Lai See | Hong Kong government can't be bothered to support start-ups

There has been a good deal of talk recently as to whether Hong Kong has the wherewithal to become a start-up hub. For many, it's a conundrum as to why one of the richest and most entrepreneurial cities in the world shouldn't be better at this.

There are those, like our colleague Jake van der Kamp, who would say this is because it is not Hong Kong's forte. Hong Kong is better at trading and finance than start-ups, he says.

Others have remarked on the high level of capital in Hong Kong and the striking lack of investment that finds its way into technology start-ups compared with other rich centres. In their World Bank study, Martin, Han and Tanaka described the venture capital sector as successful in Taiwan and Israel, but not in Hong Kong.

Ken Au and Steven White, in Hong Kong's Venture Capital System and the Commercialisation of New Technology, attribute this to the city's "historically rooted trading-and-arbitrage business mentality, the legacy of British banking practices, manufacturers' reliance on short-term loans, and the particular backgrounds of locally active VC investors".

Nevertheless, there are also a good number of people that say Hong Kong has the potential. Legislative councillor Charles Mok believes it could be done. He was an internet entrepreneur and has been promoting the start-up and technology sector.

Musing with him recently, he was frustrated by what the Hong Kong government does for start-ups compared with those in Singapore, South Korea and mainland China. There, the government sets up investment vehicles which have a degree of independence over their investments and are able to take long-term views. At the same time, the presence of government equity attracts outside investors.