Entrepreneur Derek Handley has launched Aera, a company which aims to help Kiwis buy their first home. Supplied image.
Entrepreneur Derek Handley – famous for tech ventures like the HyperFactory and FeverPitch – has launched a new business with a new mission.
He wants to revolutionise the way young Kiwis buy their first house with a start-up called Aera.
Handley has been an entrepreneur since he was at school.
He grew up in Hong Kong with a Scottish father and Malay/Chinese mother. They moved to New Zealand when he was aged 14.
“I was excited, but I was also leaving at a time when I had almost full autonomy in Hong Kong. It’s very safe. You’re just out any time at night ... you’re able to do a lot as a kid,” he says.
“Then I come here and you can’t go anywhere, it’s very hard to get around. That was the biggest shock.”
Handley started at Selwyn College in Auckland and immediately went into business.
He noticed that computer games were very expensive in New Zealand and, with the help of his best friend in Hong Kong, set up a parallel importing business.
“I would just start selling these things in the trade and exchange. So our phone, our house phone, would just be ringing like mentally. And my dad was like, what is, what are all these people ringing about? And they’re coming over to buy like a pack of Sega games or something.”
But he describes mobile text-based marketing company HyperFactory (which he sold for a substantial but undisclosed sum in 2010) as his first real business success.
“I think it was HyperFactory, yeah,” he says.
“Every time we’re in the car with my son, when George FM comes on and they’re like: ‘oh, the text machine’s on, fire in your texts’ ... and we’re like, yeah, we invented that.
“Every single radio station in TV station in New Zealand that used it at the time, they bought ours, and nobody else in the world had it.”
Handley started out in the tech sector but says he’s never seen himself as a tech guru.
“No, it was more just, that’s where the opportunity was.”
He started HyperFactory and the online sports betting app FeverPitch in the depths of the dot.com crash.
“I’d come in after that had happened, after, after the big crash,” he says.
“I viewed it as a good time to start.”
The theory is that if you can make something work when things are very difficult, then when the sector improves, the idea must be good.
“For example, the company I’m building right now, which is around first home ownership. It is a very difficult time to build that company. It’s possibly the worst possible time to start a company in this space.”
“[But] if you can make it work now, wow! When things come back, then you’re gonna be in really great shape, and that was the same theory I had around the dot.com.
“As long as you’ve got an idea and you’ve got a vision and you start and you grind and you survive,” he says, “you’re probably more likely to succeed than ever. That was the philosophy, as opposed to like reading all the magazines going, oh my God, this thing is over. It was almost like, this looks like the best time to start.”
Handley says his real passion is creating things and making things happen.
“At the moment I’m just motivated entirely about: what is the change that you can achieve? What is the future that you’re trying to bring about?
“When I was very young, I thought that was what, you know, business was about money and I thought you set these big goals. And I did.
“But the things that light me up are not the dollars. It’s like, can you create something out of nothing that’s going make people’s lives better?”
Money is nice because it enables you to do more of that, he says.
“I think if you have more, then you can do more different types of things. It’s not because I need a third house or a fourth Lamborghini or whatever it is.”
So Handley doesn’t see his latest venture Aera – which is all about getting young Kiwis into their first homes – as a change of tack.
“I got into this because when I came home from the US, during Covid, this housing issue was so explosive,” Handley says.
“It was all over the news every day and the friends and family were like, how do I get into a house? It’s crazy. I’m never gonna be able to get one.
“I was like, what’s going on here? Why is this so nuts? And is anyone gonna do anything differently about it?”
Handley says he spent two years looking at the issue and considering what the major roadblock for most people was.
He concludes that a lot of the problem was that the logistics were daunting.
“Number one, it was highly manual. Number two, it’s all intermediary and separated out, so it’s not like there’s one service that helps you from the beginning to the end,” he says.
“Number three, there’s no digitisation of the journey ... of education, of coaching, of finding, and getting a mortgage, of finding and getting a house.”
And there were people collecting commission every step of the way.
“So my theory was: you create one brand that helps somebody from the beginning to the end,” he says.
“You digitise as much of it as possible so they can have self-learning modules and steps that they take to get to that finish line. And as you get to the finish line, you help them get the loan, you help them get the house, and you split the commission with them.”
Housing affordability is also a big political issue, but Handley says he has no interest in becoming a politician.
“No. Not after all that abuse,” he says.
He’s referring to the experience of moving his family across the world to take up a job as chief technology officer for the 2018 Government, led by Dame Jacinda Ardern.
It was a job that famously turned out not to exist.
“It was extremely traumatic. It was anything but kind, which is highly ironic.”
The Minister for Digital Services, Clare Curran, was sacked after failing to declare a meeting with Handley.
The Government didn’t follow through on the job offer, deciding that New Zealand didn’t need a chief technology officer after all, despite Handley having moved his whole family home from New York to take up the position.
“It was extremely difficult for the family. I would not want anyone to be under that kind of pressure and or light,” he says.
Handley describes 60 days of intense media scrutiny where he felt “like a football”.
“To me [it] was the epitome of the difference between people and politics,” he says.
“It was the kind of crystallisation of everything that’s wrong with politics and politicians and the vast difference between what they say and how they behave.
“I wouldn’t wish it on anybody. The only thing I regret is not actually suing the Government.”
But he says he would like to see substantial political change in New Zealand.
“We have a feral, antagonistic, childish, kindergarten-type environment in Wellington, that’s just getting worse and worse and it’s no different to many other parts of the world,” he says.
“At some point, we need to rebuild what it means to be in government and what it means to have a government.”
The Money Talks podcast always asks guests what they would do if we could make them Prime Minister for the day.
“You couldn’t do it in a day, but I honestly think that the real answer to that is you need to redesign a political system where the best people from different backgrounds and political views work together,” he says.
“You create a team out of individuals instead of creating individuals into a team. Look at like the All Blacks. Who are the best people to play these positions? It doesn’t matter what team they came from.”
It might seem impossible but we managed to with MMP and many other difficult transitions, he says.
“So it’s not a pipe dream. It might [be], but maybe it’s one of the projects Aera works on, to create a pathway for New Zealand rather than flip-flopping every three, six years. Yeah. In such an abusive, antagonistic way, which is just embarrassing for our children to watch.
“That’s what I’d be working on. It’ll take longer than a day though.”
Listen to the full episode to hear more from Derek Handley.
Money Talks is a podcast run by the NZ Herald. It isn’t about personal finance and isn’t about economics – it’s just well-known New Zealanders talking about money and sharing some stories about the impact it’s had on their lives and how it has shaped them.
The series is hosted by Liam Dann, business editor-at-large for the Herald. He is a senior writer and columnist and also presents and produces videos and podcasts. He joined the Herald in 2003.
Money Talks is available on iHeartRadio, Spotify, Apple Podcasts or wherever you get your podcasts.
Listen to the full episode to hear more from Derek Handley.
Money Talks is a podcast run by the NZ Herald. It isn’t about personal finance and isn’t about economics – it’s just well-known New Zealanders talking about money and sharing some stories about the impact it’s had on their lives and how it has shaped them.
The series is hosted by Liam Dann, business editor-at-large for the Herald. He is a senior writer and columnist and also presents and produces videos and podcasts. He joined the Herald in 2003.
Money Talks is available on iHeartRadio, Spotify, Apple Podcasts or wherever you get your podcasts.