SINGAPORE--Asian startups can leverage opportunities being created from cultural differences, which can be blindspots to their larger counterparts worldwide. The scene in Southeast Asia is also becoming more compelling than China and Silicon Valley in the United States, especially in terms of cost and talent.
According to Darius Cheung, co-founder and CEO of BillPin, there is an abundance of opportunities for Asian startups in their own backyard that they can exploit before thinking of venturing to technology startup hubs such as Silicon Valley. He was sharing his insights as part of a keynote at Startup Asia held here Thursday.
For example, ideas can come from making global connections between products, such as making Korean TV dramas accessible to Middle East viewers via Arabic subtitles which fan-subtitling platform Viki had done, Cheung highlighted.
He noted Asian messaging apps, such as LINE, Cubie and KakaoTalk, have also done a good job in listening to local consumers in terms of incorporating features they want such as sending messages via voice recordings, drawings and virtual stickers.
The growth story of BRIC nations, otherwise known as Brazil, Russia, India, and China, has also become old, Cheng noted. He pointed out startups usually fared best in markets with high GDP rates, and many countries in Southeast Asia were outperforming the BRIC nations.
Cheung said he did consider setting up in Silicon Valley but it made more sense to do so back home in Singapore as it was difficult for a startup to thrive there due to the cost involved. For example, the cost of hiring an employee would be much higher in the U.S. and there would also be higher staff turnover with bigger companies poaching the more talented workers, he added.
Steep obstacles breaking into China
Agreeing, Jamie Lin, founding partner of appWorks Ventures, said the growth potential of Southeast Asia was more attractive than that of China, which was closer to his company's base in Taiwan.
"Most of the rest of Asia, when we do business we start with a whitelist or trusted list and when hey screw us over, we put them to a blacklist. Whereas in China you start with a blacklist. You put them on a distrusted list first and then when you find them trustworthy you move them to a whitelist."
- Jamie Lin, founding partner, appWorks Ventures
China is seemingly easier for Taiwanese startups to enter, but the cost of doing business there is increasing at 20 to 30 percent thus raising the barriers to entry, noted Lin, in a separate interview onstage. With this in mind, he pointed out it was relatively easier for Taiwanese companies to move into Southeast Asia.
He added doing business in China was also very different from most other places.
"Most of the rest of Asia, when we do business we start with a whitelist or trusted list and when they screw us over, we put them on a blacklist. Whereas in China you start with a blacklist. You put them on a distrusted list first and then when you find them trustworthy you move them to a whitelist," said Lin.
He also felt Taiwan had much to learn from Singapore in order to make the ecosystem more conducive for entrepreneurs.
According to Lin, some of the biggest obstacles Taiwanese entrepreneurs faced include the financial regulations on the mininum value of per share required, made it difficult for startups to offer equity for funding without having enough capital themselves.
Another problem is the restriction on third-party online payment services such as PayPal, which limits the options entrepreneurs in Taiwan can use, Lin added.