New Zealand has all elements to be like Silicon Valley, say US experts

New Zealand has the main attributes to become a version of Silicon Valley and is on the right path, according to two US experts.

Sam Altman and Scott Nolan have worked in California's famous start-up hub, Silicon Valley for years. Altman is president of start-up accelerator Y Combinator which has funded more than 700 start-ups in the past 10 years, with Nolan a partner of Founders Fund, a leading venture capital firm in Silicon Valley.

The pair have visited New Zealand several times, and said based on their view of the country as well as some of the innovative entrepreneurial companies emerging, they believed New Zealand could grow into a global start-up hub similar to Silicon Valley.

"New Zealand is a younger system and has more growing to do, but it seems like it's on a trajectory from what we can tell to be [the next Silicon Valley]," Altman said.

"We think New Zealand has a lot of the pieces you need to make an ecosystem work - very good technical talent, a community that's interested in start-ups, expertise in specific areas that we think are likely to create disruption, a relatively low cost of living, and if you look at the sort of things that a country needs to create a great start-up environment we think that New Zealand has a lot of those criteria."

According to Nolan, a growing number of investors and business people from the States were looking outside the country for areas that would be good to invest in or were good for start-ups. He said the number of start-up companies in New Zealand showed the strength of its ecosystem, and said New Zealand was in a good position to benefit from this.

"There are a lot of reasons to believe that more and more great start-ups are going to be built outside of Silicon Valley and there are forces at play that should make that more and more possible," Nolan said, adding that the increasing cost of living in California was also pushing businesses to look outside of the region.

Nolan said one of the best attributes New Zealand companies had was a willingness to be open about what they were working on and share ideas and collaborate within the business ecosystem. He said a lot of younger businesses in Silicon Valley had a tendency to be secretive about what they were working on, which often hindered their ability to grow.

"I think that openness and non-secrecy is a huge asset," Nolan said.

"There is a big advantage to know what everyone around you is working on and have those personal relationships that you can lean on."