THE AMERICANS
They’re young, rich, Silicon Valley idealists who want to change the world from New Zealand. How did the Monahan brothers come to influence our immigration policy – and what’s in it for us? Tony Wall and Adam Dudding look at how the Americans have bought
APakeha with tribal tattoos emerging from the rolled-up sleeves of his business shirt steps on to a stage. This is Nigel Bickle, head of Immigration NZ, and he’s at the New Frontiers Festival in Whitemans Valley, Upper Hutt – a kind of mini version of Nevada’s Burning Man, complete with yoga, drum circles and dancing.
After a lengthy mihi, Bickle tells the gathered international entrepreneurs how excited he is by their plans.
‘‘It’s always dangerous in government when you say ‘hi, I’m from the government and I’m here to help’ but we truly are with you guys,’’ he says. The speech is later posted to YouTube.
It’s February 2015 and Bickle is at the festival with some of his staff to pitch New Zealand as an easy, corruption-free place to do business.
The ensuing discussions will eventually lead to the creation of a radical new visa policy that will give the festival hosts, Americans Matthew and Brian Monahan, a big say in who from the startup world gets to come here.
Bickle has been described as courageous and visionary for taking a punt on the policy, while others accuse him of drinking the Americans’ Kool Aid – in other words, falling for their charms.
The Americans – described by one festival guest as ‘‘21st century cyber hippies’’ – could hardly believe the treatment they were getting.
Matthew Monahan explains: ‘‘We were humbled to be even invited to have a conversation with the government about this stuff, because we’d never been invited by government to talk about anything, ever, in the US.’’
The genesis of the new visas was the Monahans’ own experience of New Zealand immigration policy.
The brothers bought their first property in Whitemans Valley in 2011 and, after selling part of their US online records business for $140 million the following year, added forestry and lifestyle blocks, a dairy farm and a church.
They now own more than 500 hectares worth $13m. Matthew, 33, originally arrived on an entrepreneurial visa.
‘‘It proved to be too complicated . . . ‘you have to make money by this date’, ‘you have to employ this many people’, ‘you need to spend this much time in these places’,’’ he says.
He switched to an investor visa, under which $10m has to be invested over three years and a certain number of days spent in the country. He’s close to gaining full New Zealand residency – ‘‘but I’m not there yet’’.
The Monahans and their Ethiopian friend, Yoseph Ayele, who came in on a student visa and studied entrepreneurship at Victoria University, made it clear to Bickle and his staff that immigration policies weren’t attractive for technology entrepreneurs because the visas were skewed towards those buying an existing business.
Monahan says Immigration NZ wasn’t happy with the way the visas were working either, and wanted to find a different way.
The Americans were also lobbying Government ministers, meeting with theneconomic development minister Steven Joyce and Immigration Minister Michael Woodhouse. It worked.
In July 2015, then-prime minister John Key announced that the Government was looking at developing ‘‘global impact visas’’ to attract innovative entrepreneurs with global networks.
In April 2016, Woodhouse announced a four-year pilot scheme starting in 2017, under which a maximum 400 work visas would be given to people selected with assistance from a private partner.
Five months later, the private partner was named as the Edmund Hillary Fellowship (EHF), a new union between Kiwi Connect – the brothers’ networking platform for entrepreneurs – and the Hillary Institute, a leadership charity founded by Sir Ed himself.
The announcement surprised many in the immigration industry, because the visas had some of the loosest criteria ever seen and it was unheard of for a private provider to be involved in the decisionmaking process.
Immigration consultant Tuariki Delamere, a former minister of immigration, says he was ‘‘quite disgusted’’.
‘‘You have these business policies where people have to meet certain rigid conditions, yet all of a sudden, out of the blue, comes this thing called global impact visas where the Government has decided to allow a bunch of foreigners to hand out visas.’’
That’s not true – Immigration NZ will still issue the visas, but the fact remains that EHF will put the names in front of officials for approval.
