, this is it.
I look back at all the energy, policy-making and money directed into the emerging innovation space over the last eight years and simply wonder what has happened to it all. I think we got our flight-plan wrong. Perhaps things will change with the recent announcement of the new primary sector fund, which is a fantastic initiative. It is big, brave and takes into account the fact that 72 per cent of New Zealand's revenue is derived from the primary sector.
Sensible starting-point
The test is going to be to structure in visionary commercialisation, where synergies and linkages that aren't natural or even visible are allowed to play out. Who'd have thought that innovation in the meat industry would lead to a breakthrough in digital film production?
FastScan, which was created by ARANZ and used by Weta Digital to create models for creatures in The Lord of the Rings, evolved from research undertaken by Meat and Wool NZ. This is the sort of commercialisation we need, and the benefits are likely to fall straight to the bottom line. They will be transformational.
New Zealand's key asset is innovation; one that is invisible and latent across all sectors of the economy. But the smart local market is essentially oblivious to it.
You have to take off before you are able to land comfortably, and that's the piece that has been missing. We've thrown ourselves at the world rather as we have with our wine but diluted our value proposition.
The new fund provides an opportunity to get the flight-plan right and comfortably land our technology in the global marketplace. This is the opportunity to establish viable seed venture investment as the baseline driver of deal flow for the venture community both in New Zealand and offshore. Perhaps this is the take off point that we've been waiting and hoping for?
