The startup landscapes of the four Asian tigers

Image by Steve Wilson

StartupVille is really loving the animal analogies these days, so it seems like a good time to check in on our four Asian tigers: Taiwan, South Korea, Hong Kong, Singapore.

Before there were unicorns, we had The Tigers: Taiwan, South Korea, Hong Kong, and Singapore had achieved stunning economic growth from the 1960s onward, fast tracking them to the status of The World’s Richest Economies.

After WWII, these countries started from virtually zero. The governments focused on rapid-fire industrialization by building up export economies, a highly educated workforce, and avoiding debt (read: no trade deficit).

Fast forward to now, the glorious post-industrial information age, where the pressure is strong for the four tigers to develop high value, technology-powered economies and maintain their regional competitiveness.

Young people are increasingly choosing to build their own world-changing companies over climbing the corporate ladder. Willingly or not, the four Asian tigers are going to StartupVille.

As Asia Regional Manager of Seedstars World, I’ve spent the past couple months in the heart of the fast-growing startup scenes in Taipei, Seoul, Hong Kong and Singapore. Each city aspires to be a startup hub in the region — a title that’s still very much up for grabs.

Taiwan

That beautiful moment when startups, investors, tech enthusiasts, friends and family come together to support startups

(1) Existential startup crisis: China has crowded out Taiwan, which used to shine in hardware and manufacturing. The talent and production centers in Taiwan set the country up as a key center for hardware and IoT (Internet of Things) innovation and startups. Taiwan doesn’t have the ruthless business culture of China, so it will need to figure out what game it wants to play, or how to play it differently.

(2) Government getting into the game: Taiwan government is pouring $400 million into startups. A great move to incentivize startups and accelerators to get into the field, but there’s still work to be done from a policy level. For example, easing laws that hurt the climate for startups, such as the actual securities law that treats founder equity as taxable income.

(3) Insular: Taiwan is an island in itself, which makes it very easy to focus inward. But now that Taiwan is in StartupVille, it’s a numbers game. In Taiwan the total population is just 24 million. Startups have to sell investors on a total addressable market that can offer 10 times, 20 times, and 50 times returns.

So in many cases, Taiwan is just too small, especially relative to the other big markets in the region – China has 1.4 billion people, India has 1.3 billion, Indonesia has 260 million, and Bangladesh has 180 million. In the same way that Tiger Taiwan has built a strong export economy, its startup ecosystem will need to focus outwards early on.

South Korea

Hong Kong

Singapore

Tigers → Unicorns?