On April 18, 2018, Taiwan Startup Stadium (TSS), the ecosystem of many Taiwanese-based startups, organized one of the biggest dialogue sessions, the Battle of the Startup Ecosystems. TSS invited prominent people working in different ecosystems to discuss the trends, importance and benefits of building solid ecosystems in various regions. The panel included Ms Holly Harrington from TSS, Mr Joseph Huang from Infinity Ventures, Mr Amarit Chaopenren from Hubba and Mr Alexander Chan from The Mills Fabrica.
Prior to this event, TSS had already launched other multiple events including Accelerator Bootcamp, ROCK the MIC event and Founders League Mentorship Program. Battle of the Startup Ecosystems was bound to be a meaningful and monumental session indeed.
To kick start the event, all the organizations were first introduced to the audiences. TSS is a government-funded program, funded by the National Development Council of Taiwan since 2015 to help internationalize the start-up ecosystem in Taiwan. TSS focuses on building connections and strengthening the ecosystem by bringing startups together. The number one startup market TSS works with is the US. After that, it’s Japan, Southeast Asia and then China. Out of all the start-ups TSS works with, 23 of them has one foreigner co-founder while 17 of the start-ups has one female co-founder.
Currently there are not many resources allocated to females in the technology industry. However, Taiwan is beginning to see traction in setting up policies that will place these females on the same playing field as their counterparts. TSS is presently working with start-ups in the series A or B funding, their startups having, raised over US $500 million in investments. TSS also builds up startup communities to link different founders together. Their activities include startup coaching, boot camps and workshops, occasionally bringing in overseas experts on various topics. Accelerator coaching is one of TSS core programs, to help start-ups go abroad. With a network of 400+ investors, including Venture Capital firms (VCs), CVCs and angels, TSS provides the perfect platform for startups in Taiwan to grow and prosper.
Taiwan has always had strong roots in manufacturing, many of the great Taiwanese companies started from manufacturing products before branching out to various other fields. A big part of Taiwanese ecosystem is their huge amount of investments into training up software engineers and developing hardware and Internet of Things (IOT) products. The tenacity to build businesses and being highly entrepreneurial are some of the key factors that makes Taiwanese companies so successful. Many companies such as Yahoo, Google, Twitch have Taiwanese Co-founders. The Taiwanese people are also very helpful by nature, with an intrinsic motivation to genuine help other Taiwanese. Thus, this form of internal altruism builds extremely close-knitted entrepreneurial communities in Taiwan.
The guest speakers were asked to rate their countries’ ecosystem from a rating of 0 to 5, with 0 being the best ecosystem, and 5 being the worst.
Joseph representing Japan said that 5 years ago, he would have rated Japan close to 0. However, Joseph says Japan would be closer to a 3 now, but only in specific sectors. Infinity Ventures Summit was developed to push the Japanese to enter the world market. According to Joseph, entrepreneurs looking to start businesses in Japan need to master the Japanese language as all forms of businesses are done in Japanese. There are cultural norms to take note too such as the hierarchy formalities and the different speaking manner that men and women use.
Amarit representing Thailand rated Thailand’s ecosystem as an inflated 4 as Thailand has always been in at a cross roads between other countries such as US and China, Japan and Korea, Singapore and Malaysia. Being situated in the central of Southeast Asia, Thailand is very accessible and with it’s open market, it helps trade to run smoother among other countries as well.
According to Alexander, Hong Kong is one of the best places to do business due to the ease and efficiency of starting up a business. Registering for a business in Hong Kong can be as short as 10 minutes. Unfortunately, the down side of having a free market system is that huge expenses get incurred easily from staffs and resources. Hong Kong can be the bridge to bring China and Southeast Asia together. Overall, Hong Kong dude rated Hong Kong’s ecosystem as a 3 out of 5.
Holly representing Taiwan’s ecosystem rated Taiwan as a solid 3.5 right now and Taiwan will continue to get better. Holly states that more and more Taiwan people who have gone overseas to study for university are coming back to their home country to work because of the great atmosphere and environment that Taiwan provides. This brings a lot of international knowledge and expertise back to Taiwan, allowing the country to grow at a faster rate than ever before. With regards to the other nation’s ecosystem. Holly believes that it is so easy to do business in Hong Kong because they have a diverse group of international professionals who can offer different skillsets to the Hong Kong ecosystem. On the downside of Taiwan’s ecosystem, Holly mentioned that people who are running programs or setting policies usually do not understand user experience. Hence, the process of attaining the Entrepreneur Visa is very tedious. Holly states that Taiwan can learn from Hong Kong on how to better manage the administrative matters so that new startups in Taiwan can flourish.
Joseph begs to differ, he believes that a start-up can only be sustainable in a large and well-developed market like Japan. In his opinion, Hong Kong is too expensive to start a business as the living expenses is one of the highest in the world. Furthermore, hiring a team would incur insanely high manpower costs as the salaries has to match the living expenses of the country to attract good quality employees. Despite Hong Kong being a great place for capital and for networking, even renting a small office space will incur costs that can kill a startup. Hence, Joseph believes that entrepreneurs should look into starting their businesses in a mature and big economy instead.
Alexander agreed that expenses in Hong Kong is unquestionably higher than most countries. However, he believes that what made Hong Kong so successful in the first place was its ability to connect overseas markets to the large consumer base situated in China cities such as Shenzhen and Dongguan. Most people think that only Singapore is the bridge to Southeast Asia, which Alexander thinks is untrue. Every single mark in Southeast Asia has their unique talent and skillsets to offer. In Hong Kong’s case, having their colonial past helps to give their country an edge when connecting with western economies and corporations.
