Sam Stubbs: Simplicity Founder on the Government seeking foreign investment at the global investment summit

A lot could be riding on the Government's upcoming global investment summit. 

Prime Minister Christopher Luxon's hoping to tease out more foreign financial investment in New Zealand's projects and industries at the two-day event in March  

But Simplicity Chief Executive Sam Stubbs says he's concerned Luxon will spend more time focused on offshore money than domestic money. 

He told Mike Hosking getting a dollar from overseas is a lot harder than getting a domestic dollar in the door.  

Stubbs says we'll need to be providing a lot of incentives, something we've typically steered clear of in the past, and you can't just set up an expo tent, sprinkle it with a few All Blacks and expect foreigners to invest in New Zealand - it's a competitive business. 

He says it's all very well to focus on the offshore money, but he thinks the size of the prize is much bigger domestically. 

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Episode Transcript

Speaker 1 (00:00):
So the talk and noise has started around the government's
Global investment summoned around one hundred of the world's top
investors businesses. Construction Leader is going to be here to
hear that we are open and looking for money and
deals now, Simplicity CEO Sam Stubbs is going to be
there and he's with us.

Speaker 2 (00:12):
Sam, morning to you, Good morning.

Speaker 1 (00:14):
How much is riding on this, you reckon.

Speaker 2 (00:17):
Look, I think quite a lot, Mike. I mean, there
will be an awful lot of money in the room.
I think what I'm concerned about is that the government
will spend more time focus on the offshore money than
the domestic money. You know you have ke We Saber
managers will be in the room there. They'll have it
one hundred and twenty billion dollars right now and that'll
should be about a trillion dollars by twenty fifty. So
getting a dollar in from overseas is I think a

(00:39):
lot harder than getting a domestic dollar in the door.
And if you look at the Aussie super funds, they
have about fifty percent of their money invested domestically at
the moment. The KIW save for funds have got about
thirty percent so if by twenty fifty you could have
another two hundred billion dollars invested in New Zealand by
KIWI fund managers. So if this conference is doing what
we were typically doing sort of the nineteen nineties and
focus on the offshore money, that's all very well. But

(01:01):
I think the size of the prize domestically is much
much bigger.

Speaker 1 (01:05):
And so locally would collab with international or we could
do a lot more than we are with local.

Speaker 2 (01:11):
We could do an awful lot more than we are
with local right now. What you have to do is
sufficiently incentivize local managers to invest domestically, and we actually
want to, it's just it's very hard to find things
to invest in right now. So I think if we
if we have this conference like the one we would
have had in the nineteen nineties, which is us going
out with a begging bowl and saying that we don't
have that much money, could you please, you know, basically

(01:33):
look after us and invest in us, I think that
that would be a shame because we're a very different
country now. We actually have a lot more money saved domestically.
If you add it up, can we save ACC and
NZ super that's over two hundred billion dollars or remarket,
it's a lot.

Speaker 1 (01:44):
Do you want. What's the problem then, So when you
say we can't find anything to invest in, what is
it the internationals are coming to hear to see?

Speaker 2 (01:52):
Look, I think what the government wants is for the
international investors to come in and funda all of the
new stuff, you know, build the new factories and so on.
That may well work, And I mean you have to
be very serious about this, Mike. You know, you can't
just basically set up an expotent sprinklet with a few
wall blacks and expect foreigners to invest in New Zealand.
It's an extremely competitive business and you have to provide

(02:13):
a lot of incentives and that is not something key
we are usually comfortable with providing, you know, unfair competitive
advantage to the new international dollar versus the local player.
So I think we have to go through a mindset changer.
For you really want to get serious about making New
Zealand like Ireland, you have to deal with companies you
may not feel comfortable dealing with. For example, Island I

(02:34):
think has three research centers from Huawei. We don't like
Huiawei investing here. They have to provide serious cash incentives.
So this is a this is a very serious game
you're playing when you're starting to fight for international capital.
I think the much easier prize is to get the
locals to invest more.

Speaker 1 (02:49):
Here, very good insight, and I'll put it to Crystal
Bluxan about half an hour. Appreciate your time, Sam Stubb's
Simplicity CEO.

Speaker 2 (02:55):
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