New Zealand IT has to get it together, says an expat IT adviser.
The country needs to draw together the various incubators, and government entities involved in assisting our IT exporters and companies seeking to break into the US market need to relocate their head offices and sales and marketing operations there.
Those are the views of Peter Bryant, who runs an IT advisory business in Denver, Colorado. He was in Auckland and Wellington last week to give “master classes” on getting into overseas markets.
New Zealand has the Foundation for Research, Science and Technology, the Ministry of Economic Development, NZ Trade and Enterprise, all of which are involved in some way in funding or advising ICT sector exporters. Then there’s The Icehouse, Auckland University’s technology company incubator and other similar organisations like Creative HQ.
Bryant says this fragmentation isn’t helping aspiring software exporters. He accepts that merging all the entities into one would be a tall order, appointing a “czar” or higher, governing body to oversee and co-ordinate the various bodies would help a lot.
“Each of those organisations are running disparate programmes, and while there’s a ministerial IT position, you also need someone at execution level to make sure we’re doing research in the right areas etc.
“You need to have someone looking at the whole process, saying ‘we need to do this for research, this for the incubators and this for commercialising’.”
The overseeing body would have the nous to advise companies chasing the US market to re-locate their head office and sales and marketing operation there but keep research and development in New Zealand.
“Export the company, not the product”, is the catch-cry and Bryant says New Zealand needs to get over nationalistic sentiment which says companies should keep their headquarters here.
“People have tried to export the product and it hasn’t worked.”
Examples of successful “export the company, not the product” cases include Micromuse in Britain and WebMethods in Australia and Peace and Right Hemisphere in New Zealand.
Another example Bryant gives is British-Australian Proxima Technology, which had three staff in Sydney when it moved its headquarters to the US and now has 35 in Sydney.
On the other hand, Marshal Software, which was built in New Zealand, sold software successfully but, after being acquired by NetIQ, is having its former New Zealand operations shifted to the US.
“There are ways you can set [a company] up to make sure that doesn’t happen,” Bryant says.
“Marshal is a good example of what can happen if you don’t embrace the ‘export the company’ model.”
A theme of his “master classes” in Auckland and Wellington last week was the lack of venture capital available in New Zealand and the lack of experience among our entrepreneurs in getting venture capital funding.
He says that during an earlier visit to New Zealand, after speaking at a function in Christchurch, he received several emails from audience members asking for advice on getting funding and regards the fact they went to him, rather than the various entities that assist IT exporters, “as a failure of communication.”
Information on grant applications, export advice, is scattered over many websites and he says New Zealand should adopt the approach of his adopted home state, Colorado and have a single portal with that information and links to other websites available.
The government’s HiGrowth project, which seeks to have one hundred $100 million IT companies in New Zealand by 2012, is working on such a portal, HiGrowth programme manager Jane Smallfield says.
Phase one of the portal has been completed, says Smallfield, with an ICT industry directory of 1000 companies.
“This is going to be further enhanced with a project this year with NZTE and industry organisations to improve the marketing and management of this and to enable the interface with other industry and government databases, to become a true portal.”
The HiGrowth project is also working with New Zealand Trade and Enterprise on a scorecard system for the ICT industry which will rate it according to criteria such as products and services, research and development and innovation.
Peter Bryant worked for several US companies, including Mincom and InfoNow, before setting up TransTech and was with Computer Associates for 13 years during the 1980s and 1990s.