MORE technology-related small and medium-sized enterprises (SMEs) and startups from Singapore are entering South-east Asian markets, particularly Indonesia, Vietnam, Thailand and the Philippines, according to Enterprise Singapore (EnterpriseSG).
Over the years, the government agency has seen growing interest from Singapore companies in venturing out to the region, with many looking for partners to co-innovate, as well as seeking investors or clients that require their tech solutions, said Jonathan Lim, director for Global Innovation Network at EnterpriseSG.
In 2021, more than one-third of EnterpriseSG’s market access schemes under the Global Innovation Alliance (GIA), known as GIA Acceleration Programmes, were conducted in its 4 South-east Asia nodes: Jakarta, Bangkok, Ho Chi Minh City and Manila.
That year, over 100 Singapore tech SMEs and startups participated in those South-east Asian programmes – more than 10 times the number that took part in 2019, when the GIA programmes were only running in Jakarta and Bangkok.
The GIA is a network of Singapore and overseas partners in 15 cities worldwide. It is a joint initiative between EnterpriseSG and the Singapore Economic Development Board.
Run in a hybrid format, the GIA Acceleration Programmes consist of workshops, dedicated 1-to-1 mentorship with industry experts, networking opportunities and an overseas immersion trip. Participants also have access to in-market resources and co-working spaces offered by overseas GIA partners to help them anchor and scale their business abroad.Though the current pace of economic recovery in South-east Asia has been “uneven” due to the diversity of markets, Lim noted that Indonesia, Vietnam, Thailand and the Philippines remain bright spots for Singapore businesses to explore innovation opportunities.< />
“(These markets) are marked by exponential urbanisation, a rapidly growing middle class and high digital penetration rates… and stand out as the largest and fastest growing markets in the region.”
The expansion of the GIA network to Ho Chi Minh City in 2019 and Manila in 2020 contributed to an increase in regional innovation activities by Singapore companies, Lim said.
“The addition of these 2 nodes addressed the growing appetite for innovative solutions among Vietnamese and Filipino corporates, many of whom were starting to invest resources into corporate innovation and startup partnerships.”
The Covid-19 pandemic has further accelerated digital adoption and fuelled a growing appetite for solutions in areas such as e-commerce, consumer tech, enterprise tech, fintech, agritech, smart cities and sustainability, he said.
“During the pandemic, areas like healthtech and edtech, which typically had slower take-up, also saw significant acceptance and adoption given the safe distancing measures and work-from-home practices,” he added.
Getting a foot in the door
For homegrown edtech company Kinobi, expanding into Indonesia and the Philippines was a “natural move” given the large populations of both markets, said its chief executive officer (CEO) Benjamin Wong. Kinobi is a digital career management platform that offers services to university students to help them kickstart their professional careers.
“Apart from the population size, we noticed that youths in both countries were extremely ambitious, whilst the job market in both countries was also desperately in need of ready talent,” he added.
But the company initially found it challenging to engage universities in Indonesia and the Philippines on its own, due to a lack of in-market connections.
Through the GIA Manila Acceleration Programme in 2021, Kinobi was introduced virtually to F(DEV), the venture builder arm of Philippines conglomerate Filinvest Development Corporation. It ended up working with F(DEV) to develop a curriculum for student entrepreneurs interested in creating projects on non-fungible tokens.
Said Wong: “This was crucial to our growth in the Philippines because we were able to get legitimacy right from day one. As Filinvest Development Corporation is a well-known brand, clients took us more seriously and this helped to open some university doors.”
Kinobi also managed to secure a partnership with Universitas Indonesia, a top-ranked university in Indonesia, through its participation in the GIA Jakarta Acceleration Programme last year. This gave it the opportunity to provide the university’s 40,000 student body with its proprietary artificial intelligence-enabled resume builder tool, to help students create international-standard resumes.
Besides market access programmes, the GIA runs Tech Showcases, in which tech SMEs and startups submit solutions to problem statements by corporates.
Through the virtual GIA Bangkok Smart Cities Tech Showcase in 2021, water treatment startup Hydroleap formed a partnership with Bangkok Industrial Gas to run a commercial project for a leading Thai beverage manufacturer. The startup provides chemical-free solutions for wastewater treatment by using electricity instead.
Mohammad Sherafatmand, Hydroleap’s CEO, said the firm has received “significantly higher” interest in its solutions since taking part in the Bangkok Tech Showcase. It is currently in talks with a few Thai investors to participate in a Series A fundraising round.
“The first step to entering into any market is to have a better understanding of what the common practices and pain points are. This can be done efficiently if startups meet customers and partners who are ahead of the rest, in the adoption of new technologies in that market,” said Sherafatmand.
Source: The Business Times © Singapore Press Holdings Limited. Reproduced with permission.