Poke Asia’s startup bubble all you want, it won’t burst

What’s popular in these Asian countries, and why you should care. Because after all, Asia is not a startup bubble.

The cynics sneer from afar: “Oh, Asia. They only know how to play catch up; imitating her siblings from the Valley. There are many startups there, but hey, few exits. What does that tell you? Startup. Bubble.”

At Echelon 2013, a panel discussion moderated by Joash Wee, our very own editor, saw Asia being discussed and scrutinized meticulously in the company of four others who each represented their home country — Charle Charoenphan (Thailand (TH), managing director at HUBBA), Casey Lau (Hong Kong (HK), community development manager at Softlayer Technologies), Rama Mamuaya (Indonesia (ID), founder, of Dailysocial.net, and Paul V. Rivera (the Philippines (PH), founder and CEO at Kalibrr Technology Ventures). All to find out why Asia is not a startup bubble and how the soapy entrepreneurs here can make it big.

What do people like in these four countries?

For every startup getting into a new and unfamiliar market, understanding how the consumers in this said market behaves is key.

Casey shared that in Hong Kong, people are getting excited over casual gaming and social media. Casual gaming and social media happens to be two of what I think would fall under lowest denominator entertainment – something most people can partake of and digest easily. He added that there have been cases of people falling down the stairs at the train station while playing Candy Crush Saga, a top grossing casual gaming app on the App Store.

About four hours away from the Mecca of shopping and scrumptious delights sits Indonesia, the biggest country in Southeast Asia. It holds a certain potential in terms of size and reach. There are a total of four million credit cards, as shared by Rama, but only a meagre 10 percent are willing to use it online. This still amounts to 400,000 cards. He added that both the mobile and e-commerce scene in Indonesia have seen progress, albeit slow. Perhaps the princess is really waking up. However, legal regulations are still hindering the country from entering a state of true economic growth, causing a sense of unease amongst investors.

But the Philippines are fully awake and aware of what is happening. Not only is there no language barrier since English is an official language along with Filipino, 99 percent of the population is on the largest social network, Facebook. However, infrastructure (or the lack thereof) is a concern for many starting up in e-commerce. Paul stated that those transiting into the middle class do not have credit cards or even bank accounts. A good 13 percent of cost borne by e-commerce companies is used for payment logistics since a lot of consumers are still stuck with the mindset of cash on delivery.

In Thailand, Charle shared that it is clearly different. Infrastructure is not the issue — payment structures are there but underutilized. He said that about 50 percent of all businesses lie in the B2B vein and are doing very well. For example, there’s Builk, Launchpad winner of last year’s Echelon. Not only have they expanded from just Thailand to Indonesia, they also received funding of US$400,000 from PLC.

Pitch of the day for their home countries

After listening to 10 startups pitch why they should be Echelon 2013′s Most Promising Startup two days ago, it was refreshing to hear these four individuals share about why startups should head over to their country.

Hong Kong has been dubbed as one of the most exciting places to be in for a long time now. Casey shared that the startup eco-system is strong and booming in the city-state, having “something going on every night.” He also added that the lack of IP protection in China has made many cautious about starting up in the world’s most populous nation, but this has led to startups heading to Hong Kong. “People going to China are always scared people will steal their ideas, and they will probably. […] I use Twitter a lot and people in Silicon Valley who go to Hong Kong want to meet up. We have a lot of these things [present] in Singapore. There’s something going on every night.” Then, Casey joked, “There’s dim sum? Everybody likes that.”

According to World Bank statistics, there are at least 95 million people in the Philippines, and as shared by Paul, all of them “speak English with a good accent”. He also boasted of his home country as “the best bridge to the Valley than any country here (Asia).” It definitely is looking optimistic for the land which has several cultural influences, particularly that from the US and Spain. He said, “In the Philippines, it just started last year so there is no bubble. I just came back from Y-Combinator [and] the cost of starting has dropped to zero. You don’t have to buy hardware anymore. You can launch your startup with zero capital. Just because people are creating startups does not mean there is a bubble.” Paul also added that many startups have already opened up to the idea of working in the Philippines and are treating it as their second office. “People are using that office to scale operations very quickly.” It’s more fun in the Philippines, after all.

“Just because people are creating startups does not mean there is a bubble.” – Paul V. Rivera

If it isn’t Indonesia, the most populous country in Southeast Asia. Sitting in the panel was Rama, founder of Dailysocial, who sure racked his brains more than a dozen times to think of one solid reason of why startups should head to his home country. Finally, he spoke, “Okay… Indonesia.” Everyone sitting in that very conference hall started laughing. Rama then quickly explained his hesitance to hard-sell the Southeast Asian country, “I’m trying to find something other than the women and the nightclubs.”

But he did get serious. Rama shared that about 50 percent of the population are under the age of 28 and tech-savvy. “One thing about Indonesia is that it has so many problems, but that means opportunities.”

And now, to the land of Thailand. Charle said, “There is good dim sum, beautiful beaches and good-looking people. But seriously, [we are] resilient to hardships.” This is evident from the slew of political issues present to the Thais, which has overshadowed the country’s ever-growing private sector for a long time. It is also interesting to note that though there is a general shortage of talent everywhere, Charle remarked that there is an abundance of designers over in Thailand. He then shared, “With outsider help, we can become one of the leading countries in Southeast Asia.” Things have been looking positive for Thailand, with Ookbee, an e-book company expanding to Vietnam and Wongnai, a restaurant review company, securing Series A funding among others.

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This article by Elaine Huang originally appeared on e27, a Burn Media publishing partner.