High-tech stars on the rise

The latest TIN100 Report has now been released, but the average New Zealander wouldn’t know many of the companies listed. It’s one of the reasons the Technology Investment Network began producing the TIN100 Report, says Director Greg Shanahan.

“These companies mostly sell solutions to business, they don’t need to market themselves to the public.”

The TIN100 was initially a quantitative analysis of New Zealand’s 100 largest globally focused technology businesses in the areas of ICT^[?], high-tech manufacturing and biotechnology, but has now expanded to include the top 200 businesses. Sponsored by IRL, NZTE and MSI, this is the TIN100’s seventh edition.

Of the Ten Companies to Watch in the TIN100, Datacom comes in first. One of New Zealand’s largest IT services and support companies, Datacom’s revenue has increased 61% since 2008, and $58 million, or 9%, across the year. Shanahan says Datacom is an impressive company with a unique and very New Zealand model.

“A lot of New Zealand companies are innovative, because the scale here is so small. They’ve used technology sooner than their contemporaries across the Tasman or in the US because they’ve had to. It’s easier to do that in a smaller environment, and then expand. With low overheads, and a small Human Resources and marketing department, Datacom has an enigmatic culture which delivers cost effective solutions for customers.”

“A lot of New Zealand companies are innovative, because the scale here is so small. They’ve used technology sooner than their contemporaries across the Tasman or in the US because they’ve had to.”

Within the next three years, Datacom’s annual revenue is expected to be about $1 billion.

Another high-growth company to watch is IRL collaborator Rakon, which manufactures frequency-timing equipment, primarily the quartz crystal oscillators used in GPS devices. Despite the impacts of the global financial crisis in the previous two years, last year Rakon grew by 31%.

Orion is another mover and shaker, with value growth of 42% during the year. New Zealand’s largest software development company, Orion is primarily focused on health integration software. The company saw total revenue of $91 million and growth of $27 million during the year.

Scott Technology, the purchaser of IRL’s superconductor technology firm HTS-110^[?], also had a particularly good year, with revenue of $53.6 million for the year ending August 2011. According to Shanahan, Kiwi companies are doing well overseas because they are smaller, more nimble and more cost effective.

The key to Scott Technology’s growth has been its ability to respond quickly to the market, diversifying from being primarily a manufacturer of appliance roll-forming equipment, into areas like mineral analysis, meat processing equipment and now superconductors.

Importantly, Shanahan says that Scott Technology “utilises resources like IRL for specialist expertise they don’t have in-house”.