Something fishy in tech tank
OPINION: I was lucky enough last week to be a speaker at Finnotec New Zealand 2017, a conference billed as the event where financial innovation meets technology.
In reality it was probably more an opportunity for financial service providers to take a look around the bend and see some of the disruption heading their way, and try to work out if it will kneecap them or pass them by. Or, indeed, if they should take a stake in it.
Part of the agenda was a ‘‘talent showcase’’ of Fintech start-ups, who had three minutes to pitch themselves and their offering to the 300-odd incumbents in the audience.
The two standout local heroes were Sharesies and Banqer, both captained by stellar young women with fire in their belly and execution in their veins. Both provide a welcome counterpoint to the male-heavy tech start-up world.
Sharesies is an investment platform that gives people with $50 the same investment option that a person with $50,000 has.
Led by Christchurch entrepreneur Brooke Anderson, Sharesies aims to make a real difference to how New Zealanders manage their money and grow their wealth.
Banqer is an interactive learning tool set up by exaccountant Kendall Flutey to teach financial literacy in schools and boost motivation in the classroom. It delivers simulated online banking for your classroom, it provides a hands-on environment for kids to get curious, creative, and ultimately, confident with money.
But the presentation that really caught my eye was by expat Kiwi Peter Dingle. Dingle is an angel investor and entrepreneur based in Hong Kong. Over the past 20 years he’s run 10 innovation accelerators in Singapore and Hong Kong, and helped nearly 100 start-ups raise more than $75 million in seed funding.
The crux of Dingle’s presentation was the ecosystem within which technology powered disruption can flourish.
With red-framed glasses the size of whiskey tumblers and a voice like running water, Dingle presented a simple but convincing analogy of what makes a healthy ecosystem.
In Dingle’s world, a technology ecosystem is like a fish tank – made up of four components.
First there is the abiotic stuff, akin to the rocks, sand and glass of the fish tank. These are the regulators, the law and the policy makers.
Next are the consumers – from bottom feeders and school fish to the sharks and killer whales. These are the parties that consume and are consumed, from retail customers through to private equity funds, start-ups and mid-market growth companies.
Then there are the producers who help grow stuff, from krill and algae through to the kelpprotected breeding grounds. These are the parties with a growth mindset, from universities and accelerators to the research funders.
Lastly there are the decomposers who feed off the bodies and effluent of the fish. This translates to the lawyers, accountants, investment bankers and liquidators, who might recoil at the description, but perform a vital function.
While not an elegant analogy, it painted a clear picture of the four groups that New Zealand’s fast-growing tech companies must interface with.
Applying it to New Zealand’s tech-driven ecosystem is timely, as the new Government has the best opportunity ever to decide whether the existing ecosystem has the right balance.
Personally, I’m not sure that it does.
For one thing the number of producers, whose nominal job is to help grow things, is too high and they are too hard to navigate.
There are more than 130 participants right now from startup incubators, to research funders and mid-cap accelerators. Hell, last week I even heard about an accelerator for accelerators. What could possibly go wrong?
It’s far too many for a small country with a population much less than the size of Colorado.
In my experience it results in small companies spending too much time trying to understand it and get their head in the funding trough, rather than building their product and delighting their customers.
A crazy outcome to be sure. In Dingle-speak this means that the producers need a bit of sorting out. They also need clearer signposts, so a start-up knows who does what; and who’s worth investing time in, rather than doubling down on delighting customers.
I also think the abiotic stuff needs a pretty good look at.
Right now tax, trading and intellectual property laws could do with an update to better reflect the reality of fast-growing tech sectors and provide our local players with more of a level playing field.
The government department with overall responsibility for the design and maintenance of the ecosystem for hi-growth tech companies is the Ministry of Business, Innovation and Enterprise. This mega ministry has 3300 staff and $4.5 billion budget a year.
It’s got a newish chief executive, the proven Caroline Tremain, and one of the few seasoned Labour ministers, the cluey David Parker.
Together I reckon they could have the inclination and the ability to refresh and simplify the ecosystem for early stage technology businesses.
Which could mean at Finnotec 2018 we might be looking at 50 local heroes, instead of just a handful.
Now if we could just get a few more women leading them …
❚ Mike ‘‘MOD’’ O’Donnell is an e-commerce manager and professional director. His Twitter handle is @modsta and he’s had bad luck with goldfish.