New Zealand entrepreneurs have created at least nine businesses worth more $1 billion each over the last 15 years, which collectively created $34 billion in value.
They include well-known companies such as A2 Milk, Xero, TradeMe and Rocket Lab, as well as some that are less well-known including Anaplan and Telogis (now Verizon Connect), according to a new report from Callaghan Innovation.
Broadly categorised, they include one food and beverage company (A2), one consumer products (AllBirds), five ICT/software companies (Xero, TradeMe, Anaplan, FNZ and Telogis), as well as Rocket Lab and industrial biotech innovator LanzaTech.
Around half are now based offshore.
Callaghan's report - Growing The Pie - estimates these "unicorns" have between them created more than $34 billion in value.
But the report found their total value to New Zealand Inc was much greater because of their contribution to other start-ups and to philanthropic causes, Callaghan Innovation CEO Victoria Crone said.
“What most of these businesses have in common is they are helping to grow the innovation ecosystem in New Zealand,” she said. “We have come a long way since the sale of Navman 15 years ago, and we are starting to see an explosion in entrepreneurialism in Aotearoa."
Another eight technology businesses are estimated to be worth more than $500 million each, and over 20 are worth more than $100 million each.
Pioneering Kiwi entrepreneurs interviewed for the report, including Sir Stephen Tindall, Bridget Coates, and Rod Drury, share a strong view that New Zealanders should not fear overseas investment in the country's best new businesses.
Almost always, such investment is a net benefit to New Zealand, helping to improve business expertise, conquer world markets, and invest in more new businesses, they say.
The report tracks in detail how the money and expertise gained from the sale of Sir Peter Maire's Navman has been reinvested in many more businesses since, many of which are now world leaders in their fields.
Rowan Simpson, who was part of the founding team at TradeMe, for instance, said the people who worked on Trade Me leading up to and just following its original $700 million sale to Fairfax in 2006, have gone on to be involved in a long list of successful ventures including Xero, Star Now, Vend, Webstock, Beauty Bliss, Timely, Rubber Monkey, Movac, and many others.
But Simpson thinks the country and its innovation community has work to do communicating those benefits.
"In my opinion we’ve done a very poor job of clearly defining what it is that we want from high-growth early-stage businesses," he said. "Is it jobs and, if so, do we care about the types of jobs? Is it export revenue? Is it profits? Is it majority local ownership? Is it to grow the capital base that can be re-invested in the future?
"To optimise for any one of those requires compromise on at least one of the others. So when the answer is ‘all of the above’ it shouldn’t surprise that there is going to be some confusion about what is a good outcome.
"Sadly at the moment we seem to be going backwards and focusing instead on measuring ‘inputs’, like the number of companies started, the amount of capital raised or the amount spent on R&D."