How else can Hong Kong’s startup ecosystem improve
Microsoft created an incubation programme in partnership with the government.
Even with an already vibrant and healthy startup ecosystem in Hong Kong—housing 3,750 startups, of which, 18 are unicorns—the industry is not without challenges. Microsoft Hong Kong pin-pointed three pain points for these newly formed local businesses.
According to Kelvin Tse, Director for Global Partner Solutions at Microsoft Hong Kong, startups are challenged by the lack of technological stacks to support and build their businesses; a marketing strategy that will introduce them to their target customers and promote their products; and escalation for them to expand their reach internationally.
Despite these, Microsoft believes that Hong Kong is the heart of information technology. With the push from the government to nurture the space, Microsoft developed an incubation programme—an interconnected system called Microsoft for Startups Founders Hub.
“We joined hands with key stakeholders like the Hong Kong Science and Technology Parks Corporation (HKSTP), Cyberport, universities, and corporate venture capitalists to strengthen the startup ecosystem. Together, we plan to enhance Hong Kong’s status as an international IT hub,” Kelvin said.
In the hub, startups can access Microsoft products for free and build their own products using Microsoft Azure, Microsoft’s cloud computing service for application management.
“Startups can build their infrastructure or run their solutions on an integrated secure Cloud solution powered by Microsoft. Our education and training resources also help to upskill founders and their staff,” Kelvin said.
There is also an open AI platform in the hub for most tech startups or those creating AI-powered products. This platform gives them a pre-built data model they can take and recreate.
Additionally, through the hub’s technological platform, startups can automate their business processes, automation thus making sure that they become part of the ecosystem where technologies are stacked to support each other’s businesses.
“Accessing our ecosystem is more than a marketing strategy to enhance their market exposure, startups can explore business opportunities with Microsoft and our sizable corporate customers. Startups will also have a chance to expand into the international market with Microsoft’s support when they have demonstrated customer success,” Kelvin said.
An example of a successful startup from Microsoft for Startups Founders Hub is Clearbot, a company that makes AI-powered self-driving boats that collects trash from the ocean, which recently won a contract with Hong Kong property firm Sino Group.
Open to all
For the startup accelerator program, Kelvin said they are not targeting any specific segment.
“Anyone with an idea can just use their LinkedIn profile to apply online and within five to seven days, [they] will get feedback from us,” Kelvin explained.
Microsoft uses a back-end engine that verifies each application and determines at which stage the startup is currently. Then they identify the type of funding or support the startup is eligible for.
“Our Founders Hub is built for founders at every stage. Our technical experts are prepared to help startups and offer guidance at any development stage. For founders’ backgrounds, we see both fresh graduates and mature professionals are eager to develop their entrepreneurship,” Kelvin said.
Currently, Microsoft has 100 startup founders enrolled in the program in Hong Kong, most of them in the fintech or retail sector.
Why Hong Kong
“We can see the government continues to allocate funding and resources to nurture local startups to grow. The Hong Kong government is committed to increasing research and development (R&D) spending from less than 1% of the gross domestic product (GDP) to more than 1.5% this business year. We can still expect massive funding resources injected into different universities, incubators, or corporate ventures,” Kelvin said.
Kevin also observed that startups in Hong Kong are not just focused on making money, but on making a difference as well.
“[Hong Kong startups] have a big ambition to do some social good and create a positive impact in terms of ESG and sustainability,” Kelvin explained.
One example is a fintech startup called Know Your Customer, which, as the name implies, is a company focused on solving pain points in KYC and providing anti-money laundering process automation. The startup runs its entire platform using Microsoft Azure with AI and machine learning.
Microsoft managed to connect Know Your Customer with KPMG, one of the big four accounting firms in Asia. The two managed to go to market together by providing an end-to-end solution that lets financial firms comply with market regulations.
Aside from fintech, e-commerce, professional services, and logistics, Microsoft said they are seeing more growth for startups in terms of property tech, education tech, health tech, and sustainability tech.
Kelvin reiterated that through the Microsoft for Startups Founders Hub, Microsoft Hong Kong is committed to investing and supporting the startup community to grow and learn together and become a better, improved ecosystem.