New Zealand named the globe's most start-up friendly nation in 2018

21 August 2018 Authored by Consultancy.com.au

New Zealand has been ranked number one overall in a global study of the regulations and requirements necessary to start a business. The study – conducted by Reboot Digital Agency using data from the World Bank Group – found that it would take just one procedure, half a day and less than 1% of income per capita to start a business in Auckland.

New Zealand has been named as one of the best countries around the globe in which to found a business according to the British SEO firm. Reboot Digital Agency’s recent study analysed 119 countries taking into consideration the number of procedures (i.e., licenses and permits), the time it takes and costs for a small-medium sized limited liability company to start up and formally operate in the country’s largest business city.

New Zealand came out in first place with a near perfect score of 99.96 percent. In the following spots this year was Canada, Hong Kong, Georgia and Jamaica. The rest of the top 10 was made up of Singapore, Australia, Ireland, South Korea and Kosovo.

The Kiwis were top also named as the top nation to do business in, in the World Bank Group’s Doing Business report – from which Reboot drew its data – in 2018, blitzing Australia who sat at number 14. The country’s business friendly economy has few regulatory barriers, has made paying taxes easier through a digital portal, and has reduced red tape around enforcing contracts with the establishment of a new Commercial Panel. 

In a recent interview with Virgin on New Zealand’s start-up culture, the former co-director of Global Entrepreneurship Week and start-up veteran Derek Handley commented on the country’s business vibe: “It’s pretty much in line with general culture in New Zealand - laid back, creative, fun-loving and balanced. It’s also very accessible - so there are far fewer ‘layers’ or hierarchies.”

New Zealand - The globe's most start-up friendly nation in 2018

“New Zealand is really inexpensive to set up shop - you can get going establishing a company within a few days and on not a lot of money. It’s relatively expensive to live in the cities so housing becomes a relatively high cost for employees, which means salaries are decent. There aren’t a lot of ‘transaction’ costs, taxes are not bad and there are a lot of great government grants and incentives for research, development and for anybody trying to build a business from New Zealand that sells to the rest of the world.” 

The ranking drew on data accumulated in regards to the ease of which a business can be created, with regards to government red tape, costs and procedures necessary. Business regulation is important because it can either discourage entrepreneurs to enter an country if too complex or promote a country “where the rules governing start-ups are accessible, transparent and predictable,” states the report. 

“This, in turn, benefits the economy, boosts capital investment and job creation, and generates more choice for consumers, proving the economic and political benefits of improved business regulation undeniable.” 

For New Zealand, the favourable economy and start-up environment is attracting more investors than ever before. Last year, a record of $86 million was invested into 111 companies, almost threefold what the country saw five years ago.  

Anand Reddy, partner at PwC New Zealand remarked, “We’ve seen success stories like exits from TradeMe that created a whole new generation of angel investors. Now, with other high-profile exits like Power by Proxi, we’re going to see an even stronger network of skills and financing for early-stage companies.”

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