The system works like this: EHF selects applicants from around the world for its three-year fellowships, and, if they meet health and character requirements and have at least $36,000 to support themselves and their immediate families, they will get work visas.
EHF will be responsible for supporting them and connecting them to the business and innovation community, and at the end of three years, they can apply for permanent residence.
There are no age limits, qualification requirements or need for a business plan.
Documents obtained under the Official Information Act show the type of people INZ wants to attract: younger entrepreneurs in the early stage of their ‘‘wealth cycle’’ with a greater appetite for risk.
The documents reveal that EHF will be paid $4m over the four years to cover costs, with the anticipation that the programme will become self-funding.
INZ officials identified risks with the programme, including being ‘‘flooded’’ with non-genuine applications, ‘‘rentseeking behaviour’’ by the private partner – manipulating public policy to increase profits – and selecting people who do not succeed in the New Zealand environment.
These could be mitigated by a robust application system, oversight of the provider’s fees and selection process and close monitoring, the officials advised.
Although only a small number of visa holders were likely to be ‘‘big winners, potentially the next TradeMe or Xero’’, the others in the cohort should be allowed to stay on in New Zealand because they could still ‘‘add value’’.
It’s clear from the documents that Kiwi Connect was the preferred provider from the start.
There was talk of partnering directly with the company without going through an official process, but the contract was put out to tender. Only one other party tendered, which INZ refuses to name for reasons of commercial sensitivity.
Katy Armstrong, a Hamilton immigration adviser who has met the Monahans and their team, supports what they are doing and says New Zealand needs the global impact visas.
‘‘It breaks away from the model where we were just looking very in the square, at people with business plans and not really looking at the people themselves.’’ But she has some concerns. ‘‘What happens if someone goes a bit AWOL or doesn’t do what they’re meant to be doing?’’
She’s surprised that Immigration NZ is putting $4m into the programme.
‘‘It’s a lot of money isn’t it, to put in a bunch of young hippies – we’re calling it the hippie policy,’’ she says, laughing.
‘‘I did say to Nigel Bickle . . . ‘had he gone a bit new age?’ ’’
At his office at the Ministry of Business, Innovation and Employment in Wellington, Bickle laughs at the suggestion.
‘‘Look, if I’m being completely honest, it’s not a world, as a career public servant, that I’m familiar with,’’ he says.
‘‘You rocket out to Whitemans Valley . . . what strikes you out there is they are a bunch of guys who live their values . . . whose mission statement for their companies is to make the world a more beautiful place – ‘meet my chief engineer of happiness’.’’
Bickle admits the global impact visas are ‘‘pretty radical’’.
‘‘The reality is we’re doing some innovating and experimenting at the high end of the New Zealand economy.
‘‘I kind of get that one of the risks is . . . this idea of ‘is this just American people being able to run their vested interests and bring their own mates in?’
‘‘I don’t think we’ve designed it to do that. Be really clear, what we’re not outsourcing is what will always be the government’s sovereign right and role – to issue visas.’’
It’s only 400 visas over four years, Bickle says, out of more than 200,000 total work visas issued each year. So the upsides are greater than the potential downsides.
Kristian Slack, a Palmerston Northbased intellectual property consultant, is dubious.
‘‘You could have anybody coming in and saying ‘I’ve got an idea and I’m calling myself an entrepreneur’. There’s no real measure of what the outcomes are or anyone saying what was the overall economic benefit?’’
Slack doesn’t think looking offshore is necessarily the answer, either.
‘‘Do we not have the ideas here and the people already? I suggest we do. These ideas don’t come from start-ups, they come from people who have a problem [to solve].’’
Plenty of others see the benefits. Science educator Michelle Dickinson, known as Nanogirl, says it’s great that Immigration NZ has worked with the Monahans, who she says are smart and passionate.
She believes the EHF programme ‘‘has the potential to host and nurture the next Bill Gates or Steve Jobs’’.
Tech investor Mike O’Donnell, formerly of TradeMe, says the government ‘‘couldn’t identify entrepreneurs if they fell over them’’ and he describes the outsourcing of the search as ‘‘courageous’’.
