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OUR RESEARCHERS WENT TO THE BEACH TO HELP BUILD A $300 MILLION INDUSTRY.Since the 1990s, Cloudy Bay Clams has been harvesting tuatuas and other surf clams. The company saw the potential to grow a much larger business, but first it wanted to make sure its ideas made economic and ecological sense.

So Cloudy Bay Clams formed a partnership with AUT University to develop a sustainable new fishery. The surf clam industry currently yields about $10 million a year but there are indications a $300 million export industry is well within reach.

AUT Associate Professor of Applied Ecology Lindsey White was commissioned to survey the Foxton coastline. Based on this survey, the Ministry for Primary Industries set a quota of 2,800 tonnes from 42 kilometers of the Manawatu coastline – essentially doubling the clam quota for the whole country.

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4 | IDEALOG.CO.NZ

CONTENTS | September– October 2015 | Issue 59

Forward6 Editorial

Is it sharing? Is it commerce? No, it’s collaboration – and Idealog’s doing it too

9 Idealogic What happens when loyalty

schemes go feral 10 Exponential futures

Scary scenarios from a Silicon Valley futurist

12 Doing good, being bad Social entrepreneurs, rich

men, and injecting eyeballs

14 Global briefs Recycling, Angry Birds and

VDubs topple the Japanese 15 Kiwis as lab rats Global tech companies testing

their products on us

16 Emerging talent: Dakai Tapping Chinese brains

17 Pitch Circus Kiwi creative taking

bangerritos to the world

18 The Gear Design with a hint of apricot

20 Style rebellion Fashion at Atherton House

Features23 Five fabulous female foodies Breadfruit flour, chia seed drinks, paleo snacks, vege-

enhanced pet food. What will they think of next?

37 Collaboration Nation? Why two heads aren't nearly as good as four, or eight, or...

52 On a high: Making dosh from legalising dope Colorado reaped $US 76 million in tax revenue from

legalised marijuana sales in 2014. Why not us?

56 Power and the people Bracing for massive disruption in the electricity sector.

Plus: Dude, where's my electric car?

Special feature46 Creating collaboration

Inside AUT’s Colab

Workspace71 Hiring and hiring

Six tips for hiring in a talent-strapped world

72 Shifting the Titanic Mark Templeton has turned

around three companies. Now he’s doing it again

74 Books Jane Kelsey believes we’re

heading for economic crisis

52

Columns75 Lord of the things

Don’t tell my fridge

76 The American dream Get out and flaunt it!

77 Marking your territory Peeing around your desk

78 Too good to last The future for National

79 Paul Henry naked... and the saving of journalism

80 A Kiwi paradox Fighting the wrong battles23 56

76

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6 | IDEALOG.CO.NZ

EDITORIAL | September – October 2015 | Issue 59

facebook.com/idealog linkedin.com/groups/Idealog-4206549 twitter.com/idealogmag gplus.to/idealog

I PROBABLY SPEND more time than I should mulling over the meaning of words. Might be a journalist thing. Like, when did “cute” stop being small (and probably furry) and start being something that looks good (probably to a teenager). When did a bulldog become cute? Don’t get me started.

Recently I’ve been pondering the collaborative economy – sometimes called the sharing economy.

It is a much overused phrase these days. Some commuter paying to park in your inner city driveway while you are at work? Sharing. Getting a group of investors together to fund your start-up? Collaboration. Renting a bed from a guy you’ve never met in Kazakhstan? You get the message. Suddenly things aren’t transactions any more, normal business; they are collaboration, sharing.

Call me old fashioned, but when I was in kindergarten, sharing didn’t involve an exchange of money – that was called buying. Just because I use Uber to get to the airport, or Airbnb to find a place to stay when I get to my destination, doesn’t make it collaboration – just a technologically disrupted version of an age-old commercial model.

To me, Airbnb is a peer-to-peer marketplace, not a collaborative (or a shared) anything.

But I suspect all this is just a problem of semantics. The sharing or collaborative economy has come to mean a business system, probably involving clever use of technology, which allows us to make use of excess capacity in goods and services. My empty driveway, for example. Or that spare bed in Kazakhstan.

As far as I can see, “rental” becomes “sharing” when the goods are something an individual bought, probably for personal use, rather than what a corporation owns.

And PwC reckons the collaborative economy could be worth $US335 billion by 2025. So it’s worth looking into.

Our feature on the “c” word – collaboration – on page 37 is more prosaic, but no less interesting. There’s a reason why the expression “two heads are better than one” has been around for almost 500 years (it was first mentioned in John Heywood’s A dialogue conteinyng the nomber in effect of all the prouerbes in the Englishe tongue, in 1546, although a version of the saying appears in the Bible). Collaboration in its positive sense (not the “sucking up to the enemy in a war” connotation) is a Good Thing, and we should do more of it.

We look at why New Zealanders have traditionally been bad at collaborating, whether that’s changing, and who’s doing it well.

In other parts of the magazine we ponder the economics of legalising marijuana (page 52), profile five fab female foodies doing clever things around healthy food (page 23), get frightened by the thought of our fridges talking to our bathroom scales (page 75), and get inspired by a movie featuring a semi-naked Paul Henry (page 79). Cute? Not.

The collaboration connundrumWhen did renting out your spare room become the sharing economy?

Issue 59

Editor Nikki Mandow [email protected] director Matthew MossDesigner Ann HoDesign interns Rachael Liddell, Rupal HiraDigital editor Jonathan [email protected] Madeleine HeronCommercial manager Anita Hayhoe 022 639 3004, [email protected] & subscriptions manager Monique [email protected] manager Jay SayerPublisher Vincent [email protected]

Contact Idealog Idealog is published by AUT Media19 Lyon Ave, Mt AlbertPO Box 77027, Mt Albert, Auckland 1350(09) 360 5700 idealog.co.nz/[email protected]

Subscribe to Idealog 0800 782 347idealog.co.nz/[email protected]

Production Tangible Mediatangiblemedia.co.nz

DistributionNetlink

Copyright 2015 by Idealog Limited. Idealog™ and The Voice of the Creative Economy™ are trade marks. Idealog magazine is published bi-monthly. ISSN 1177 097X. Idealog is subject to copyright in its entirety. The contents may not be reproduced in any form without written permission of the owners. All material sent to Idealog will be assumed to be publishable unless marked ‘not for publication’. Idealog invites contributions but accepts no responsibility for unsolicited material. The opinions expressed in this magazine are not necessarily those of AUT, AUT Media, Tangible Media or Idealog Limited.

Idealog is published by

Printed by Image Centre Idealog is printed using vegetable oil-based inks. Paper supplied by BJBall using pulp from well-managed forests and other responsible sources.

Founders Martin Bell, Vincent Heeringa, David McGregor

Our collaboration cover Thanks to all our idealog.co.nz readers, friends, and Twitter followers who sent us photos for the cover and collaboration feature.We especially love the premature baby feet!

If you have any thoughts on anything in the mag, write to [email protected], or comment on our stories online.

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Idealogic | Technology | Emerging talent | Pitch circus | Gear

ForwardTo the pointDemystifying the murky world of loyalty schemes

AIR NEW ZEALAND’S recent unscheduled departure from one bank’s loyalty programme to another caught many frequent flyers on the hop, and led to an unseemly squabble between banks desperate to win our eternal patronage in exchange for the chance of a one way off-peak trip to Timaru in 2019.

It also got us thinking. What is it about these loyalty schemes that makes us drive across town to earn points in some programme we don’t really understand and might not ever profit from? What’s in it for the marketers and why do they spend so much on them? And could the collective brains of the Idealogic Department concoct a range of programmes even more attractive than the current crop?

The first two questions probably require some sort of MBA to properly answer, but the answer to the third, happily, was found at the bottom of a bottle of cheap wine, partly paid for with our last nine years’ Fly Buys.

Bottoms up, loyal reader and enjoy our take on the future of rewards.

Shear pointsRumoured to be the banking sector’s big move for 2015, this scheme sees banking return to its rural roots, with at least one company offering to drop round a bale of top quality merino wool

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to its most loyal customers. “Bruce”, a part-time loyalty manager at one leading bank, was cagey about the details but did say: “We’ve been fleecing the bastards for long enough… only fair they get a bit back.”

Emirates Team New Zealand Loyal-teaGrant Dalton and co have really pushed the boat out on this one, promising anyone at all who writes a cheque in support of the next challenge that Dave Dobbyn will pop around in person, sing his 1952 hit jingle “Loyal” until they’re sick of it, then make them a cup of tea.

Ker-Ching!Cash is king in this frankly mad leaked Labour Party programme. Aimed to counter the claims or racism leveled at it in the wake of its Asian-sounding-surname property ownership survey debacle, Ker-Ching offers to compensate anyone called Ching, Chang, Lim or indeed anything a senior Labour staffer described as “even a little bit Howicky.”

Fight ClubcardPrivate prisons operator Serco describes this as, “an innovation in modern corrections facility management.” Fight Clubcard offers prisoners great rewards such as home brewed alcohol, mobile phones, Class B drugs and even Corrections Officers’ radios in exchange

for creating and distributing relevant and compelling video content online.

Dine with DOCAimed squarely at the gourmet end of the market, Dine with DOC rewards foodies who aren’t afraid to think outside the menu. The programme encourages all New Zealanders to make better use of the living larder currently sitting wastefully in our zoos, national parks and wildlife sanctuaries and offers tasty rewards for doing just that. The scheme currently focuses on kereru and other easily caught birds, but seafood lovers will be licking their lips at the prospect of Maui’s Dolphins returning to the menu in late 2016 (served rare, of course). Frequent flyers heading for Zimbabwe might think about joining the newly-opened international sister scheme Supper with Cecil.

Startup Burn ‘n’ EarnThis scheme is sponsored by NZTE and rewards startup companies not for spending their own money, but investors’. NZTE head of press releases Sarah Frankly-Speakin explains, “Profit is an outdated metric and anyone who focuses on it is living in the past. We wanted to reward companies who aren’t afraid to spend other people’s cash. Especially ours.” Details are sketchy but the scheme looks likely to offer direct cash payments to companies with a proven record of accepting and spending direct cash payments.

10 | IDEALOG.CO.NZ

FORWARD | Briefs

Number of connected devices

Number of people online

Exponential futuresSalim Ismail, an Indian-born Canadian working in Silicon Valley, spends his life thinking about the future, in particular a future dominated by exponential organisations – ones growing not in a linear fashion ( for example, 10% a year), but exponentially (eg doubling each year). He visited New Zealand last month, where he outlined a future where exponential growth in key technologies will change the world as we know it in ways that are awe-inspiring, and a bit scary.

DRONE LOADS At the moment quadcopter drones can carry packages of about 4kg. Soon, that will double to 8kg, and then again to 16kg. Imagine the impact on international post-disaster aid in remote areas.

DRIVERLESS CARSThe per-car cost for sensors on Google’s driverless car:2009: $US300,000 2011: $US75,000 2015: $1,000“Today’s four-year-olds will never get their drivers’ licence.” Salim Ismail

POWERFUL SOLAR Solar is doubling its price performance (ie cost against output) every 22-30 months. At this rate, Ismail predicts solar could deliver 100% of the world’s energy needs by 2038, and 200% soon after. Not too long after that, solar could render electricity almost free. “We believe we are flipping the needle from the world of scarcity to the world of abundance.”

HAIER SIZED GROWTHChinese whiteware manufacturer Haier (owner of Fisher & Paykel Appliances) reorganised its 80,000 staff into 2,000 autonomous teams, which choose their own team leaders and vote collectively on what new features to work on. The result? A 400% increase in revenues between 2000 and 2013.

2100

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50 billion

2005 50 million

2015 12 billion

2010 1.2 billion

2020

more than 5 billion

2015

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EXPONENTIAL ORGANISATIONS Airbnb – 90x more listings per employee

than competitors Quirky – 10x faster product development

(29 days compared with 300 days Tesla – 30x bigger market cap per

employee Tangerine (formerly ING Direct Canada) –

7x more customers per employee and 4x more deposits per customer

Uber – 10x valuation increase 2011-2014 ($US2b-$US20b)

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FORWARD | Briefs

Number of intelligent cleaning robots that could be working in NZ by the end of the year. Imported from the US by cleaning company OCS, three of the small-child-sized Intellibots are already at work at Auckland Airport, with the rest heading into servitude later this year. They cost $50,000 each.

15Going badHanover Finance boss Mark Hotchin – and most of the other directors of the finance company that went under taking $500 million of investors’ money with it – has settled with the Financial Markets Authority (FMA) to the tune of $18 million, avoiding a lengthy court battle.

The outcome for the 16,000 investors? Most will get nothing, and the “lucky” few (around 5500 investors) will get 5c-20c in the dollar.

The outcome for Hotchin? He gets his frozen assets back including, presumably, several million dollars of assets from property sales, and his share in the $91 million he and fellow director Eric Watson took out of the company in dividends in the years before it went bust. Sounds fair.

SCARY SCIENCEA group of US-based biohackers (do-it-yourself biology researchers) has figured out how to give humans temporary night vision, by injecting Chlorin e6, a chemical found in some deep-sea fish, into their eyeballs.

Doing good19-year-old Kiwi social entrepreneur Bonnie Howland put her uni education on hold to launch Indigo & Iris, a vegan and cruelty free cosmetics company. Her first product,

Mascara For Sight, puts some of the

profit from each sale towards sight-saving surgery in the Pacific.

Last month Howland

was chosen to represent

New Zealand at the 2015 Global Entrepreneurship Summit in Kenya – also attended by US President Barack Obama. Ok, she didn’t actually shake hands with the Great Man himself, but what were you doing at 19?


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Busy mind waking you up?

CORRECTION : In the story “Risk of showers” in the last issue of Idealog, we wrongly stated that “Methven is fighting back after half a decade of financial losses”. This should have read “half a decade of declining revenues”. Whoops. Our bad. And Methven, while originally a Dunedin company, is now Auckland-based. Apologies.

NO ONE EXPECTS to end up in trouble – heart attack, mugging, car breakdown in the middle of nowhere on a dark night etc. Unfortunately, this stuff can happen.

Mobile phones are a boon in bad situations – call an ambulance, call a breakdown service, call a friend. But what if you don’t speak English? Or you are here on holiday and don’t know the number? Or you don’t know where you are?

GPS is good for that, but if your life depends on someone being able to find you quickly, normal mobile GPS technology isn’t failsafe. There are urban canyons, lifts, underground car parks. Then the device defaults to your last known location – which isn’t a bargain if you are unconscious in a pool of blood.

Auckland-based company 2Life has developed a monitored personal safety service which works off a smart phone and uses new triangulation GPS technology. Press the 2Life icon and you are connected to a call centre, which will link you to emergency or breakdown services, translating if you don’t speak English (Mandarin, Cantonese, Korean and Hindi offered so far).

Co-founder Stephen Katz says the idea came from an elderly aunt who had a medical alert system at home, but was stymied by the fact it only worked within 50-100m of the base station at home.

“Worrying there might be an emergency while she was out was inhibiting her quality of life,” Katz says.

Working with a software developer, Katz began building a safety alert system based on smartphone capability and enhanced GPS. 2Life was launched in 2014, with its first major customer being AUT, which wanted a safety system to offer newly-arrived foreign students.

Now the company has signed a deal with the third biggest global China Southern, and China Travel Services. Katz says the two state-owned companies are keen to promote 2Life to Asian travellers coming to New Zealand with little or no English, but wanting to travel independently.

“China is New Zealand's second biggest tourist market, with over 310,000 visitors arriving in the year to April 2015, up 26% from the previous year,” Katz says. “In the past, Chinese visitors have been restricted to tours because of not being confident on their own. What would happen if they got sick, or lost, or their vehicle broke down?”

Katz says the China deal will see 2Life offering concierge services too, and the app will be being bundled into a $50 mobile phone package including a New Zealand Sim card, calling minutes locally and to China, texts and data.

Disclaimer: 2Life shareholder Mike Hutcheson is also a director of the company that owns Idealog. But the story meets our normal Idealog editorial criteria: an idea so cunning you could pin a tail on it and call it a weasel.

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14 | IDEALOG.CO.NZ

FORWARD | Briefs

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Recycling

HATE ITThe growing mountain of 700,000+ festering tyres

in a dump in Taranaki. The only option to get rid of them appears to be compacting and

exporting them.

LOVE ITA PhD student at AUT is

researching making shoes for kids out of thrown-out academic regalia (mortar

boards, gowns etc). Grave to cradle (kind of ).

ANGRY BIRDS ON THE BIG SCREEN

Finnish gaming firm Rovio has invested almost $120 million in an Angry Birds movie, set to premiere next year. The company is looking for a come-back, after profit halved last year and turnover fell 9%. The Angry Birds game, launched in 2009, has been downloaded almost 3 billion times. For non-aficionados, the plot involves birds jumping into slingshots and attacking pigs’ fortresses. Quite how that will become a full-length feature film remains to be seen.

Overtaken by a Bug

Volkswagen became the world’s biggest-selling carmaker in the first half of the year, knocking Toyota from the position it has held for three years. The VW empire (which includes Porsche, Bugatti and Audi) sold 5.04 million vehicles Jan-Jun 2015, versus Toyota’s 5.02m. General Motors finished third.


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LLFORWARD | Technology

“New Zealand companies in the technology space will always be helped by the fact that Kiwis are very progressive in their uptake of technology.”Rob Ellis, CEO, Semble

or a new feature added to an existing one, is a resounding flop in New Zealand, it can quietly be dropped without having much effect on the company’s overall reputation.”

Facebook apparently canned disappearing messages (à la Snapchat) and a tool that let users pay a small fee to promote their status updates to friends, after Kiwi users nixed them.

“If you mess up and burn [in the NZ market], it’s not that big a deal,” David Stewart of photo-sharing firm Fade told The Economist.

Being a lab rat isn’t normally a bargain, but in this case NZ firms also benefit from this country being the place to technology-test subjects.

For example, NZ was one of the first testing grounds for Eftpos payments in the 1980s. And this Kiwi success is one of the reasons New Zealand is at the forefront of trials into “mobile money” (smartphone payment systems), says

Rob Ellis, CEO of Semble, the company behind New Zealand’s first mobile wallet – a product intended as competition for innovations such as Apple Pay and Google Wallet.

“New Zealand companies in the technology space will always be helped by the fact that Kiwis are very progressive in their uptake of technology,” says Ellis.

Semble (launched in March and previously TSM NZ) is a collaboration between Spark, 2degrees, Vodafone, Paymark, and banking partners ASB and BNZ. It uses technology provided by the Dutch security firm Gemalto to protect users’ contactless payments.

While Rob Ellis rejects the notion that Semble is somehow a test vehicle for foreign companies (“It is a New Zealand innovation, by Kiwis for Kiwis”), he accepts the country makes for an attractive proposition for overseas firms.

“I believe it’s about the Kiwi “can do” attitude and our size. We’ll always give it a go and we’re small so we’ve got a better chance of making it happen quickly,” says Ellis.

Paul Spain says he has come across a range of companies working with New Zealand firms – mostly leading innovators in their field globally, such as Umajin, Aeronavics, PowerByProxi, Navman, Teknique, Marker Metro and Fusion – to test technology in New Zealand.

Kiwis as lab ratsInternational tech companies are testing their products on us.

TEXT BY DANIEL O’MAHONY

ON A CLEAR day in May, Auckland commuters gazing up to the sky for some relief from the gridlocked traffic might have spotted something unusual: a spidery black object, looking a bit like a miniature Dalek, flying over the factories of Industry Road with a small parcel attached.

If they had followed this city-soaring UFO, observers would have seen it stop and hover before smoothly delivering the parcel to street level on what appeared to be a descending fishing line. A quarter of an hour later they would have seen a Fastways van pull up, comprehensively beaten to its own delivery.

This demo drone delivery in Auckland (search “drone delivery trial” on YouTube) was the latest example of a foreign company (in this case US company Flirtey) partnering with a New Zealand business (Fastway Couriers) to test new products and ideas. In other examples of new technology being tested on these shores, Sway, Microsoft’s website-building app, was previewed in New Zealand in October 2014, and Facebook has trialed a number of features here, including single-column timelines and highlighted posts.

It’s a source of smugness for us. We tell ourselves these behemoths use NZ not just because of our geographical isolation, but also because of our tech-savvy population— a combination that provides the perfect, low-risk testing ground for new products.

They also like our hands-off regulatory environment, our network of early adopters and the openness of local companies to team up with foreign partners.

Oh, and we’re probably cheap too.As Paul Spain, CEO of Gorilla Technology

and host of the NZ Tech and NZ Business podcasts explains: “New Zealand has a growing reputation for innovation, fast execution, value, and ease of doing business with.”

Clever us.The trend is getting noticed overseas. UK

business magazine The Economist recently ran an article entitled “Kiwis as guinea pigs”, where it suggested international tech firms use New Zealand to fix bugs, check server capability and to make sure dud products are killed before anyone that matters gets to see them.

“If a firm finds that a particular product,

Microsoft

Facebook

Drone delivery

16 | IDEALOG.CO.NZ

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FORWARD | Emerging talent

Tapping Chinese brainsA Wellington start-up is connecting Chinese students in New Zealand with Kiwi businesses looking to tap into the world’s largest marketTEXT BY STEVEN TRASK

IF YOU’RE KEEN to do business in China, the internet is full of can’t-fail tips like, “order a glass of warm yoghurt to look sweet and considerate in meetings”. Yes, really.

However, if your idea of success doesn’t involve being laughed out of the boardroom, maybe you should speak to entrepreneur Bianca Grizhar instead.

Grizhar is the founder and driving force behind Dakai, a Wellington start-up looking to help Kiwi companies compete in China.

As everyone knows, China is a mind-stoppingly large business opportunity. A $10 trillion economy growing at 7% a year – and that’s in a bad year.

