Change at the top as NZ’s largest high-tech exporters named

TIN100 principal Greg Shanahan it’s the first time in 13 years that F&P Appliances has not occupied the top slot

TIN100's Greg Shanahan on this year's top trends and top movers in high-tech exports.

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The Technology Investment Network's ranking of our largest high-tech exporters, by revenue, for the 2017 financial year

TIN200 high-tech companies 2017 highlights

• Exports: $7.35 billion (+8.5%)
• Total revenue: $10.00 billion (+7.9%)
• Employees: 43,000 (+11% or 4352 new jobs)

Datacom, owned by NBR Rich Lister John Holdsworth, knocks F&P Appliances from its perch in the latest TIN100 list of our largest high-tech exporters.

Technology Investment Network principal Greg Shanahan says it’s the first time in 13 years that F&P Appliances has not occupied the top slot.

The TIN boss says another standout this year is Queenstown-based Magic Memories, which has built a global business taking photographs at tourist attractions. Over the past year, it has built its revenue 137% to $154 million through its acquisition of US theme park market leader Sharp Shooters. The purchase price was not disclosed but, with 2000 staff, Sharp Shooters was a substantial operation. Magic Memories backers include Pioneer Capital (whose 20% stake makes it the largest shareholder), its chief executive John Wikstrom (who earlier described his growth strategy to NBR as “R&D by M&A”), Milford Asset Management and Craig Elliot, the US tech industry figure who has property investments around Queenstown and Wanaka.

Pushpay received the inaugural “TIN Rocket” award for the biggest jump in rank as it jumped 63 places to number 45. The mobile payment company, which has been particularly active in the US faith sector, recently reported its annualised committed monthly revenue (ACMR) had nearly doubled to $US67.5 million. Chief executive Chris Heaslip says it’s on track for cashflow breakeven by the end of 2018.


TIN's fastest growing high-tech exporters of 2017, by revenue increase

Boom year
Overall, it was a boom year for TIN200 companies (the TIN200 being the NZTE and Callaghan Innovation-backed project’s wider list).

Total high-tech exports rose 8.5% to $7.35 billion, meaning high tech now accounts for roughly 10% of New Zealand's exports. To put that in context dairy exports were $13.6 billion last year; tourism generated $11.8 billion from offshore, sheep and beef $7.4 billion, forestry $4.88 billion and wine $1.66 billion.

A jump in exports to the rebounding US economy accounted for about half of TIN200 growth, Mr Shanahan says, although Australia remains New Zealand's largest market. Europe also features strongly. High-tech exports to Asia lag, in part because software companies find it harder to crack non-Engish speaking countries.

This year, TIN introduced a new list of Maori high-tech companies, defined by a Maori founder, chief executive or substantial iwi investment. It was topped by Waikato Milking Systems, with $93 million revenue. 

Total TIN200 revenue rose 7.9% to top $US10 billion for the first time.

And the number of staff employed by TIN200 companies worldwide increased by 4352 or 11% to more than 43,000.

Without those sort of numbers, the impact of any changes to the high-tech sector are now being felt through the entire economy, Mr Shanahan says.


TIN100's list of the emerging companies with the largest revenue increases. Sometimes big revenue increases go hand in hand with broader success, as with Syft. But the publicly-listed GeoOp and Pacific Edge have struggled recently.

More profits going offshore
The only wrinkle is that the number of TIN200 companies that are foreign-owned continues to increase. Last year it was 31. For the 2016/2017 financial year, with fruit sorting company Compac sold to Norway’s Tomra for $70 million, it rises to 32.

Rocket Lab founder Peter Beck was guest speaker at the TIN announcement last night in Auckland.

His company, with its $US1 billion private equity valuation is undoubtedly a success story for New Zealand – it has created 200 high-value jobs, most of them in Auckland, and created a whole new local industry – these days it is registered in the US, and US heavyweights like Lockheed Martin and Khosla Ventures feature on its share register (along with the likes of founder Peter Beck and Sir Stephen Tindall’s K1W1).

So what makes a “New Zealand” company?

“TIN200 companies have to originate in New Zealand; they’re in ICT, high-tech manufacturing or biotechnology; they have at least 10% of their revenue sourced from outside New Zealand and they still maintain a strong presence in the country,” Mr Shanahan says.

“So, if companies are bought and they move their core operations offshore and they no longer have a significant presence here, they’re no longer in the report. But we still include companies that are majority foreign-owned.”

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19 Comments & Questions

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This report is an absolute waste of money and data space

It is paid for by NZTE and Callaghan to justify their very existence.

