The travel and tourism industry is a major influencer in Hong Kong’s economy. With 270,000 people employed in this field, Hong Kong tourism industry accounts for 7.2% of the total employment. Thanks to the plethora of market opportunities, Hong Kong’s startup ecosystem has witnessed phenomenal growth over the past few years. It is one of the fastest growing startup hubs in the world.
To further give a boost to this startup ecosystem, InvestHK is organising an event called StartmeupHK Festival from 23rd to 30th January next year. We spoke with Dr. Simon Galpin, the Director-General of Investment Promotion, InvestHK about StartmeupHK. Here is an excerpt from the conversation:
What’s the core idea behind the first ever StartmeupHK Festival?
The week-long StartmeupHK Festival from 23–30 January 2016 will see leading champions in the startup community (accelerators, corporations and associations) hold a series of thematic conferences and pitch events covering Internet of Things (IoT), financial technology (fintech), health technology and data analytics, sectors in which Hong Kong has distinct competitive advantages. This festival will provide a unique opportunity for stakeholders in the startup community locally and from overseas to connect, collaborate and do deals.
Over the years, Hong Kong’s reputation as a startup-friendly destination has risen sharply. What are the key factors that have contributed to this phenomenal growth?
When InvestHK launched the StartmeupHK initiative in 2013, the startup ecosystem in Hong Kong was just developing with only three co-working spaces/incubators (HKSTP, Cyberport and Nest). Three years on, the city has transformed into one of world’s most vibrant and fastest growing startup hubs in the world with over 45 co-working spaces, incubators and accelerators.
According to InvestHK’s latest survey completed in August this year, there has been a 46 per cent increase in the number of startups in HK in the last ten months with an increase of 56% in the number of jobs created. The number of work stations has increased by 60% since the first survey done in November 2014.
Hong Kong has a unique appeal as a startup hub. This is especially true for hardware startups, whether in the consumer device, robotics or medical device sector. Geographically, we are close to the Mainland consumer market and its manufacturing base in Shenzhen, the so-called hardware capital of the world. Founders can not only access the international and Mainland market via HK but can also enjoy the rapid prototyping, small scale manufacturing, just-in-time delivery and world class fulfilment set up just across the border.
The financial technology sector has also attracted a lot of entrepreneurs, which isn’t surprisingly considering Hong Kong is one of the world’s financial centres. The technological innovations that are being created here tend to focus on Hong Kong’s traditional strengths in financial services, for example in the trading and wealth management, security and cross border trade areas.
These startups, along with companies in other sectors, seek to leverage Hong Kong’s intrinsic business advantages and super-connector role. Add the context of a world class city in which to base, with a strong rule of law, dedicated and professional talent pool, and ease of doing business, and the figures begin to make a lot of sense.
How tough is it for overseas entrepreneurs to startup in Hong Kong? Are there any key elements that one should look at while exploring Hong Kong for starting up?
Hong Kong has one of the easiest business incorporation procedures in the world, which takes only one hour to be done online, with one director who doesn’t need to live in Hong Kong and minimal capital of only one Hong Kong dollar. It makes setting up particularly easy for entrepreneurs and allows founders to focus on their business rather than spending time on the incorporation process.
With thriving co-work spaces in Hong Kong, the cost of renting a work seat is very affordable at only about HK$2,000 a month. However, because competition is keen in Hong Kong, founders should have carefully mapped out business and cost models in order to be successful in the market. It is also the responsibility of the founders to make sure that their ventures are within the legal ambit in Hong Kong.
A number of partners such as Brinc are supporting the events at the week-long summit. Would you like to talk about their involvement?
As the first and only IoT specific accelerator in Hong Kong, the Brinc IoT Hub at PMQ (the former Police Married Quarters) provides top quality IOT startups with space, networking opportunities, training as well as access to world-class manufacturing supply chains and distribution networks.
As part of the StartmeupHK Festival, Launch, the consumer IoT Conference presented by Brinc, will include workshops, pitches by finalists of a global IoT start-up competition and exhibitors, and a conference with prominent speakers from Indiegogo, Samsung’s Innovation Center and Misfit, a new wearables company that pre-sold 250,000 devices in one day via Chinese e-tailer JD.com.
FF16 or Fintech Finals 2016, is being organised by fintech experts NxtBnk (or Next Bank) and Fintech HK. Both these organisations aim to collaborate with the community to drive change for the better in financial services through design, innovation and entrepreneurship. FF16 will feature a startup village, the finals of a global fintech competition with heats in a number of cities, summits and high profile speakers.
The health tech event will be organised by AIA, alongside HKBIO, HKAPI, HKMHDIA, and in addition to showcasing the latest innovations in health technology and some of the hottest startups in this space, there will also be the final pitches by ‘emerging entrepreneurs’ in the age 8-12 age group.
KPMG, one of the Big Four consulting groups, will host the data analytics event with a special focus on e-commerce.
The event is drawing wide interest from the international media and the global startup system. What sort of expected participation are you looking at?
The Festival is expected to attract thousands of local and overseas startups, investors and business leaders to converge in Hong Kong and see the dynamism and growth of the ecosystem for themselves. It will be a busy week for the startup community, with a range of conferences, workshops, pitch events, startup competition and social events vying for their time. Local and overseas investors can also witness the new investment opportunities HK has to offer.
Dr. Simon Galpin joined InvestHK as an Associate Director – General of Investment Promotion in 2001. His contribution in shaping the strategy and business planning process has helped establish the firm as one of the world’s leading investment promotion agencies. He is actively involved in promoting Hong Kong’s expanding start-up ecosystem.