Speaking at today’s Australasian Innovation and Investment Summit (Innovest) in Auckland, Fahrenheit Wellness Fund general partner Bridget Liddell said New Zealanders needed to overcome cultural barriers when preparing to do business internationally.

“Some of the culture of going it alone – which comes from the farming culture - does unfortunately carry over and I see it all the time in the businesses I deal with.

“To do international business takes an open mind. People will often complain bitterly about the rules of the game in North America. They try to change the rules rather than working within them.”

New Zealand produces great firms but has trouble scaling them, Liddell said. For long-term sustainability she recommended transplanting the entire ecosystem of a company, from customers to the supply chain, to the international markets the firm is operating in.

“Collaboration means every aspect of a company gets built in every foreign market. That’s what makes a sustainable business.”

New Zealand companies should use peers and networks overseas to scale faster, she said. She cited the example of Hamilton-based BioVittoria, which has investors in China, and relationships with local government and the science community there. In North America, BioVittoria has governance and management, capital providers, shareholders, and does branding, media, sales and marketing.

Australian-based serial CEO Chris Witt also stressed the importance of removing potential cultural impediments to global commerce.

“Once you get past culture and differences you start to engage. People want to engage and do business on a handshake. You can’t rely on a contract or IP, you have to rely on relationships.

Early market validation was also key.

“You need help to understand how the target customer will absorb what you do. Prove early on there is a market. Build an early version of your product because you need to get the sense of what the product will look like.

“IP is an asset but the value of that is over rated. It’s really about market development. It’s about New Zealand’s ability to engage with the market and satisfy the market need.”

Singapore-based angel investor and startup advisor Joe Rouse’s key message was, “size matters”.

Small countries like New Zealand could gain competitive advantage by focusing on particular specialties, Rouse said.

“Small nations are more manageable. In New Zealand our size enables us to be more differentiated. It’s about doing certain things very well and ignoring the rest. We need to accept mistakes but be prepared to fail fast and get on with things that we do well.”

The New Zealand Institute called for the establishment of national institutions to improve our innovation performance, with experienced practitioners who can advise firms that are internationalising.

Director Rick Boven said it was also pushing for an innovation forum to identify gaps in the ecosystem.

“The market view is capital flows to where it’s needed but we need institutes to place it where it’s needed,” he said. “We need skilled investors and institutes where they can reside.”

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