What Dakai wants to do is match New Zealand businesses wanting to investigate the Chinese market, with Chinese students in New Zealand who know the market, know the people,

“There are more than 30,000 Chinese students studying in New Zealand universities – but nobody ever thinks to ask them for advice.”

Idealog’s Emerging Talent page combines a story about new talents and technologies written and illustrated by an emerging journalist and photographer.

and funnily enough, speak the language too. Grizhar says there are a huge number of

Chinese students studying in New Zealand universities – more than 30,000 in 2014 – but nobody ever thinks to ask them for advice.

“These students have an intimate understanding of China, but they are often ignored because of cultural and language barriers,” she says. “This is a huge oversight in terms of the ‘locals-only’ knowledge these students bring with them to New Zealand.

“There are some very simple things. A company’s website might not work in China because it uses blocked applications like Google

or Facebook. Chinese students understand this. They can translate what a business is doing on a platform like Twitter, and put it onto the Chinese counterpart.”

Grizhar, 35, spent four years working in China’s ICT sector, before coming to New Zealand to work for Victoria University’s commercialisation arm.

She says businesses often underestimate what it takes to crack the Chinese market.

“There are the companies who want to get into China, but are a bit naïve about how much work is needed. They think you can take a three-week trip there, and all of a sudden you understand this huge market.”

Other businesses see China as a strange and intimidating place.

“They want to go there but it is too big, or they heard about other people failing, and they are too scared to try.”

Working with students is a cheap way for businesses to decide whether it is worth taking the plunge, Grizhar says. “Chinese students can answer questions like ‘Is there a market for this in China?’, and ‘What would it take to get this product or service over there?’”

Grizhar is working with Victoria University’s Chinese Students’ Association to get Dakai off the ground in Wellington. The first step is building a database of the 800 Chinese postgraduate students there and their expertise.

She is also working with innovation agency BizDojo to unearth some pilot projects – small companies keen to have a crack at China.

Pat English, executive director of the New Zealand China Council, says Dakai could play a valuable role helping New Zealand businesses with language and becoming “China-savvy”.

“Our number eight wire way of doing things has taken New Zealand businesses a long way,” he says, but that is not necessarily enough in the current environment.”

BizDojo co-founder Nick Shewring agrees. He says New Zealand businesses will need to take off their blinkers. “New Zealand has some hugely talented international students, but a lot of businesses don’t see that,” he says.

Meanwhile Chinese Students’ Association president Grace Cheng believes Asian students will be keen on the job opportunities involved.

Shewring says there is no reason Dakai can’t spread from Wellington to other places with lots of foreign students.

“Dakai addresses a universal problem. The potential is huge.”

Bianca Grizhar


FORWARD | Pitch Circus

Sausage sizzlerA crazy creative taking a burrito banger to the world has won the latest IdealogLive Pitch Circus competition

TEXT BY JONATHON EDWARDS

BEN POLKINGHORNE’S idea of a burrito-flavoured sausage is just crazy enough to catch on, which is why we may see the Kiwi-born (but now London-based) entrepreneur’s bangerritos spreading through New Zealand – and maybe even further – over the next year.

It is also why advertising creative Ben Polkinghorne took out top honours at the latest IdealogLive Pitch Circus start-up competition*.

Polkinghorne’s love for burritos started with home dinners as a child. However, he had all but forgotten about them until he discovered California-style Mexican restaurant chain Mexicali Fresh in 2010.

“I thought ‘Oh my God, you can buy a burrito fresh?’ I had to try every burrito in Auckland and find the best one.”

His obsession led him to create The Auckland Burrito Review Facebook page in 2011, with the goal of reviewing every burrito the city. It gained a mini-cult following of more than 1,800 people.

Polkinghorne used the page to “piggyback on election hype” last year and meet politicians Jacinda Ardern, Russell Norman and Nikki Kaye to ask tough questions like, “If you could represent the realistic outcome of the upcoming election as a quesadilla, which party would be the refried beans no one wants?”

Then, while chatting with friend and sausage-connoisseur Matt Simpkins, the pair dreamed up an idea which The Auckland Burrito Review unbiasedly called “the biggest innovation since the sausage roll”: The taste of burritos and the convenient casing of sausages.

Next stop: production. Through his job at ad agency Colenso BBDO, Polkinghorne met Wade Lewis, who owned a boutique sausage factory and the pair got working on a sausage filled with pork, black beans, red cabbage and red onion, to be served with guacamole, hot sauce and sour cream – all wrapped in a tortilla.

Bangerritos were launched last December on a footpath BBQ outside the Ponsonby Workingmen’s Club, but soon got picked up by boutique supermarkets Nosh, Farro Fresh and Moore Wilson, as well as a few New World stores. By June he had sold 50,000.

Polkinghorne worked during daytime hours

“If you could represent the realistic outcome of the general election as a quesadilla, which party would be the refried beans no one wants?”Ben Polkinghorne

*Every IdealogLive Pitch Circus winner receives cash, business advice, a bottle of Johnnie Walker whisky, and a profile in Idealog magazine. To find out about entering, email [email protected].

at Colenso, while his evenings, mornings and weekends were spent on Bangerritos. He says his work at the agency was integral to his success, as he was surrounded by creative people he could bounce ideas off.

Polkinghorne recently moved to banger Mecca: London where, true to form, he tried seven different burritos in the first week.

He hasn’t quite quit the day job yet, working at ad agency Wieden+Kennedy, known for its Nike “Just Do It” slogan and Old Spice commercials. All other time is spent on bangerritos.

His New Zealand plans are to buy a food truck, expand throughout the country and take the product to Sydney, where he has already had interest from gourmet supermarkets.

If things go well in New Zealand and Australia he will target the London market where, he says, there is more room for niche products. “There is a cafe here that literally just sells different kinds of cereal, and a restaurant that only sells gourmet hotdogs and champagne.”

A New Zealand Trade and Enterprise spokesperson says Polkinghorne needs to find the right business partners and look into whether the London market is ready before taking his product there.

“Replicating what the business does in New Zealand may not be the best way to approach other markets.”

Meanwhile Polkinghorne's former boss, Colenso BBDO managing director Nick Garrett, says he believes in the bangerritos idea, which is why he was always tough on him.

“Ben is equal parts wonderfully naïve, emotionally stupid, very tenacious and extremely talented. The wrong combination of those four things and Ben would be an absolute disaster. However somehow he makes it work and to great effect.”

Now Polkinghorne is experimenting with new flavours. He landed a partnership with tequila company Jose Cuervo and after some disastrous prototypes, recently launched a tequila-flavoured chicken bangerrito.

He has future plans for vegetarian and beef flavours, but says he will only release them “when there is some kind of interesting twist”.

Meanwhile, the business advice offered to all Pitch Circus winners may come in very handy. “I’m sort of making it up as I go along. I don’t really have any idea what I’m doing.”

18 | IDEALOG.CO.NZ

FORWARD | Gear

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HWITH ITS SPRAWLING angles, igloo-shaped white plaster, and signature circular turret, Athfield House looks like a shipwreck from some distant Mediterranean island. The first major project from Ian Athfield (later Sir Ian), it was built as his house and studio, and initially many people considered it an eyesore.

But like the vilified Eiffel Tower before it, Athfield House has become one of the most recognisable buildings in New Zealand architecture; a unique building from a man whose work both offended and inspired.

Working Style founder and director Chris Dobbs says the team chose Athfield House for its “rebellious spirit”, and the way a “wild creation evolved into a timeless classic”.

“When I grew up in Wellington, this was a really weird building,” Dobbs says. “It was controversial. And now, it’s very much a part of the Wellington landscape. That’s true heritage.”

Dobbs started Working Style 28 years ago, selling made-to-measure shirts door-to-door (and office-to-office), before branching out into suiting and then casualwear. It is now one

Style rebellionWorking Style has chosen the late Sir Ian Athfield’s signature home Athfield House as the backdrop for its Summer 2015/16 collection campaign.

FORWARD | Lifestyle


“When I grew up in Wellington, Athfield House was controversial. Now, it's very much a part of the Wellington landscape. That's true heritage.”Chris Dobbs, Working Style founder and director

of New Zealand’s longest-running made-to-measure menswear brands.

The Athfield House campaign, shot by Mark Smith and styled collectively by the Working Style team, is the second of an on-going series of Working Style shoots photographed in iconic New Zealand buildings. The first, for the Winter 2015 collection, was shot in Auckland’s recently reopened St James Theatre.

Working Style will also be releasing an online video of the photo shoot as part of the company’s expanding digital marketing

strategy, which is spreading the brand to new customers over social media. A recent video, shot at a private airport north of Auckland to promote Working Style’s summer wedding line, has reached more than 650,000 people.

Dobbs says Athfield began work on his eponymous building 50 years ago, and it remains a work in progress, despite his death in January this year.

“It’s his life’s work, so it’s a real privilege to be part of that,” says Dobbs. “And I’ve been doing this for 28 years. It’s my life’s work as well.”

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INNOVATION | Food


In January this year Idealog freelance writer Latesha Randall and her partner Seb started a coconut yoghurt business out of their home in Raglan. Their entrepreneurial journey* (begun when Seb’s allergies meant he had to go dairy-free) has brought Randall into contact with a whole load of other food entrepreneurs making products for the growing gluten-free, dairy-free, organic, health-food segment.Successes, challenges, pull-your-hair-out moments: Randall talks to five fabulous Kiwi women about building their own foodie start-ups.

*Follow the highs and lows of the Raglan Coconut Yoghurt innovation story on Latesha Randall’s blog on idealog.co.nz.

Les food fatales

24 | IDEALOG.CO.NZ

INNOVATION | Food

Belinda Tuki After being fleeced by her first manufacturer, the Honest Food Company’s boss says her organic products will always be handmade

AUCKLAND MUM AND wellness warrior Belinda Tuki has a growing number of fans raving about her handmade, organic, paleo products. And not only in New Zealand – she’s just had the magic handshake from Australia too, with distribution into major health stores lined up for late July.

Idealog last spoke with Tuki back in 2014, when she’d just finished crowd-funding $37,000. She says that money was put to very good use.

“Having that cash was amazing. It allowed me to grow the company, and hire staff. It also got me into my own kitchen – which we’ve already outgrown, and we’re in the process of getting set-up in a new place right now.”

It all sounds pretty busy for a single mother. Would she recommend the life of an entrepreneur to other mums? “Yes – but I think you have to have an overinflated sense of self (in the best possible sense) to try. You’ve got to be a little bit crazy and naive, otherwise you’d never even get started. It’s not easy, but it’s worth it.”

The Honest Food Company online store brings in a lot of business, but comes with its own challenges.

“Don’t even get me started on shipping! Things going missing, customers ringing up and saying ‘Where is my order?’ Honestly if someone wanted to set up a new, reliable shipping company for small businesses I reckon there would be plenty of people keen to call them. I think shipping in New Zealand is a bit of a nightmare.”

Queensland distribution is ready to roll from July, and Tuki says she plans to do a lot with Aussie in the years ahead. But The Honest Food Company won’t become a big machine-operated factory, she says.

“The products will stay handmade. I’m determined about that. Handmade means more jobs for single mums like me.”

Mindfulness and exercise keeps her sane, and her top tip for stressed out business owners in the early stages is: Ask for help.

“Women tend to do everything for others but not enough for themselves and often don’t

“Honestly, if someone wanted to set up a new, reliable shipping company for small businesses I reckon there would be plenty of people keen to call them. Shipping in New Zealand is a bit of a nightmare.”

want to ‘bother people’ by asking for support. Don’t be scared to ask for help, I’ve had to ask for plenty!”

Biggest stuff-up: My first business venture was an egg white protein product. The company I had contracted the manufacturing to ended up ripping off my idea and pushing their own product into all the same stores – I was absolutely gutted! That’s a big reason why now I do everything by hand, myself. No way I’m contracting out production again after that.

Motivated by: My daughter. I want her to know this business is her legacy; I’m building it for her.

HEALTHY, ORGANIC FOOD ON THE RISE Worldwide sales of additive-free foods surged

11.5% in 2013, to $35.1 billion, the sector’s strongest sales in five years, according to the Organic Trade Association. The OTA was predicting 12% growth in 2014.

Australia’s organic sales are increasing at an average of over 15% each year, according to the 2014 Australian Organic Market Report. This values the country’s organic market at an estimated $A1.72 billion.

Local certified organic sales have also risen substantially – an Organics Aotearoa NZ report estimates the market at $126m-$133m a year. In 2012 supermarket sales of non-fresh organic products increased 26.8% over 2009 figures, with a 7.5% increase from 2011, while organic sales in specialty retail shops were worth $25.5m – almost twice as much as three years before.

honestfood.co.nz


Motivating motherhood: Belinda Tuki says her daughter Layla is the impetus behind The Honest Food Company

26 | IDEALOG.CO.NZ

INNOVATION | Food

Chloe Van DykeNelson-based company CHIA exports drinks made with fruit juice and chia seeds to Malaysia and Singapore

What: Nutrient-dense sports and health drink made from fruit juice and seeds from the chia plant – a mint-like flowering herb from Central America. Who: Chloe Van Dyke, 30-year-old neuroscience graduate, adrenaline junkie, and food-nerd launched the business in December 2012 and produces, markets, and ships her drinks from Nelson. How it’s going: CHIA has over 400 stockists in New Zealand, including supermarkets, health stores, and cafes. Van Dyke exports to Singapore and Malaysia, with Australia on the cards.

What’s so great about chia seeds? They’re one of the richest plant sources of omega 3, protein, antioxidants, antacids, magnesium and fibre. They are also full of naturally-occurring electrolytes. The idea to create CHIA drinks came when we were looking for a nutrient-rich drink to have after exercise, and discovered that chia seeds are famously used by the Tarahumara Indians, direct descendants of the Aztecs, who are renowned for their long-distance running ability.

At the moment we import our seeds from Australia, but if anyone wants to grow them here, do get in touch.

Your Dad is your business partner – what's that like? It’s great. He’s in his 60’s, a professional swimmer, and used to run his own mail-order business called NZ Nature. Dad was just settling back to enjoy life after selling it when I dragged him into this! He takes care of sourcing ingredients, equipment, and helps with production. I mainly focus on getting it out there and doing the marketing. I think it’s good having the age balance of someone older as a business partner.

Do you have any shareholders – have you considered getting outside investment?Not seriously. We started small and have grown sustainably along with the business. We won the ANZ Flying Start competition back in 2013, which secured us $30,000 funding, that made a big difference at the early stages. If we were to take on an investor it would be more about the

“A word of advice for newbie foodies: Just start doing it. If you wait until all your i’s are dotted then you’ll be too late. Dare to try.”

networks they’d contribute to our growth than just financial investment.

You chose Singapore and Malaysia as your first export markets. Why? We were approached by a distributor who represents other New Zealand food businesses in the Asian market, including Nelson-based health food brands Pic’s Peanut Butter and Proper Crisps. We’re starting slowly and working out what our price-point is in those markets. A bottle retails for around $4.99 here and the equivalent of $6 over there. Getting our heads around three-week freight is a tricky one, as we need to allow for much longer production lead-times. At the moment we’re cutting it fine on margins but if the quantities pick up it will work. You really need to have a lot of trust in your distributor. We’re talking to Australia at the moment about getting into stores over there; that will be our next move.

CHIA won the Massey University Healthy Choice food award last year. Would you recommend entering awards? It was awesome to get that acknowledgement.

You can tell everyone ‘Our product is great!’ but it means a lot when someone scientifically analyses it and says, ‘Yes, it really is great.’

What’s the biggest challenging area for you?Putting myself out there. I’ve realised that this business isn’t just about getting the product into the market, it’s about me personally sharing my story and vision with people.

Do you have advice for newbie foodies?Just start doing it. If you wait until all your i’s are dotted then you’ll be too late. Dare to try.

Biggest stuff up? We had some wild yeast get into a batch. The drinks were all sitting boxed up in the warehouse, and then suddenly we realised they were exploding. I had to put a helmet on to go in – imagine how much mess bottles of blackcurrant & apple make when they’ve exploded all around a room – it was a disaster-zone!

Motivated by: Adventure. CHIA is about encouraging people to get outdoors and enjoy an active lifestyle. We’re sponsoring the CHIA Abel Tasman Coastal Classic this year and want to do more events like that.

chia.co.nz

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Sitting pretty: Neuroscience graduate Chloe Van Dyke is riding on the back of nearly three years of success with her CHIA brainchild.

28 | IDEALOG.CO.NZ

INNOVATION | Food

“It’s amazing – when we need more breadfruit flour we just put out a radio notice on the local station. The people go outside their houses to their breadfruit trees – nearly every family has a tree – pick the fruit, then take it to the production facility and get paid for it. It’s that simple.”has two business partners managing the relationships with the farmers. And when we say “farmers”; don’t think middle-aged men in gumboots. In Maiden South Pacific’s case, she’s talking school kids and grandmothers.

“It’s amazing – when we need more breadfruit flour we just put out a radio notice on the local station. The people go outside their houses to their breadfruit trees – nearly every family has a tree – pick the fruit, then take it to the production facility and get paid for it. It’s that simple. There are children and parents and older people all picking the breadfruit, and they’re all so grateful to get paid fairly for it.”

As for the coconut oil, Epati is taking a sustainable approach to business growth, aiming to expand slow and steady, so the coconut farms in Samoa can keep up with demand.

Epati understands the value of connections. She’s recently teamed up with the capital’s artisan darling Wellington Chocolate Factory. Sending them samples of Samoan cacao beans led to a chocolate bar collaboration – ‘The Samoa Bar’. Made with single-origin cacao beans, the product is now on the shelves all around New Zealand.

“They called me up one day and said, ‘Let’s make something happen’. And we did. Kiwi businesses are like that, they innovate and they move on things fast.”

Biggest stuff-up: Not being true to myself. For my first tasting event at Farro Fresh I thought I had to dress and act a certain way. I wore my hair down instead of up in my usual funky style. And then I felt off the whole time! It just wasn’t me. Now I’ve learned that I need to just relax and be me, and anyone I’m talking to jives with that.

Motivated by: Personal growth. I see this business journey as a way to challenge and grow myself.

maidensouthpacific.co.nz

stores around New Zealand. Epati knew she was going out on a limb

launching something people had never heard of – but says she felt the market was ready for it.

“Breadfruit flour is a new concept, completely new to the Pacific. We have always had the fruit but only just realised that we could make delicious, gluten-free flour out of it. Its response to baking is the closest thing to gluten-containing flour, so people are surprised at how well it works in recipes.”

In typical start-up fashion, Epati has had to be somewhat of a one-woman-wonder, handling the increasing – and unenjoyable – burden of administrative tasks.

“I’m terrible at most of those areas to be honest! Logistics, finances, admin … I don’t enjoy any of that. What I am good at is people, passion, and having the vision. If I’m inspired to talk to someone or do something, I’ll do it.”

Production happens in Samoa, where Epati

Tiana Epati Maiden South Pacific has invented a whole new food category – gluten-free breadfruit flour – and now it’s giving jobs to people in her native Samoa

BREADFRUIT FLOUR – it’s a thing, at least now that Maiden South Pacific has made it one. More importantly, it’s a gluten-free flour thing.

Tiana Epati is a New Zealander passionate about her Samoan roots, and part of the rationale behind founding her own company was wanting to find a product that would give her people jobs.

Starting off at Auckland markets, her breadfruit flour and raw fermented coconut oil are now bringing an island flavour to Farro Fresh, Commonsense Organics, and other PH

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Flour power: Tiana Epati has created a completely new concept, gluten-free breadfruit flour sourced from Samoa

30 | IDEALOG.CO.NZ

INNOVATION | Food

Sophie Carew Carew Kitchen produces handmade raw, fresh unpasturised almond milk

What: Handmade almond milk in two flavours, sweetened and unsweetened.

Who: Auckland health enthusiast Sophie Carew launched Carew Kitchen in July 2014, wanting to create an alternative to dairy with no additives, sugars, or preservatives.

How it’s going: Carew Kitchen now supplies Farro Fresh, specialty stores such as IE Produce and Wise Cicada, and 20 cafes across the

Auckland region, including Espresso Workshop, Odette’s and Ortolana.

You make the milk with your Mum – do you think bringing in family members is a good idea when you’re a start-up?My family has always been involved with the business but when the orders started increasing rapidly Mum became a full-time employee. We are now officially a family business and I love that. We work really well together and I couldn’t imagine the business without her. She handles all of the accounts and administration for Carew Kitchen as well as production. There’s already trust there with family members.

Is it hard to being a newbie food business? I think the food industry in New Zealand is

“I’m motivated by people who have overcome hardship –such as Rebecca Wadey, a breast cancer survivor who now owns Kingsland yoga studio The Centre.”

extremely supportive of people starting out. I was overwhelmed with the advice and support offered by other business owners, like Coffee Supreme and Kokako, and I love that we can help support each other.

Your product has a very short life shelf – how does this impact your business?The shelf life is six days for our almond milk, because it’s raw, fresh and unpasteurised. This means currently we can only supply Auckland, but we would love to be able to cold-pasteurise our milk eventually and supply all of New Zealand – even the export market. We are looking into ways to do so but sustain the nutrient value.

Record number of bottles sold in a week? We only rent our commercial kitchen for two days a week and all our milk is made by hand by the two of us. But in late June we rolled out 350 litres – our largest volume to date.

What’s Carew Kitchen’s next big move? We have plans to diversify with the release of two new products. I originally started making sugar-free, gluten-free natural treats for my family and have always entertained the notion of producing those again.

Biggest stuff up: I bought 3000 bottles off Trade Me for $200; I thought it was too good a deal to pass by so I bought them. However they ended up being on a super tall pallet that didn’t fit in my storage area, so I had to buy a lock up at Storage King, which ended up costing me more than the bottles themselves. Now I wait and think things through carefully before making any decisions on the spot. Motivated by: I’m motivated by people who have overcome hardship – such as Rebecca Wadey, a breast cancer survivor who now owns Kingsland yoga studio The Centre.

