Welcome to the awakening tech jungle of Asia.
Magnitude of Landscape
How big is Asia’s tech start-up environment? An even better question: how much bigger can it become?
First of all, it’s not a Silicon Valley yet. With the exception of Japan, Asia is a landscape of nascent tech entrepreneurs, without as much of the venture capitalists, IT consultants, specialized project managers, or tech branding managers available as it is in the more developed tech markets of other countries.
But it’s huge, from Beijing to Jakarta, Bangalore to Singapore, Ho Chi Minh to Manila. Most of Asia has been busy trying its hand at incubating and launching tech startups in the first decade of the 21st century. So far, some 6,000 Asian startups have cropped up since 2005. Most of the startups are in China and India; in terms of the sheer number of start-ups, China and India are now the second and third-largest in the world. The rest originate from none other than Southeast Asia.
Just like their Western counterparts, Asian startups are brave, bold, and rather idealistic. They believe their ideas will improve their respective countries, think about how much money they’ll make out of going public, and how many of their countrymen’s lives they’ll make richer as well.
The Key Difference
But the big and successful Western former-startups like Amazon, Groupon, and Linkedin have been trying to establish themselves as the predominant web-based service companies of their niche in Asia—and not quite succeeding. Why is this?
Applying exact copies of successful Western startups onto the Asian ecosystem doesn’t work; these were created for the needs and expectations of a Western market, which on certain aspects are different from our own Asian market. One good example is the typical Asian preference for products recommended by family or friends, instead of hundreds of strangers. This means retailers must automatically link their e-commerce operations to their social media marketing in real time—a deep integration that hasn’t been thought of in the West. Little wonder, then, why they’ve never really taken off in the region—or why there aren’t as many venture capitalists.
Other barriers to growth are the lack of government, cultural interest, management talent, pioneer-role models, and proper legal and accounting frameworks.
However, all these will soon change. There’s a new trend in Asian startups: homegrown ideas. Asian entrepreneurs know exactly how tech startups and the Internet can fit into Asia’s existing market behaviors. It’s only a matter of time before barriers to growth are overcome, and the capitalists come to the gate.