In recent years, the world has witnessed the rapid economic development of Southeast Asia.
The level of economic development the region has achieved in recent years has made Southeast Asia a hub for emerging markets and investors. creative innovation about technology.
According to observers, it is not surprising that Southeast Asia has become a stronghold for foreign countries start-up company (startup).
“Soil”
Nancy Wang, General Manager of Data Protection Services at Amazon Web Services (AWS) and founder of Advancing Women in Tech, said that in addition to impressive economic growth, the skills and education level of Amazon Web Services (AWS) and Advancing Women in Tech. Southeast Asians have made the region an attractive destination for startups.
Research by S&P Global Market Intelligence shows that the region consisting of 10 countries with more than 660 million people and a Gross Domestic Product (GDP) of $3.3 trillion (as of 2021) has become one of the fastest growing regions. of the world economy.
According to the Association of Southeast Asian Nations (ASEAN) Investment Report 2023, the region sees growth momentum to continue despite current economic difficulties.
Citing International Monetary Fund (IMF) forecasts, the report notes that the region estimates an average growth rate of 5.6% in 2022 and 6.0% in 2023, outpacing the growth rate. Global GDP growth is expected to be 3.4% and 2.9%, respectively.
An ASEAN startup report noted that in 2018, the region had at least 5,800 startups operating in e-commerce, financial technology (fintech), enterprise solutions, and data. Big Data, consumer goods and services.
Between 2013 and 2022, the region spawned 52 “unicorns” — just startups with valuations in excess of $1 billion.
Southeast Asia’s unicorns include ride-hailing service Grab, e-commerce platform Lazada, travel app Traveloka and financial technology companies Mynt and Coda Payments.
According to Ms. Wang, the region’s large community of highly skilled technical professionals, combined with a good command of English in the workplace, make Southeast Asia an attractive area to invest in. technology company.
Ms. Wang cited Grab, a ride-hailing company as an example of the explosive growth of startups in Southeast Asia.
She noted that Grab’s approach to “serving the needs of the local economy” in Malaysia has become an advantage for the company ahead of Uber in the US.
Grab hits on the cash usage habits of Malaysians, which the US competitor does not offer on their app. Building on the example of Grab, Ms. Wang emphasized that startups need to be built to solve local problems.
An attractive destination despite many challenges
However, Southeast Asia has recently been affected by the economic downturn caused by the Russia-Ukraine conflict, high global inflation, and recession fears.
According to the Nikkei Asia news agency, startups in Southeast Asia raised just $17.79 billion in 2022. That was down 31% from a record $25.75 billion in 2021.
Only eight startups in Southeast Asia are considered “unicorns” in 2022, much lower than 23 the year before.
However, this number is expected to increase as the world economy recovers from the COVID-19 pandemic and more funds and investment channels pour into the region.
Illustration. (Source: Getty Images)Despite the current challenges, Ms. Wang believes that Southeast Asia’s trend of centralizing the digitization of the economy has and will help tech and financial startups in the region grow.
For German businessman Simon Bacher, it was Southeast Asia’s vibrant culture and thriving economy that prompted him to set up an education startup called Ling in Thailand.
He noted that the low operating costs of the business – including staff salaries, office rent and food and drink – have given him and his colleagues more opportunities to grow their startup with limited budget.
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While there are many challenges startups face in Southeast Asia, such as the lengthy registration process for foreigners and adapting to the local culture, Mr. Bacher shared that Ling App has successfully grown in the region, increasing the initial number of employees from just 5 people to more than 40 people now.
By enabling entrepreneurs to bring their business to the Internet and the cloud, Southeast Asian countries have enabled local startups to take the leap into the digital age.
This has helped startups avoid the “painful and possibly tedious journey” of modernizing themselves, Ms. Wang said.
When asked if startups would prioritize looking to certain countries in the region, Ms. Wang said entrepreneurs should use a specific set of criteria rather than searching for a specific country.
According to her, those who are hoping to start a business should consider the English proficiency, ability to operate on a global scale, technical level and risk needs of the country they are considering.
Thuy (VNA/Vietnam+)