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Handling success: Sophie Carew makes handmade almond milk and has plans to diversify into sugar and gluten-free treats

32 | IDEALOG.CO.NZ

INNOVATION | Food

Tammie WhartonSoul Organics produces fresh organic vegetable and fruit juices

IN SEPTEMBER 2014, ‘Soul Organics’ was Tammie Wharton at a small juice stand inside a Whakatane grocery shop. Less than a year later, the company has three business partners, a raw food café and juicery, two mobile juice vans and over 40 stores and cafes stocking Soul’s juices.

If Tammie Wharton was one of her products, she’d be the beetroot-infused ‘Energiser Bunny’. Tall, bubbly, and excited about everything, she’s made a lot happen in a very short time.

How does a solo juice stand operator end up

only one in New Zealand that we know of.” After some dramas with shipping (the wrong

juicer was loaded onto the cargo ship), the beast arrived and Soul Organics can now churn out 250 litres of juice an hour.

Short-shelf life was an issue for the company in the early stages. With a raw, preservative-free product, the juices needed to be consumed within 5-6 days.

“Shipping companies kept letting us down, forgetting our boxes at depots or taking too long to deliver. We ended up having to buy our own chilled delivery truck.”

However, these stresses are now a thing of the past; technology came to the rescue when Wharton discovered ‘HPP’ – high pressure process. “We found a company in Auckland which has an incredible HPP machine that can keep the juice alive for longer. It applies 600psi of pressure to the product, which is like diving down to the ocean floor... kills all the bugs without destroying the raw living goodness.”

The new three-week shelf life has made it much easier to get the product on café shelves, she says.

Not content with being a juice entrepreneur, Wharton is also bouncing into a new food arena – our furry friends.

“It sounds a little random, but at the moment we’re getting ready to launch a pet food brand. Organic food for dogs and cats made out of the left over fruit and veggie pulp, combined with wild game meat.”

Biggest stuff up: Putting the café helpers in charge of juice production one night. They forgot to clear out the pulp from the first juice batch before making the next. Our Energiser Bunny – usually bright purple from the beetroot – was muddy brown.

Motivated by: Bringing health to people. It makes a huge difference in people’s lives when they get the right nutrients.

www.soulorganics.co.nz

“It sounds a little random, but we’re getting ready to launch a pet food brand. Organic food for dogs and cats made out of the left over fruit and veggie pulp, combined with wild game meat.”

shipping bottled juices all over New Zealand in a matter of months?

“It’s been crazy! I was approached by one of my best customers at the juice stand; he was juicing himself back to wellness after a health scare and loved my juices, said they were the best he’d had.

“Turned out he was a business dude with money to invest; he wanted to help me grow Soul Organics into something big. I said yes, we brought more people into the team – and boom! Soul Organics was pumping.”

A regular plug-and-play juicer had worked fine for the stand, but Wharton quickly realised they’d need something bigger to supply all the stores who wanted to stock the range. Something a lot bigger.

“We needed to import a hydraulic cold press juicer from the States. It was a six figure investment, and takes up a lot of space – it’s the


In association with Complete Kids Nutrition

Superfoods for kidsFor Megan Dixon, making healthy shakes for her daughter was the solution to balancing a busy lifestyle with getting a variety of nutritious food into a fussy eater. Now she’s taken her company Complete Kids Nutrition – and her campaign to get kids off junk food – to crowdfunding site PledgeMe.

THREE YEARS ago Megan Dixon and her partner Todd Mantle found themselves with a problem on their hands. They were passionate about good nutrition, but their daughter, Tyla, wasn’t having a bar of much of what they put in front of her.

The good thing was that she loved smoothies and milkshakes.

“It became a way to sneak in wholefoods and she was none the wiser,” says Megan.

Trouble was, as their lives got busier it wasn’t always convenient to make smoothies every day, so the couple tried to find a ready-made solution.

They couldn’t find one. There didn’t seem to be a nutritious shake on the market that wasn’t full of refined sugars, e numbers and preservatives.

So the couple put their heads together and created Complete Kids Nutrition – a range of instant superfood milkshakes with kids’ taste buds in mind.

Complete Kids Nutrition has two ranges; Anytime Kids, which can be used as a complete nutritional drink during the day or night, and Active Kids, which is a pre or post sports meal that keeps kids fuelled with quality nutrition during physical activity and helps with their recovery.

“Our superfood shakes deliver your children a great source of carbohydrates, protein, recommended fats, 18 essential vitamins and minerals (including calcium, iron, vitamin C, prebiotic fibre), and New Zealand dairy goodness. They are also low in natural sugar and salt, low fat, low lactose and gluten free. We use only natural colours and flavours. ”

Since launching in October 2013, the couple have spent over $500,000 of their own money developing the business, and the product is now stocked in nine Foodstuffs supermarkets, 12 other retailers, and their online shop.

But now they have launched a PledgeMe

www.pledgeme.co.nz/projects/3846, closes August 28 [email protected]

page, where the team hope to raise $50,000+ to cover in-store tastings and events, store visits, and increased retail presence in New Zealand, and further marketing and branding.

“With a bit of encouragement we are hoping like-minded businesses and parents, who may have had similar issues, are willing to help us take things to the next level,” Megan says.

"At the end of the day, it's about keeping our kids healthy."

The PledgeMe campaign closes on August 28. For Megan, belief in the product is what has

driven her forward. “Complete Kids Nutrition is all about offering a

quick and easy meal on the run and an alternative to junk food.

“We want to change the way kids perceive healthy foods and snacks, and give parents

“We are hoping like-minded businesses and parents, who may have had similar issues, are willing to help us take things to the next level.”Megan Dixon - Complete Kids Nutrition

the peace of mind that they are feeding them something genuinely healthy.”

“Our shakes are a healthy meal on the run that even the kids can make – simply mix the powder with water. They also taste great warm and can be frozen into ice blocks!

“They make the perfect option for morning tea, afternoon tea or before bed.

“With fussy eaters it is hard to ensure they are receiving the right nutrients and calories their growing bodies need and we think we have developed a great option to assist busy families.”

34 | IDEALOG.CO.NZ

In association with ANZ

social media campaign – all aimed at getting the message across to women to get their retirement act together.The campaign highlights a number of disturbing statistics for New Zealand women:

They earn on average $300 a week less than men, or $600,000 across their lifetime;

They have an average of 28% less in their KiwiSaver account than men, a gap which is increasing each year, and could leave them $60,000 or more worse off at retirement;

They are more likely than men to be in a conservative fund (whether through lack of action moving from a default fund, or because of natural inclination against risk is unclear), which could knock $90,000 off their savings;

They are more likely to take a KiwiSaver contributions holiday, either to bring up children or look after elderly relatives. A five-year break at age 30 could mean $50,000 less at 65.

They are less confident about reaching their financial goals than men. While 55% of men believe they are on track financially, only 34% of women have the same conviction.

Lockyer says ANZ recognised the bank

ANA-MARIE LOCKYER understands better than most why it’s so critical for women to get their financial act together.

As a banker, (Lockyer heads up ANZ’s KiwiSaver business) she sees first-hand what happens when women don’t have enough savings; how they struggle to eke out a meager pension.

She worries about figures that show women earn less than men, have less saved at 65, and are less confident of reaching their financial goals.

Perhaps more crucially, she knows women are less likely than men to make time to think about how they are going to fund their retirement; and she knows the damage that choice can have.

But it’s as a mother of three young daughters, where these issues have become gut-wrenchingly personal.

Lockyer wants her daughters to turn out confident, independent, secure women. But the evidence in front of her every day at work shows that unless they seek the right information and make the right decisions, that probably isn’t going to happen.

ANZ to women: Don’t get mad, get evenWhy ANZ has teamed up with filmmaker Jane Campion to get women to fight for a more equal financial future

“All too often, money is something that we as women put to the back of our minds, and we wait for others to make the decisions for us.

“Life is so busy and your financial future is one of the things you just forget to think about.”

Sound familiar?In late July, ANZ launched a series

of measures, including: a short movie commissioned from award-winning filmmaker Jane Campion; the Wise Women retirement planning website; and the #EqualFuture


needed to be actively talking to women. “No one likes to think about retirement, but

what I would like my daughters and all New Zealand females to know is: Are they on track for what they want to end up with when they retire?”

She says ANZ initially started with seminars, but the new initiatives take this further. The Wise Woman pages on ANZ’s FutureWise site (anz.co.nz/FutureWise) provide information and tools geared specifically to women, and #EqualFuture sees ANZ joining in what is a global debate around equality.

The bank is also putting its money where its mouth is, announcing it will pay the KiwiSaver employer contributions for all staff on paid parental leave.

Still, it’s the Jane Campion short film (put “ANZ Jane Campion” into YouTube to find it) that gets Lockyer most excited.

The movie, launched on July 29, features a bunch of young girls (including a spectacular eight-year-old Japanese karate black belt) being sad and stroppy in turn about the fact that girls’ brains develop faster than boys, yet women end up with significantly lower lifetime earnings and almost 50% less superannuation than their male counterparts globally.

“Our CEO for Global Wealth, Joyce Phillips is hugely passionate about this issue and she wanted to find someone who could tell the story, could engage people in this story and start the conversation.

“Jane is passionate about gender and nurturing talent and she led a team who were almost all women. We provided some stats to start telling the story, but at the end of the day

Visit anz.co.nz/WiseWomen for information and tools to help you make smart choices your future self will be proud of.

ANZ Bank New Zealand Limited

it was Jane’s story and she did an amazing job.“You look at it and you go: ‘It’s true, it’s so

true.’ It works so well to tell the story we are trying to tell and get people talking.”

The film is set for circulation via social media, rather than the small (or big) screen – initially at least.

“We think it’s about having a conversation; people talking about it. We don’t want to be preaching about it. There are no right answers in this – everyone makes their own decisions.”

Lockyer says the success of the campaign will be measured in a number of ways, just one of which will be any increase in KiwiSaver contributions from ANZ’s 300,000 female customers.

“That’s more a measure for us of whether the message is getting through. It’s not something where we are setting targets.

“Success for me from all these initiatives would be seeing women engaging actively with their KiwiSaver accounts, taking actions today that will give them the best outcomes in the future.

“I hope that by sharing the message, they will take action today that will give them a better retirement in the future.

“I’m not asking everyone to contribute more, but I want people to make the right choices, to take time to think about their financial goals, seek out the right information and ask the questions.”

IN BRIEF

Women face unique challenges, which can impact on their financial future. On average, Kiwi women earn $300 a week less than men (that’s $600,000 over a lifetime), and have significantly smaller savings when they retire. At the same time they outlive men – so spend more time having to live off their (smaller) retirement funds. They are more likely to take time out of the workplace, so it’s harder to reach their long term savings goals.

The Designers Institute. Best Awards.October 9th 2015bestawards.co.nz#bestawards

IS IT INSPIRATION OR PERSPIRATION?After the hard yards and late nightsit’s time to find out what you’re made of.Who will be taking away the Gold, Purple and Black pins?

Molecular model of Magnesium (mineral component of sweat). #2 in a series of 3

FINALISTSANNOUNCEDTICKETSON SALE

(*But why just write about it? Idealog decided to try a bit of collaborating ourselves, so we asked for help to illustrate this feature. Most of the photos on these pages – and on the cover – were sourced from our readers, friends, followers, and the people we've written about recently. (The rest were us.) We're all in this together.)

CollaborationNation?

BUSINESS | Collaboration


Forget cut-throat competition, the hot topic these days is collaboration. Whether it’s companies in shared working spaces exchanging ideas around the water cooler, entrepreneurs picking other people’s brains via crowdsourcing, Xero start-ups teaming up to get customers, or big bosses of primary producers strategising at Stanford University, working together is de rigueur.*

38 | IDEALOG.CO.NZ


+ COLLABORATION IS a pretty overused word these days. Mulling over your idea with a colleague over

coffee? Collaboration. Renting out your house through Airbnb? Collaboration. Sometimes it’s for profit. Often it’s about sharing ideas, connections, or knowledge. Or just helping out. Sounds good, right? Sit around a long table, drink coffee and draw on whiteboards. There might even be pizza. Remember, there are no bad ideas.

But what does it really mean to collaborate? Are New Zealand companies collaborative enough? And how are some of New Zealand’s most successful and innovative businesses using collaboration to help one another succeed?

As a nation and a culture, New Zealand prides itself on being inventive and resourceful. The myth of the tinkerer in the shed with some No 8 Wire is pervasive. But do these cultural touchstones become a hindrance in a technologically advanced world?

OUT OF THE SHEDShaun Hendy thinks they do.Hendy is a physics professor working at Auckland University’s Centre for Innovation and Entrepreneurship. He’s also the founding director of Te Pūnaha Matatini, a Centre of Research Excellence focused on the study of complex systems and networks, and he co-authored Get off the Grass: Kickstarting New Zealand’s Innovation Economy with the late Sir Paul Callaghan.

He reckons to move beyond an agricultural economy, New Zealanders have to leave the shed mentality behind.

“We must start thinking like a city of four

“It’s part of our national myth that we can be self-sufficient and have a garage in which to tinker. That’s not where great ideas come from any more. Individual people can no longer master everything you need to master to make something world-beating.”SHAUN HENDY, AUCKLAND UNIVERSITY

million people and build scale and diversity in our collaboration networks,” he says.

“We’ve got used to working on our own,” he says. “It’s part of our national myth that we can be self-sufficient and we all have a garage in which to tinker. The reality is, that’s not where great ideas come from anymore. A hundred years ago, New Zealand was very successful with that model. We were patenting more things than anyone else in the world. But the complexity of today’s technologies has caught up with us and individual people can no longer master everything you need to master to make something world-beating.”

FISHING TOGETHEROne recent example of collaboration leading to extraordinary innovation is Precision Seafood Harvesting, a 10-year project between CRI Plant & Food Research and three major (and competing) Kiwi seafood companies: Sanford, Sealord and Aotearoa Fisheries. The $52 million partnership has produced a technology to replace fishing nets with collapsible PVC tubes with holes (think those colourful plastic tubes at kids playgrounds). Instead of trapping everything in their wake, these tubes allow undersized fish to escape, and “off-target” species (the ones the trawler isn’t wanting to take home) to be returned to the sea alive and unharmed.

Precision Seafood Harvesting says not only

APPLEApple is great at collaboration – there are dozens of partnerships behind each i-product. I mean the company even collaborates with Microsoft. The latest gossip is around talks between Apple and BMW. The iCar?

COCA-COLAAs part of a $US150m+ move to develop plastic bottles made 100% from plant-based materials, Coke formed a research collaboration with Heinz, Ford, Seaworld and others to support development of renewable feedstocks. The first PlantBottles were unveiled at World Expo in Milan in June.

TOYOTA-GENERAL MOTORSNummi was a GM-Toyota JV car plant opened in 1984. The collaboration gave Toyota the foothold it wanted in the US; GM gained experience of Japanese manufacturing practices. The experiment was initially successful, but the plant was sold in 2010 and the collaboration was never repeated.

BOEINGOne of the oft-quoted reasons for Boeing being forced to ground its entire 787 Dreamliner fleet after a string of incidents, including fires, is mismanaged collaboration between the company and its many partners.

The good and the bad


“Collaboration’s a catchphrase,” says Wellington entrepreneur Serge van Dam. “I hate the word personally because it’s ill-defined and not meaningful.”

Idealog would pretty much agree. With modern parlance, it’s sometimes hard to separate the sharing economy from the collaborative economy; crowdsourcing from being paid to lend your car to the guy down the road (surely not collaboration, but just another form of one-on-one transaction).

We asked van Dam to break it down more. He says there are three types of meaningful collaboration: vertical, horizontal and geographic.Vertical: Collaboration between companies in the same industry selling to the same parties – often called ‘clustering’. Companies share resources, information and contacts for their mutual benefit. This can be particularly useful when one company can leverage its good reputation to the mutual advantage of other companies.Horizontal: Collaboration between companies with similar functions that don’t necessarily sell to the same people. Horizontal collaboration is more about sharing skills rather than contacts.

“There’s a lot we can learn from each other, so the benefit is in intellectual property, not in escalating sales,” van Dam says. “We don’t help any individual sell more, we just help everyone be better at their jobs.” Geographic: Collaboration between companies in the same territories, even if they are participating in different markets. Geographical collaboration is “one of the best things you can do for moral support and logistical support, helping people establish themselves in a market and giving them cultural guidance. It helps but it doesn’t necessarily move the needle.”

is the system significantly more sustainable than nets, but it should bring in a $100 million increase in export returns.

Hendy has studied patent databases around the world, looking for patterns between the number of jointly-owned patents and the total number of patents registered. He’s found that approximately 10% of companies that file patents around the world share ownership with other companies or organisations. But astonishingly, that 10% accounts for more than two-thirds of the world’s total patents.

In New Zealand, he found only three examples of companies co-owning patents. That’s right, three. And one of those was a patent for a collaborative invention between Fonterra and a now-defunct biotechnology company, Genesis R&D Corporation.

“I’LL DO IT MYSELF”Bram Smith is general manager of the Kiwi Innovation Network (KiwiNet), a grouping of universities and crown research institutes collaborating to commercialise scientific research. He sees many of the same Kiwi-in-shed problems in research organisations.

“What I hear a lot is ‘I don’t need to collaborate, I’ll do it all myself ’,” he says. “But in order to keep up with what the rest of the world’s doing, it’s not a matter of inventing everything here, we need to be importing innovation from overseas, adapting it for our particular

needs and then exporting our innovations back overseas to other markets.

“We spend too much time locked in our workshops and not being inspired by what’s going on around the world, or not being inspired by what’s going on in companies in our own communities.”

Canterbury University Professor Andy Buchanan is an example of a researcher collaborating with commercial organisations to meet a community need – in this case for earthquake-resistant wooden buildings.

Buchanan and his team are developing ways of using structural timber that can compete with concrete and steel for large span and multi-storey buildings, giving architects more options in innovative building design.

Buchanan’s research has been funded by $5 million of private investment from the likes of Carter Holt Harvey, Nelson Pine Industries, and others, plus another $5m in government funding.

Buchanan has now set up the Structural Timber Innovation Company, which is looking to commercialise this research with industry partners around the world, particularly in markets like Japan and Canada, where there is lots of wood and high earthquake risk.

MINE THOSE KIWI NETWORKSThere’s no reason for New Zealand businesses to be battling away on their own, says Nick Houldsworth, chief marketing officer of Vend, when easy access to our communities and companies is one of the biggest assets New Zealand has.

“It’s a small market and people know each other and it’s pretty easy to build connections,” Houldsworth says. “New Zealand culture lends itself well to start-ups because it’s a very flat culture, where people are generally accessible. And it’s a meritocracy – if you have a great idea, people want to hear about it, whereas in other countries there may be more hierarchy and layers to get through.”

“People are inspired by success,” he says. “If you get a couple of people who are doing very well in a particular sector, people want to follow suit. And they recognise that the best way to get advice is to work with others and to build on the success of others.

“If you want to chat with Rod Drury, you can find him on Twitter and he’s generally pretty responsive.”

Serge Van Dam

“If you want to chat with Rod Drury, you can find him on Twitter and he’s generally pretty responsive.”

Three shades of collaboration

40 | IDEALOG.CO.NZ


If Rod Drury isn’t your man, there are other ways entrepreneurs can pick each other’s brains: two of them being crowdsourcing and shared workspaces.

Crowdsourcing is better known as a way for start-ups to raise money, often by showing a prototype or design to prospective customers, and then asking them to pre-purchase the prospective product.

But it’s not just money entrepreneurs are after. Increasingly, people are crowdsourcing expertise, asking strangers, often with no financial reward, to contribute their skills and knowledge to a project.

The internet is full of examples of crowdsourced collaborations. Take Egyptian-born designer Karim Rashid, who used his Facebook page to ask his 400,000 fans to help him design a seven-storey building in New York. As well as choosing their preferred ideas, commenters provided feedback and ideas for Rashid, some of which he incorporated into the final project.

HELPED AT HIS OWN GAMECloser to home, Wellington entrepreneur (and game design rookie) Mark Major used crowdsourcing platforms 99designs, Reddit and Facebook to get experts to help him with design and features for his new iPhone game, Plummet Free Fall. The game has been downloaded more than 350,000 times and was number one on iTunes in four countries, including Russia.

People are also coming together in a more physical way through use of co-working spaces. Designed to give lonely start-ups the power of the group, shared spaces offer cheap infrastructure, but also a community of other

“If you’re an exporter you are hamstringing yourself if you don’t have a rich collaboration network in New Zealand. Your competitors will, in general, be enjoying a much more collaborative environment.”SHAUN HENDY, TE PUNAHA MATATINI

people working in a similar situation. In a quick Google search, Idealog found almost

20 such spaces, from the well-established Icehouse incubator and BizDojo networks, to newer facilities like the Hanger in Queenstown.

De rigueur is a cool name (The Aviary, Iron Bank, Innovation Precinct etc), a fast internet connection and (one suspects) a bit of alcohol to get the combined creative juices flowing.

Freelance PR guy Paul Brislen, who works out of GridAKL in Auckland’s Wynyard Quarter says encouraging collaboration is a deliberate act. “There’s a team of people from BizDojo in the Grid every day ensuring there’s always someone talking at lunchtime, there’s always opportunities to meet new people, so everybody’s engaged and everybody’s involved.”

EXPORT COLLABORATIONSOn a bigger scale, organisations like Export NZ and New Zealand Trade and Enterprise are also actively fostering collaboration between New Zealand companies.

