The new frontier for Kiwi tech companies is Colombia. Yes, Colombia

When New Zealand game developer PikPok decided to expand, it headed to South America.

When New Zealand game developer PikPok decided to expand, it headed to South America. The company, known for mobile apps like Super Monsters Ate My Condo and zombie shooter Into the Dead, bought a studio in Medellin, Colombia because it couldn’t find the necessary talent in its hometown. home.

“The staff that PikPok needs does not exist in the country,” said CEO and co-founder Mario Wynands. “If we want to continue to lead, that means not only training our people internally, but also tapping into cutting-edge talent internationally.”

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New Zealand has never lacked a pioneering spirit, from the ocean navigation of the first Pacific Island settlers to the feats of Rocket Lab’s satellite launch, but its failure to invest in public education Technology has created a skills gap that sets their digital entrepreneurs apart. That won’t help the South Pacific nation diversify its economy away from reliance on agriculture and tourism.

Recent reports have determined that the education system does not provide enough talent to develop emerging fields such as digital technology.

“The industry is moving at the speed of a Ferrari,” said Bruce Jarvis, Head of Software-as-a-Service at Callaghan Innovation, a government agency responsible for supporting the growing technology. The educational system is moving at the speed of the Massey Ferguson tractor. companies. “We have no shortage of entrepreneurs. The biggest limitation here is the talent to bring those ideas through the maturity stage, through the international stage.”

That is the view shared by the OECD, which says that New Zealand’s digital sector is lagging behind its peers.

Australian tax law

Despite being “relatively advanced in some aspects of digitization”, the country’s advanced IT skills system in the country remains “weak”, the Paris-based group said in a recent report. January. It identified an over-reliance on skilled migrants, increasing competition from other countries for staff, and poor math and science skills among students.

A recent survey by the New Zealand Game Developers Association found that more than half of the 12 biggest studios are considering moving some of their operations to Australia to take advantage of a government-led incentive scheme. proposed there.

From 1 July, Australia will offer a 30% tax credit to digital game developers. An extra 10% discount is available in some Australian states.

NZGDA president Chelsea Rapp said: “Why don’t you go to Australia to earn 40% more, like you’d be stupid not to. She said that New Zealand was unusual among her peers in not offering “any form of gaming incentive at the central government level”.

The government has responded with a draft Sector Transformation Plan that recognizes the need to improve the country’s skills system, but has yet to make specific proposals.

Proposals include additional funding and resources to increase the participation of Maori, Pacific Islanders and women in the technology sector.

Digital Economy Minister David Clark told Bloomberg the government was monitoring developments in Australia. The final version of the sector plan will include details to support future growth, he said.

Amazon, Microsoft

Meanwhile, competition for the nation’s brightest tech talent is getting tighter.

From 2024, Amazon Web Services has committed NZ$7.5 billion ($4.9 billion) over 15 years to set up a network of cloud data centers in New Zealand, creating an estimated 1,000 jobs. do. Microsoft Corporation has also announced plans to build data centers in the country.

“These global companies will be hiring top people from the source,” said Greg Cross, co-founder and CEO at Soul Machines, a New Zealand artificial intelligence company with operations in San Francisco. limited labor.

Furthermore, the pandemic has underscored the possibility of remote working and increased the likelihood of locals being sought after by foreign companies, he said.

“We now live in a world of working from anywhere,” says Cross. “The brain drain happened that Kiwi didn’t even leave the country.”

PikPok’s Wynands said he’s lost staff to larger companies in the US, Europe and Australia.

For him, having talent in a country like Colombia makes perfect sense.

“The young workers there see the game industry as a vehicle that helps them really change the economy and the narrative around the country,” he said.

It’s a big step up from the company’s beginnings in a rundown apartment in the late 1990s, when he and two other founders tore down the rug to run cables through the living room and work on the project. weekend. Now, PikPok has more than 200 employees, has reached 500 million downloads and is tired of waiting for government support.

“The games industry here is going to be a success with or without government help, because we are doing what we need to do to get it done,” Wynands said. “But if the government takes the game industry more seriously, there will be even more successes to celebrate.”

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