Dunedin’s modern-day gold rush – and business resurgence – has been triggered by a swathe of high-tech developments

For  New  Zealanders    whose  lives  have  been dominated   for  18  months  by  Covid-19, Dunedin’s  renaissance   may  not have registered  on  their  radar.  Yet  quietly  the southern  city has  sprouted  some  of  NZ’s  fastest-growing  hi-tech  businesses.

Once  a  city   that was home to some of  the  country’s biggest  companies, Dunedin had  several decades during which many of  its  brightest and   best  migrated  north and   its  life appeared to  revolve,  as  the  rest  of  NZ  saw  it,  about its  university (and the  Highlanders).

Whereas once it had been the  country’s financial capital, home to the  head  offices of  many  of  the  NZ’s leading  companies,  it  ceded  that title  first to  Wellington  and then  to  Auckland.

But  almost mysteriously,  it  has  found  a  new  life and suddenly   the  rest  of  NZ   has woken  to the  new  era  which  is  enveloping the  city.  It   is  somewhat like  the  gold  rush  which  promoted  it  to  be   at  the  front  edge of  NZ’s first  wave   of  prosperity  more  than 150  years ago.

Just  last week  global  investment firm  Kohlberg Kravis Roberts  announced  it  is acquiring a majority stake in Dunedin-based tech company Education Perfect,  in   a  deal that  values  the   enterprise  at  $435m.

A  month  previously  cloud software firm Timely  was  sold  for  a  sum  reported  to have topped  $100m.  Timely  offers cloud software services for appointment management, often used by those in the beauty or fitness industries.

The  KKR  deal  steps up  a  notch  from   that.  The  world-renowned firm is  taking a majority  stake in Education   Perfect, alongside Australian-based private equity firm Five V Capital which invested into the company in 2017 with Malaysian group Mulpha Credit.

The equity investors bought the then majority stake from co-founders Craig and Shane Smith, who launched the concept nearly 20 years ago as a vocabulary tool to help pupils come to grips with modern language learning.

The company now has offices in Australia, NZ, Singapore and Dubai, and is being used by 1 million pupils and 50,000 teachers in 3000 schools across 50 countries.

According to Deloitte Fast50 calculations, the company recorded a 90% revenue growth path from 2016 to 2018 to about $21m. KKR is investing into Education Perfect from its Global Impact Fund, which is focused on investing in market-leading companies whose business contributes towards the UN Sustainable Development Goals.

KKR says  it  will leverage the firm’s experience in investing  in technology and education companies to support Education Perfect and the management team’s vision to grow into a major edtech business globally, with a mission to improve education efficacy and outcomes.

Education Perfect’s CEO, Alex Burke, said the investment by KKR’s global impact fund validated the company.

“Covid-19 has put education technology in the spotlight, and our amazing team and world-class data, technology and content have been the foundation of our success”.

 The KKR investment marks a key moment in the company’s journey and sets EP up for its next phase of global growth, he said.

Other  significant Dunedin-based tech companies  have won their place in the world in some surprising niches. ADInstruments, for example, is one of the world’s leading creators of DAQ software and hardware, which is used for a wide range of university research applications.

Among other successful tech companies  include CodeLingo, which automatically scans and corrects coding errors.

One company said  to have found great success is Pocketsmith, providing software for personal finances that is now used across 191 countries worldwide.

Dunedin is also where Sir Ian Taylor started his firm Animation Research, which specialises in computer animation.

EnergyLink ,  too,  has  become   very  successful  with  its  technology  being  used   by most  of  the  companies  in the  energy  industry.

Many tech startups   have  found  a  home  in the Warehouse Precinct  whose  owners  are  planning   another  development  with  what  they  call The Investors Lab, a workshop for prototyping to be used by gadget and hardware startups.

The  success  of  the   tech  companies   stands  alongside   other  Dunedin-based  companies  like  A2 Milk  and  Pacific  Edge   which emerged  from  research   by  academics  in   the  city.

Pacific Edge  is one  of  NZ’s remarkable  stories, a  company   that  has  turned  the outcome of years of  research  by  Professor  Parry Guilford  into  a  commercial  success.

Guilford   is  both  co-founder of  Pacific  Edge  and its principal  scientific officer.  He  discovered  and  developed the patented  Cxbladder  test  for  cancer which  has  been  adopted  by  some of  the  biggest  healthcare  groups  in  the  US,  including United  Healthcare  and  Kaiser  Permanente.  The consequence  is  that Pacific Edge’s  shareprice  has  climbed 347% over the  past year  and  the  company  is  now  capitalised  at  $895m.

Only  a  few  weeks  ago the company  told the market  Kaiser Permanente is  about  to begin  commercial use of a second Cxbladder product, Cxbladder Triage, from July.

In June 2020, Kaiser Permanente approved the commercial use of Cxbladder products by its urologists for patients being evaluated and managed for bladder cancer. Kaiser Permanente commenced its commercial use with Cxbladder Monitor for patients being monitored for the recurrence of bladder and urothelial cancer.

The Cxbladder Triage is  to be used for patients presenting with haematuria (blood in the urine and a key indicator of bladder cancer).

Kaiser Permanente will start its commercial use of Cxbladder Triage in a single clinic comprising six urologists. This initial clinic is also using Cxbladder Monitor. Kaiser Permanente plans to progressively roll out Cxbladder Triage, alongside Cxbladder Monitor, across their network.

No  wonder Professor Guilford  is  recognised  as  a world-leading  cancer  geneticist.  His work with both a fatal form of inherited stomach cancer, and bladder cancer, has  had  a profound effect  on   saving lives.  It won him the Distinguished Research Medal, the University of Otago’s highest research honour.

Previously his work had been recognised by the award of the top Health Research Council of New Zealand medal, the Beaven Medal, for his contribution to translational research, and the Royal Society of New Zealand’s Sir Charles Hercus Medal for biomedical sciences.

Point  of  Order,  after  sampling  the   vibrancy   of  Dunedin’s tech  and  science  sectors, is  convinced  fresh  chapters   will be  added in  the  next few years  in  what  could be  another  (metaphorical)  gold  rush.

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