The Family of Twelve consists of 12 independent New Zealand wineries focused on promoting Kiwi wine overseas. They join together organise tastings and events in key markets and to get prominent critics, sommeliers and retail buyers to visit New Zealand.

Importantly they share not just costs and logistics, but knowledge and contacts.

Meanwhile a strong push to get Kiwi avocado

THREE'S A CROWDTriangular collaboration is increasingly common, particularly in the tech sector (Microsoft-Intel-Cisco, for example). But a three-way partnership brings an exponential increase in potential headaches, according to Professor of Entrepreneurship Jason Davis.

LAST RESORT COLLABORATIONCanadian corporate collaboration expert Ann Svendsen warns against the "collaboration when all else fails" approach. Companies unable to solve a problem unilaterally sometimes reluctantly seek a partner, she says, but that's a bad start.

SWEAT THE BIG STUFFA long-term view, rather than a focus on short term objectives, problems or failures can often make the difference between sturdy and shaky collaborations, Davis says – and that may make alll the difference when it comes to innovation.

ROTATE THE LEADERSHIPDavis's study found successful collaborations rotated control of the project back and forth between the two partners. Rotating the leadership worked better than either one company dominating throughout, or a consensus-based approach.

Making it work – the experts


One of the most publicly collaborative brands in New Zealand right now is Whittaker’s, who over the last two years has collaborated with a number of other New Zealand companies, sometimes causing voracious social media buzz and unprecedented consumer demand.

“It’s about developing Whittaker’s into other indulgent areas,” says chief marketing officer Philip Poole. “Through the collaborations, we can innovate together. L&P, hundreds and thousands, Jelly Tip, Lewis Road are all very innovative and exciting products, so if you get the collaboration right, one plus one is bigger than two.”

For Whittaker’s, the collaborative process started internally, searching for ways the company could innovate both its product and its marketing. Then it expanded outside.

Poole says companies looking to collaborate on products “have to be very careful in terms of the brand fit, and ensuring the partner has the same ambitions and motivations in producing a quality product.”

After the first few collaboration successes, working alongside other brands has become part of the Whittaker’s brand, Poole says, and now when a new collaborative product is launched, customers immediately start speculating about what will come next.

When the Jelly Tip chocolate, a collaboration with Tip Top, was released in June this year, #whittakersnewflavours started bouncing around Twitter.

Whittaker’s now receives a steady flow of pitches for collaborative products, but is careful about who to partner with.

“Having done a number, there’s a certain expectation of what are we going to next,” he says, “but we wouldn’t do anything for the sake of doing it. Collaboration is part of the brand strategy, but collaboration has to be adding to the wealth of the brand. It has to meet the criteria. We would never do a collaboration just for the sake of doing it.”

growers to “communicate and collaborate like never before” is already reaping rewards, industry body CEO Jen Scoular says. A newly-united sector has doubled sales to $135m for the 2014-15 season, and wants to double them again by 2023, she says.

“As an industry we want to share data and knowledge and provide people in the avocado industry access to insights that will help improve decision-making and orchard productivity.”

It’s a logic you can’t argue with, Hendy says.“The smart move is to try and be more open

and try and get a return from your ideas and your technologies as they go out into the world,” Hendy says. “If you’re an exporter going into offshore markets, you’re hamstringing yourself if you don’t have a rich collaboration network in New Zealand, you’re at a disadvantage against your international competitors who will, in general, be enjoying a much more collaborative and innovative environment.”

But don’t just collaborate, says Serge van Dam, a Wellington entrepreneur currently chairing three SaaS start-ups, Wipster, Montoux, and Coachseek.

COLLABORATE WITH PURPOSE Extend your network, van Dam says. Build relationships. Be interested in what others are up to and don’t be so secretive about what you’re doing, he says. Trust other researchers, inventors, entrepreneurs and companies.

Collaboration in the chocolate factory

Business and innovation aren’t zero sum games. “There’s an emotional impetus to working

together because we want to see New Zealand perform on a global stage and there’s this almost natural, circumstantial advantage that we can draw on,” van Dam says.

“We’ve just all got to be willing to not just use loose terms like collaboration, but be very specific about how we can help each other. Whether it’s introducing people via email, or giving access to a contact list or sharing experiences to make other people smarter, I think we’ve got a real opportunity to make each other better. The world’s an enormous marketplace and a rising tide lifts all boats. If everyone gets smarter, we all benefit.”

World-beating

So if collaboration is vital in an innovation economy, how can it work for you, in your company, in your industry? We look at three New Zealand examples where collaboration is providing significant benefits for all the players concerned.

SOFTWARE AS A SERVICESoftware as a service is a perfect breeding ground for collaboration. There’s the background of the internet to start with – that open source nirvana of geeks saving the world. Then there’s the fact many Saas companies are born from the desire to solve a single problem, which may have once been one small aspect of a comprehensive (and expensive) software suite.

“By solving a single pain point you can make a much better product, much faster,” explains Nick Houldsworth, chief marketing officer of cloud-based point of sale software service company Vend. “But customers still need different systems to be connected together.”

Vend is one of over 400 service providers integrated on the Xero accounting software platform. Xero CEO Rod Drury says that by opening his system to other app developers, Xero doesn’t lose sovereignty. Instead other companies add functionality to his products.

“Anything that can be automated will be automated,” he says.

And while the level of collaboration varies greatly between those 400 providers, Xero actively works with start-ups to increase the value of the system as a whole, and to foster talent in the ecosystem, Drury says.

42 | IDEALOG.CO.NZ


“We love having companies camp out in our offices and taking advantage in the investment we’ve made in them.”

Vend started as one of those companies, realising quickly that by collaborating with an existing service provider, they could concentrate on solving a specific problem while also having access to Xero’s growing customers base.

“So there was a pretty compelling reason for us to collaborate, both from creating a unique proposition for the market, but also achieving a new channel to market for ourselves,” says Houldsworth.

“We were finding new retailers and they were finding new accountants and we knew that if we could combine forces we could find new customers together.”

But the two companies don’t just collaborate vertically. They also collaborate horizontally, sharing practical knowledge and market insights.

“In those early stages it’s really helpful to have a collaborative working relationship not just to find new customers but to just get better at your craft,” Houldsworth says. “Because you’re effectively trying to sell a similar product at a similar price point to a similar audience, and in a lot of ways are trying to figure it out as you go along.

“So the more you can share ideas, the better equipped you’re going to be tackling some of those problems.”

And as Xero helped mentor Vend, Vend is helping younger companies which are providing ancillary services on its own platform.

“We’re always happy to share information because we’ve had the benefit of learning from others as well,” Houldsworth says.

“We also get to learn things in reverse, even

if the company is smaller than us. They’re often trying new tactics that we’re not thinking about.”

Earlier this year Xero and Vend were selected to help Apple develop and promote the business capabilities of the iPad. One of the biggest companies in the world collaborating with two companies started half a world away.

Apple doesn’t want to have to build its own Xero or Vend; it wants to make its iPad better by helping make Xero and Vend better.

PRIMARY COLLABORATIONIt’s not just cloud-based software that’s proving fertile ground for collaboration.

A group of New Zealand’s primary industry leaders decided to look to Silicon Valley to learn how to collaborate and better adapt to a volatile commodities sector.

In 2012, John Brackenridge, CEO of Merino New Zealand, and Keith Cooper, CEO of meat company Silver Fern Farms, visited Professor Baba Shiv, an expert in marketing and “neuroeconomics”, at Stanford University in Stanford, California.

While there, Brackenridge and Cooper realised that many primary sector CEOs didn’t even know each other, let alone work together. The two started inviting primary sector leaders for a week-long annual boot camp at Stanford, where alongside university professors and Silicon Valley leaders, they talk and think about how New Zealand’s primary industries can shift from being commodity producers to generating more value through better understanding the changing consumer behaviours.

Since 2012, the boot camp has grown to 50 participants, including CEOs and senior managers from Zespri, Sealord, Fonterra, and

“We’re always happy to share information because we’ve had the benefit of learning from others as well. We also get to learn things in reverse, even if the company is smaller than us. They’re often trying new tactics we aren’t thinking about.”NICK HOULDSWORTH, VEND

UP CLOSE AND PERSONALAn Economist Intelligence Unit (EIU) survey suggests face-to-face collaborations are most likely to be successful. Meeting the people you are working with catalyses the relationship – particularly early on. Rely on virtual stuff later.

TRUST EACH OTHER – A BITMajor obstacles to collaboration include culture clash, divergent strategic interests and fear of IP poaching. No wonder trust is important. But it isn't critical. The EIU report found very few collaborators totally trust their counterparts. Doesn't seem to matter. The report said most collaborators

expect and forgive lapses in judgement, and colaborations without trust can still be successful.

KEEP IT CIVILPlay nice in the sandpit. Always be courteous (ABC), and turn off the sarcasm channel.

CELEBRATECelebrating successes, big and small, becomes more important the more people you have involved in a project, because that's a way to keep motivation high. Experts suggest people are often more incentivised by a celebration than by a few extra dollars.

Making it work – the soft stuff

David Aitken Chief Information Officer, Sentient Software

Master of Commercialisation and Entrepreneurship

What will you gain? Core knowledge and skills needed to commercialise and take

to market new products, services and processes based on

research discoveries, inventions and new ideas. Build networks

and gain access to the regional entrepreneurial ecosystem.

Who should apply? Innovators and “intrapreneurs” facilitating change in large

corporate organisations, SMEs and Crown research institutes.

Working professionals, entrepreneurs and researchers operating

at the intersection of technology and the marketplace.

Apply before 8 December 2015 to start in January 2016.

Email: [email protected] | Phone: +64 9 923 4985

“It’s great to be part of a new wave of students set up to deliver on innovation initiatives across the spectrum, from start-ups to New Zealand’s biggest corporates.”

Tools to deliver innovation in any business

Craig Squire CEO/Entrepreneur, Tsunami Ventures

www.mce.auckland.ac.nz/2016

Yun Jae Lee Commercial Manager, Comvita Innovation

CENTRE for

INNOVATION and

ENTREPRENEURSHIP

44 | IDEALOG.CO.NZ


others, hosting a diverse range of speakers from American designer William McDonough to former US Secretary of State, Condoleezza Rice.

As well as being inspired by the speakers and the Silicon Valley ecosystem, Brackenridge says by nurturing relationships and establishing trust, primary industry leaders have begun working together to help each other in overseas markets.

The most prominent practical outcome of the boot camp is Primary Collaboration, a geographic grouping set up by Andy Borland, managing director of Scales Corporation, helping New Zealand primary industries access Chinese markets. The collaboration includes fishing company Sealord, Silver Fern Farms meat, Synlait Milk, Villa Maria Estate winery, Maori food and beverage producer Kono, and Pacific Pace, itself a collaboration between three Hawkes Bay apple-based companies Mr Apple, CrasbornGroup and J M Bostock Group.

Brackenridge is excited about the project. “You’ve got New Zealand’s biggest apple producer, New Zealand’s biggest seafood company, New Zealand’s biggest meat company and one of the biggest wine companies all saying, ‘Rather than going into Shanghai in a silo, why not go in collectively and share insights, share resources, learn from each other?”

After this year’s boot camp, Brackenridge travelled to Italy, where the economy has had to radically transform, after losing much of its manufacturing business to China. Brackenridge

sees Italy, where collaboration has become a necessary part of success, as a model for New Zealand’s primary industries. “The companies that have survived, the ones that have prospered, are the ones that have collaborated, even with their arch enemies, as long as they’re in the same philosophical space,” he says. “We need be able to collaborate with somebody who’s getting market insights and knowing when to collaborate and when to compete.”

Collaboration is a process not an outcome, Brackenridge says. “The outcome is greater value, greater consistency, less volatility, as a consequence of us being far more sophisticated in our value chains and our branding, and therefore less dependent upon commodities.

“And the way to do that is through better investment in talent, better awareness of digital, and the utilisation of a far more collaborative approach to market.”

“In Italy, the companies which have survived, the ones which have prospered, are the ones that have collaborated, even with their arch enemies, as long as they are in the same philosophical space.”JOHN BRACKENRIDGE, MERINO NZ

PUBLIC / PRIVATE COLLABORATIONThe Kiwi Innovation Network (KiwiNet) was launched in 2011 as a grouping of university and Crown Research Institutes. It now includes 15 partners which represent 6000 New Zealand researchers (67% of the total). Its aim is to get scientists and businesses working together.

KiwiNet General Manager Bram Smith, says getting collaboration happening is all about establishing trust, and the only way to establish trust is through relationships:

“When we first set up we were really worried about confidentiality, so we had quite complex arrangements around making sure that if somebody disclosed information, it wasn’t shared or didn’t blow any competitive advantage. “But what happened was over time, that really started to break down. People started to build trust and pursue confidentiality and nondisclosure agreements only when it was really necessary.”

A key part of getting that sort of trust is encouraging people to form personal relationships, he says. “Organisations don’t collaborate, people do. So you’ve got to enable people to form personal relationships and get to know each other. You can’t just force people together and expect them to collaborate.”

In June this year, KiwiNet held the inaugural NZ Mathematics in Industry conference, where six companies paid $6,000 each to have 100 of the country’s top mathematicians take on their real world mathematics problems – together.

“It’s great for the business because they get really sharp minds working on their opportunities,” says Smith. “It’s great for the mathematicians because they get good experience of the kinds of problems businesses have and how to solve them. And it creates a really good culture of getting people collaborating together from across multiple organisations to pursue innovation opportunities and solve technical challenges.”

In less than a week, some problems were solved, or well on the way, and some mathematicians were offered contracts to continue their work.

“We see researchers who could do so much more for companies around them if they could get out and talk to them, if they could immerse themselves in what those companies are dealing with,” Smith says.

“And we see so much more that companies could do if they had more capacity to engage with the science community. A lot of what KiwiNet does is just get people together in the same room so they can get to know each other and form relationships.”

At BDO, the more we get to know our clients and their businesses, the more passionate we get about them. BDO Partner Greg Thomas

helped New Zealand Merino knitwear entrepreneurs Dil and Cath Belworthy expand the Glowing Sky brand from their Stewart Island

basement to five retail stores and a global online business. Now he’s proud to try out the latest in their collection of Superfine Merino.

With 15 offices nationwide, backed by a global network, we can help take our clients wherever they want to go.

Vision and commitment, backed by BDO.

Audit | Tax | Advisory

www.bdo.co.nz

“I don’t mind rolling up my sleeves. Especially when they’re 100% Merino.”

BDO Partner Greg Thomas with Glowing Sky founder Dil Belworthy

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BDO is the brand name for the BDO network and for each of the BDO Member firms. © 2015 BDO. All rights reserved.

46 | IDEALOG.CO.NZ

COLLABORATION | AUT’s Colab

Collaboration worksLooking for a good time in central Auckland? Idealog spent a few hours at AUT’s Colab, and came away buzzing.

TEXT BY NIKKI MANDOW

+ EVER WONDERED WHAT the sounds of your life would look like 3D printed in white nylon? Or what they do in a

megatronics lab? Or what 200 game developers would talk about if they were all in a room together? Or how you might incorporate conductive fibres into a ‘smart’ shirt so it becomes ‘wearable technology’? Or why all those white dots on your face are necessary to turn you into an avatar? Or how you print an industrial widget from stainless steel powder using selective laser melting (spoiler alert: it isn’t anything like printing a plastic toy from one of those loud desktop 3D printers).

OK, so you maybe didn’t ever ask these questions? But if you did, chances are Colab could give you the answer.

Set up in 2008 as the inter-disciplinary unit

for AUT’s newly-created Design and Creative Technologies faculty, Colab’s mission was to get students and researchers from five disparate academic disciplines – art and design, communication, computer and mathematical sciences, creative technologies, and engineering – talking and working together to encourage innovation in new areas, in particular creative applications of newly-developing technologies.

Artists working with programmers on interactive art for big screens, for example, or engineers collaborating with fashion designers on wearable tech.

The original founders still head up Colab – architect Charles Walker, and Frances Joseph, who was an artist working in sculpture, installation, puppetry and animatronics.

Joseph says she has always been interested in


how creativity and science come together.“My father was an electronic engineer and

my uncle was a professor of English and a poet. So I always had two dimensions to myself: technology and artistry.”

Still, creating an interdisciplinary organisation within a university structure hasn’t been easy.

“What we were doing was quite radical six years ago. People were talking about collaboration between disciplines quite a lot, but it’s a hard thing to do, particularly in universities, which tend to be focused on disciplinary expertise – deep and narrow – with funding associated with students in different areas.”

Has it been worth it?Definitely, Joseph says. Collaboration is crucial.To take just one example, there are no

university courses where people study advanced

engineering and advanced textile design together, she says, so if you want to develop wearable technologies or e-textiles, you have to have some way of bringing these different areas and experts together.

“The wearable technologies group includes textile designers, PhD students, electronic and

mechanical engineers, nanotechnologists, computer programmers, physiotherapists and health scientists, as well as industry partners.

“The researchers come from different disciplines with different cultures. They understand things differently and speak different languages.”

In general New Zealand organisations don’t do collaboration well, Joseph says, though we are improving. “Maybe kids do it better, but our systems – university, business, government – aren’t geared for collaboration.”

LABS NETWORKThe word “Colab” conjures up (in this mind at least) a Silicon Valley-like white space, full of muted groups of students, perhaps in lab coats.

The real thing isn’t like that at all.

Capturing interest: Colab co-directors Frances Joseph (left) and Charles Walker (right), with public liaison co-ordinator Harry Silver (centre

right) and visiting Montreal academic and artist Chris Salter (second from left) in Colab's motion capture lab.

“Others see chaos. We see experimentation and discovery... Around 30% of graduates from the programme go on to found their own business. ”Charles Walker, Colab

»

48 | IDEALOG.CO.NZ

COLLABORATION | AUT’s Colab

Without its own building (though it may get a home in 2018 as part of AUT’s rebuilding programme), Colab has snuck, magpie-like, into other people’s spaces.

3D printing is at the bottom of the science and engineering block; textile and design is tucked in the basement of an unlikely building near the top of the campus; PIGsty is currently a virtual group, managed through Colab, and is waiting for confirmation of its own physical lab space.

Then, several floors above PIGsty is the megatronics workshop – grandad’s shed taken over by the teenagers.

Handtools and drills sit alongside 3D printers and old oscillators salvaged for parts – the workshop is a glorious treasure trove, open once a week for anyone who wants to work on their own projects, exchange ideas, and collaborate.

PROJECT-BASED LEARNINGThere’s almost no stand-at-the-front-of the-classroom-style teaching at Colab, Walker says. Instead, the curriculum is project-based – with the projects mostly devised by students themselves. Some visitors used to the old, traditional way of academic teaching can be a bit horrified, Walker says. But students (and mostly their parents) “get it”.

And if success is measured in terms of how much innovation you foster, Colab is winning. Around 30% of graduates from the programme go on to found their own business.

“Others see chaos,” Walker says. “We see experimentation and discovery.”

Six years after the Tertiary Education Commission handed over its first $1.4 million of funding, Colab now has 200 students, 17 staff, and four labs – 3D printing, textile and design, motion capture and PIGsty (play interactivity and games). There’s a data visualisation lab coming

on stream in 2016 where researchers will be looking at new applications in areas like virtual realities, tangible interaction and the design of immersive spaces. And Colab staff also run a series of regular meet-ups and hackathons – from game development to digital art.

COLLABORATION CULTUREAt any one time there are dozens of projects going on in Colab, says Walker. Some involve undergraduate student teams, others post-graduate researchers from various disciplines, and the teams often work with academic staff and people from industry, business and the creative sector.

“There is a lot of emphasis on teamwork with the students – students develop and disband teams on a project-by-project basis. That’s how

the world works, but it’s one of those overlooked skills in universities – how to fit into teams, work with people and be constructive.”

WIDENING PARTNERSHIPSAt the moment, Colab is working with about 10 business and community partners, including Spark (formerly Telecom), Walker says, with an emphasis on new technologies and digital futures.

“Everyone talks about disruption, so if the world is changing because of new technology, what are the new products, services, business models, careers and organizational structures that are going to be successful. That’s what we are interested in.

“With external partners, we like to sit down and run ideation sessions; work out what the questions are, and agree a path forward, rather than start with them telling us their problem.

“For example, Spark knows it can’t be a telco, it has to be a digital service provider, so what is its future in the new digital economy?”

And Colab is also growing in other ways. Last year it took 50 first year undergraduate students; this year the intake was increased to 70. The school typically gets 350-400 applications. Now the focus is to boost post-graduate numbers from 35 to 60 by 2018.

“We tend to attract people who are at the edges of their own discipline,” Walker says. “They might be an engineer that became interested in mechatronics, or an artist who wants to get involved in technology, or a programmer who wants to do something creative, like film or motion capture.”

The biggest challenge Colab faces, Joseph says, is keeping ahead of the game, when the game is digital futures. But when it works, it’s worth it.

“One of the best moments for me was finally getting electrical engineers working with textile designers in the field of wearable tech and e-textiles. It was a five-year process to get this happening because fashion and engineering are traditionally seen as opposites... predominently female students versus almost exclusively male, 'frivolous' versus serious, creative and expressive versus scientific and mathematical.”

What possible right would New Zealand have to create a world-class contemporary art museum? We’re world-class when it comes to growing stuff. And we’re world-class when it comes to knocking people over, rowing quickly and throwing things a long way. So why set out to build a world-class contemporary art museum in New Plymouth? Because there’s no point wasting everyone’s time creating one that’s average. And because art makes the world a bigger place. It lends you someone else’s brain for a minute. It throws your gaze on places you wouldn’t otherwise see. The job of the Govett-Brewster is to provoke. The point, surely, of visiting an art museum is to feel something. We get that you can live a life that’s insulated but we just can’t see the point. The value of experience lies in the depth of feeling. So we want to make you angry. In fact, we suggest you stop by Giovanni Intra’s Needle in Glove. Get angry. Get annoyed. Get delighted. But get something. Then visit the Len Lye Centre. Spend some time with his Universe. It’s beautiful and it’s puzzling and that’s ok. Then spend some time with Ngahina Hohaia’s I am your Lord. Poignant, sad and inspiring. We believe the point of art is to challenge people’s perceptions. To challenge them. Not to gently nudge them. Art isn’t mild. Art is full-fat. Art isn’t polite. Art punches, screams and kicks. We are the Govett-Brewster. Provocateurs since 1970.

