Council start-up venture in search of a new CEO - and a hero project

Everybody knows that start-ups are tough. New businesses often fail and investors are understandably nervous about committing hard cash to an unproven project run by an often unproven team.

So it was a brave move by the Queenstown Lakes District Council to put an initial $380,000, followed by further top up funding, into Start Up Queenstown Lakes. Brave but necessary, as the council's own Economic Development Strategy highlights the continuing crisis we have with low wages, unaffordable housing and low productivity - all linked directly or indirectly to our current over-reliance on tourism.

The council has even provided some snappy graphics to highlight just how serious our problems are - it's worth taking a detailed look.

Sobering facts about our local economy.

So these figures tell a fairly bleak story, and diversification away from tourism is pretty much the only obvious solution, unless the tourism industry suddenly starts paying much higher wages. But turn a few pages of the QLDC's Economic Development strategy document and you'll be hit in the face with this even more scary set of facts relating to how QLDC distributes $6.58 million of funding and resources to economic development.

This is how QLDC distributes $6.58 million of funding and staff to different economic areas of activity.

These two sets of data clearly tell a conflicting story. On the one hand our local economy is heading into very difficult territory in terms of below average wages, below average housing affordability and below average productivity. On the other, we are putting only a relatively tiny amount of resource into finding a solution - via economic diversification.

SQL's Chair - David Wallace.

Therefore the departure after just one year of Start Up Queenstown Lakes founding CEO James Burnes is a double blow. It's a blow because now a new person has to be found, causing inevitable cost, delays and some loss of leadership. Plus it sets back the entire council funded attempt to build a broader based local economy.

To the outside observer the first year of Start Up Queenstown Lakes has been a whirlwind of coffee meetings, seminars, workshops, trips to Dunedin start up workshops and more coffee meetings. Crux asked both Peter Harris, QLDC's economic development boss and David Wallace, SQL's Chair, if there was any concrete progress - any new business ventures launched with SQL's assistance or any measurable progress towards a diversified economy.

David Wallace provided the following list of activities.

• 21 programmes in Wanaka
• 28 programmes in Queenstown
• 300 entrepreneurs supported across the district across a learning workshop, advice clinic, or one-on-one mentoring sessions with a business advisor
• Launch of Wanaka, Wakatipu Investment Network (WWIN)
  • 3 WWIN in Queenstown
  • 1 WWIN in Wanaka
• 10 coffee jams in Queenstown
• 8 coffee jams in Wanaka
• 260 different individuals participating in Entrepreneur Coffee Jams
• 19 ADI clinics
• 43 participants, 9 mentors, 3 judges, and 40+ community members at pitch night for the return of start-up weekend
• 43 different tourism businesses engaged during tourism innovation workshops and sessions 
• 20 companies from NZ, AU, and US with nearly 100 community members attending the inaugural Tourism Tech Expo in Queenstown
• Prospector Pop-up collaboration space for 12 weeks with more than 100 individuals participating in learning sessions and 25 individuals using the space to advance their idea – feedback provided to local shared spaces
• MOU completed for sharing of programs and development of the lower South Island investor network with Start-up Dunedin and Invercargill
• Recruitment of a business adviser in Queenstown and one in Wanaka
• Expansion of the number of trustees from 4 (incl council appointee) to 6 (incl Council appointee)
• Engagement with Callaghan Innovation, MBIE, Creative HQ and a number of other start-up communities across and Angel Groups NZ

QLDC's Peter Harris provided the following information about SQL's funding and governance.

• As part of the annual plan process SQL submitted (it can be found on page 40 of these submissions) https://www.qldc.govt.nz/assets/Uploads/Council-Online/Annual-Plan/Full-Submissions/A-C-Submissions-Redacted.pdf
• As a response to this submission Council allocated $220k pa for 19/20 + 20/21 financial years
• Alexa Forbes was the Councillor rep on the Trust until the elections. Since then Glyn Lewers has been appointed to replace her – he hasn’t attended a meeting yet but is the process of being inducted. I attend Trust meetings as an advisor.
• An MOU and funding agreement is in place.
• Startup support sits under our diversification efforts within the Economic Development Strategy (alongside other initiatives like film, study, and remote workers).

So, as a health check at the end of Year One, SQL would get full points for activity and seems to have adequate ratepayer funding for its currently set goals.

But big questions remain. Is it enough and is it working?

Turning our tourism focussed local economy around, and reducing the attendant low wages, housing affordability and productivity problems, is a lot like turning the proverbial oil tanker in a new direction. It's going to take a lot more focus, effort and leadership to get real results - and having the CEO leave after just 12 months is not good. Let's hope this new enterprise can enjoy a stronger Year Two - we all need it badly.

Main Image: Departing SQL CEO James Burnes - he's going back to the States.

Interested in the CEO Position? Here's the link.