Holly recommended that if the various nation’s ecosystem combined forces to compliment each other’s skillsets, they might all achieve greater success than ever before. This is because Taiwan lacks business talents but has an abundance of Taiwanese developers, while Hong Kong is in dire need of technological developers but has excess business professionals in their ecosystem.
Alexander also mentioned that the strength of an ecosystem is not so much about a city on its own, but more of the thinking and the city’s connectivity to other regions. The city that has the most connections with other cities around the globe will be able to encourage trade and tap on resources more easily, creating a vibrant ecosystem within that specific city.
For Amarit, one of the biggest concerns for a startup is how much money they have in the penny, how long before they run out of money and where they can hire cheap, hardworking and talented people. Thailand is very affordable to live in and startups there go through very little competition. If start-ups can prove they know how to operate in crazy and adverse conditions in Southeast Asia, Thailand is the goldilocks. It’s not too difficult like the aggressive western industries and not too easy like Singapore where everything works.
During the session, the audiences were also encouraged to participate in the session, giving feedback and opinions on the ecosystems in Southeast Asia. One of the audience members, a professional from Ireland but currently based in North America has lived in all four countries in the past 2 years, his take on the ecosystems is that Thailand has an ecosystem that is backed by corporates. The people in Thailand and Taiwan are also extremely friendly and helpful, with the food and accommodation being highly affordable.
Joseph stated that the public’s perception of Japan is that they are extremely high tech. New trends like live streaming and E-commerce are slowly picking up in Japan. Japan people are actually really stubborn and resistant against new technology. One example was that they were still using the J-phones even after smartphones came out. But the great thing is once they get into the trend, they will take over the entire market. Hence, entrepreneurs looking to expand to the Japan market can tap on that trend and create a form of business that will be appealing to the Japanese community. Another tip for doing business in Japan is that when a Japanese says “maybe”, it actually means “no”. Japanese people are generally very polite so it is important to read between the lines. To get a Japanese investor to say yes takes a very long time, but the moment they say yes. They do things highly efficiently and the deal gets done.
For Taiwan, they are famous for their hardware. For TSS, when analyzing their startups, they found out they had a lot of IOT startups while there was a significant drop in hardware startups due to the intense saturation of hardware businesses in Taiwan. These days, there are more B2B businesses that are helping enterprises to grow and prosper. The companies that are gaining recognition for their work are those who are focus on developing Artificial Intelligence (A.I). Most of the start-ups that TSS are currently working with are software based. These start-ups have secured contracts with bigger corporates because their software can help digitalize the corporates system structures.
In Thailand, there is a strong attitude of gratitude and karma, it’s always about giving first and investing in karma. Hopefully, that will correspond to a positive energy among business partners. In Thailand, there is this culture in business where entrepreneurs need to be trusted fast by potential investors. That normally achieved through referrals, by becoming their friends, creating great rapport relationships and creating mutual gratitude.
According to Alexander, 35% of the start-ups in Hong Kong are being started by foreigners. There’s a whole culture of risk aversion due to the high living standards and costs in Hong Kong. However, the good thing is that many investors would prefer their start-ups set up in Hong Kong because of the practicality of the low taxes policy.
In Taiwan, people are often very slow to reply to emails, Hence, TSS encourages the startups to follow up with the person that doesn’t get back to them. This shows that the startups are persistent and determined to get the job done. Another thing to note in Taiwan is Facebook. TSS advocates their start-ups to avoid adding investors from overseas on Facebook because Americans generally separate their personal and professional lives. Facebook is a medium for them to interact and connect with their closest friends. Mediums such as Linkedin and Twitter would be more appropriate as platforms to connect with potential investors. But in Taiwan, it is the biggest necessity. It is the “Linkedin and Twitter” of Taiwan, investors in Taiwan want to connect through Facebook instead of other mediums. People in Taiwan are very close-knitted, it is all about relationships. By knowing which social media platforms to use in the various countries, it allows the client to feel comfortable in forming a partnership with the startups.
The various guest speakers were then asked to name companies that are of absolute importance to connect with to thrive in the different ecosystems. Holly said that LTSS (Line Taiwan) is extremely important as almost 70% uses it as a messaging tool. Another one is Anchor Taiwan, which does a 30 day experience in Taiwan on everything, from the people, to the food, to the businesses, to the venture capital firms.
For Amarit, he suggested getting in touch with Paul Ark, the managing director of digital ventures, a subsidiary of Siam Central Bank (SCB) the second largest bank in the world. Digital Ventures have investors who are willing to invest over 150 million dollars. Another one is Dtech Accelerate, they are one of the longest and most known accelerator in Thailand. Dtac has raised over USD 16 million funding and is currently a USD $130 million company.
In conclusions, conferences help people connect and meet new people. The major conferences to attend in Hong Kong would be InvestHongKong and Rise while the biggest conference in Thailand would be the Techsauce Global Summit which is benchmarked against RISE and Slush. Slush Japan is the biggest conference for startups who have just started out and are looking to begin their entrepreneurial journey. People who are interested in attending Joseph’s Infinity Ventures Summit really need to come prepared with an agenda and are looking to IPO their businesses.
How the guest speakers rated their countries’ ecosystem :
Taiwan: Talent, Growing, Underestimated
Thailand: Sexy, Rich, Easy-Going
Japan: Willingness to Pay, Innovative, Bold
Hong Kong: Growing, Diverse, Lots of Kungfu