Impact Entrepreneurship in New Zealand
11 reasons New Zealand is the place for purpose-driven business
Down at the bottom of the world, there is an exciting sense of momentum building. In the wake of a growing worldwide awareness and demand for businesses to become more environmentally and socially ethical, one country is carving out a niche for itself to address this growing need.
New Zealand is commonly associated with hobbits, rugby, and sweeping, mountainous vistas. But in recent years, a number of cultural, policy and business trends are creating the perfect conditions for an interconnected ecosystem of entrepreneurs, investors, creatives and changemakers who are driven to achieve positive impact through their work.
At the same time, people around the world are looking for like-minded communities who share their values. At our core, we are tribal beings, and we have a desire to connect with others who are passionate about the same things. Below we outline 10 reasons why individuals and organisations who strive to make positive impact can find an ideal home in New Zealand.
1. Sensible immigration policy
While the much of the world is tightening borders and adopting nationalistic immigration policies, New Zealand, also known by the Māori name of Aotearoa, is viewing immigration as an opportunity rather than a problem.
In 2017, the New Zealand Government introduced the world’s first visa to focus primarily on an individual’s potential to create positive impact for the country and the world — the Global Impact Visa (GIVs). Entrepreneurs and investors have the flexibility to change their business plan and/or work on multiple projects at once, they can take on supplementary employment, and there are no requirements for minimum days spent in New Zealand within the 3-year term. Family visas are provided and after 30 months, GIVs-holders and their families can qualify for permanent residency.
To become eligible for GIVs, individuals must first be accepted into the Edmund Hillary Fellowship (EHF) — a community of more than 200 Fellows representing 37 nationalities. EHF Fellows are entrepreneurs, investors, artists, activists, government intrapreneurs and other innovators who are driven to develop long-term scalable solutions to pressing challenges and create global impact. The definition of “impact” varies a lot depending on who you talk to, but for the EHF community, it means disrupting the status quo to remove complexity, make better use of resources, reduce inequalities, engage authentically, and operate in an environmentally and socially ethical fashion.
2. Government support for innovation
Serious about investing in driving New Zealand’s knowledge economy, the New Zealand Government has set up a number of funds and support bodies to accelerate innovation:
- Callaghan Innovation assists with funding and commercialisation support for innovations ins science and technology.
- The New Zealand Green Investment Finance fund is a $100 million fund for companies, projects, and technologies that facilitate lower emissions benefits with the potential to significantly scale.
- The Provincial Growth Fund aims to spend $3 billion between 2018 and 2021 to support innovation, industry and business outside New Zealand’s main centres.
3. Government policy to solve social and environmental problems
In addition to a focus on innovation, the Government is currently pursuing several major policy packages that focus specifically on improving social and environmental outcomes.
- The Zero Carbon Bill aims to put in place the policy underpinning efforts to reduce carbon dioxide and nitrous oxide emissions to net zero by 2050. The Bill also targets methane, with a 2030 target to reduce by 10%, and a provisional target of 24–47% reduction by 2050. New Zealand also has a target of 100% renewable energy generation by 2035.
“Throughout the submissions and public meetings, we heard that New Zealanders want certainty about how we will respond to climate change as a country. This enables business and government to invest and make effective decisions about how the transition to a low emissions economy will occur.”
— Vicky Robertson, CEO Ministry for the Environment, and EHF Fellow.
- New Zealand’s first ever Wellbeing Budget was announced in May 2019, which includes a $1.9 billion investment into mental health services. An investment of this magnitude could help reverse the country’s shockingly high youth suicide rate and reduce high levels of domestic violence. The groundwork was laid over a number of years by the Living Standards Framework undertaken by the New Zealand Treasury — the nation’s primary economic development agency.
- The Predator Free NZ initiative is aiming to eradicate all introduced predator species from the entire country by 2050. For New Zealand’s native bird species, which evolved on islands free of mammalian predators, this could be the policy that saves many endangered species from extinction.
- The Government is currently investigating the possibility of introducing product stewardship regulations that would see manufacturers having to be responsible for their own waste; a promising first step towards a circular economy.
The upshot of these progressive policy initiatives for impact entrepreneurs is that there are going to be massive areas of opportunity and investment in ventures, products and services that can deliver results. To help match government & corporate supply chains with suppliers who create impact, the Ākina Foundation launched social procurement programme Fwd in 2018 in partnership with the Department of Internal Affairs. In the first round of signups, 12 buyers joined the programme, collectively representing an annual procurement spend of $27 billion.