EHF has been set up as a limited liability company, wholly owned by the institute, and will be run as a non-profit.
Checks and balances include conflict of interest registries, double-blind applicant reviews and an independent panel to review the list of successful applicants before it goes to INZ.
Meanwhile, back in Whitemans Valley, Ayele and his team have been hunkering down, poring over the 311 applications from 53 countries that came in for the first EHF intake.
Proposals include using virtual reality to improve education access; growing kelp to reduce carbon in the ocean; and research into legal innovations that might arise from the recent granting of ‘‘person’’ status to the Whanganui River.
The $4m available over the next four years will be spent on advertising and marketing, websites and supporting the
fellows once they start arriving later this year, Ayele says.
The Monahans are still spending a lot of time in Silicon Valley, where their original company, Inflection, is now focusing on internet security.
When they first arrived in Upper Hutt, they were so clean-cut some locals mistook them for Mormons. These days, Matthew has collar-length hair and wears a large piece of pounamu. He’s learning Maori and can do a decent mihi.
Brother Brian, 30, who is in the US during this interview preparing to get married, is into something called ‘‘flowetry’’, a cross between rap and poetry, and will often take the mic at conferences, introducing himself as B-Mo.
They’ve employed several locals to manage their farm and properties and seem to have settled in well, although there is a bit of resentment at their habit of calling the area Aroha Valley in the apparent belief that ‘‘White Man’s’’ Valley has racist overtones.
‘‘We respect the [Whitemans] name,’’ says Matthew Monahan. ‘‘We’re not trying to change it. But we found it pretty funny, so we nicknamed it.’’
He accepts that people might view them suspiciously – ‘‘there were a couple of comments on the dome, ‘it looks like a spaceship’ ’’ – but for the most part he feels plugged into the community.
‘‘They’ve saved us on countless occasions because we didn’t know what we were doing, so our farm is very much a collaboration with the neighbours.’’
The Monahans’ philosophy is, of course, the polar opposite of Trumpism.
‘‘I’m definitely not a Trump supporter,’’ Matthew says. ‘‘I think the environmental challenges we have ahead of us are real. They are really giant problems that require all hands on deck.’’
The New Yorker recently ran an extraordinary article about megawealthy Silicon Valley entrepreneurs and hedge fund managers who are buying up land in New Zealand ahead of the apocalypse. So are the Monahans doomsday preppers? Absolutely not, says Matthew. ‘‘Frankly, it’s a bit annoying to us, this image of New Zealand being a place to escape from the apocalypse.’’
Monahan worries about climate change, rising economic inequality, disregard for indigenous people – but the solution isn’t to get a bolthole on the other side of the world, he says.
‘‘We don’t need survivalists, we need positive endeavours to fix things.’’
Some remain sceptical of their intentions. One source who has had a bit to do with them says he likes them, but believes Government officials are being naive in their rush to assist them because they have an agenda like everyone else.
‘‘They take the parts they need to succeed here – the Maori theme, the show of modesty. All the while, they’re doing what they need to to succeed in the long game – acquiring a base, surrounding themselves with likeminded people, gaining access and influence through political networking.’’
But people who’ve worked closely with the Monahans say their intentions are pure.
The Hillary Institute did ‘‘extensive due diligence’’ on the brothers and their associates, says founding director Mark Prain, and was impressed enough to hitch the Hillary name to their wagon.
They stood out in Silicon Valley for their values and ‘‘higher aspirations’’, not something that community is necessarily known for, Prain says.
Monahan says he cares deeply about New Zealand. He cheers for Team NZ in the America’s Cup, rather than Larry Ellison’s Oracle Team USA.
‘‘I want to raise my children here if I’m so lucky.’’ (He’s yet to start a family).
He expects to travel the world on EHF business, hunting for the best innovators to attract Down Under.
‘‘Probably the best summation is the kaupapa set by Nigel [Bickle] at the outset,’’ he says. ‘‘Go get the world’s best people New Zealand needs to prosper.’’