Opportunities and challenges facing HK startups in Taiwan
Expanding to Taiwan has become a noticeable trend in the Hong Kong startup community. Among the entities that have made the move is co-working space operator Zerozone, which was founded in 2016. The Hong Kong Economic Journal recently sat down with the startup's founder Roy Law to discuss the opportunities and challenges pertaining to the Taiwan market. Also participating in the conversation was Luke Chu, co-founder of Vizz Digital, a Hong Kong-based digital marketing solutions provider that is one of Zerozone's members.
Excerpts from the discussion:
HKEJ: As we know, Zerozone recently opened a branch in Taiwan. How did you come up with the plan?
Law: It all started in October last year, when I paid a visit to the incubators, startup accelerator programs and co-working spaces in Taiwan. I saw the enormous effort and resources that the Taiwan government put into supporting local startups, and establishing an innovation ecosystem. Then we came up with the idea of expanding to the island.
We chose New Taipei City as Zerozone's first overseas branch, serving mainly information technology-related firms and startups. For now, it plays the role of guiding Hong Kong startups to “land” in Taiwan, offering supporting services to help them hire a new team, register the company in Taiwan, apply for government subsidies, etc. We know that what our clients need is a “local guide” in the newly launched market, such that they can focus on their own work in product development.
With regard to the innovation and technology ecosystem in Taiwan, it has a mature hardware technology industry, with heavyweights such as TSMC and Foxconn. Meanwhile, the island is also ramping up efforts in boosting its development in software. And one of the focuses has been the merger of hardware and software technology to build internet of things (IoT)-powered solutions.
HKEJ: My next question is for Luke. As a digital marketing startup and a user of Zerozone, how does Zerozone support Vizz Digital in its Taiwan business?
Chu: Leveraging digital technology and the power of social networks, Vizz Digital mainly helps clients design digital marketing strategies. One of our subsidiaries, Madcradle, has expanded to Taiwan, and Zerozone has assisted the company in exploring partnership and cooperation opportunities with local firms there.
From our experience, there is one interesting comparison between the work culture in Hong Kong and Taiwan. Hong Kong staff are efficient and “result-oriented” at work, while Taiwan people tend to be passionate about their work. The staff turnover rate is relatively lower in Taiwan, which is good for companies to implement long-term technology development plans.
Vizz Digital has moved the research and development operations to Taiwan, in order to enjoy the complementary advantages of the two cities.
HKEJ: For the Hong Kong startups expanding to Taiwan, what are their major concerns?
Chu: Zerozone has created a community in Taiwan for companies and startups from Hong Kong to communicate and exchange the latest market information. From that, we find that many of those startups are facing a difficulty in boosting their brand awareness and product exposure in the local market. Marketing services, such as building media connections and relationships, is one of the services that they need.
Law: Personally, I find that how they can enter the local market, seek local partners and financing are the top concerns among the Hong Kong startups in Taiwan. And those have been our major service offerings, in response to their demands. Take financing as an example. Our team would first meet with the entrepreneurs, to explore whether there is any suitable venture capital available, or to assist in their participation in local startup activities and events.
Meanwhile, I find that many Taiwan startups are interested in entering the mainland China market, as well as eyeing other places in Asia, something that Zerozone also can also help with. We know that there have been abrupt changes, or even turbulence, in the international landscape, such as the Sino-US trade war. But, in the middle of difficulty lies opportunity. We believe what's most important for startups is to pursue the opportunity that lies within.
This article appeared in the Hong Kong Economic Journal on July 28
Translation by Ben Ng
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