“There is a significant opportunity for organisations to enable social and environmental impact through their supply chains. By including social enterprises in their supply chains, government and corporates can spend the same dollar twice — making a real difference in the communities in which they operate.”
— Louise Aitken, CEO, Ākina Foundation.
4. Investors and employees alike are increasingly driven by impact
New Zealand launched its first dedicated impact-based venture fund, the Impact Enterprise Fund, in early 2018 raising NZ $9 million in their first raise. Purpose Capital launched mid-2019, with the goal of raising NZ $20–30 million, and several others are in development. In addition, equity crowdfunding through platforms like PledgeMe make impact investing accessible to the smaller scale investor.
The NEXT Foundation is a strategic philanthropy fund, with a $100 million spend available over 10 years for education and environmental initiatives. While it is a philanthropic fund rather than a venture investment fund, NEXT targets initiatives that are run in a business-like way, and have the potential to create transformational impact.
New Zealand’s well educated workforce are likewise motivated to see business doing good. In the 2018 Colmar Brunton Better Futures report, 86% of employees agreed with the statement, “It is important for me to work for a company that is socially and environmentally responsible” — an increase of 13 percentage points from the previous year.
“In a world in which both public policy and consumer demand are forcing business models to shift, the total cost accounting values and mindset that abounds in New Zealand positions it well to mint the kinds of companies that the world will increasingly demand.”
- Andrew Hoppin, Investor and EHF Fellow
5. It’s super easy to do business
New Zealand is recognised by the World Bank as the easiest country in the world to do business. It is unbelievably simple to register a company. In a three step process, you can check and reserve your company name and then incorporate it online at the NZ Companies Register. The whole process costs around $130, and takes less than an hour. Once registered, the Inland Revenue Department (IRD) send you links and information about free seminars to help you learn the ropes. Navigating the tax system is remarkably simple compared to other countries, with a streamlined online process for filing taxes.
Compared to other larger economies, there is a distinct lack of massive corporations who dominate markets, meaning that there is breathing room for trying different things and experimenting, without being immediately overtaken or acquired by a large competitor. The small population also means that those who are highly trained or specialised in a particular area can carve out a niche for themselves quickly. It’s a much smaller pond, and you can be a big fish. This results in open doors, more opportunities, and the chance to expand your network very quickly.
6. The lifestyle is second to none
For those who are interested in transforming the nature of business to be more holistic and to live a similarly balanced life, New Zealand is a paradise. Commutes are short — many are walkable — and in no city in New Zealand are you more than half an hour’s drive from beautiful beaches, vast forested areas, or natural adventure playgrounds. New Zealand’s well educated workforce have a good work/life balance, value time spent with family, and are among the friendliest people you will meet. (Read more about this in our interview with EHF Fellow Boyd Multerer here, on his experience of moving his family from Seattle to Wellington.)
New Zealand is generally a safe country, with policies that promote peace. In the wake of the March 2019 shooting attacks on two mosques in Christchurch, in which 51 people were killed by a white supremecist, there was a national outpouring of support for the Muslim community. It was New Zealand’s first major mass shooting since 1990, and the Government reacted swiftly, banning semi-automatic firearms within a week.
“There’s a great natural filter in New Zealand for people who care about impact. People from other countries who want to be the biggest and the best at all costs in a purely capitalist sense would never move here. Those who do have a different set of priorities. If you share them, it’s a great place to find collaborators.”
— Alanna Irving, EHF Fellow
7. Kiwis value collaboration over competition
Whether it’s time, money, mentorship or advice, Kiwis are super helpful and tend to make time for each other. New Zealand has been described as a “village of 4.5 million people”, and there is a cultural belief that most people are connected within two degress of separation. When the likelihood of running into people time and again is high, people tend to invest a lot in social currency and avoid burning bridges or trampling over one another.
“It’s pretty amazing actually. In the dozens of countries where we have been asked to share our waste-to-energy technology, never have we encountered so many offers to help. We have over 70 groups and communities now talking with us about making New Zealand the world’s first zero-waste nation — all coming from one little chat given at New Frontiers summit with EHF!”
- Mike Hart, EHF Fellow.
The Enspiral community is a fantastic example of impact-driven individuals pooling tools and resources together to achieve more collectively. A network of over 300 entrepreneurs, programmers, designers, freelancers, and investors, they share information, finances and decision-making to enable more people “working on stuff that matters”.
