Capital company among fastest growers

23:09, Dec 06 2012
Lance Wiggs
PowerKiwi co-founder Lance Wiggs, whose company recorded 1916 per cent growth in the past three years.

Online electricity retailer PowerKiwi might have only made enough money to shout its founders a few meals, but it is one of the fastest growing tech companies in the Asia Pacific region.

Wellington is home to the most high-growth technology companies in the country, with 18 businesses from the capital listed in Deloitte's Technology Fast 500 Asia Pacific Index.

The ranking system tracks tech companies that have grown the most during the past three years throughout the Asia Pacific region.  There were 17 from Auckland on the list, followed by five in each of Hamilton and Christchurch.

PowerKiwi, the only independent retailer on the Meridian-owned Powershop website, came 18th with 1916 per cent growth, the highest placing for a Wellington business.

As of yesterday, it had sold a total of 240 million units of power. Co-founder Lance Wiggs, who started the business with several other entrepreneurs including early Xero investor Rowan Simpson, said it was ''wildly fun'' to grow so fast.

''Our margins are 0.01 per cent of a cent between the wholesale price of electricity and Powershop's or sometimes even zero. We are quite happy with very low margins. If we had higher margins, the power price would be higher and we wouldn't make any sales. There is no real money in this so there is no real attraction for [competitors] to come on board,'' said Wiggs.


PowerKiwi, described as ''cheap and very cheerful'', takes only a few hours a month to operate. The business got started when Wiggs, a tech entrepreneur, was invited by Powershop - itself ranked 112th on the index with growth exceeding 500 per cent - to see its work before the site officially launched. Because the only power for sale on it was Meridian owned, he said it was not a competitive market place and he wanted to challenge that with a rival - which Powershop agreed to.

''We're doing it to help Powershop grow. It helps us get lower prices as consumers and it is fun. I mean, our main product is called Flower Power: it's just cool, it's just awesome. We get  a little bit of money out of it too which pays for lunches and things but it's really just good to be part of changing the way people buy power.''

Cloud computing GreenButton, a Wellington business that helps companies shift their data in to cloud storage, was ranked 32nd place. Through partnerships with leading computing businesses such as Microsoft and Dell, it has grown 1248.33 per cent in the past three years. Earlier this year, it launched a new cloud rendering service called RenderMan On Demand with Disney-owned animation studio Pixar.

It had held an office in the United States for two years where it recently hired more staff, taking its total to six. It has 14 employees in Wellington. Chief executive Scott Houston said business was going very well. It also had a partnership in Europe so sales were split with 10 per cent in New Zealand, 15 to 20 per cent in Europe and about 75 per cent in the United States. Recently it developed a video indexing service in partnership with Microsoft called InCus and last month it launched new product GreenButton Cloud Fabric that allows people to host and deliver their own cloud services.

''Next year we are projecting another 50 per cent growth in staff, probably evenly split between the United States and Wellington. The focus is really driving our business in the US to enterprises and cloud partners,'' Houston said.

''We'll be starting to develop systems integration channel partners and starting to make forays into Asia which we hope will be a springboard to China, which is more like 24 month plan. The biggest challenge is the sales process in the US does take lot longer but that is because we're working with larger customers.''

The highest-growth Kiwi company overall was Auckland transport technology and services business EROAD that grew 2746 per cent. 

Deloitte partner Stephen Nicholas said the Asia Pacific Tech Fast 500 dominated 10 per cent by kiwi companies was proof New Zealand businesses were some of best technology entrepreneurs around, illustrating that the small size of the market was not always a barrier to growth.

''As long as they get their business model right and remain true to their core values, they can compete with the best in the world. Increased digital connectivity and the cloud have levelled the playing field for companies to achieve growth on a global scale and New Zealand companies are particularly adept at capitalising on this technology.''

Contact Jazial Crossley
Wellington business reporter
Twitter: @msbananapeel

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