By Andy Hamilton, CEO of The Icehouse
Drawing inspiration from organisations like Y-Combinator I wanted to write you a letter to put some context around what we do, why we do it, the results and why they matter.
I know letter writing is pretty old-school, but sometimes it pays to put the proverbial pen to paper, take 5 mins and reflect. While perfection is always the goal, we strive for continued progress. It’s important that we improve, iterate and drive forward towards success (both for The Icehouse and the businesses we work with). We’re proud of what we’ve achieved, we think we’ve set out ambitious goals going forward, but would love your feedback and direction to ensure they’re right.
2017 has definitely been a year of continued progress – sometimes through a journey that wasn’t what we’d envisaged, but always forward. We’re lucky enough to work with some of New Zealand’s most passionate, innovative and enthusiastic people, and that old adage of “success breeds success” is undoubtedly true. They say it takes a village to raise a child, and sometimes startups or new projects can feel a little like your baby – so we intentionally surround ourselves with the most skilled, driven and passionate village we can.
What’s happened over the last year?
- 1,133 business owners or startup founders worked with The Icehouse
- 1,290 new jobs created
- $1.114 billion revenue created
- Over a third of programme or workshop attendees are female
- $17m of investment in 52 startups by our funds and angel networks
- Of these startups, 12 had female founders, and 5 more were from ethnically diverse backgrounds
- 110 events (workshops, programmes, Demo Day, Showcase etc)
- We now have 11 funds with $27m under management
- 16 companies tenanting the shared workspace
- NPS score of 74
2017 and beyond - What do we focus on?
The Icehouse dream
The purpose of The Icehouse is to enable Kiwi businesses and business people to be successful and reach their potential. Our dream is to see New Zealand thrive through harnessing the efforts and success of entrepreneurs and business owners.
How do we do it? We work with startups and established businesses, their teams, advisors and investors. What we do with each of these groups varies according to their situation and need; no two businesses are the same. For example, we invest in and add value to startups to set them up for a strong start and prepare them for whatever is the ‘next step’. For established owner managed firms, we help business people grow themselves, lifting their aspirations and their capability to grow their business successfully. This is because we know the most effective way to build strong businesses is to build strong business owners – but more on that later.
Our long-term impact goals perhaps show this best, as they measure people, businesses and the economy.
- People – The Icehouse is working to establish a massive talent pool of entrepreneurs, owners, team members, investors and advisors focused on helping New Zealand businesses succeed and reach their potential.
- Businesses – Businesses that we work with are now an enabled network of internationally-focused, relevant and successful businesses that are growing at three times the market rate.
- Economy – Economic impact is the result of the focus on people and business. We aim to enable a 10% growth in NZ’s GDP by 2021 including the creation of over 26,000 new NZ jobs, $27b of incremental revenue growth (including $3.9b in international revenue), achievement of 15 ‘exits’ for greater than $20m and the creation of 1,250 Businesses of International Quality (BIQ's).
Our dream underpinned by our values:
This year, we stepped back and took a good look at our organisation and community at all levels. These three values consistently came up in all that we do – whether that is investing in startups, running Owner Manager Programmes or hosting tenants in our co-working space.
It’s personal because we don’t believe ‘it’s just business’. Every one of our customers embarks on their own personal journey to grow the aspirations and capability of themselves, their teams, and their business. The connection we form as they forge their own unique and personal experience fuels us and we wouldn’t have it any other way.
Expect the best because we have high expectations of ourselves and of our community. The world, and especially the business community is demanding, it is competitive and we need to reach high for you and for us. Taking second best means settling, and we’re not willing to settle.
Stronger together underpins so much of what we do. We don’t believe we would be capable of delivering results for our customers or our stakeholders without each other. We are a unique partnership model of people coming together to enable potential and build success.
The Icehouse is owned by a charity
The Icehouse was established in 2001 and is owned by the International Centre for Entrepreneurship Foundation – a registered charitable not-for-profit. The Foundation focuses on supporting charitable activities in the areas of business growth, education and research. To do this, they work principally in schools, universities and the wider New Zealand community.
The Icehouse is held accountable to delivering an impact for New Zealand by lifting the international competitiveness of the SME sector. We aim for a material impact on the economic performance of New Zealand over the long term.
Getting into the nitty-gritty
We currently harness potential and enable growth in two key segments - startups and established owner managed firms. While the objective is the same for both groups; to enable business success, the method is different.
For the start up community, we believe our biggest impact is in matching capability, passion, experience and support to enable success. We invest in our community of investors and entrepreneurs to recycle talent, learnings, resources and capital between and into the next generation of founders.