New Plymouth, Aotearoa New Zealandgovettbrewster.com

In association with Insight Creative

50 | IDEALOG.CO.NZ

Customers by designSales success is the process of attracting customers by showing them how your product and/or service will meet their needs better than the alternatives available. Good design attracts customers, sells more products today and sets a platform up for you to sell even more tomorrow, writes Steven Giannoulis from Insight Creative.

WE OFTEN GET approached with fantastic new product ideas and are asked to create a design for the product, its packaging and its marketing material. We love this type of work. Our work on projects like ecostore, Gravity Coffee, 1Above and in the early years of Icebreaker have shown us just how important design can be in positioning a product or idea and capturing the market. Many entrepreneurs understand that getting the brand story and design right will have a significant impact on how successful they’ll be.

But unfortunately many don’t. Way too often we see amazing ideas, where the company’s founders have spent years getting the product right, but have not invested enough money, and more importantly time, into the branding, packaging and marketing of that product.

Not surprisingly, creating a design that attracts audiences starts by understanding the audiences. We start with the basics – Who are they? What’s their motivation? How do they buy? What influences their decisions? Where do they get information from? What’s the buying process? What benefits and features do they value?

Design is subjective so it’s important to keep our audience profiling holistic, not just focusing on demographics, common actions, traits and behaviours, but understanding unifying ideas, perceptions, motivators and aspirations.

At the same time, it’s important to have the conversation from the other end. What does the business want? How do they want to position themselves and their product? What do they want audiences to do and feel? Why? How will the product be distributed? How will it be priced comparative to the market? How is the competition positioned?

The two ends come together to inform a story to be told in design. It starts with a tone of voice. Is it fun, serious, classic, modern, cutting edge, high-performance, natural, New Zealand, international, something else? The tone will inform the combination of colours, fonts, graphics and imagery styles that will help potential audiences make an immediate association. The design allows the brand qualities to be expressed, key product benefits and features to be emphasised, and allows audiences to quickly decide if this product meets their needs and value considerations.

Design is always about balancing hearts and minds, but product packaging goes one step further. You want people to see themselves in the product – will it make them feel younger, cooler, smarter, whatever is important to them? Designers also need to think about functional elements like proper labelling and consumer information, how it feels and performs when you hold it, how it stands, how it stores and how it bundles with other products.

When we designed the ecostore brand for supermarket entry, we were very clear about what the brand stood for and how that should manifest itself in the design. What made the challenge interesting was the competitive environment – mainstream household cleaning products – which all seemed to have loud visual identities. Our design thinking had to make ecostore feel different, but at the same


Steven Giannoulis is CEO & Strategy Director at Insight Creative. [email protected]

IN BRIEF

This is the fourth in a series of articles highlighting how good design thinking can address problems and opportunities facing businesses.

Insight Creative is a design communication agency that has been helping businesses achieve their business goals for 40 years. They specialise in brand, digital, environmental experience, marketing and investor communications. www.insightcreative.co.nz

time deliver real cut-through in a ‘noisy’ supermarket environment.

Product packaging is just one part of attracting customers. The sales process often starts way before the consumers find themselves in front of the product – and can continue way after. A design agency will look at how audiences become aware of your products and services and how this first experience can be enhanced to encourage an interest to learn more. It will look at how each experience reinforces the earlier ones and how the design can drive greater desire and action.

One thing we always say to new companies launching new products to markets is “think about what’s next”. Product extensions. New product lines. New markets. Think about where the business may go and future proof your branding to the extent you can. Design today for where it may go. Invest into building the equity into the overarching brand, not just the product. This will reduce the time and cost associated with launching future product initiatives and will aid future success, as new products benefit from positive associations with earlier products.

While I’ve focused on start up businesses with consumer products, the thinking is equally valid to established businesses, NGOs and B2B operators. Last year, we helped Government-owned science powerhouse ESR take a unique DNA testing product to a global business and government agency market. The execution was different but the approach to design thinking reflected much of the above.

52 | IDEALOG.CO.NZ

INNOVATION | Pot potential

+ NEW ZEALAND LOVES marijuana. While estimates vary, somewhere between 11%-15% of New Zealanders

have consumed the drug in the last twelve months. It’s the most-used illegal drug in the country, and number three most popular drug overall, behind alcohol and tobacco.

According to the 2014 United Nations’ World Drug Report, New Zealand is the world’s third largest consumer of marijuana per head of population, behind Iceland and the United States.

And guess what’s projected to be the fastest-growing business in the US? Apps? The ‘sharing’ economy? The internet of things? Big data? It’s actually ... (imagine you hadn’t read the headline or seen the accompanying images) ... marijuana.

Four US states (Colorado, Washington, Alaska and Oregon), plus Washington DC, have legalised marijuana for recreational use, not by turning a blind eye, as in Amsterdam, but through a highly regulated commercial market.

A further fifteen states have decriminalised marijuana to varying degrees, and 23 states have legalised it for medical use. In total, 59% of states, plus DC, allow marijuana use in some form.

While using cannabis remains illegal under federal law, the Obama administration has instructed federal law enforcement agencies not to intervene in states with laws that contradict the federal law.

Legislation has been achieved through private

ballot (similar to citizens-initiated referendums), and has been promoted as a way to bolster struggling economies by creating new business opportunities, increasing tax revenue and cutting law enforcement costs.

It’s early days, but it looks like it’s working. In 2014, legal marijuana sales in the US totalled

$US2.7 billion, up 74% from $US1.5bn in 2013. ArcView Group, a marijuana-orientated research and investment network, reckons sales will rise to $US3.5bn in 2015, and $US10bn in 2018.

Meanwhile six more states are due to vote in 2016, and an article in Time magazine suggested 18 states (36%) will have fully legalised recreational marijuana use by 2020.

ArcView reckons legalisation in all 50 US states would result in annual retail sales of $US36.8bn.

But the economic benefits of the “green rush” aren’t restricted to cultivation and sale. As demand for legal marijuana has grown, a new industry of infrastructure and service providers has sprouted alongside it.

Take the Marijuana Investor News site, with stories geared solely at entrepreneurs and investors wanting to put their money into cannabis. Then there was the three-day Marijuana Investors Summit in April in Denver, which attracted 1,000 attendees, a mix of investment groups/venture capitalists looking for places to invest millions of dollars, plus lawyers, accountants, human resources, and security services all hawking marijuana-related services.

Pot, spliff, ganja, skunk weed, doob, reefer, mighty mez, bubonic chronic. Whatever you call it, they are imbibing it legally in four US states, Holland, Uruguay and North Korea. More US states and several countries in Europe and South America are looking carefully at legalising it. And there’s big money in making wacky backy legit – just ask the Colorado tax department.Henry Oliver explores the economic implications of legalising marijuana, just in case New Zealand lawmakers are thinking about it.

On a high: Making dosh from legalising dope

»

54 | IDEALOG.CO.NZ

INNOVATION | Pot potential

to stress there are no active legislative efforts to legalise or decriminalise marijuana in New Zealand, but if legislation continues to spread in the States, and other nations follow its lead, New Zealand is likely to get swept up in the rising tide of reform. As we’ve seen with gay marriage, things can change quickly these days, even after years of stagnation.

The idea that taking a tough stance on drugs has largely failed to reduce harm is now gaining credence in New Zealand. As Ross Bell, CEO of the Drug Foundation, told stuff.co.nz in July: “We followed the US into the war on drugs and I think we are going to join them in the peace movement as well.”

Would Kiwi entrepreneurs be interested in cannabis as a commercial proposition? It’s hard to know, as people Idealog contacted were very reluctant to get involved in the debate.

But TradeMe founder and former boss Sam Morgan did believe legalisation should go ahead.

“The bigger issue is that, like alcohol prohibition before it, the war on drugs has failed. Marijuana and other recreational drugs should be legalised, controlled and taxed. This will leave criminals to focus their attention on much more profitable areas such as cyber-crime, and reduce significant cost and social harm.”

Matt Bowden, the infamous party pills innovator, was instrumental in the development of the Psychoactive Substances Act, which regulates legal highs and which many believe could be easily used in the legalisation of marijuana.

“I expect here the recreational users will have to go to the back of the queue and let the medical products come first,” he says. “After the medical is out there, I guess we will see gradual release through quite restrictive, tightly monitored, systems for recreational consumers.”

If marijuana’s legal status in New Zealand changes, it’s the third option, full legalisation for adult use, that will provide opportunities for local entrepreneurs to make money.

“It will be big business,” says the owner of a retailer holding a legal high licence, who’s been in the industry for years. “Like in the States, people are realising there’s this huge potential, both recreational and medical.”

HUGE POTENTIALColorado’s experience gives some idea of what might happen if New Zealand had a fully-open market. Colorado has a similar population to New Zealand (5.36m versus 4.47m in 2014). And two years after marijuana was legalised in Colorado, total sales reached almost $US700 million, with the state reaping $US76m in tax.

It’s hard to know exactly how much weed New Zealanders would consume if it was legal, but

ArcView has invested $US41 million into 54 marijuana related companies. And billionaire Peter Thiel (the guy who put money early into Facebook, LinkedIn and Yelp and thereby made a name for himself as the investor that funds ideas that sound crazy to almost everyone else) has also jumped onto the cannabis bandwagon. His investment firm Founders Fund has put millions into Privateer Holdings, a private equity firm which launched the Marley Natural brand of legal marijuana in partnership with Bob Marley’s family.

One of the pioneers in the industry is Christian Hageseth, CEO of consultants American Cannabis Partners, president and chairman of Colorado-based producer Green Man Cannabis, and author of Big weed: An entrepreneur’s high-stakes adventures in the budding legal marijuana business.

Hageseth began by cultivating medical marijuana and has been a long time advocate of marijuana law reform. He’s as bullish as they come when it comes to the effect legalisation has had on the Colorado economy: “We’re a job creation machine,” he says with deep, American enthusiasm. “Colorado is enjoying a great economic boom and marijuana is one of the key drivers.”

Once again, he says the benefits aren’t limited to growers or manufacturers. “Entrepreneurs and small business owners are asking how they can use marijuana to their benefit,” he says. “That goes for accountants, web designers, masseuses, hotel operators, restaurant and bar operators. Could they open a marijuana-friendly restaurant? Maybe you serve a kale and cannabis salad, actually using it in the food preparation rather than just letting people smoke a joint.

“The introduction of a new legal vice opens up a world of opportunity for entrepreneurs beyond just growing and selling the plant.”

SO WHAT ABOUT NEW ZEALAND?Once upon a time, dreadlocked Green MP Nándor Tánczos was pretty much a lone voice in the wilderness calling for the legalisation of marijuana in New Zealand.

Not any more. Associate Health Minister Peter Dunne’s

decision in June to approve the use of California-produced cannabinoid oil product Elixinol for the first time in New Zealand to help a teenage boy suffering from seizures was one sign changes may not be out of the question.

And the move by retiring Waikato Police District Commander Win van der Velde to speak out in favour of decriminalising cannabis is another indication.

The National Government has been at pains

TOTAL 2014 SALES:$US 699M

SALES TAX ON MARIJUANA:

10%

EXCISE TAX ON RECREATIONAL

MARIJUANA:15%

TOTAL 2014 TAX REVENUE:$US 76M

MARIJUANA SOLD IN 2014:130.3 TONNES

POPULATION OF COLORADO

IN 2014:5.36M

PERCENTAGE OF COLORADO ADULTS

THAT CONSUMED MARIJUANA IN THE LAST 12 MONTHS:

12.8%

POPULATION OF NEW ZEALAND

IN 2014:4.47M

PERCENTAGE OF NEW ZEALAND ADULTS THAT CONSUMED

MARIJUANA IN THE LAST 12 MONTHS:

14.6%

NUMBER OF TOURIST VISITORS TO

COLORADO IN 2014:71.3M

AMOUNT THEY SPENT:

$US 18.6BN

PERCENTAGE OF RECREATIONAL MARIJUANA SALES TO NON-RESIDENTS:

44%

What is happening in Colorado?Colorado legalised marijuana sales in 2012. Adults over 21 can legally possess 1oz (28g), and grow up to six cannabis plants in a private, locked space. Residents can buy 1oz at licensed retail stores, with non-residents allowed ¼oz (7g). It can’t be consumed openly or in public.


the figures we have show that 9% of Colorado residents used marijuana at least once a month in 2014, versus 14.6% New Zealanders who said they had used the drug in the last 12 months (this latter according to the latest UN Drug report).

Dr Chris Wilkins, who heads Massey University’s Centre for Social and Health Outcomes and Research, studied the illegal marijuana market in 2001 and estimated it to be worth between $131 m and $249 m annually, with his best guess at $190 m, though he cautions that the calculations may not be much use in estimating the potential legal market.

“The size of the market as we calculated it is the size of the illegal market and because it is illegal, the price is higher than it would be under a legal market. So the size of the market may be smaller than the existing illegal market, even if there are more users and buyers.”

He also warns about reading too much into Colorado’s experiences so far.

“It’s quite early days, so I think you have to be a bit cautious about looking at Colorado now and saying that that’s what it’s going to be like. There are still a lot of things to happen there in terms of developing the commercial market, the kinds of costs saving you might get over time and whether the user base is going to grow."

SOCIAL COSTS“The other thing to keep in mind is sure you’re going to create a big legal market, but what we know from alcohol and tobacco is that they’re responsible for a huge amount of social cost: driving accidents, poor health, poor educational achievement, crime, poverty, social welfare dependence.

“So you might get an initial financial boost in terms of taxation but there could be a whole raft of social costs that you’re eventually going to have to pay for.

“[In addition] you could argue that if you had a legal cannabis market, maybe you would have smaller alcohol and tobacco markets. But that’s not a question anyone has the answer to.”

The legal high retailer, who spoke to Idealog only on condition of anonymity, says the popularity of synthetic cannabis in New Zealand during the period when it was legal, showed people don’t want to break the law.

“They’d prefer not to be criminals.”

CREATIVE OPPORTUNITIESBrand strategist Jill Brinsdon, who heads marketing and advertising agency Radiation, says legalising marijuana would create significant opportunities for creative marketing and branding – as it has for the craft beer market.

“If it sits in the same realm as alcohol, the opportunities will be enormous. The business of legalised escapism from the human condition, there’ll always be a big market for that.

“We would expect spectacular branding and design. They’ll follow in the footsteps of all the independent craft beers who are marketing themselves beautifully.”

The legal high retailer agrees: “I don’t think this is a tobacco industry model. In the States and Amsterdam, you don’t see big business that involved. What you see is a lot of small business.

“I don’t think Marlboro is going to be able to put out a packet of joints and sell them at a dairy. I would guess that most people who are marijuana smokers wouldn’t want to deal with those type of companies. They want something local, not something grown somewhere random and sprayed with God-knows-what.”

When it comes to making money off legal marijuana, US consultant Christian Hageseth advocates an holistic approach.

“I’ve often looked at the gold rush in the United States of the 1860s, and the people who made the most from the gold rush weren’t the gold miners,” he says. “They were the people who sold the picks and the shovels to the gold miners, the people who had hotels for gold miners. Levi Strauss, the blue jeans maker, is probably the guy who made the most.

“So if marijuana were legalised in New Zealand, as an entrepreneur, look at everything. You don’t have to just get in and grow the plant. You don’t just have to sell it at retail. Create a better vape pen [a hand-held vaporiser for “smoking” pot]. Supply all the packaging for the product. Provide outsourced services for staffing temporary labour.

“There are a lot of ways to profit in the marijuana business where you’re not involved in the cultivation or sale of it, but rather supporting the industry in some significant way. Entrepreneurs should know that wealth creation, the opportunity to innovate, and the ability to be creative in a business sense is not relegated to growing and selling marijuana.”

“We’re a job creation machine. Colorado is enjoying a great economic boom and marijuana is one of the key drivers. The introduction of a new legal vice opens up a world of opportunity for entrepreneurs beyond just growing and selling the plant.”

CHRISTIAN HAGESETH, AMERICAN CANNABIS PARTNERS

What is happening in New Zealand?

Going straightSteps on the way to a fully open marijuana market

Decriminalisation: It is legal to possess marijuana and grow a small amount for personal use, but without a legal market which can be regulated and taxed.

Restrictive legislation: Marijuana can be grown by licensed clubs or operators, similar to medical marijuana dispensaries, but with no fully commercial market.

Full legalisation: Marijuana may be bought and sold in a regulated, and taxed, market.

The illicit marijuana market in New Zealand is worth $131m-$190 m.

A tinny (1.5g) costs $20, no matter which of the main centres you are in. But if you buy by the ounce, you are better off getting your marijuana in Wellington, where it's $296/oz, as opposed to Auckland ($326) or Christchurch ($342) .

It's getting easier to get hold of. 82% of frequent drug users said they can buy marijuana in one hour or less, up from 75% in 2006. 45% said it takes less than 20 minutes.

Most people still buy cannabis from a private house (82%) or a tinny house (49%). But access is growing from other places too. 27% of people

got it from a public place like a park, up from 12% in 2009, 17% bought it at a pub or club (10% in 2009), and 8% at their school or tertiary institution (2%). 9% bought it from work, but only 3% went online.

Most frequent drug users got their cannabis from friends (71%) or acquaintances (57%), though buying from drug dealers and gang members is also popular (61% and 35% respectively). Just over 20% bought from family members.

The police seized over 155,000 cannabis plants in 2013, up 30% on 2012.

Source: Dr Chris WIlkins, Massey University, 2013. Based on interviews with frequent drug users.

56 | IDEALOG.CO.NZ

INNOVATION | Power

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The energy sector no longer wants to keep us in the dark. The word on the street is when it comes to electricity usage, socially-conscious goes hand in hand with financially astute. As New Zealand braces itself for massive disruption in the energy sector, we look at some of the best electricity innovation since the lightbulb. TEXT BY JAI BREITNAUER

58 | IDEALOG.CO.NZ

INNOVATION | Power

Smart power Until recently, energy companies have been the one-eyed king in the land of the blind, providing consumers with confusing information and a lack of choice, while pocketing healthy profits. Not any more. A streamlining exercise by the Electricity Authority has opened up the market to competition, and the new boys are riding in on the cloud, with an iPad in their scabbard.

Here are three of the new kids on the block:

ELECTRIC KIWILaunched in May, Electric Kiwi offers “naked electricity”, a business model structured around online tech innovation.

“We’re a tech start up as well as an energy start up,” says GM Julian Kardos. “We’re completely online, we don’t have any call centres, all payments are made using credit and debit card, and all trouble-shooting is done through live chat.”

The cost savings are obvious – fewer bums on seats means less capital outlay, and the saving is passed on to the consumer.

“This approach isn’t for everyone,” admits Kardos. “Some people like to chat about the weather.” But if you’re internet savvy you could save big, as long as you’re on a smart meter.

Smart meters mean that Electric Kiwi is able to get more information about its consumers, Kardos says.

“We’ve changed the pricing model to reflect power usage based on that information. Instead of discount incentives and different rates for different customers, we’ve given everyone

Marcus Kohn-Taylor, Utilise

“The market is no longer at the feet of energy providers; we’re going to see a world where people can choose to buy energy when it’s cheapest, choose to store it or use it, choose to produce their own energy and choose to sell power back to the market for a profit. ” Steve O’Connor, Flick Electric

Steve O'Connor, Flick Electric Julian Kardos, Electric Kiwi

FLICK ELECTRICAnother start-up, soft-launched in Wellington last August, Flick is also using smart meter data to give customers access to wholesale prices.

“Other businesses bundle up the costs of getting electricity to your door, which makes it easy to justify price increases,” says CEO and founder Steve O’Connor, noting that electricity retail prices have increased 75% in the last ten years, while some costs for retailers have actually dropped.

“We’re offering full transparency – all we charge you for is the price for being your retailer. You pay actual market prices for the energy and network costs.”

The price of energy changes every half an hour depending on demand. Network costs passed directly through to customers also vary depending on the load they have to deal with,

access to a flat rate and the ‘Hour of Power’ – a free hour of off-peak electricity each day.”

Kardos says if you do nothing, you will save an average of 4.2%, but if you think about your power consumption and complete high energy jobs during that hour, you could save 10%-15%.

“And importantly, we’re reducing the peak load on the network and encouraging people to consume power at night when it’s mostly renewable,” says Kardos. “Our model is good for the country, as well as the individual consumer.”


O’Connor says. Flick gives its customers access to that information which, coupled with usage data from their smart meters, should enable them to get a cheaper price.

“We do have customers who play the game, watching the prices,” O’Connor says. “But in reality most just make a couple of simple changes. If you use your dishwasher at bedtime, for example, you will be paying up to a quarter of the usual retail price for your power without it impacting on your life.”

He says the average saving is around 17%, compared with a regular retailer. “Some customers have moved to automation to benefit from wholesale energy prices as well,” explains O’Connor. “With gadgets on timers or smart plugs, you can have complete control over your energy usage.”

O’Connor says Flick’s business model has been set up in preparation for what is to come – energy-efficient technologies becoming cheaper and therefore more accessible.

“The energy sector hasn’t really changed for

Worth changing: Co-owner of Rushworth

Cafe James Gardiner switched to Utilise because

he was frustrated at his power bill.

30 years, but within the next five years, we’ll see 50 years’ worth of disruption.

“People can afford solar panels now, plus Tesla has been developing a new battery that can store energy for use later on.

