Despite the COVID-19 lockdowns and the uncertainty and disruption to business, 2020 has seen continuing strong investment activity in start-ups in New Zealand, with ANZ’s investment in Aider just one of a number of similar deals.
PwC’s November 2020 Startup Investment magazine noted that 2020 was likely to see more than NZD$100m of investment going into start-ups in New Zealand, on par with previous years.
It recorded NZD$33.6m of start-up investment in the first half of 2020, with 42% of this focussed on “SaaS” or Software as a Service technology.
Even before Covid-19 accelerated the pace of change, the global market for SaaS – cloud-based software systems for companies – has been growing rapidly, and is expected to be worth more than NZD$317 billion by 2022.
Paying a subscription to access an application over the internet – often through a web browser – rather than having to host it on a company’s own servers, enables businesses of all sizes to access powerful software with minimal upfront costs.
Small companies can now access software and insights that were once only accessible by large corporations.
In many ways the world is only now waking up to the fact that data is the new oil.
Cloud-based systems like these are expected to become increasingly popular, especially in these uncertain economic times as we experience the financial fallout from the global pandemic.
Software systems like Aider can adapt quickly to dynamic business conditions and are capable of rapidly re-tooling their services to meet changes in customers’ needs or regulations, competitive rivalry or changing device or internet usage.
Start-ups that demonstrate adaptability and agility, while staying focused on their particular niche or objectives, will see success in what is a new and exciting start-up age.
The pandemic has highlighted the need for businesses to have digital offerings, while the combination of artificial intelligence, machine learning and voice assistants like Alexa, Siri or Google Assistant make these services increasingly easy to use and accessible globally.
Previous financial crises have shown us that innovation is often borne out of economic uncertainty and there are clear indications the disruption caused by Covid-19 will have the same effect.
Start-ups in New Zealand look to benefit from the brain gain of returning Kiwis, often with extensive global start-up experience, while also being able to make the most of a local investment climate eager to back and help develop these new technologies.
The export of software and services was worth over NZD$2 billion to New Zealand in 2019, up 47% on 2017.
It is clear that with the right support and investment, start-ups like Aider have the potential to play an exciting and vital role in New Zealand’s economic revival.
This article first appeared in the New Zealand Herald on December 4th 2020