This mostly means building a partnership between investors and founders, then getting out of the way. Because no two startups are the same, we have a range of investment partnerships and activities to ensure we’re providing the right kind of support to the right people at the right time.
For the established owner managed firms, we believe the biggest barrier to growth is a lack of confidence and aspiration to “raise the bar”. While the startups need to back-fill capability to meet aspirations, the owners need to start dreaming a bit more to create a strong and more aspirational vision and get momentum in their business. After all, running an SME in New Zealand is damn hard. It can be a lonely and chiselling experience, and because the barriers are a little more personal than numbers on a spreadsheet, it can be hard to seek help. Our flagship ‘Owner Manager Programme’ is a six-month programme for business owners that focuses on mindset and a strategy for winning. A four-month Leadership Development Programme addresses barriers for senior leaders in organisations. We aim for participants to walk away from these programmes ‘fired-up’, amping to grow their business, with a clear strategy on exactly how they can do this, and how they can sustain it.
‘Stronger Together’ means that we continue to partner with these alums, with support, connection and enablement on their execution challenges as they take their strategies into the market. Continuing to journey with these business owners is a WIP for us, and a key priority over the coming years. Growing strong, successful, sustainable businesses is a long game.
What about impact, is it working?
Measuring results is important to our stakeholders and to ourselves, but with a goal as broad as ‘enabling business success’ what can we look at and measure to make sure we’re on track? ‘Success’ is defined differently in every business, so how can we see what impact The Icehouse is having? How can you put success measures around personal development?
These are questions I try to answer most days, and although difficult, we’ve come up with a basket of measures that can tell us if we’re on track, if our input is working, and what we can learn. From customer satisfaction, to NPS ratings of our experts, to team engagement, to capital raised, to jobs created, there’s a whole raft of measures that pull into our Annual Impact Report.
We also acknowledge that we are enablers, not do-ers, and comparisons are very difficult. While we can partner and advise, we are just a part of each business we work with – they’re the ones creating real value to the New Zealand business landscape. So, for as long as our customers continue to tell us that we’re creating opportunities, value and support – we’ll continue to do what we do.
Here are some snazzy little graphs to show how we’re tracking on our path to our 2021 goals (you can click the image to expand).
Our fourth major measure of success is interaction and results of The Icehouse Business of International Quality (BIQ) Assessment. Over 2700 businesses have used the tool to measure six areas that we know play a significant role in creating business success – Leadership, Offering, Market, Processes, Governance and Capital. This year 330 businesses used the assessment tool, some for the first time, and some as an annual pulse-check. 101 of our customers gained gained BIQ ‘status’, meaning they’re now a ‘Business of International Quality’!
What’s next?
In 2016, our board and shareholders worked through a strategic planning process to 2026 – establishing a 10-year vision.
In 2017 we reviewed, tweaked and updated this strategy to ensure we were prepping for success. This meant reviewing our strategic focus and identifying any new opportunities to support Kiwi entrepreneurs and firms. Many of our programmes teach that the ‘plan’ in a business plan is a verb not a noun. It is a process, not a document.
We challenged ourselves to explore how we might accelerate the time it will take for investment returns from our activities to be greater than the costs of supporting the startups and investors. We have now set a challenge to accelerate the time to do this earlier than our original target set in 2016. In 2018, this means continuing to grow the investment capacity and capability of our networks, and then to invest in world-class entrepreneurs.
With our established firms, we challenged ourselves to deliver continuing journeys of 5+ years with our owner manager customers. Not a six month programme, but a long-term partnership that supports the owners’ journeys by providing ongoing assistance on key execution areas or the opportunity to refresh and enable momentum, or simply as a sounding board. Success is what these owners and their families define.
What we know is that like our businesses that we work with, it is a competitive world and differentiation and value are critical even for us. We have a lot to work on – a lot we can improve and a lot we must change if we are going to continue to be relevant for our customers of the future. We also have the aspiration to lift the impact that happens through our programmes and activities – scale is important in this context.
We end where it matters...
They say it takes a community to raise a child. For Kiwi business and business people to reach their potential we need a business community that participates, learns, adapts and improves. Not just the startup founder, or the business staff, but this includes investors, advisors, suppliers, family members, the list goes on.
What really matters to The Icehouse is that we rally around New Zealand businesses and help them reach their potential – because when businesses grow, our communities will be better off, our country will benefit, and our shared future is brighter.
So, if you have ideas or thoughts on how we can improve what we do to support Kiwi business – we’re all ears. After all, it takes a village.
Thanks for reading.
Andy