“The market is no longer at the feet of energy providers; we’re going to see a world where people can choose to buy energy when it’s cheapest, choose to store it or use it, choose to produce their own energy and choose to sell power back to the market for a profit.”

UTILISEUtilise launched its business retail offering earlier this year. Kiwi-owned and with generation assets in Taranaki, the company calls itself a new “Gen-tailer” – an innovative retailer for business customers, with the security of a generator behind it.

Like Electric Kiwi and Flick, Utilise is able to offer the service it does because of the roll-out of smart meters – power boxes which take accurate power usage readings and transmit that information in real time to the power company. Over half of all domestic electricity meters are now smart and this is forecast to be 75% by the end of 2015, and up to 95% in 2018.

Add in business and commercial customers and there are now approximately 1.2 million smart meters around.

Utilise has also benefited from the developing electricity hedge market. Once dominated by the big players, Utilise is now able to trade in

this market, to the benefit of its customers, says general manager Marcus Kohn-Taylor.

“Energy retailers take the risk away from their customers by purchasing electricity hedges. If there is a drought and spot market prices spike, businesses don’t face that extra cost.”

Utilise says historically, large industrial users have benefited from customised prices, which are aligned to the electricity spot market. But other businesses have paid a more expensive flat rate, as have residential consumers.

Kohn-Taylor says Utilise uses smart meter technology, combined with its own bespoke software, to analyse each customer’s usage and then offer them a unique, personalised tariff.

“It takes about 20 minutes, and while we still build the risk into our pricing so the customer doesn’t have to factor that in themselves, we’re able to offer a streamlined tariff that is closer to the wholesale price, even for smaller companies, based on the actual energy they use and when they use it.”

Take the Rushworth Café in Auckland’s Wynard Quarter, for example. Co-owner James Gardiner switched to Utilise because he was frustrated at his power bill.

“Our chillers run 24/7, but we were paying a peak rate even at night. I thought there had to be a better structure.”

Utilise installed a smart meter, and Gardiner now gets a discounted power price overnight.

“It will save us about $1500 annually – a big gain for a small business.”

“The energy sector hasn’t really changed for 30 years, but within the next five years, we’ll see 50 years’ worth of disruption. ” Steve O’Connor, Flick Electric

»

60 | IDEALOG.CO.NZ

INNOVATION | Power

Three energy efficient appliances that could save you $$$

SMART HEATINGAll the rage in Europe and America this year, smart thermostats have hit the market to help homes and businesses automate their heat provision and reduce energy output – and maybe even help companies move to a more sustainable heating and cooling regime.

First unveiled in 2011, the Nest learning thermostat, for example, doesn’t just respond to the way you’ve programmed your needs – it actually learns what your needs are and pre-empts them.

Nest is Wi-Fi-enabled and connected to the internet, and the smart thermostats use sensors to detect whether you are actually in a room or not, and learn your schedule so you don’t have to manually set the heating to come on at a particular time.

In New Zealand, where thermostat-controlled central heating is still not the norm, Mitsubishi Electric has unveiled a Wi-Fi heat pump control app. The idea is customers can control several heat pumps from one app on a phone or tablet, with no expensive hardware needed – apart from the pumps themselves.

They can also change the set up and

You’ve got the power

Got all the gear, but no idea? The Energy Efficiency and Conservation Authority (EECA) recommends businesses put together an energy management plan, to take advantage of new transparency over energy prices and fancy smart gadgets.

“First, understand your energy use,” says EECA's Gary Walker.

“How much are you using, and where and when do you use it? Use the tools provided by your energy supplier.”

Switch to a smart meter, which can give detailed information about usage.

And ask your retailer to send you reports daily or give you online access to real-time information. Most of the new breed of retailers can offer that service.

Once you have gathered information you can make a plan.

It might be as simple as remembering to switch the lights off when you leave the office – or you could install sensors or software to do this for you. Use smart technology if you can.

One option that may get more traction in the future is smart plugs – intermediary devices which comes between an electric gadget (anything from the office dishwasher to your cellphone charger) and your electricity supply. Smart plugs are normally used so users can control their devices remotely – letting you turn off the lights at work from the car when you forgot at the end of the day.

But Walker says a logical extension (if you were nerdy and power conscious) would be to set up your smart plugs using an algorithim relating to when electricity is cheapest.

That would mean that gadgets that need charging (mobile phones, laptops etc) or aren’t time-sensitive (dishwasher, washing machine) could be set off automatically when the power price drops below a certain level.

Whatever the plan, make it visible and educate your organisation – empower them to take part.

Step two, after you’ve tackled the low-hanging fruit of energy savings, is to look for any opportunities to optimise energy use, Walker says.

“Analyse your processes; do two similar actions or sites use different amounts of energy? Find out why, and combat that. It’s an ongoing process – make sure you have regular review periods where you can check what you’ve achieved and set new targets.”

temperature of each pump remotely. Trish Stenzel from New Zealand distributor

Black Diamond Technologies says Wi-Fi Control is geared for small to medium-sized commercial buildings including offices, motels, and schools.

“Once each heat pump is fitted with an adapter, building managers can control and customize the heating and cooling needs of multiple units, not just in the same building, but across a number of locations, through one app.”

So a business headquartered in Takapuna but with a factory in Papatoetoe can control both systems from one mobile phone.

Stenzel says the technology has been designed specifically for the New Zealand market and can be retrofitted to most Mitsubishi Electric heating and cooling products, including ducts systems, as long as they are less than five years old.

Unlike the Nest thermostats, the Mitsubishi Electric app can’t learn your habits, but you can programme in usage parameters, setting heat pumps to a particular pattern.

“With gadgets on timers or smart plugs, you can have complete control over your energy usage. ”Steve O’Connor, Flick Electric


Help! I can’t afford money-saving upgrades!

Check out EECA Programme Partners, who know what grants, funding and support are available via the EECA networks.

Work out how quickly you can get the money back from lower power bills. “Some businesses will find that some of the savings coming from energy efficiency will pay off the costs of the technology within one or two years,” says EECA's Gary Walker.

Investigate partnering with a service provider, who might be prepared to invest some of the up-front money.

“Some provider’s are willing to take the savings over time,” Walker says. “The business reduces capital outlay, receives the benefits of new technology and the service provider makes ongoing margins and longer term clients. Everyone benefits.”

Energy saving tips for small to medium sized businesses

Low hanging fruit: Find the obvious problems and tackle them first – shut down and switch off when you leave.

Make small changes: Do you need to turn on the lights closest to the windows? Can you switch from oil to bio-fuel?

Educate staff: Help them understand energy management isn’t just about saving money, but reducing the business impact on the environment and the load on the network. Being an energy-responsible staff member actually saves personal (not just corporate) tax-payer dollars.

Keep up the review: Check you’ve met your targets and set new ones. If you’re not meeting targets, find out why and instigate a better plan.

Get help: If you’re unable to manage your in-house plan or your business is growing, seek assistance. The Energy Efficiency and Conservation Authority (EECA) can help you find a consultant, or you could invest in some energy management software. The ISO 5001 is an energy management framework useful for larger organisations.

Craggy Range Winery

In 2009 Craggy Range Winery in Hawkes Bay partnered with Transfield Worley so it could install a heat recovery system with no capital outlay. The result is that the winery has reduced its electricity use by 13%, and the savings generated from that paid off the installation costs within four years.

The heat recovery system takes heat from chillers and an air compressor and uses it to heat hot water for the vineyard’s facilities.

“We are focused on sustainable wine growing,” said Michael Wilding, chief operating officer of Craggy Range. “We are constantly investigating process re-engineering opportunities that will deliver energy efficiencies, which inevitably will also deliver financial savings.”

SEE THE LIGHTAre you still using traditional lightbulbs? The UK’s Telegraph newspaper, with the help of comparethemarket.com, calculated that replacing ten 60w ordinary bulbs with 6w LED lights could save you nearly $500 a year.

And even though they’re more expensive than other types of lightbulb on the market, the energy savings are so significant you would have paid off your investment within five months. The bulbs themselves last on average 18 months.

If you upscale their calculations to a large office, your savings could well enter the four figure mark, not to mention the huge reduction in your carbon footprint.

DON’T BE FRIGIDIf your business uses industrial refrigeration units you’ll know how energy inefficient they can be. This is because of the way units work, with the thermostat asking the compressor to run until the minimum temperature is achieved, and then the compressor’s energy use increasing exponentially as the bottom of the temperature control band is approached.

Vancouver-based company Smartcool has developed two products (known sexily as ECO3 and ESM) which can be used with an existing refrigeration system, to optimise its cooling cycle, reducing energy output by around 15%.

The devices are placed between the compressor and the thermostat, where they actively monitor and analyse the system.

They then use that information to adjust the length of each cooling cycle to make sure it uses as little electricity as possible.

62 | IDEALOG.CO.NZ

INNOVATION | Power

Studying energy-efficient buildings

Developing sustainable buildings has been a major consideration for AUT University’s recent construction projects, says AUT director, asset development, Suzanne Webb. The new building for the Manukau campus was no different.

During the design process for the new South Campus building, AUT’s architects worked with EECA to use energy efficiency reviews and computer modelling to determine the impact of particular items on the efficiency of the building, Webb says.

“Computer modelling indicates the building currently offers improved energy performance compared to an NZ Building Code reference

building,” she says. “This has been calculated at around 30kWh/m2 per year energy savings offered by the building envelope design, and around 70kWh/m2 per year energy savings offered by the building services design”.

In other words, the walls and roof of the building have been highly insulated and the services inside the building have been made incredibly efficient, resulting in a serious energy saving for every square metre of the building. If you base costs on the average price of residential electricity at 26c per kWh, AUT’s new South Campus will save around $7.80 for each external square metre (the walls and the roof) and $18.20 for each internal square metre. And it’s a bloody big building.

So what have they actually done? First, they’ve strategically placed windows and solar

shading to make sure the building doesn’t take on too much heat from the sun in summer, reducing the cost of cooling the building with aircon. High spec insulation means the building stays warm naturally in winter, vastly reducing the need to whack on a heat pump.

And in a real cutting edge innovation, AUT is using “displacement ventilation”, where the heating system is in the floor, not the ceiling. Because heat rises, the intelligent heating system is set to heat only the first two metres of any space, while traditional heat pumps spend a lot of energy pushing heat down.

AUT will also fit high efficiency LED lighting, and an ‘energy sub-metering’ system, which provides a clear breakdown of energy usage to give the team a chance to regularly fine tune the building.

AUT South Campus

Never return to a cold home again.

Mitsubishi Electric Wi-Fi Control gives you the freedom to manage your heat pump through your smart phone, tablet or online account, no matter where you are.

On the way home, running late, coming home early, or even when you’re in a different country, Wi-Fi Control allows you to preheat or precool rooms before you arrive home. Now you’ll always arrive to total comfort regardless of what New Zealand’s ever changing weather is doing outside!

Not just when you’re away.

Effectively replacing your traditional heat pump remote, Wi-Fi Control gives you the freedom to manage your home environment regardless of where you are.

A warm wake-up on frosty mornings.

Wi-Fi Control is great for preheating your living room before you have to get up in the morning. It will make those frosty early morning starts just that bit easier to face.

Intelligent central control for multiple rooms.

With the purchase of additional adaptors, multiple indoor units can now be seamlessly monitored and controlled. Simple, yet effective centralised control at your fingertips.

Much more than a 7-Day Controller.Because Wi-Fi Control reflects real time room temperature, the unique rule setting functionality allows you to customise a minimum and maximum temperature range. So it maintains the perfect temperature, for total comfort all night long.

Ideal for families with children.You no longer need to physically walk down to each individual bedroom to check the temperature and turn a heat pump on or off using the hand held remote, potentially interrupting the sleep of children.

Quietly SuperiorHeat Pumps

TRY THE ONLINE DEMOwww.mitsubishi-electric.co.nz/wifi

64 | IDEALOG.CO.NZ

In association with Utilise

Above: Sabato owners Philip and Jacqui Dixon will save over $5000 off their power bill after switching to UtiliseBelow: Adam Peary, logistics and facilities manager for Sabato

IN THOSE PRE-café-culture days, New Zealand food choices were fairly basic, and the Dixons became hooked on these delicious, traditional, food products, often made from recipes passed down through the generations. Soon many of their friends were clamouring for them too.

“The difference in taste and quality was so different to what was available here, we decided to look at securing a regular supply,” says Jacqui Dixon.

She was a nurse, and her husband was in finance, but they decided to leave their careers to create Sabato, born in the Dixon’s home in 1993.

The name “Sabato”, which means “Saturday” in Italian, was also a sign of the times. Shops didn’t open in New Zealand on Saturdays in those days, so “Sabato” stood for pleasureable foods you could indulge in on a non-work day.

With two young children in the mix, starting a new business was a big juggle, Dixon says, but Sabato prospered, fuelled by a growing network of people who tasted their products and were no longer content with commercial options.

“When you try really good ingredients, sometimes it’s just too hard to go back.”

Fast-forward to today and Sabato is an established artisan food importer, producer and retailer, employing over 30 staff. Its retail store in Mt Eden has become a treasure trove for foodies.

The premise also has a commercial kitchen, and on any given day it is a busy place, filled

New electricity retailer Utilise powers artisan food store SabatoIt all began in the early 1990s when Jacqui and Philip Dixon were visiting friends in Australia and tasted true artisan food products for the first time – in their case, Rustichella pasta, Colonna extra virgin olive oil and Ferron risotto rice.

with people, the hum of commercial mixers, and the smell of puff pastry and empanadas.

All this activity soaks up a fair amount of power, and that’s why Sabato was attracted to the Utilise electricity offering, savings gained through customised pricing coupled by personal service.

The business feels it’s hit the jack-pot with Utilise, an innovative new entrant in the electricity sector, which has designed its services specifically for business needs.

Sabato’s logistics and facilities manager

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IN BRIEF

Talk to a Utilise Business Solution Specialist for a customised power price for your business.

oil and free range eggs. They also make Julie Le Clerc and Peter Gordon condiments and a selection of baked products.

Dixon says their Christmas mince pies, made with the “wickedest butter pastry”, have a following all of their own.

The company also employs its own cheesemonger who works with local cheese makers, to offer a range of New Zealand cheese.

Dixon says Sabato sells much of its range to selected food stores, and online, but some things can only be purchased from the retail store in Mt Eden.

“Life is never dull as we constantly taste and assess potential products. We supply many restaurants up and down the country.”

5 pm and 5.45 pm, which meant they didn’t get in the way of the kitchen and store and that made the transition easy,” Peary says.

“It’s not just about the savings either, we can also go online and check out our power usage and get a clear idea about our power usage pattern.”

Now the electricity is taken care of, Sabato can focus on what it does best – providing artisan food around the country.

The Dixons regularly travel overseas to source products direct from family businesses and have grown the range considerably over the years. Some of the companies they deal with have been in business for generations, Dixon says, like Giusti (balsamic vinegar of Modena), and Forvm (wine vinegars).

Sabato’s kitchen, powered by Utilise, produces its own mayonnaise range, using quality olive

Adam Peary says it investigated switching to Utilise after seeing that it offered the most cost-effective deals and was transparent with pricing.

“Running a production kitchen with commercial mixers, ovens and chillers, we consume a lot of power and so we need to manage these costs closely.”

The Utilise business consultant met with Peary to discuss Sabato’s needs and found out about how their business uses power and assessed their connection and metering. And within 24 hours the company came back with a well-thought-out proposal.

“The Utilise proposal was impressive, and provided customised pricing for us. When they saw our legacy analogue meters they offered to upgrade them to smart meters, which meant they could give us a pricing plan with peak and off-peak prices. After seeing the seven chillers in our shop they immediately saw savings opportunities for our business. We will save $5,000 over the next year as a result of switching over to them,” Peary says.

The upgrade to smart meters was at no extra charge and outside normal business hours – which was a real attraction, Peary says.

Within a week of the first meeting with Utilise, Sabato had made the switch.

“They came to install the smart meter between Utilise.co.nz0800 UTILISE [88 45 47]

“The business feels it's hit the jack-pot with Utilise, an innovative new entrant in the electricity sector, which has designed its services specifically for business needs.”

66 | IDEALOG.CO.NZ

+ Not a lot of people know this, but electric vehicles aren’t a new, cool technology. The first electric car was produced in the 19th century, by the same guy behind electrification of the

London underground. Fairly quickly, electric technology was superceded by the combustion

engine we know and love. Now, say the afficionados, the time of the electric vehicle is nigh.

Drive Electric, the not for profit industry body for electric vehicles (EV) in New Zealand is focussed on helping New Zealand realise the environmental and energy benefits from switching to electric vehicles. The organisation believes the key is encouraging businesses to change their fleets – 70% of vehicles in New Zealand are fleet vehicles, so converting them can have a big impact.

“We know the barriers to the uptake of EV vehicles, but these are falling away,” says Drive Electric acting GM Joanna Silver.

“For a start, demand for these vehicles is driving competition, resulting in the price reducing and the choice of vehicles increasing.

“Second, the technology has improved immensely in the last few years. Extended battery life now gives pure EVs a reach of 120km between charges, perfect for urban fleet vehicles, and more public fast-charging points are being rolled out nationally. Finally, there is a deeper awareness of the whole-of-life cost.”

Still, electric vehicles are far from being mainstream. Drive Electric’s own figures suggest there are just under 700 electric vehicles registered in New Zealand, in a total fleet of around four million. There are 74 charging locations and seven different EV models available, as against hundreds of petrol stations and models of petrol/diesel vehicles.

Electric vehicles are also more expensive than their carbon-fuelled equivalents, although enthusiasts argue EVs create tangible whole-of-life cost savings through reduced refuelling costs, and significantly lower maintenance costs due to fewer moving parts.

For example, they argue charging an electric vehicle in New Zealand costs about the same as buying petrol at 26c a litre (as compared to more than $2 per litre of petrol for carbon-fuelled vehicles), so the initial capital outlay can be quickly recuperated through running costs alone.

The health and safety aspects also need to be considered, Silver says. She reckons a quieter and smoother driver experience could have a positive impact on the workforce and the wider public.

“New Zealand spends $930m a year combating the negative health effects of car emissions,” says Silver. “That’s according to the Government-commissioned Health and Air Pollution in New Zealand Study 2012.”

Reducing emissions will reduce these unnecessary social and economic costs shouldered by the public, she says.

Then there’s energy security. “We currently spend over $5 billion a year importing fuel for our

transport fleet,” Silver says. “By switching to EVs we can fuel our vehicles using New Zealand’s natural resources, reduce our fuel import bill, and move towards energy independence.”

On the brink of an electric vehicle revolution – kinda

CHARGING STATIONS

Public

Residential

High Power

Consumes 1/7 of NZ's electricity. Recent decision means it will remain NZ's biggest power consumer until at least 2018.

TIWAI POINT ALUMINIUM SMELTER

Sources: plugshare.com, gronnbil.no/statistikk, driveelectric.

org.nz, med.govt.nz/sectors-industries/energy/energy-

modelling/publications/energy-in-new-zealand

Electric Cars - The New Zealand Story

We have sustainable power generation and falling demand, so why don't we have a bigger EV industry?

TOTAL ELECTRICITY GENERATED (%)

Hydro

Gas

Geothermal

Coal

Wind

Bioenergy

TOTAL ELECTRICITY DEMAND

NZ VS. NORWAY - TOTAL EVS OWNED

660

60,000

= 2,000

INNOVATION | Electric cars

TEXT BY JAI BREITNAUER BREITNAUER BREITNAUER

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OPINION | Electric cars

New Zealand has all the factors that should make electric cars a big hit. Cheap, renewable energy. Declining electricity demand. A clean green reputation to uphold. So why on earth, asks environmental activist and writer Andy Kenworthy, have we got fewer than 700 electric vehicles in the country – a measly 0.01% of our total fleet?

+ WHEN I WAS nine I discovered a new laugh hiding behind my tonsils. It was 1983, and I was on the back of my

Dad’s Z1300 roaring along at 170 kilometres an hour. I heard it again last month. The Tesla Model S I was in made the jump to light speed at the touch of a button, while humming.

Electric cars are about to make other cars look like Chitty Chitty Bang Bang. The oil age will seem like the steam age. Pouring stinking liquids into vehicles will seem as quaint as shovelling them full of coal. The only question left will be why we waited so long.

Part of the answer is in the history. This technology has been with us since the 1860s. By 1900, more than a third of America’s fledgling car fleet was electric. But they only went 30 kilometres an hour, and then the batteries died. Increasing their

range and performance would remain a challenge throughout the next century.

Early petrol cars were crap as well, but with investment they got better faster. Oil was cheap. Climate change was an issue for wonks until the 1990s. Oil based air pollution was less obvious than the coal smog everyone had grown up with. So why not do everything with internal combustion?

Fast forward to more recent times. Anybody in contact with reality knows why the internal combustion engine is a liability, whether they choose to accept it or not.

Don’t get me wrong: I like cars. But I also like Bangladeshis and the Marshall Islands – both of which are seriously at risk from climate change – and I’m quite keen on not having to fight endless hordes of refugees in a hurricane.

In 2008, a blip that was part of the beginning of

D U D E , W H E R E ’S M Y E L E C T R I C C A R ?


Green jalopy: For a long time, a procession of crackpot electric vehicle designs that looked like jelly moulds left in an oven helped make driving electric cars as cool as tongue kissing your grandad at a funeral.

the end of cheap oil created a fuel price spike. American shoppers suddenly felt they might not all actually need 6-litre, 3-tonne Hummers. The US car industry shat its pants to bankruptcy. That was pretty much all those geniuses had on their shelves.

Cab drivers and people who were good with numbers were already buying hybrids. Enter the alien lifeform known as Elon Musk, with hysterical amounts of .com cash cascading from his ears. The Tesla Roadster his company produced had lithium-ion batteries you could charge at home. It had a range of more than 320 km. It went 0-100 in less than four seconds and could whirr up to 165kph.

