How to Enter Asia with Ease: A Review of Summer 2018’s Asia Expansion Roundtable at CDL Super Session
This year, the Saltagen Ventures team had the pleasure of hosting an Asia Expansion Roundtable at Creative Destruction Lab’s Summer Super Session. In order to provide startups with a variety of expertise, we brought various delegates from Hong Kong, US and Canada including Jeff Nankivell (General Consul of Canada in Hong Kong and Macao), Shirley Wong (Head of Investment Promotion, InvestHK Canada), George Tee, Raymond Wong, and Henry Fong (CTO, Head of Investment and Assistant Manager of the Hong Kong Science and Technology Park, respectively), Timothy Chen and Luke Fromowitz (Managing Director and Principal of Shenzhen Valley Ventures, respectively), Andre Bertram and Frank Nguyen (Founders of HelpWear Inc.) and Dr. T Chen Fong (Investor and Creative Destruction Lab Fellow). The following is a summary of the insightful and fruitful discussion that explored crucial next steps for any startups looking to successfully land in Asia.
Start with Hong Kong
Hong Kong has always been known as the best place for a soft landing in Asia. English is the second major language, it is located next to China — one of the biggest markets in the world — and their legal system includes well-protected intellectual property rights. Hong Kong is also home to the International Finance Centre, and acts as the financial headquarters of Asia. With the majority of the population being able to speak fluent English — including most Csuite-level executives — it is much easier to enter the Asian market through Hong Kong. Finding partners to help your startup enter and grow through the Asian market may seem like a daunting task, but there are numerous companies and organizations that are committed to supporting Canadian startups as they venture into new territory.
If you are looking to enter the Asian market, your first step will be to reach out to the Consulate General of Hong Kong and Macao, Jeff Nankivell. With his extensive business and ambassadorial experience, he will act as a trusted and well-connected source that will provide any startup with the resources and introductions necessary to begin your process. But be sure to book your appointment in advance! For more information, visit http://www.canadainternational.gc.ca/hong_kong/index.aspx?lang=eng
Once you have booked your appointment with the Consulate General, feel free to reach out to Saltagen Ventures (that’s us) as we are always eager to meet with Canadian startups that are looking to land in Asia. Andre Bertram, CEO of Helpwear — one of our portfolio companies — stated that Saltagen was instrumental in building connections with important organizations such as the Hong Kong Science and Technology Park, Cyberport, InvestHK as well as many others that have allowed HelpWear to being the process of entering the market knowing their startup was in good hands.
Everyone knows that poor choice of initial partners can affect your startup. So no matter how appealing a partnership may be, be sure to properly vet your partners. It is also important that your startup is cognizant of the difference between partnerships and contracts that won’t dilute your shareholding as you enter this market. That is why it is imperative that startups not rush into Asia. Find people you trust and carefully plan your strategy. This strategy should include a point of contact with InvestHK; they will provide sound advice on commercial terms and legal structure.
Although entering the Asia market through Hong Kong means having access to a wide-range of manufacturing possibilities, be sure to thoroughly research the purpose and strengths behind contract manufacturing (CM) and design-for-contract manufacturing (DFM). A contract manufacturer is a manufacturer that contracts with a firm for components or products. DFM describes the process of designing or engineering a product in order to facilitate the manufacturing process in order to reduce its manufacturing costs. DFM will allow potential problems to be fixed in the design phase which is the least expensive place to address them. Regardless of which route you decide to take, always look for experiences and like-minded products from your manufacturer.