New Zealand is leading the way in Agtech and Health start-ups, according to the Genome Startup Ecosystem report 2018, which has based its findings on data sourced from a survey of more than 10,000 start-up executives around the world.
“With a population of fewer than 5 million people, the New Zealand start-up ecosystem punches above its weight. There are about 500 start-ups across several verticals. VC investment has ranged between $90 million and $140 million in the past three years and New Zealand has been named the number one country in the world for doing business,” the report reads.
Agtech and New Food is the leading category for New Zealand, with the report noting it “has long been a world leader in agricultural productions with $1.2 billion in value-added agricultural activity”. New Zealand shares top global status in this category with ecosystems in Silicon Valley, Boston and Amsterdam.
Agtech presents “a huge opportunity for investments in digitisation and automation”, with the Internet of Things (IoT) and 5G connectivity important enablers: “Potential applications will include water management, fertigation, crop communication, livestock safety and maturity monitoring, aerial crop monitoring and drilling, seeding and spraying.”
There are a growing number of IoT Agtech applications being developed locally, as was evident at the IoT event in Auckland last week.
New Zealand is also strong in Health and Life Sciences, where the report notes that this country is ranked fourth for global start-up ecosystems. It recognises a strong talent pipeline that is “fuelled by local academic institutions like University of Auckland, University of Otago and Massey University – the country has the highest density of post-secondary science graduates and PhD graduates in Life Sciences in the world.”
In contrast to the Agtech sector, this is a more crowded field, with competition from ecosystems in 24 cities in Canada U.S Europe, Middle East, Asia, and Australia.
The compulsion for New Zealand companies to focus on export-driven business models in this sector is keenly felt, according to Executive Director Maxine Simmons of Cure Kids Ventures, a seed fund quoted in the report: “We are seeing significant growth in the number and quality of investment opportunities in Health and Life Sciences. As New Zealand has a small domestic healthcare market, even our very early stage businesses have immediate focus on international growth.”
While New Zealand start-ups are ahead in Agtech and Health, they have some way to go in terms of attitude. The report found that 38% of New Zealand founders “want to change the world (compared with 41% globally), while a mere 10% possessed “high ambition” (compared with 21% globally). Meanwhile founders scored 5.2 on the ‘theoretical know-how index’ (just above the global average of 5.1), but a woeful 3.8 on the ‘practical know-how index’ (below the global average of 4.8).
On a slightly more positive note, 29% of New Zealand founders have an entrepreneur mindset (compared to 20.5% globally), and 48% have a builder mindset (compared to 32.5% globally).