Simon Hendery: Wales wooing IT firms with offer of leg-up into Europe

IT entrepreneurs take note: there's a Welshman in town bearing gifts and he'd like to lure some of you up to the Northern Hemisphere with a business deal he hopes will prove too enticing to refuse.

Rhodri Jones is the Sydney-based Australasian head of International Business Wales, the trade and investment arm of the Welsh Assembly Government.

IBW is scouting for exciting high-tech businesses interested in expanding into Europe by setting up a beachhead in Wales.

It has just launched Access Wales, an initiative that will give businesses which meet the criteria free office space for up to a year in one of 15 Welsh high-tech innovation centres.

Also on offer are free business services such as advice and support on the local business landscape and professional consultancy support worth up to $40,000.

Jones insists the scheme is not a sly plan to sap this country of its all-too-small pool of bright technology talent.

It is about giving growth-focused New Zealand businesses assistance to expand into Europe, an opportunity that will hopefully benefit both the Welsh and Kiwi economies.

"It's kind of a try-before-you-buy," says Jones. "It's for a company that's perhaps got a couple of sales [in Europe] or wants to have somebody in the market to scope it out."

During the year, if the business is working well, companies can apply for additional funding to expand through Welsh and other European Union sources.

But are globally focused Kiwi start-ups that take up the offer likely to pull out of the deal after the 12-month honeymoon period is up?

IBW is clearly hoping not, and will be relying on building a good relationship with its new charges that will convince them to maintain their Welsh links long term.

Wales' selling points could be quite compelling for many New Zealand businesses seeking a European home - IBW promotes the fact that London is only a two-hour drive from some of its innovation centres, and as a European beachhead, it is a relatively cheap place to be based.

There's also the inertia factor, once a business has established itself at one location, it is unlikely to uproot without good reason.

Microsoft uses a similar strategy to encourage start-ups to use its business software, offering free access to otherwise expensive technology for the first three years of the business' life.

The thinking is that being absorbed in a Microsoft environment in those formative years will establish a habit that is upheld as the business grows.

IBW has already had successes courting some Kiwi businesses and our Government's recent clampdown on research and development spending makes Europe a more attractive option for start-ups with big R&D needs.

If IBW's strategy really does work in the win-win sense promoted by Jones, it's worth looking at as a leg-up for some of our ambitious innovators.

Perhaps just as importantly, we should be monitoring its success to see if we can win some business back in this direction.

New Zealand may not be able to offer the proximity to the huge European market that is a key selling point for IBW, but we have other selling points that are of interest to the technology industry, including our time zone (allowing overnight delivery of services to Europe during our business hours) and the "lifestyle" benefits that attract migrants from around the world.