8. Government and major CEOs are accessible
The social accessibility of the New Zealand business community extends into government. You can often get a coffee meeting with the head of a Government Department or the CEO of a big company, sometimes even one that you might be in direct competition with. It’s not uncommon for you to be able to meet with your local Member of Parliament, or to engage in the process of developing policy.
“If you have a problem with something in government — a tax issue, immigration questions, or how to apply for assistance — you can just ring up that ministry or department and someone will answer the phone and help you out. Kiwis don’t even understand why this is mindblowing.”
- Alanna Irving, EHF Fellow, originally from the US.
9. A shift from social enterprise to impact entrepreneurship
One significant trend in New Zealand at the moment has been the rise of the social entrepreneurship sector over the past five years or so. In 2017, New Zealand hosted the Social Enterprise World Forum (SEWF) in Christchurch, attracting 1600 attendees representing not only social enterprises, but government, corporate business, not for profit organisations and the philanthropic sector. The 9th world forum, it was the largest event to date, and really helped to galvanise the sector in New Zealand, providing a collective identity that was previously elusive.
Even so, there is a growing awareness of the need to embed impact into all forms of business or organisational activity, rather than prescribing specific business models or labels. This is well demonstrated in the shift in focus for the Ākina Foundation — New Zealand’s biggest champion of the social enterprise sector — from “growing social enterprise” to “putting impact at the heart of our economy”.
10. The Māori worldview brings a holistic approach to business
Aotearoa New Zealand suffers an unfortunate history of colonisation like most western nations, with the consequential negative social and economic effects are still felt widely in Māori communities today. The New Zealand Government has been going through a Treaty settlement process in recent years with a number of iwi and hapū (tribes and sub-tribes) around the country, to compensate for land confiscations. Although the payouts represent only a fraction of the value of what was taken, they are helping to fuel a rapidly growing Māori economy that in 2018 was valued at $50 billion.
Many Māori-led businesses are embedding values from Te Ao Māori (the Māori worldview) into their business models, and these values increasingly permeate into businesses run by non-Māori as well. Commitments to kaitiakitanga (stewardship over the land and people), whakawhanaungatanga (the process of establishing links, connections, and relationships between people), and long-term planning (for example, a 500 year plan) are placed at the core of how businesses operate. In the wake of the Whanganui River, Mount Taranaki, and the Te Urewera ranges gaining legal rights of personhood in recent years, conversations are shifting to how businesses can have a more genuine relationship with the land upon which their operations are based.
Immigrants who come to New Zealand through EHF are provided with a comprehensive and immersive welcome week experience that places great emphasis on navigating Te Ao Māori and tikanga Māori (Māori protocols or ways of doing things), and the community offers helpful inroads to Māori communities and business networks.
“I was pleasantly surprised by the integration of Māori culture in New Zealand and the ways Māori businesses operate. They have a different attitude towards business and life, which has a crossover positive effect on the fabric of society.”
— Boyd Multerer, EHF Fellow.
11. You can take bigger risks
New Zealand has long enjoyed a strong social safety net, with unemployment benefits, free healthcare and affordable education. The Social Security Act 1938 introduced a comprehensive system of tax-funded benefits, designed “to safeguard the people of New Zealand from disabilities arising from age, sickness, widowhood, orphanhood, unemployment, or other exceptional conditions”.
This makes entrepreneurship less of a risky endeavour than it is elsewhere — if your startup doesn’t pan out and you lose your life savings, it’s unlikely that you or your employees will end up on the streets or losing your healthcare cover. It also makes entrepreneurship more accessible to a wider range of people — not just those who are already wealthy or have a family support network to catch them should they fail. These benefits are available to NZ citizens and residents only, but the bonus with EHF and the Global Impact Visa is that you can qualify for this status after 30 months on the visa.
Given it’s small and agile nature, things are quickly developing in New Zealand, and those who are driven by creating impact can quickly find their feet. There has never been more urgency around solving social and ecological challenges on a global scale. If you are driven by such work, and you want to learn more about whether New Zealand is a good fit for you, check out these links:
- Learn more about the Edmund Hillary Fellowship and Global Impact visa here (or if you are ready to apply, click here)
- Meet the current EHF Fellows
- Learn more about New Zealand and the EHF network of support here
Are you a visionary entrepreneur, investor, or changemaker building solutions to global challenges? You can bring your vision to reality from New Zealand by joining the Edmund Hillary Fellowship. Apply here.
