Why Hong Kong remains attractive to tech start-ups – despite challenges
- Abundance of talent, capital and stable infrastructure means city can continue to entice newly established international businesses
- While it may be going through a period of volatility, local start-up landscape continues to offer lively new events and opportunities
Hong Kong’s businesses are facing a challenging time. The long-running US-China trade war, as well as the months-long street protests, have plunged Hong Kong into a technical recession, with the city’s gross domestic product (GDP) contracting 3.2 per cent in the third quarter, compared with the second quarter.
The slowing business landscape has also created a more challenging environment for start-ups seeking opportunities in Hong Kong.
Hong Kong’s advantages are long rooted in its stable financial system and good start-up infrastructure. So even though investors have become more cautious, start-ups with great potential and solid business plans will find opportunities
“Investors have certainly become more passive and conservative [over recent months], which has made it more difficult for start-ups when they look for growth hackers,” Alvin Lam, managing partner of private equity fund, T12M Ventures, says.
However, reasons for optimism remain, with recent activity suggesting that the city’s fundamentals are still solid and it still has a lot to offer to new businesses.
September’s announcement that Hong Kong start-up accelerator Betatron will invest up to US$150,000 in each of the eight tech start-ups it selected from a list of more than 1,000 applicants has also taken on special significance at this challenging time.
Lam believes that while fundraising may have “become more difficult”, Hong Kong still remains competitive as a regional hub for innovation.