The very report itself its whats wrong with the set-up. Its gross corporate welfare. I would live to know what the report cost

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Actually the Hi-Tech industry and their representative bodies need this report. It is not corporate welfare to fund a survey/report. Without it in the past there was in my view no regular collective voice backed by numbers reminding the NZ Government how big the Hi-Tech industry is and it's higher than average growth rate. It is not the questions or content of this report that are the most important thing. It creates wider awareness of the industry size to attract employees and investment into existing entities and new Hi-Tech ideas. Attract those in bigger numbers and NZTE and Callaghan have done their job by increasing the tax take and net wealth of NZ from the higher than average profits of this industry. Both will hopefully need to invest less over time as a proportion of the total revenue the industry earns. Being around the industry for years, it just makes sense to me.

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What nonsense. The report is made up to suit its authors and funders.

Fisher and Paykell is a Chinese owned company that makes dishwashers and fridges. Fisher and Paykell Health is largely a manufacturing company that does most of its manufacturing off shore. Xero is SAAS, not high tech. Gallagher make electric fences, no prizes for guessing what Douglas Pharmaceuticals actually does. Its not tech! NDA group is an engineering company

They are largely innovative companies, this doesnt make them tech companies

To say 'tech' is larger than the NZ meat industry for example is laughable

If I paid for this report I would ask for my money back

Again, I would love to know what this report cost

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You disagree with how they define tech or hi-tech versus innovation. I get that. Tech and innovation are hard to define and they are never going to get it perfect. But your proposal is to eliminate a regular report that has a go at defining it, gives "innovative" investment a collective voice and exposure. If they eliminated the report, what would you replace it with that provides the same value for money that the industry could use? Or what else currently out there fills this role?

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I very much doubt anyone in the 'industry' asked for this. I also dont know what it cost, so same value for money is hard to say

However I would probably replace this with a report about the tech industry. People and companies that create new technology not just use it

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Further - If no one knows what exactly tech is. Why does the NZ tax payer throw a billion dollars at it each year??

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I agree you could refine it if there was a better definition. But think that could be unrealistic and cost more than the benefits of this report. Not sure where you get that taxpayer cost figure from. I doubt the taxpayer throws anything like $1b at this industry alone. The article quotes $10 billion total revenue and $7.35 billion export revenues, not NZTE and Callaghan costs.

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I didnt know who Temperzone was. They are a manufacturing company. They also resell Hitachi equipment.

Use tech, not tech company

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Could NBR please do a write up on Magic Memories some time (interview CEO, etc.)? It seems like a really interesting company which is obviously growing very quickly. It's international reach is very impressive from what I understand.

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Hi Steve, our most recent article is linked to above (and here). An NBR journo has been trying to do an update over the past couple of weeks, but so far the CEO's travel schedule hasn't coincided. CK

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Magic Memories is a fantastic company built by hard work and smarts over 30 years. It started life before 'tech' was even a thing. To me its a company using some technology, not a technology company

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Why not start your own list of pure high tech companies? That's what Greg did, and good on him.

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With respect to Greg, he hasnt done it for free or for love. He has, like many others including yourself simply sucked off of the welfare teat under the guise of helping tech.

I find the subset 'high tech' amusing when no one actually knows what 'tech' is

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Pacific edge have made a press release today congratulating themselves for being identified by Tin100 as one of ten hot emerging companies.
They are a listed by Tin100 purely because of their revenue growth.
This growth has largely been written off as bad debts and they made a correction to the market for a huge error in reported cash inflow.
Seems wrong and misleading to celebrate this error.

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Most of you miss the point, rather than criticising and bagging these companies, how about celebrating what they have achieved. It is dam hard work to grow internationally - stop being so bloody negative and be optimistic for them.

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I don’t think anyone was bagging the companies. Derek was bagging the definition of the tech ‘industry’
I was bagging Pacific Edge because Chris specifically called them out, saying that being in the list didn’t always go hand in hand with broader success.
Pacific Edge shouldn’t be in the list because they were recognising revenue before satisfying all the requirements to get paid. Then ended up writing it all off as bad debts.
Now they’re celebrating an award which is based off revenue growth that didn’t actually happen. For a listed company doing a capital raise this is poor form in my opinion.

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Sorry, just one more to bag. GeoOp, the other company called out by Chris had revenue growth that came from an expensive merger.
Looks like Xero could be <5 years away from being our largest tech company. That’s pretty impressive going from $0 revenue to maybe number one within 15 years.

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How did Invenco go from $20m to $80m in rev within 12 months?

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Likely their manufacturing agreement with Tatsuno Japan

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