New Google x CUHK Study Says Hong Kong’s Startup Scene Has Grown 300% Since 2009

A joint study done by Google and CUHK’s Center for Entrepreneurship shows that Hong Kong’s startup scene has grown almost 300% since 2009.

The study surveyed over 600 young entrepreneurs, interviewed a panel of 12 local experts (whose names were not revealed) and took into account analysis from international databases and reports.

Appearing to be a more local vs. expat focused report, the snapshot of the ‘typical Hong Kong entrepreneur’ is male (72%), between ages 21 – 25 years old (38%), holds a B.A (58%) and has graduated from a local university (83%).

The study indicates that these Hong Kong entrepreneurs were more ‘ideas people’ or ‘biz dev’ types, citing major strengths in business management in presentation skills. Fundraising, coding and actual experience in doing a startup were some of their weak points.

The Positives:

• The influx of physical hubs in Hong Kong was cited as key to ecosystem growth. The number of co-working spaces (no surprises there) has grown from 1 in 2009 to 22 in 2014 while startup accelerators and incubators have tripled from 6 to 16.
• Knowledge providers have doubled from 14 to 37, direct funding from business to local universities has grown by 35%, and government-matching collaboration programs have tripled since 2009. Funding providers (including associations HKVAN and HKVCA) have almost tripled from 16 to 42.

The Negatives:

• Raising funds at the early stages proved to be one of the biggest challenges as 88% of surveyed entrepreneurs said they were bootstrapping. Even though there are reportedly 260 established Hong Kong-based VC firms as of 2013 that invest in startups, only approximately 1.8% of total local venture capital investment and 21% of angel investor funding went into startups within the 2009 – 2013 period.
• Culture was cited as a big issue in cultivating the entrepreneurial spirit with many locals being highly risk-adverse. Surveyed entrepreneurs said they faced growing pressure from family and friends after enrolling in entrepreneurship programs.

As a roundup:
From the looks of it, the strength in our startup scene lies in its growing pool of resources such as co-working spaces, incubation programs and increased government schemes. However, the study shows that difficulty in raising funds and a conservative mindset might be the culprits slowing down our ecosystem growth.

What did you think of this study? Let us know in the comments below.

Headline photo by Edward Barnieh