Hong Kong needs cultural change if it’s to catch up with regional tech peers, start-up survey finds
- Hong Kong ranked last in availability of private funding, talent and pilot testing among 10 regional peers
The technology ecosystem in Hong Kong is in dire need of cultural change to catch up with regional peers as the city’s early-stage start-ups still struggle with limited access to private capital and talent, according to the results of a survey released on Monday.
Hong Kong ranks last in availability of private funding, talent and pilot testing among 10 regional peers including Singapore, Beijing, Shenzhen and Tokyo, while it ranks in ninth spot overall, according to the Hong Kong start-up Index, which measures the favourability of Asian business environments.
“Culture plays a crucial role in the development of the tech ecosystem, and businesses in Hong Kong, and the general public still need to be educated about their understanding of how technology will be able to add value to their industries and the society as a whole,” Raymond Mak, founder and executive director of local entrepreneur community Entrelink, which initiated the survey, said in an interview.
When the city’s investors bet on property and the brightest minds go into banking as they have done for the past few decades, the start-up ecosystem in Hong Kong will continue to struggle unless there is a change in mentality, he added. The survey, carried out by Entrelink and the University of Hong Kong, polled 233 local start-ups, with most respondents in the early stage of their business.
Hong Kong has set a goal to become a regional hub for innovation and technology as it strives to diversify an economy heavily reliant on finance and property. The city will set aside HK$28 billion (US$3.6 billion) for research and development in universities and re-industrialisation for innovation and technology, Chief Executive Carrie Lam Cheng Yuet-ngor announced in September.
The new funding will add to the HK$50 billion earmarked for innovation in the government’s 2018 budget in the areas of biotechnology, artificial intelligence (AI), smart cities and fintech, on top of the HK$10 billion commitment for supporting tech industries from the year before.
In May the government announced a programme to attract overseas tech talent to work in the city. More than 700 firms at local innovation hubs Hong Kong Science and Technology Parks and Cyberport will benefit from the three-year pilot scheme. In the first year, a maximum of 1,000 people will be admitted to Hong Kong to work in biotechnology, AI, cybersecurity, robotics, data analytics, financial technologies and materials science.
The government will also fund qualified businesses to hire up to two people with a doctoral degree in a science, technology, engineering or maths discipline. Each will receive a monthly allowance of HK$32,000 (US$4,000) for up to 24 months.
However, the survey results revealed a gap between the government’s support and actual benefits or perceived benefits that Hong Kong start-ups receive.
“Innovation, start-ups, technology – these are becoming key words in the speeches of the politicians, but government information is usually unavailable or obscure. The start-up community does not necessarily feel the real change,” said Wilson Wong, director of Entrelink. “The government should be able to provide a one-stop service for entrepreneurs.”