City Focus: Wellington
Replacing Auckland as the capital of New Zealand in 1865, Wellington is the southernmost capital in the world with a population of approximately 418,500, representing 8.5% of the country’s population. The second most populous urban area in the country - after Auckland - Wellington was recognised in 2019 as the number one ‘most liveable city’ for its second year running in a list compiled by Deutsche Bank. With a climate best described as generally ‘moderate all year round’, it has warm summers, mild winters and is exceptionally clean for a capital - the city maintains its streets to such a high standard that some people don’t even feel the need to wear shoes.
In business, Wellington is primarily a service-based economy, with a particular focus on finance and insurance services. Having overtaken Taranaki, Wellington is now the region with the highest GDP per capita at NZ$71,622. Ranked by the World Bank as the ‘easiest country to do business’ in - stealing the crown from Singapore - Wellington has a thriving startup culture, with at least 60 new companies basing their operations within the city. Tourism also adds a further NZ$1.3bn to the region’s coffers each year, with its awe-inspiring natural vistas often ranking highly in Lonely Planet’s Best Travel guides. However, it is also a young city with an expanding IT and tech scene, a commanding innovation sector, as well as being the centre of New Zealand’s film industry. It is these industries that have recently begun to play a larger role in the country’s economy.
Founded in the humble beginnings of a Wellington studio apartment in 2006, Xeno has now snowballed into a company employing over 2,500 people and drawing in revenues of NZ$552.8mn. Offering cloud-based accounting software for SMEs, Xero’s success has allowed it to spread across New Zealand (three offices) and into Australia (six offices), the UK (three offices) and the USA (three offices), as well as single offices in Canada, Singapore, Hong Kong and South Africa.
In 2014, Xeno was placed on the top spot by Forbes for its ‘top 100 most innovative growth company’ list. More recently, in 2019, the company announced that it had reached 1.8 million subscribers worldwide.
A digital visual effects company co-founded in 1993 by Hollywood director Peter Jackson, Weta Digital and New Zealand itself were propelled to international recognition in 2001 when it produced the SFX for the Lord of the Rings trilogy, subsequently winning six Academy Awards for its work. Not just successful in its work but also its influence, Weta Digital’s business has contributed to Wellington receiving $644mn in film production revenues in 2016 and the city continues to be an active and successful hub for New Zealand’s film industry.
Currently the largest online marketplace in New Zealand, creator Sam Morgan founded the company in 1999 when he couldn’t find a heater for his flat in Wellington. That inspiration has led to Trade Me being the fifth most visited website in New Zealand and the 2,711th in the world. Originally listed on the NZX under TME, Trade Me was delisted after it was valued (and subsequently bought) at NZ$2.54bn by equity house Apax Partners in 2019. The site continues to be very popular and has 3.7 million active users, averaging 878,000 people in daily webpage traffic. Some eccentric items sold on the website include a ‘Jesus Christ Pita Bread’ and an International 574 tractor that came with 20 acres of farmland for free.
Cherished by innovators
Handling approximately 10.5 million tonnes of cargo annually, Wellington Harbour (also called Port Nicholson) is one of the most important ports in New Zealand. Serving both the domestic and international market, the 42 square miles of harbour imports oil, automobiles, food, and more. It also serves as a dock for the many cruise ships that visit the island as part of the tourism industry.
Upcoming business events in the city this year include ‘Climathon Wellington 2020’ on 3 April. Sponsored by Wellington City Council, the event is a fast-paced, 24 hour challenge pooling a diverse range of talent in the city to help find the best way of maximising the growth of the green economy, a sector which was valued at NZ$6trn. The perfect event for pioneers in the sector, participants will be provided with the latest data and work alongside industry experts, with prizes awarded for the best ideas to take them onto the next step.
Wellington has proven itself as a city that cherishes innovators; it’s the kind of town where a good idea can truly explode into success. The movers and shakers of its industries demonstrate the eccentricity of true creativity, whilst Wellington itself creates an atmosphere that is receptive to brilliant new ideas. Exciting developments in the world of business no doubt await for a city that combines these two important things.
For more information on business topics in ANZ, please take a look at the latest edition of Business Chief ANZ.