In three years they sold only 2,250. But owners included people like Leonardo di Caprio, Will.I.Am and Matt Damon. The electric car finally became aspirational. But to be aspirational, it was also deliberately exclusive, and expensive. To get a Tesla Roadster to New Zealand would have cost more than $NZ200,000, plus shipping. So nobody did it.

The technological advancement, demand and economic imperatives finally spurred other companies to action. BMW, Toyota, Nissan, Chrysler and more started turning laughable concept cars into serious propositions.

THE RACE WAS ON. Trouble is, years later, and New Zealand is still stalled at the start line with strange smells coming from under the hood, while Norway leaves everyone for dust. Aren’t Norwegians a bit like us? They have their clean green image to uphold and they have their renewables. So what have they got that we haven’t?

So far they have had an economy affluent enough to fund this investment in electric cars. Ironically, a lot of that comes from the country’s faltering oil industry. Norwegian electric car owners pay no annual registration fee. They pay no tolls. They get access to special lanes on the roads. If you drive for a living in an electric car, you get an income tax deduction. Electric cars are

Suave alternatives: Seven carmakers have EV models available in New Zealand including (left to right) Mitsubishi Outlander EV, BMW 13, and Holden Volt

Norway: A case studyThe road to EV take-up— Norway started using incentives to boost sales of electric vehicles in 1990. It works...

No. of electric vehicles:

0

The government launches a 7 million euro EV infrastructure program: 1,900 charging points installed by end 2011

1990Import tax abolished

1996Reduced annual registration tax

1997

Exemption from road toll

2000

Reduced company car tax

2003

Access to bus lanes in the Oslo region

2009EVs can travel for free on ferries

2020

EV owners will pay the full amount of the yearly road licence fee

No. of electric vehicles (2015):

54,160

Sources: evnorway.no, phys.org/news/2015-05-norway-electric-car-incentives, gronnbil.no/statistikk»

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OPINION | Electric c`ars

exempt from the otherwise hefty sales taxes. Most of these discounts are set to remain

in place until Norway has pump-primed its car fleet with 50,000 shiny new electrics. About one in seven of Norway’s cars is electric, and the Tesla is the biggest selling car. More than 1,500 of them purred out of the showrooms there just through March last year.

Norway closed the price gap. Now that range and performance issues are solved, this is all that holds electric vehicles back. Tesla’s stated mission is to develop a quality electric car for the masses.

But we are not there yet. Take the example of the quirky little Mitsubishi iMiev. It was first imported into New Zealand in 2011, but at $60,000, went head to head with a host of top end motors. It sold less than a dozen. The main distributor here doesn’t even put them on its website anymore. A new electric Nissan Leaf costs $33,000. You could get a similar petrol Toyota Yaris for $13,000 less.

Still, even in New Zealand the gap is closing rapidly. Electric vehicle battery charging costs are the equivalent of 26 cents per litre. High quality second-hand Nissan Leaf vehicles imported from Japan can be had for $20,000. It is only a matter of time. And it wouldn’t take much to speed things up.

Electric vehicles will get better and better. They are coming. That is inevitable. The only choice we have is how long we choose to lag behind. The New Zealand Government has already provided an exemption on Road User Charges until 2020. Currently it is only worth about $NZ700 a year. Other tax exemptions and benefits like those in Norway should follow. And the Government should do its best to assist companies like Tesla to set up shop here.

Far-sighted company fleets at Northpower and Mighty River Power are making the switch. They have a vested interest in selling more electricity. The New Zealand Government, local authorities and health boards should be next.

Energy minister Simon Bridges wants electric cars in New Zealand. But he wants his oil money too, and it’s about 30 years too late to do it the way Norway has. Instead we can do better. Norway’s electric cars are funded by oil. Ours need not be. Cleantech will be for the 21st century what oil was to the 20th. We can shift gear right now.

Either that or we keep pumping $NZ7 billion of fuel into New Zealand each year. And instead of a two-for-one choccie deal, our free gift will be all the Middle Eastern wars and climate destabilisation we can deal with.

S E E H O W T H E Y R U NIdealog’s Johan Chang tested out two vehicles on the electric spectrum – the 2015 Toyota Camry Hybrid and the Tesla Model S full electric car.

TESLA MODEL SBack in 1884, English inventor Thomas Parker produced the first electric car. (He also electrified the London Underground, introduced overhead tramways in Liverpool and Birmingham, and invented the smokeless fuel coalite.)

By the turn of the century, 38% of American automobiles were electric, while only 22% ran on petrol (and the rest were steam-powered).

Fossil fuel technology soon overthrew electrical vehicles’ golden age, however, and it is only in the last decade or so that electric cars have started to make a comeback.

Tech maverick Elon Musk’s sporty 2008 Tesla Roadster was the first electric vehicle that could be called aspirational. And when Tesla’s current flagship, the Model S, was first shipped in 2012, it came with a long waiting list, a range of over 400km and a gas equivalent of 2.64 l/100km.

But for me, at the wheel, if I am being truthful, it is neither the environmental holiness, the surprising range, nor the fuel economy that is important. What is exciting about the Tesla is the instant torque afforded by an electric drive train. This is car enthusiast-speak for the entire force of the motor being available the instant the accelerator is pressed, meaning the Model S goes from 0-100 km/h in 2.8 seconds, which is almost as fast as a $4m Bugatti Veyron.

Take that, petrol heads.Sadly, I don’t get to drive the very latest

update of the car, the one which comes with “ludicrous speed”. Still, I am impressed. Even with my beginner’s timing, starting from zero at the top of a motorway on-ramp I still get to 100 km/h in under four seconds.

The problem, really, is never whether the car will go fast enough, but more rather whether my instincts will be able to handle it.

The most noticeable thing is that the car is eerily silent; the only sound being the friction from the wheels against the road.

It’s also a car without keys, start button, or clutch. Walk up with your remote and the door handles automatically extend. The moment you sit down in the cockpit the engine is ready to go. Putting it in “park” and getting out effectively turns it off.

Which is nice, but unimportant the moment you press the pedal to the floor and get slammed into your seat.

Still, at nearly $200,000 to import into New Zealand, it probably requires a bit of your soul.

TOYOTA CAMRY HYBRID Toyota’s Prius (“the hybrid that started it all”) got a bad rap. First created when petrol was cheap and “sustainability” was for hippies and eco-terrorists, it would have fitted right in if it were invented today. (But didn't then.)

Still, it allowed Toyota to experiment and play with hybrid technology as if it were a “science project”, (as General Motors’ Bob Lutz once said).

Fast forward to 2015 and the latest edition of the Toyota Camry hybrid is benefiting from what the Prius had to suffer through.

The Camry is a smooth ride. After spending a week with the 2015 model, including a road trip from Auckland to Matakana, its 2.5-litre, four-cylinder, petrol-electric drive system performed well both in the city and around the countryside.

At no time did I feel the need to push the pedal in any exaggerated way. At low speeds and going downhill, the electric motor did most of the grunt work. Moving a bit faster and uphill, the petrol engine kicked in.

A hybrid Camry will set you back $44,000, as against the normal model at $39,000. In terms of fuel economy, while Toyota touts the car as using 5.2 litres of petrol per 100km, I used 7.4l/100km, which is a fairly significant difference. Don’t get me wrong – I drove over 300km over the course of the week, and needed only around $50 of fuel.

For a mid-class sedan that’s not too bad at all.


WORKSPACE | Recruitment

In 2014, Frog Recruitment director Jane Kennelly teamed up with The Icehouse business accelerator, speaking to over 700 employers across New Zealand. One outcome was the recently-released e-book, Hiring and keeping good staff: A seven step guide, designed to dispel some employment myths and help SMEs level the playing field for top talent against the big budget corporates.Nikki Mandow took six tips from the book.

TIP 1: PLAN YOUR WORKFORCEAll too often companies know talent is hard to find, but instead of planning ahead, they react to each vacancy as it occurs, meaning positions can take weeks, if not months, to fill.

Workforce planning involves connecting staff recruitment and retention with your overall strategic planning. Set aside time each year to forecast your people needs against planned projects.

TIP 2: HIRE WHEN YOU FIND SOMEONETop talent is scarce, and high calibre individuals enter and exit the job market over a matter of days. This means companies need to shift from the traditional model of only hiring when they have a vacancy, to a continuous hiring model, where they are ready to take on a really good person should he or she come across their radar screen.

Start by identifying the “must have” roles in

your company where there are significant skills shortages, and then gear your hiring process so it can begin immediately if the right person comes onto the market. OK, so you might have additional salary costs for a period of time, but you avoid the problems and costs involved in searching for the right person, employing the wrong person, or having a position empty for months.

TIP 3: IDENTIFY HIGH-POTENTIAL EMPLOYEESAccording to an article in the Harvard Business Review in June 2014, the secret to success in today’s hiring environment is being able to spot “high potentials” – staff who consistently and significantly outperform their peer group.

This isn’t as easy as it might sound. For a start, most companies measure performance, not potential, so attributes and behaviours that characterise high potentials – like a better

“Start by identifying the “must have” roles in your company where there are significant skills shortages, and then gear your hiring process so it can begin immediately if the right person comes onto the market. ”

H I R I N G A N D H I R I N GSix tips for SMEs dealing with a talent shortage

ability to manage change or a greater learning capability – might go unnoticed. In addition, most organisations don’t articulate the attributes and competencies they value in their ideal employees, so managers don’t know what to look for in identifying future talent.

TIP 4: FOCUS ON RETAINING TOP TALENTSome ideas for retaining your best staff include:

Know their expectations (for example in terms of career development, support, ongoing challenges and variety).

Provide challenging and stimulating work and opportunities to learn and develop.

Let them know what career development plans you have for them and what opportunities are available for them to grow within the company.

Offer flexibility and work-from-home options.Focus on training and equipping your

managers as coaches. Often employees don’t quit their jobs or companies, they quit their managers.

Communicate directly and clearly. Good employees want to please, but they need to know what they need to do.

Recognise and reward good work. Monetary bonuses are nice, but recognition of a job well done creates good will and loyalty. Note: make recognition specific. “Good job” is acceptable, but “Good job on the Nelson project” is better.

TIP 5: COMPANY CULTURE MATTERS Jane Kennelly says that having spoken to thousands of career seekers, the one thing universally in common is the desire to work in an organisation that has a positive culture and is a place people are proud to be working for.

And this is not just the domain of big-name companies. Many New Zealand SMEs are winning the culture race because they act with heart, and their purpose is clear (see "Shifting the Titanic, next page).

TIP 6: WIN THE CUT AND THRUSTTop candidates may well receive more than one job offer, so make sure yours is the most attractive. This means being tuned into a potential employee’s job acceptance criteria, and being adept at articulating a compelling job offer.

Use employee benefits as a way of bolstering your offering, particularly if you are competing with other companies. Benefits (not to be confused with incentives, which are different and mostly performance-based) are a powerful way to encourage new people to join your business. So flaunt your company pension scheme, private health insurance or childcare vouchers.

nz.frogrecruitment.co.nz/hiring-guide

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WORKSPACE | Troubleshooting

MARK TEMPLETON IS an experienced fix-it CEO, who joined air quality monitoring company Aeroqual in 2012, when the 11-year-old company was in crisis. Aeroqual was lacking strong leadership and clear strategic direction.

Oh, and it had never made a profit. But despite some obvious practical challenges

(like having no cash), one of Templeton’s first actions was to think about the company’s culture. He told Nikki Mandow (and a room full of breakfasting executives) why.

WHAT IS YOUR DEFINITION OF COMPANY CULTURE?Two definitions I like are: “How it feels for people to work here.” And “How things really work around here.”

Not so good, are definitions like: “How management would like to imagine things are.” Or “What the internal marketing department writes and puts up on the wall.”

The trouble with these latter approaches is that they remove any personal sense of connection that employees might have with these statements – thus negating the whole point of the exercise.

IS CULTURE IMPORTANT?Yes, but it’s worth considering a salient anecdote here.

I have personal experience of two different cultures. One was toxic, restrictive, dis-engaged and de-energising. “Working here”, one colleague told me “is like having the life sucked out of you slowly.”

The other company culture was energising, challenging, supportive and stressful, in a positive way.

The negative one was very successful financially. The positive one ran out of cash and went out of business.

The moral of the story: Culture is only one reason companies fail. (Others factors include leadership, strategic planning and execution, recruitment, and performance and financial management.)

SO WHY BOTHER?Good question. Certainly culture is something you take on at your peril. And it is not something

you impose wholesale onto a company – it’s something you adapt over time; you graft new attributes onto the healthy core of the current culture to better respond to a changing market.

Actually, a big part of it for me is about personal fulfillment. By this I mean, if I went back to a younger (non CEO) self, would I want to work in this company. Would I feel there was a greater purpose I was personally engaged with, would I feel both challenged and supported, would I feel connected with others around me?

Whatever the reasons, you need to be clear from the start why you want to change the culture. Too often I see culture change efforts launched without a clearly communicated rationale for change. For people to want to change, it is important for them to recognise both a burning platform and a worthwhile new destination.

WHERE DO YOU START?Be open and honest with staff. Management have a tendency to try to protect staff. Don’t. I nstead be transparent. If the company needs to be sold, work with staff to get the best outcome.People can manage change, but they can’t handle uncertainty.

Ask your staff what they think. Aeroqual was in crisis when I joined, not least because it had totally run out of money. One of the first things I did when I joined was have a 45-minute coffee with all 27 of the staff and with many customers and distributors. I asked three questions:

What do you really like about the company?What do you struggle with at the moment?If you had the chance to change one thing, what

would it be?Then I put a list of all the suggestions for

change up on the wall. There were about 40 of them. Four or five were simple things and I just gave people a budget and told them to go off and do it. For example, one involved changing the physical layout, so we knocked a few walls down. Others we worked on and ticked off over time. Some I said weren’t possible right now.

WHAT DOES A VISION STATEMENT LOOK LIKE?I’m a big fan of “provisional and scrappy”. Work with staff to get a “good enough” statement of

S H I F T I N G T H E T I TA N I CCompany culture is a hot topic – but changing it is hard. Idealog takes advice from Mark Templeton, who is on his fourth successful corporate turnaround gig.

Mr Fix-It

Mark Templeton is on his fourth turnaround CEO-ship.Current: Outdoor air quality instruments company AeroqualTurnaround: Crisis to turnaround to scale-up (three years)

Previous: Robotic forklift automation start-up Inro TechnologiesTurnaround: Crisis to strategic value sale (18 months)

Previous: Onboard weighing company Actronic TechnologiesTurnaround: Engineering company to global niche market leader (five years)

Previous: Crown Research Agency ESR – forensic, public health and environmental scienceTurnaround: Government agency (insular professional culture) to commercial science company (five years)


1 | Vision board: The company’s Purpose is drawn on a large blackboard in the lunch area.

2 | On the floor: The final assembly area handles twice the volume it did in 2012, with fewer staff.

3 | The Gong: The Gong is rung to celebrate personal and company achievements.

4 | Targets: It looks like a pink palm tree, but was used to celebrate a record month.

5 | Lunch room. The table cost $300 on TradeMe, and was painted by staff at the weekend. The bike hooks were another suggestion from staff.

6 | Open plan: Early staff feedback led to “breaking down” several walls and creating a more open plan office space. It was a big symbolic shift.

vision, purpose, and values, then try it out in the workplace to see if it sticks.

Put the statements up in chalk or marker pen on the walls. People then know (1) you’ve truly listened to their input, and (2) you want to test the vision, purpose and values to see if they work for them.

TOP DOWN, OR BOTTOM UP?Bottom up. I personally don’t like authority; I don’t like being told what to do. Unexpectedly, I’ve found some of the most useful people in any change process are the disaffected people, the mavericks. The best thing to do is to harness them as change agents. I have found if you challenge the mavericks to get involved in change there’s a 50:50 split around what they do: they leave or they step up. Both are great solutions.

WHAT CAN GO WRONG?One of the biggest mistakes I made was trying to get into culture change too early. You don’t

have enough shared sense of reality, so you spin your wheels with endless workshops.

Purpose can’t be developed by the management team; it has to emerge from the grass roots.

HOW DO YOU TAKE PEOPLE WITH YOU?There are four types of characters within an organisation, and people with different characteristics, or mix of characteristics need to be given information in different ways:

Visionary people. Give them the vision.Scientists. Give them the facts.Process people. Give them the path (“This is

what we are doing over the next 30-60 days and these are the targets”).

People’s emotional side. As a leader, you need to reveal yourself as a whole person, including your flaws and mistakes. Make your motives clear. That is how you build trust.

When I give a presentation, I keep these four in mind and change my pitch depending on who I’m talking to.

YOU'VE BEEN DOING THIS CULTURE CHANGE STUFF FOR A WHILE. WHAT’S YOUR NUMBER ONE TIP?Learn to accept complexity and ambiguity. It’s going to be messy and confusing, but you have to believe it will happen and work with your team. Don’t fear failure – there are no guaranteed results.

Celebrate failing fast – we call them epic fails and we openly discuss them.

DID IT WORK?As I said before, culture change isn’t the only factor, but yes, over the last three years we’ve turned Aeroqual around. We are cashflow positive, and after the first 90 days, we didn’t need to ask for any more money from shareholders. Revenue is up 35%.

Staff satisfaction has increased from 54% to 75% and we haven’t lost any key staff.

We have pulled $800,000 in costs out of the business. Most of this improvement initially was based on ideas that came from staff.

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WORKSPACE | Books

Biohistory: Decline and fall of the West

Jim Penman

Cambridge Scholars Publishing, $32.50

After reading the introduction to Biohistory I knew exactly how I should approach this review. I needed to compare notes with F, the homeless guy I sometimes share a table with at the Merge café on K’Rd (a Lifewise Trust project to assist the homeless). F is a little chaotic in some respects, but he is well read and interesting. To backtrack: Jim Penman’s relatively radical thesis involves the link between the rise and fall of civilizations, and epigenetics – the way environmental factors (for example diet, lifestyle choices and behaviors) can change the health not only of the people who are exposed to them, but of their descendants. Penman argues epigenetics are key to why Rome and other empires collapsed, and he believes that “Western civilization could be brought to its knees through uncontrolled epigenetic change”.

F and I reviewed our findings over lunch. I secretly hoped for an animated debate. But F rated this slender volume much as I had. ‘D’, with an ‘A’ for effort. Penman aims to join fascinating and plausible dots into a profound, unified theory but, ultimately, fails to persuade. (DM)

Mindful work: How meditation is changing business from the inside out

David Gelles

Profile Books, $25.90

I jumped on a beaten horse with this book.

Mindfulness has ridden a fair few miles in the business/personal development community over the last couple of years.

And although Gelles (a business reporter for the New York Times, who studied meditation in India and spent two years travelling around the US picking up stories about mindfulness in corporate America) does his best to make the topic original with forays into historical figures and modern-day applications – Google, Facebook and the like – I still can’t be bothered to finish all 279 pages of a book telling me that mindfulness is a good idea.

It is, but let’s not write any more books about it please. (LR)

The FIRE Economy

Jane Kelsey.

Bridget Williams Books, $49.95 (print), $20 (e-book)

I believe Auckland University Law Professor Jane Kelsey has written a very important book, warning us our economy is being burdened with unsustainable debt and we are sleepwalking to a potential financial crisis.

The “FIRE” in the title is an acronym for Finance, Insurance and Real Estate and has become shorthand for the forces currently seen as the drivers of our economy. Kelsey makes the very real point that these are also the forces that will destroy it.

The FIRE economy, marked by neo-liberalism, has become so embedded it will take either a crisis or careful dismantlement over years to loosen its grip. Jane Kelsey argues in the last three decades, “financialisation” has seen paper values used to leverage greater paper values, fuelled by unsustainable investment in non-productive assets, exacerbating the gap between the haves and the have nots.

It’s a book that needs a wide audience. The launch was well attended by the Jane Kelsey Fan Club – anorak-wearing Green and Labour Party supporters. I hope the book doesn’t get politically hijacked and therefore marginalised and dismissed as Socialist cant.

It’s too important for that. (MH)

Get the truth: Former CIA officers teach you how to persuade anyone to tell all

Philip Houston, Michael Floyd, Susan Carnicero, commentary by Peter Romary

Icon Books, $35

When faced with the words “CIA interrogation” I conjure up action hero (and ex-CIA agent) Liam Neeson and his gravely voice in the Taken movie franchise. But this is the book that returns the subtlety to the CIA, and chucks out the butcher’s cleaver.

Through a series of anecdotes (craftily redacted to protect the people involved), readers glimpse the world of the US intelligence agency – how subtle twists of words revealed one of the largest leaks by a senior agent, for example, or how one decades-long trusted asset was outed as a double agent.

The stories themselves are worthy of Hollywood treatment. But what stays with the reader are the learnt skills of CIA officers about how to elicit truth by sitting across a table from someone with a cup of coffee.

There’s a problem with the book: it’s too short, and while nice, too anecdotal. Still, if you’re a person that reads between the lines, it might be the perfect book to get your kid to admit to stealing cookies from the jar. (JC)

Books

Reviewers: Mike Hutcheson, Latesha Randall, Johan Chang, David MacGregor

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OPINION | Technology

Lord of the things: Homewares and internet just don’t mixThe emerging internet-of-things has plenty of excellent applications, but some things should remain sacred.

GOD HELP US ALL, Tamagotchis are back. The annoying “virtual pets” that sprung to

such voracious life in the 1990s, then died, forgotten and neglected, have returned from their shoebox graves, this time with a twist.

Now, powered by the internet-of-things, Tamagotchi 2.0s can communicate between themselves and over the internet, adding a whole new dimension to arguably the most one-dimensional toy in human history.

