In June this year Mercer NZ (now Marsh) followed its trans-Tasman counterpart out of the fund administration game.
As per the Australian agreement signed about six months prior, Mercer NZ will eventually hand over the admin duties to Apex both for its in-house funds and numerous traditional superannuation schemes.
The Mercer-Apex deal also introduced a new name into the NZ financial services directory with Australian data and IT advisory firm, Novigi, arriving as part of the package.
Novigi has worked with Mercer Australia since 2019 and partnered with Apex Australia in 2024 soon after the latter acquired the super admin arm of ASX-listed financial technology firm, Iress, for up to A$60 million.
Apex later sold the consulting business that came with the Iress purchase to Novigi, which has grown from scratch in 2016 to an Australian super admin tech advisory powerhouse both through organic growth and acquisitions.
Novigi co-founder and chief, Ash Priest, said the firm did consider the buyout strategy as a NZ market-entry ploy but ultimately opted to build a presence here through the Mercer-Apex project.
“We’ve made our first hire in NZ and will open an office,” Priest said.
Elynna Yang, former head of business services for the NZX-owned Smart, joined Novigi last month as the inaugural NZ employee.
Before Smart, Yang spent almost four years with NZ financial services technology consultant, Mosaic FSI, which likely has some overlap with Novigi.
But while the Australian firm has wider competitive ambitions in NZ, the Mercer-Apex transition project will absorb its energies for now with completion not expected until the end of next year.
Priest said Novigi senior staff Steve Welchman and Leigh Johnson have been seconded to NZ to manage the technology handover along with the Mercer admin team here.
Mercer administers more than $11 billion through its own-brand KiwiSaver and other funds: the business also acts as administrator for many workplace saving funds including the $2.7 billion police scheme, Unisaver ($1.8 billion), Dairy Industry ($1 billion) and Firesuper ($585 million).
While the looming admin change, like all looming admin changes, has put some schemes on edge, Priest said “I’m confident it will go well”.
“This is a high priority for us.”
He said Novigi would also take time to understand the NZ market, getting to grips with the KiwiSaver “architecture”, tax settings and regulatory framework, for instance.
“We’re not just going to roll in and do the same thing as we have in Australia,” Priest said, citing a recent partnership with the Papua New Guinea super scheme as an example of its adaptive approach.
Novigi, which is part-owned by Australian industry super fund investment specialist IFM Investors, registered a NZ company this July.
In its home country, Novigi has grabbed a large share of the super IT consulting and managed services market, now working with a third of the scheme population (representing half of all members), he said.
Established in 2016 by Priest, Melissa Fuller and Joash Belousoff with a general brief to do something innovative in technology, Novigi settled on financial services as its core focus after the COVID crisis.
All three founders previously worked together at Australian actuarial consulting firm, Rice Warner, a seminal super advisory business sold to Deloitte in 2021.
“Super admin in Australia was fragmented with sub-scale tools and capability,” Priest said, making it ripe for a tech makeover.
He said the advent of artificial intelligence (AI) has come with further potential to strip costs amounting to “tens of billions” of dollars out of the super admin stack, pointing to a real-life example where a Novigi-led refit saved one scheme about A$25 million in operating expenses in the short-term.
Back in 2016, AI wasn’t the ubiquitous acronym of post-ChatGPT times but Priest tapped into an earlier large-language model, Google Translate, to come up with the “coolish-sounding” name.
Novigi means ‘innovate’ in Esperanto, the made-up global language attempt concocted by Polish academic, L L Zamenhof in 1887 that also translates ‘fund administration’ to the snazzier, ‘fonduso administrado’, and New Zealand to ‘Nov-Zelando’.