Jump-starter goes to town
Updated: 2015-02-20 16:02
By Selena Li(China Daily HK Edition)
Simon Galpin, director-general of investment promotion at InvestHK says rapid growth in Asia, particularly the Chinese mainland market, and the flattened economies of North America and Europe are driving entrepreneurs with global ambitions to Hong Kong. Edmond Tang / China Daily
Invest Hong Kong is seeing an uptick in young entrepreneurs looking to set up shop in the city as they seek to conquer the world. Selena Li reports.
A clearer picture is emerging as Hong Kong, an ideal "business" destination, begins to shape itself as one of the fastest growing startup hubs.
"The percentage of our clients that are really entrepreneurs rather than bigger multinational companies from mainland China or around the world has started to grow," said Simon Galpin, director-general of investment promotion at Invest Hong Kong (InvestHK), the government agency responsible for attracting and facilitating foreign direct investment into Hong Kong.
The push-pull factor behind it, Galpin said, is the rapid growth in Asia, particularly the Chinese mainland market, and the flattened economies of North America and Europe.
"If you're an entrepreneur and want to start a high-growth business, coming to Asia and starting off your business in Hong Kong is a sensible choice," he said.
"The global elements of Hong Kong will become more important because we are attracting startups and although they're very small, they all have global aspirations. They want to conquer the world."
Startups find a home
According to a survey conducted late last year, there are 1,065 registered startup companies operating in the city's burgeoning co-working spaces, involving more than 2,300 staff.
"What we have noticed is that the organizations that are supporting startups, both in the public or private sector, have grown from just three in 2010 to more than 35 today," Galpin said.
"The Hong Kong startups community is truly global," he said. "About 40 percent are either foreign-born or people returning to Hong Kong to start a business."
With the help of technology, small businesses are able to create a global reach, and that makes Hong Kong a sweet spot for startups, Galpin said, adding a compact place like Hong Kong benefits from its high business efficiency and great accessibility.
"Most startups with a global aspiration are in a real rush. They feel they have got to get their products or services out to the world market before somebody beats them to it," he said.
Two months ago, just across the border, the Shenzhen hub of Qianhai opened an innovation hub designated for young entrepreneurs to start their businesses.
"I think Qianhai will complement HK," Galpin said. "This is a winning combination because if they want manufacturers maybe they can do their prototyping and maybe R&D in Hong Kong, they can do the financing in Hong Kong. But if you want manufacture they can do it just 20 or 30 kilometers across the border in Shenzhen or Qianhai."
"Many professionals in Hong Kong use social media that you have right across the Chinese mainland. They also use social media that are being used in North America and Europe as well. Most startups want to take the advantage of that," he added.
In talking about the rising costs of office space that may push business away, Galpin explained that Hong Kong offers a range of different options at very different prices within a small area.
Beside strong traditional funding support, InvestHK has noticed another emerging opportunity among mainland and Hong Kong high net worth individuals.
"Not just Hong Kong, but also mainland entrepreneurs are using Hong Kong's family offices for wealth management. But normally they are willing to make more traditional investments, like property and stocks," Galpin said.
"If we can communicate that there are these new opportunities with all this fast growth of startups in Hong Kong, we hope that some of those more traditional investors will support the startups too."
InvestHK makes use of partners and intermediaries, including law firms, consulting firms already engaging with wealthy individuals and making efforts to reach out to angel investor networks as well.