I’m imposing a media ban on my children until this fad passes.

You go ahead, we’ll catch up later on. Actually, on the whole, I’m a little wary of this

whole internet-of-things thing that seems to be coming, unstoppably, and with so much spilled ink, my way.

My position is simply this: I don’t want my household stuff connected to the internet. I just don’t. My things have enough internet already, thanks.

But before I get my dander too far up, let’s back up a bit.

The first incarnation of “internet-of-thingsness” might originate circa 1980s at Carnegie Melon University. A programmer there, frustrated at walking all the way downstairs only to find his favourite vending machine all out of soda, set up a sensor system whereby he could check the stock levels of the machine at any time using only an internet connection.

From that seemingly inconsequential affair, things have progressed, as they are wont to do, and now we’re looking at some pretty impressive potential applications.

Imagine a sensor embedded in the asphalt of an airport runway that can detect ice. When ice is present the sensor sends a message to oncoming planes, alerting them to the slippery hazard. If the pilot doesn’t take steps to deal

with the problem, the tech itself steps in and makes changes to the plane’s trajectory and speed, providing a comfortable and safe landing for the pilot, plane and its blissfully ignorant passengers.

So there’s potential there, I admit it. Few would argue that a sensor that tells you when an important part on an oil rig is about to blow is a good idea. If a tiny sensor can prevent us from filling the ocean with Texas tea one more time, then the porpoises will surely thank us for it.

But something tells me the applications which affect my daily life will be a little more intrusive and a whole lot more trivial than that, in the same way that my iPad could be teaching me the finer points of neuroscience, but is instead

hectoring me to buy power-ups for the Candy Crush game I can’t seem to stop playing.

So I’m saying “No” now, in the hopes I can avoid the unavoidable entirely.

Count me out. My stuff just doesn’t need to talk to my other

stuff. My god, what would they even talk about? It should go without saying, but bathroom items need not be in cahoots.

A man’s home is his castle and I will not have my toilet talking to my bathroom scales about me when I’m not there. Anything my toilet’s got to say about me, it can say it to my face.

I don’t want my heater communicating with my microwave for the same reason I don’t want my drinking buddies to meet that strange guy I made friends with at judo. Because that would be weird.

No blender of mine needs Wi-Fi, and I don’t need my fridge on the internet. If anything, I need my fridge to stay off the internet.

That fridge already knows too much.

Jonathan Cotton is a writer, grammar Nazi sympathiser and internet generalist.

Jonathan Cotton

“I don’t want my heater communicating with my microwave for the same reason I don’t want my drinking buddies to meet that strange guy I made friends with at judo. Because that would be weird. ”

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The size of the American dreamWhen it comes to selling to Silicon Valley, Kiwi companies need to scrap the Modest Minnie approach and get out there and flaunt it.

THERE'S NO DOUBT New Zealand tech companies are successful. IT services exports have grown at an average 14% a year for the last six years, and the ICT sector now accounts for 1.7% of our GDP, or $3.09 billion.

We have some great success stories. Vend, for example, has a 500% growth rate, Grinding Gears 172%; quite a few are growing at more than 50%.

But I think we are not reaching our potential. I don’t say that lightly, and I’m certainly not

undermining the great work done by individual companies. However as a veteran of the ICT sector (25 years), observer of business growth, and regular visitor to tech hubs like Silicon Valley, I can see there is one core thing which is preventing us reaching our potential – ourselves.

I’ve been lucky enough to spend a couple of months at Stanford University, studying in an executive programme, and this means I’m able to interact with business leaders from around the world, and tech firms from across the Valley. I’ve asked many of them for their impressions of New Zealand tech business, and advice on how our tech companies can be successful here.

Their immediate reaction is bemusement – the question doesn’t make sense, why would a New Zealand company be any different from any other company?

Why do we see ourselves as different, or disadvantaged? Reflecting on this response, I realise there is often an insecurity in our approach, a shyness, a sense we are asking permission to play.

One of the US tech leaders here in Silicon Valley recently asked me why more New Zealand companies haven’t approached him for help – indeed, in our work at NZTE with the Beachheads programme we have many such offers of help from international experts.

And he asked an insightful question: What do you think holds NZ companies back? Is it the size

Learn how to pitch! For pity’s sake, if you can’t tell your story with passion, enthusiasm and credibility then get a front-person who can. I can’t stress how important this is. So many great Kiwi companies are poor story-tellers and in a region where everyone is selling, the quality of your story has to be top notch. If in doubt, ask NZTE for some pitch training.

Seek the advice of those who have gone before: Claudia Batten, Rod Drury, Victoria Ransom, Adam Bennett and many more. Google them and get out and pick their brains – think of it as free consulting, free pearls of wisdom.

The Kiwi Landing Pad and NZTE’s North American team are set up to ease the entry into the USA. Use them!

It’s not all about Silicon Valley. While San Francisco and LA are important entry points, there are clusters of success in several “second tier” locations: Seattle; Austin; Colorado; Chicago are just some places where New Zealand companies are starting to find legs. Washington DC remains an excellent beachhead into the public sector, and NYC is still the location for many global HQs and thought leaders in design, finance and retail.

Boots on the ground. You can’t phone it in, you have to be prepared to spend serious time in market, building connections. And the pace here is incredible – if you haven’t returned a phone call or email within 2-3 hours (seriously), you’ve probably lost. And you need to be ready to meet within a day. US investors, customers and tech experts tell us they expect almost real-time access and follow up.

Leverage existing strengths. New Zealand is an agri-business powerhouse with real credibility. Add great technology and you’ve got a winning formula. Better than being just another app developer.

Take on investors – and staff – not just for their money, but for their connections and advice. If you aren’t prepared to dilute, then don’t bother coming. Stock options and good technology are the only way you’ll get good people working for you, so factor that into your business model.

The bottom line is: Dream bigger – and act.

“The pace here is incredible – if you haven’t returned a phone call or email within 2-3 hours (seriously), you’ve probably lost. And you need to be ready to meet within a day.”

OPINION | Silicon Valley

By day (and the occasional night) David Downs is general manager, services, at NZTE. Other strings to his bow include authoring books (No.8 Re-Wired is the latest), presenting on radio and TV, and playing the ukulele. (We can’t all be perfect.) He blogged about his time as El Presidente at Stanford at idealog.co.nz.

David Downs

of the dream? In other words, do we allow our aspirations to be limited?

There is a wealth of practical advice for tech business wanting to grow in the US, but unless you’re prepared to dream a little bigger, drop the shy approach and tell your story better, these tips won’t help.

New Zealand companies have to understand that the things that will make our companies succeed are the same things that will make all companies succeed. We are on an even playing field.

If anything, the fact that we come from a small, relatively unknown country is a positive; it makes us memorable. Our country’s history as an agricultural hub is a bonus, not a hindrance. We’re interesting.

Our funny accent and relaxed way of working can be great… mostly (see below).

So get over any perceived insecurities, dream bigger and… Go for it.

Now for some practical advice – virtually none of it my own, and pretty much all of it in the “bleeding obvious” category:

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OPINION | At work

Penelope Whitson

Penelope Whitson is a word nerd with a fondness for syntax, cats and lolling about scoffing cake. She tweets on an irregular basis at @PenelopeWhitson

Marking your territoryHot desking is on the rise. The benefits for profit-grabbing corporates are obvious. But maybe there are advantages for workers as well

I SOMETIMES LIKE to pretend I am David Attenborough, occasionally going so far as to crouch next to the cat to say something along the lines of, “And here you see the male of the species marking his territory by peeing on my bed”. It makes me very popular at parties and for that reason alone I see no reason to cease my behaviour.

Marking one’s territory sprang to mind again recently when we were told at work that as well as moving buildings we were moving to hot desking. I’ll admit I panicked. My desk and I are close. I don’t want to share it. I know what will happen, it’ll start seeing other people, catch diseases and pass them on to me. It’s happened before.

Despite those of us averse to sharing (the AOL Jobs site recently described hot desking as one of the “Five workplace trends making your job harder”), the enthusiasm for hot desking isn’t waning.

And apparently this isn’t just about companies trying to save space and make more cash. Of course not. Even back in 2002, when the (admittedly ultra-conservative) Telegraph newspaper in Britain wrote about the initiative, it was noted that for employees hot desking was a win because they were judged on results, not on how long they were at their desks each day.

Backing this is up an article by the British Psychological Society published a few years ago on ‘self-management’, suggesting employees who work without constant supervision do a better job, work harder and achieve more.

Those who think they should be self-managing but know they’re being watched (by the boss at the next desk, for example) will try to recover autonomy by other means, even at the expense of the organisation. So micromanaging is even more uncool than we realised.

But mostly it’s all about efficiency. In 2013, real estate firm CBRE found that on average

30% of US offices are vacant. Hot desking can fix this shocking waste of space by allowing companies to downsize their actual office and take away permanent desks for employees who don’t work on-site every day.

Deloitte’s new headquarters in Toronto, which opens this year, will have no permanently assigned desks. A 2014 Financial Post article notes that “The cost of moving into fancy new digs is being offset by savings from better space utilisation, packing employees in tighter than ever before.”

Of course, this can also create a vicious musical chairs scenario where fear of missing

out means you bagsy a desk anyway, or just rely on your status to do the work for you.

An anecdote in a 2013 Business Insider Australia article on hot desking describes the etiquette around people knowing they should never try to work at a desk that an important person has metaphorically peed around.

“You know that you can’t sit at some of the window seats … probably, their executive assistant would come up and ask you to move.”

Downsizing on space and upping profits is all very cheering for the higher ups, but for me, it’s the little things that appeal about hot desking. Such as the fact that your boss won’t always be able to physically locate you. They’ll be able to see you’re around online but, really, you can be far from the madding crowd just by sitting somewhere else.

On a different floor. Maybe wearing a wig.

“A 2013 Business Insider Australia article on hot desking describes how you should never try to work at a desk that an important person has metaphorically peed around.”

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78 | IDEALOG.CO.NZ

OPINION | Politics

Pattrick Smellie is a founder of the BusinessDesk news service. He puts “human cannonball” as his occupation on immigration forms. @pjsmellie

Too good to lastThe National Government may be in trouble once voters realise the golden age of economic expansion could well be over

ON ANY OBJECTIVE measure, New Zealand looks as safe a place to hold down a job as anywhere in the developed world right at the moment.

It may not be the best-paid, by any stretch of the imagination, and if you’re living in Auckland and don’t yet own a house, those wages are going to look even less attractive against the cost of getting on the property ladder.

But by most other indicators, New Zealand is enjoying a rare period of sustained economic expansion.

Unemployment is closing in on 5% at the same time as the country experiences record immigration and some of the highest rates of workforce participation in the OECD. It’s too strong to say that if you can’t find work in this environment that you may also not have a pulse, but it’s not far off.

The outlook for the next two or three years is also for economic growth to plug along between 2% and 3% a year, which is strong by historical standards.

The trouble with that, however, is that the present and the immediate future are most often judged against the standards of the recent past.

And the recent past – between about 2011 and sometime early this year, is starting to look like a golden age of economic expansion in New Zealand. (Granted, a goodly chunk of that expansion was the result of the Canterbury earthquakes and anyone reading this in Christchurch would be justifiably offended to have this period described as in any way ‘golden’.)

But at a national level, the combination of high dairy prices, rocketing growth in exports to China, strong migration, low petrol prices, Canterbury rebuild activity and historically low interest rates created an undeniably powerful growth impulse.

To the extent that voters got used to that combination and returned a National-led government last September, the outlook for the 2017 election is nothing like as promising.

Dairy prices are expected to recover to their

2014 highs, but not before 2019, according to the latest forecasts from the Ministry for Primary Industries. Chinese demand for dairy products is moderating not only because of the short term impact of a large inventory build-up, but also because China’s own dairy production is rising while dairy producers elsewhere have ramped up output too.

Inward migration may continue to be stronger than is currently forecast, but most economic soothsayers are predicting a return to average inward flows of around 16,000 people a year, well down on the current 60,000.

That reduction probably needs to happen just to take the pressure off Auckland – not just its house prices, but also its physical and social infrastructure – but it won’t be without its

impact on domestic consumption.In Canterbury, construction activity will

continue at around current high levels for at least another five years before finally beginning to tail off, but the growth in that activity is over. It will no longer be contributing to increases in the rate of economic growth.

And finally, interest rates will almost certainly be on the rise by early 2017. They still won’t be high. In fact, if the official cash rate cracks 5% again this decade, I’ll eat my hat (and I do have one).

For a Government seeking re-election and a fourth parliamentary term – something that’s only happened three times in the last century – that all adds up to a much higher hill to climb to victory than National faced in either 2011 or 2014.

John Key’s preferred Prime Minister ratings, around the 50% mark after seven years at the helm, mean he remains a political force to be reckoned with. Still, by mid-2017, it’s a fair bet they will be lower than they are now.

Key will be tired and the team around him will have had many more opportunities for the pratfalls and botch-ups that eventually tip a government out of office, no matter how good they were or how strong the economy was.

The conventional wisdom is that governments lose elections, oppositions don’t win them. Even so, New Zealand’s left-leaning Opposition parties will have to look a lot more like a government than they do at the moment – or have looked for the last 10 years – to be in with much of a chance.

The economic wind will be at their back in 2017 – there will be worrying narratives aplenty, especially from the regions, which will likely have had three years of drooping dairy prices by then and three more years in which to build up resentment towards Auckland.

But to really have a show in 2017, Labour will need freshly-articulated, cleverly-honed new policies, and the kind of strong working relationship with the Greens that they lacked last time.

On showings to date, progress towards either of those goals is achingly slow.

It is still less than a year into the current parliamentary term. There is still time, but it’s a-wasting.

“Unemployment is closing in on 5% at the same time as the country experiences record immigration and some of the highest rates of workforce participation in the OECD. It’s too strong to say that if you can’t find work in this environment that you may also not have a pulse, but it’s not far off.”

Pattrick Smellie

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OPINION | Media

Vaughn Davis

Vaughn Davis farms goats, flies aeroplanes, builds brands, hosts a radio show and tweets @vaughndavis. He once landed a big aeroplane on a sheet of floating ice in Antarctica but that was ages ago.

And then I saw Paul Henry naked…How a Kiwi star in a tiny robe changed my view about the future of journalism (again)

A COUPLE OF ISSUES back, I wrote about the parlous state of journalism, the emptying out of newsrooms, and the rise and rise of corporate communications departments.

Since then, Campbell Live has been replaced by (last time I looked) an innuendo-laced cooking show (juicy breasts!), Mihingarangi Forbes has quit Maori TV after management killed a story she had been working on, and Fairfax has laid off (albeit with plans to mostly lay back on) most of its editorial staff.

Call me Nostradamus. (You know… that sixteenth century French dude who may – or may not – have been able to predict the future.)

On the face of it, you’d think all that happening would have only increased my alarm and strengthened my belief that leaving journalism to the amateurs – people like me – is a more or less terrible thing.

But then I saw Paul Henry naked and it changed my mind.

He was sitting on a couch, perched next to a girl in a cheap Los Angeles hotel. The coffee table in front of him was strewn with empties and fast food wrappers. And OK, he might have had a towel around his waist, or maybe a robe. But there was more Paul Henry on display than many animals and small children might be comfortable with.

I saw all this on my TV, watching a preview of a movie he appeared in recently called The Desk. Despite my skills as an ad guy, I haven’t convinced many people to watch it. But you should. It’s very good and here’s why.

Its director and writer is a former New York Times journalist called Andrew Goldman. He’s Paul Henry’s biggest fan (or he was when they made the movie). And while the movie is ostensibly about Henry, it’s just as much about the state of mainstream media and professional journalism in the USA.

It’s not really spoiling the movie to reveal that Goldman’s career at the Times ended badly. His job was to write one feature

interview per week. (I know! In America that’s an entire job with which you can pay a mortgage and feed your children!) Trouble was, while that one job was great for paying the bills, it came with conditions. Tweet something ironic or offensive about an author and you find yourself on the carpet in front of the editor. Ask a curly question to an interview subject who also happens to be a major advertiser and you find yourself on the pavement.

For Goldman, what he perceived as Paul Henry’s untrammeled freedom to say and do whatever he wanted seemed very appealing, and led him down the path that ended in making a movie featuring a barely clothed Paul Henry on a couch.

While the couch scene is the film’s enduring image, it’s Goldman’s story that caused me to rethink my position on amateur journalism. There he was in a dream job, being paid well to interview interesting people. But relying on that

job and its regular pay cheque came with more constraints than freedoms. After a year of doing everything he could to avoid offending readers, he pissed off an advertiser and was out the door.

That can’t happen to an amateur. We don’t work here; we can’t be fired. Maybe, then, the amateurs aren’t just inevitable, but essential to the future of journalism.

Think of it as Superman in reverse. Rather than Clark Kent occasionally ducking into a phone booth to pull on his tights and save the world, the future of journalism lies in Superman popping on his geeky glasses and now and then doing a bit of writing. Sometimes there’ll be money in it; sometimes there won’t. It doesn’t matter when you’re Superman, right?

Not relying on journalism for a living can mean writing to change minds, even the world, without worrying about who you’re pissing off.

Yes, Superman will need to take his part-time journalism gig seriously; readers deserve the same ethical standards whether the writer is a professional or not. But that’s not an impossibly high hurdle. And even if it was, he could leap it in a single bound.

“OK, he might have had a towel around his waist, or maybe a robe. But there was more Paul Henry on display than many animals and small children might be comfortable with.”

80 | IDEALOG.CO.NZ

OPINION | Democritus

Mike Hutcheson

Mike Hutcheson is a former Saatchi & Saatchi grand fromage, a director of Image Centre and just learning to read without his finger under the words. [email protected]

The paradox of Kiwi ingenuitySuccessful companies lodge international patents. The rest of us just invent stuff and hide it under our raincoats

THERE IS A PARADOX in the notion of Kiwi ingenuity that lies in a disparity between our ability to invent and to implement. There appears to be no shortage of ideas in this country of ours, but there is a significant paucity of those ideas being brought to scale on a global level.

We New Zealanders are an inventive lot. This is reflected in our ranking in a number of different indexes. For example, in The Global Creativity Index 2011, we rank sixth and in the 2012 Economist Intelligence Unit Creative Productivity Index, that analyses creativity and innovation in Asia, we again rank sixth.

However, in The Global Innovation Index 2014 report, while New Zealand ranks eighth for local patents, we only come in at number 19 for filing overseas applications. Business analyst Alan Main suggests this failure matters: New Zealand has a 22% conversion rate of local to international patents, compared to Singapore, where the number is 81%, Finland, 58%, and Denmark’s and Ireland’s 42%.

The insight here is the irrationality of a small export-reliant nation seeming to place greater importance on protecting technology in a small home market, while largely ignoring international protection. Main has observed that this patenting profile is not found in any other small domestic market. The over-emphasis on protecting inventions in our immaterial home-market is echoed by our lowly ranking of 27th for patents filed in at least three countries.

However, in that same Global Innovation report, New Zealand ranks as the sixth most prolific nation in terms of authoring work in technical publications. This is an indication of our greater interest in adding to global knowledge (an egotistical driver) in contrast to exploiting commercial knowledge (an economic driver).

“The insight here is the irrationality of a small export-reliant nation seeming to place greater importance on protecting technology in a small home market, while largely ignoring international protection.”

It seems we are comparatively naïve in terms of harnessing the value potential of creative endeavours in STEM activities. (STEM is an acronym for Science, Technology, Engineering and Mathematics. The term is typically used when addressing education policy and curriculum choices in schools. It forms part of a government policy initiative aimed at improving competitiveness in technology development.)

We appear to be more intent on sharing knowledge than converting that knowledge to prosperity. This bias is evidenced by the fact that in that same report, New Zealand ranks 63rd (behind Senegal, Latvia and Bulgaria) for high-tech and medium-high-tech output as a percentage of total manufacturing output.

Arguably then, there is a disparity between what many of us recognise as good ideas and our ability to build them into scalable businesses capable of being taken further afield. The question one might ask is, why?

A number of writers have explored or commented on successful business innovations in New Zealand, often alluding to a seemingly innate cultural propensity for innovation. Such texts celebrate a certain belief in cultural ingenuity.

However, aside from business commentator Rod Oram’s observations warning us about being captured by cultural myths, and John Bridges & David Downs’ book No.8 Re-Wired, where they discuss the dangers of perpetuating number eight wire thinking and practice, most lack in-depth analysis of the business contexts in which innovation occurs.

Bridges and Downs chronicle 202 New Zealand inventions “that have changed the world”, but are careful to note that we are being left behind in OECD rankings.

We need to re-examine the nature of creativity in business and find what is innately “Kiwi” about how we generate solutions and replicate them in relevant ways in today’s business world.

We need to extend thinking around the topic, and design ways of spreading the gospel of entrepreneurialism in a manner that effectively targets business people and interested students. We’re not short of ideas in this country, but we’re desperately short of being able to take them to market on a global scale.

We have to spend more time and effort on encouraging aspiring entrepreneurs and inventors to innovate and use creative techniques to succeed through carefully constructed, market-led strategies.

Management guru Peter Drucker’s words are worth repeating.

“Business has two functions, innovation and marketing. Everything else is a cost.”

It’s funny how appliances have become smart – but power companies haven’t. Because while you can set your dishwasher to work at any time – most companies charge you the same fixed rate, all the time. So whenever wholesale market prices are low (like overnight!) most customers are paying... well... a surprising amount more. But with Flick, you’ll pay the wholesale market price of your power – so that your dishwasher (and you) can pick up some smart savings. Consumer Powerswitch reckons that a mid-sized Kiwi home could save more than $500 in a single year just by switching to Flick. With smart appliances, and smart timing, adding even more!

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THE ART OF PERFORMANCE

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idealog - september-october 2015.pdf

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