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Hyperfactory boss quietly departs after US buy-out

UPDATE: Derek Handley has left his postion as chief executive of The Hyperfactory, sold to US media giant Meredith in 2010.

Mr Handley, quietly left the company in December.

He told NBR his departure was long-planned.

Mr Handley, who founded mobile advertising creative company The Hyperfactory in Auckland with his brother Geoff, now bills himself as chairman of mobile advertising network company Snakk Media.

He remains chairman of The Hyperfactory, now a division of Meredith.


Hyperfactory boss defends decision to shift jobs to New York

Feb 4, 2011: The Hyperfactory boss Derek Handley has defended his company against a Herald article this morning detailing how around 16 Auckland staff have been given the choice of moving to New York, or losing their jobs.

The company, which creates advertising campaigns for mobile phones and tablets, was founded in Auckland in 2001 by Derek Handley (32)  and his brother Geoff (35), and soon expanded to open offices in Manhattan (which became the head office and the Handley's new home), LA, Sydney and various points around Asia. 

Clients include Coca-Cola, BlackBerry, L’Oreal, Vodafone, Disney and Kraft; there are around 90 Hyperfactory staff in total.

Last year, US media giant Meredith Corporation completed a two-stage deal to take over The Hyperfactory, for what NBR estimated, from annual reports, to be a deal worth up to $US16 million.

Last month, during a visit to Auckland, Mr Handley told the "23 or 24" staff that 16 roles would no longer be located in Auckland. Staff were offered equivalent positions in New York.

Terms of the deal
This morning, Mr Handley - more used to being a new economy poster boy - lashed out at this morning's media coverage.

Auckland staff were being given a year to decide if they wanted to move, The Hyperfactory boss told NBR.

Asked if relocation costs would be covered, he replied:

"Of course. We are totally covering everything, including sponsoring and paying for the visa (which as you probably know is impossible to get for any Kiwi and alone is around $10,000), relocation of their entire house contents, temporary accomodation for three months, flights for them and family - if they have one - the lot."

"It's the first time in history any Kiwi company has offered to relocate a bunch of people to New York - which I'm sure is a dream come true for many Kiwi's to at least give it a go in the Big Apple," Mr Handley said.

More by Chris Keall

Comments and questions

I had a three month secondment in New York and it was spectacular. I agree with Mr Handley, it is a spectacular opportunity and his team should grab it with both hands - even if for only 3-4 years.

He could have easily simply not made the offer to cover costs and visa, effectively making it no choice at all.

What an amazing opportunity for those chosen to go.

He's only offering them a year to decide, sponsorship, relocations for household, flights for family, 3 months accommodation.... How can he be so heartless? Where do I sign?

Once again some are quick to knock a Kiwi success story. Yes, we helped them with funds, but they worked 7 day weeks for years to become an overnight success, and NZ got plenty of credit for it. What about the good work they continue to do for NZ?

Great opportunity for staft.

For NZ Inc - It is a shame it is moving jobs out of NZ but that is where their market is.

Still, a very postive move.

Chris are you on the Handleys payroll? Its true Derek has been the darling of NZ business for a long time, for once he's being questioned and is upset :(
Name any other CEO who has had such an easy ride with the media.

Will they pay back the tax payer funded R and D grants I wonder. All that IP is now lost to NZ, how is that good for our economy?

This is a good story for the very smart and very hard working Handleys. this is not a good story for the NZ economy.


Stansta, agree this is not a good story for the NZ economy but NZers need to understand why this happens. A very hard working Handley will not put up with much red tape. I do not know what is really going on, but in Fisher & Paykel's case they can build a new factory for manufacturing washing machines in 12 months from scratch in locations overseas. In NZ within 12 months they had still not received resource consent to alter a front gate! Makes certain decisions a no brainer.

This is not a story about red tape. The Hyperfactory is now based out of the US because that is where their market is (And where there owners are)
For me this is a story about NZ tax payers funding grants etc (lets assume the Handleys and investors have funded the lions share of the development) for companies that take their precious IP offshore. How can that happen without a real return to the tax payer?
Maybe we should stick to subsidising dairy conversions, at least we know what we are doing

If any of you have received a Tech grant, at least a resent one you will know that its not legally possible to take the IP out of NZ unless its paid back

Red tape that has proved itself worthless, see leaky homes, and massive increases in anything to do with RMA, councils delaying tactics, arborists having more say in design than engineers etc. and now the unintended consequences, rapidly increasing rents because no one in their right mind will build a rental property if the upfront costs are punitive.

Surely the Hyperfactory can see value in an overnight turnaround? while the northern hemisphere sleeps, the team (or teams) of developers work collaboratively with their northern hemisphere colleagues so that products have been altered and tested by the time the customer gets to work in the morning. NZ becomes the powerhouse that drives the exported product while the Hyperfactory retains it's global appeal via satellite service offices? maybe the boys at the Hyperfactory have been watching too much Gossip Girl?

Handley may have worked hard for a few years but he has been very well rewarded for it. I do not begrudge him the returns he had received but many NZ'ers work harder all their life and do not get so rewarded. They also do not take everything they have been given here and leave the country (more fool them I guess).

Stansta is correct this is a success story for Handley alone. NZ misses out here after much money invested in him and his family throughout his life. The jury is still out as to whether anything will flow back to NZ in the long term. My pick would be no.

What about all the money he lost for his shareholders in listed company see this article

Looks like entrepreneurs taking financial risk with their own money. Some win, some loose.

good on him for making some $$$ but the reality is he obviously never developed his ideas/products with an eye to be based in NZ. The product itself is great to sell to corprates/ad agencys in the US as marketing fluff but lets face it who pays attention to this garbage advertising on phones is hardly earth shattering, amazing what you can make a buck off!

I guess you do have to take your chance so good on them. However I do always have more respect for the likes of Sam Morgan who have built up a company in NZ then choose to reinvest in largely NZ projects when they make the big $$$. I guess that is what you call loyalty to NZ, I don't get the impression that giving something back long term to NZ is a concern for this guy.

He's a young version of Eric Watson, only one thing matters and that's his ego. Everyone is wrong only Derek knows what is right and he IS the businessman of the century - just ask him. We love you Derek (aka Eric)

Lets not get personal people.
Derek is a very smart and driven man, the likes NZ should be able to hold onto.
He just takes advantage of loose rules around tx payer funded R and D etc
Thats me getting off my soap box

I think The Handley boys have done a great job to get to where they are and have done great things for the NZ economy & image over the last 10 years... government grants does not make a company successful....the people, countless hours of hard work & determination with a touch a luck and the right circumstance is what makes it happen. Without the latter this wouldn't even be a thread.... or we could change the thread to complaining about why we even bother giving grants to companies if they are just going to fail....may as well invest it in P. Can't win either way it would seem.

Smoke and mirrors.

It still amazes me how much these guys stretch the truth in order to protect their image and profit.

E.g. like them telling clients that all their skills are in-house when they out-source everything.

Lets quietly congratulate him on his success and wish him more success in the future. He is an inspiration to Kiwi entrepreneurs and future business people. Watch this space and this man and his future innovations.

Hes a knob