We are continuing to present you startup ecosystems over the world. In previous articles, we showed you: Top 5 Startup Ecosystems in Europe and Top 5 Global Startup Ecosystems. In this article, we present you top 5 Startup Ecosystems of Asia-Pacific Region.
In Asia-Pacific region, there are a lot of young startup ecosystems: Kuala Lumpur, Melbourne, New Zealand, Seoul, Sri Lanka, Bangalore, Sydney, Singapore etc. Many ecosystems of Asia differ from others by a short period of finding engineers. For example, the global average value is 41 days and the Asia-Paciﬁc median is 35 days. Also, Asia-Pacific region is characterized with high development of local startups. This is because countries in Asia-Pacific region are not enough attractive for foreign companies.
So, that was a short review of startup ecosystems in Asia-Pacific region and you can learn more from this infographic:
Kuala Lumpur’s ecosystem has been building momentum and attracting worldwide attention since it hosted the 2013 Global Entrepreneurship Summit. Kuala Lumpur also has one of the highest percentages of women founders in the world at 23%. Startups located here beneﬁt from a good level of English, a prime location in Southeast Asia, as well as lower labor costs compared to nearby Singapore.
The government has been actively involved in stimulating the Malaysian ecosystem. One such eﬀort called the Cradle Investment Program has invested over $60 million in Kuala Lumpur since its inception in 2003. They have funded an accelerator program called the Coach and Grow program, which has supported over 700 startups to date. Thanks to strong leadership from government agencies and the strength of the existing tech community, the ecosystem’s connectedness, experience, and funding rounds are accelerating rapidly. As a next step, the government is expected to launch a 10-year tax exemption plan to further attract foreign tech companies to Kuala Lumpur.
Kuala Lumpur is not ranked among the global top 20 startup ecosystems due to its relative lack of Global Connectedness and Startup Experience, but low cost, easy to hire engineering talent could foreshadow a rise in the ranks.
Only 10% of customers for startups in Kuala Lumpur come from outside of the country, more than 13% less than the global average, indicating a strong local market but also challenges in reaching the global one.
Melbourne is renowned as the world’s most livable city and has a great standard of living but relatively high costs — a circumstance that makes it challenging for many of the currently 900 - 1,300 local startups.
The ecosystem almost scored a top 20 ranking in terms of its Startup Output, but its Valuation and Exit numbers lag further. However, it has one of the strongest rates of Early-Stage Funding, strong Global Connectedness scores, and high quality engineering — all indicators that it could make a push into the top 20 soon.
Melbourne founders are more technically oriented compared to their neighboring ecosystem in Sydney. Founding teams in Melbourne are 25% more technically skewed and 15% less business skewed.
Melbourne startups have one of the lowest utilization rates of Startup Advisors in the world, with only .73 Advisors with Equity per Startup.
40% of startups reported that they are oﬀering a product that is the ﬁrst of its kind globally. In relation to the world average of 34%, this underlines Melbourne’s ambition to disrupt entire industries.
New Zealand’s spirit of collaboration and inventiveness is paving the way for a healthy and well-funded tech sector. Over a few decades the country that holds just 4.5 million people has radically transformed to become one of the most globalized economies around. At the moment the local startup ecosystem is estimated to be home to 400-600 ambitious tech startups.
Research shows that every dollar invested in tech sector productivity brings a $3 ROI — an impressive stat made possible in part by the New Zealand Venture Investment Fund and the $300 million that has been earmarked to boost the country’s vibrant early-stage investment market.
In the overall Index, New Zealand’s strongest factor is Talent, followed by Funding which are both above average in the global comparison. Performance metrics are below average and pose an opportunity for improvement. The big picture suggests brighter days are ahead, as solid Funding and Talent variables are key ingredients for improved performance over time.
New Zealand startups report a high Percentage of Foreign Customers outside their continent at 32%, conﬁrming the fairly small domestic market and, more importantly, the ability to Go Global.
New Zealand ranks 5th in terms of startups that found positive Corporate Interest and Involvement with them, at 65%. The global average is at 51% of startups having a positive Involvement with Corporates.
Seoul is a home to 1,500-3,400 startups. Its Gangnam District is the most active startup area in Seoul with 81% of VC residing in the region and over a hundred thousand in attendance of 3,000+ startup-related events in 2015.
The government recently announced a $1.5 billion initiative to increase internet speeds so that you can download a feature-length movie in approximately one second. The fastest growing sector by funding is virtual reality, with FinTech and cybersecurity startups not far behind.
Seoul is an ecosystem that’s fast on the rise, looking to crack the top 20 soon. Seoul lacks strength in the Exit category, but it has a very high Startup Output and a strong Funding environment that is progressing better than most of its peers. Its biggest weakness in the Index is its Market Reach, which is hampered by a lack of Global Connectedness to other startup ecosystems and a relatively low Percentage of Foreign Customers.
Startups can hire an engineer in Seoul faster than anywhere else in the world, with a median Time to Hire of 15 days, compared to a global median of 41 days.
Seoul startups are tied for the 3rd with Silicon Valley for the highest Percentage of Employees on their Growth Team that previously gained at least two years of startup experience — at 76%, they trail only Tel Aviv and Austin.
Seoul has the highest percentage of B2C startups at 50 percent. Only 8% of customers for startups in Seoul come from outside of the continent — one of the lower rates of this year’s assessment — indicating a strong challenge in reaching the global market.
The Government of Sri Lanka is working hard to oﬀer universal access to broadband infrastructure and mobile connectivity to its citizens, but you’ll already ﬁnd the local tech scene teeming with the right vibe, proliﬁc ideas, and programmers typing away on their keyboards. It’s no wonder then that its economy has seen robust annual growth, with a GDP per capita that’s ahead of the other South Asian countries, and making it a promising target for curious investors. Research indicates a growing startup ecosystem comprising of 150-300 active tech startups.
Not surprisingly, Sri Lanka does not rank among the top eco-systems in this year’s Index. Due to its infancy, it doesn’t have many output oriented metrics to showcase its progress, but its Early-Stage Funding is growing at one of the fastest rates in the world. And its decent Global Connectedness scores, combined with low cost engineering talent is a bright spot to build around.
Sri Lankan startups have the 2nd fastest Time to Hire an Engineer, with a median of 20 days. The Asia-Paciﬁc median is 35 days, while the global median is at 41.
26% of Sri Lankan startups report that they are working on a product/service that is globally unique. 34% report a purely local diﬀerentiation of their product/service.
So, now we are watching for development of startup ecosystems over the world and in the close future, we get more and more opportunities for startups.