New Zealand's technology sector is booming, with more companies going global, raising capital and expanding than at any time since the Global Financial Crisis, according to research by the Technology Investment Network.
Technology Investment Network produces the annual TIN100 report tracking the progress of New Zealand's technology companies. At an event at advisory firm EY's office last night in Auckland, the top companies by revenue growth were named.
The EY Top Ten Companies to Watch and ASB Hot Emerging Companies for 2015 included firms with revenues of $14 million to $1 billion, and $3 million to $14 million respectively.
Revealing the two lists, before the release of the full report on October 28, Technology Investment Network managing director Greg Shanahan noted the positive movement of most technology companies in the past year, with success in United States markets highlighted as a key factor.
"You're seeing the high-growth companies getting US exposure sooner than you might otherwise have expected so all of a sudden they're going global sooner," Shanahan said.
"The other aspect of that is that a lot of those companies are publicly funded so some of them are quite small but they've got plenty of cash and so that's enabled them to achieve growth elsewhere [outside the US]."
Total revenue for The EY Ten Companies to Watch list was up $378 million, or 12.5 per cent, for the year with the smaller ASB Hot Emerging Companies to Watch list up $32 million, or 80 per cent.
Fisher & Paykel Appliances topped the EY Ten Companies to Watch list followed by Datacom, Xero and Fisher & Paykel Healthcare.
In the ASB Hot Emerging Companies list, Pushpay came up tops, followed by Vend and Serko. Shanahan said one of the fastest growing sectors was in financial services.
"One of the key trends is a large number of these companies are in the financial services technology sector, like Vend, DataTorque, PushPay, Xero, Transaction Services and Invenco, so it's a strongly growing market.
"It's exciting that the ICT companies are growing but some of the companies that have been around for a while, like Tru-Test, Gallagher Group, Fisher & Paykel Healthcare (with outgoing chief executive Mike Daniell) and Datacom, are also all doing well," he said.
"It's indicative of a rising tide but also a growing level of expertise and understanding of how to grow a global business."
The decline of the New Zealand dollar against the US dollar as well as the continued growth of the US economy had provided a significant boost for tech exporters according to Shanahan, who said it was the first time in a decade the two factors had happened simultaneously. It was also the first time both lists had shown growth of this scale since the GFC, and Shanahan said if current economic conditions remained the same, this expansion was likely to continue.
"The two lists demonstrate the health of the sector with well known large companies doing well, but also a fresh supply of unknowns coming through the ranks."
Over the 11 years the report has been produced, Shanahan said technology exports had continued to grow, comprising an increasing portion of the total export market.
"I think that New Zealand is, and can be even more so, a global leader in technology and the TIN100 report is using this information to make what success looks like transparent so that other companies and other people can be inspired to follow their example."
According to Shanahan, a number of the technology companies that were succeeding were businesses that had dealt with the GFC and come through the other side as leaner and better designed.
"The level of competition now globally means businesses have had to be better by lean manufacturing and better by design," he said.