Ready to Leap: Myanmar on the Brink of Technological Revolution
Lessons from Alter’s portfolio companies
“This isn’t a moonshot. It’s happening now, it’s very real, and we are on the frontier.”
With that, an Alter entrepreneur perfectly encapsulated the current environment in Myanmar. He was talking about his own growth-stage company, but he might as well have been speaking for any of our five portfolio ventures, or indeed for the entire ecosystem of entrepreneurs beginning to scale up in the country.
Alter has been working in Myanmar since October. It’s been an exciting time, both for us and for our partners there. As we’ve watched them scale, these ventures and entrepreneurs have taught us valuable lessons about building successful businesses in Myanmar. Interviewing the founders, employees, and consumers who are driving technological change in the country, a few key messages have come up over and over again. They’re worth outlining here, as they provide a bit of an insider’s guide to what makes new ventures successful in Myanmar.
1. Myanmar is an unmatched test-bed for new tech in the developing world.
Leapfrogging is more than just a buzzword here. In just the past few years, mobile connectivity has jumped from less than 4% to over 80%. The proliferation of smartphones, combined with a gap in available services, means that tech-driven business models have significant room to play. Relatively undeveloped infrastructure has left few legacy systems for new ventures to overcome, while the spread of advanced mobile devices has opened to door to sophisticated new products.
By bringing new technology to bear on old problems, Alter’s entrepreneurs have become the first to offer certain services across the country. The innovators at KoeKoeTech, for instance, have rolled out a popular health app for new mothers, providing access to information rarely, if ever, available in remote parts of the country until now. On the retail side, our partners at CityMart are combining an e-commerce platform with a robust logistics network to create unprecedented access to commercial goods across the country.
2. The most popular products are built with consumers’ income levels in mind.
It’s surprising how often we see startups that fail to heed this most basic tenet. But the common thread behind our ventures’ success is their ability to understand and empathize with the needs of customers in Myanmar. At a basic level, this means recognizing that, to be broadly successful in a country like this, you need to build products that are both accessible and affordable to the average consumer.
The entrepreneurs behind Frontiir, whose goal is to provide WiFi access to all of Myanmar’s people, have built this elemental fact into their product and their pricing, with a multitude of options designed to attract the broadest possible set of consumers. Similarly, the creators of Impact Terra, an agricultural tech company, designed their platform to accommodate the country’s poorest farmers while attracting content producers with higher willingness-to-pay. The end result is a widening customer base that has the potential to extend throughout the country, even where incomes are much lower than in urban areas.
3. There’s no substitute for local knowledge.
Though there may be little legacy infrastructure standing in the way, it would be impossible for a new venture to succeed without working within the very real social and political structures that set Myanmar apart from more traditional entrepreneurial environments. Part of what has kept some major international players out of the country, despite the allure of a growing and modernizing economy, is the difficulty of anticipating or even understanding the legal, social, and political barriers that can crop up in response to innovation.
Here’s one example: Though most of Myanmar’s citizens now own smartphones, digital literacy remains a challenge for platform-based businesses. Because of this, app distribution doesn’t follow the path typically seen in other places. To confront this problem, ventures like Oway, which has pioneered travel booking and ride-sharing in the country, view consumer education as a major part of their overall goal, and a vital step toward enabling the next wave of digital solutions in the country. The founders of KoeKoeTech, too, see digital education of their users as a major piece of the social benefit they hope to create, alongside health information. These ventures are not only enabling more users of their own apps, but are also paving the way for broader uptake of digital solutions across the country.
4. Myanmar is on the cusp of realizing its potential, but the future probably won’t look like anything we’ve seen yet.
Though there certainly are some unique hurdles facing entrepreneurs in Myanmar, the country is clearly on the path to a more inclusive, tech-driven economy. After abandoning military rule, Myanmar has seen a massive influx of money and ideas. A lot of those resources are chasing imitation, rather than innovation — replicating models that have worked in other contexts, instead of crafting them from the ground up to meet Myanmar’s realities.
But the ventures seeing the most success right now are not simply looking to make outside products work in Myanmar. Instead, they’re preparing for the singular future of Myanmar and tackling the obstacles — like digital literacy and distribution — that stand in the way. Those barriers are quickly crumbling, and within a year or two the technological potential of Myanmar, seen now in terms of raw statistics like smartphone penetration, will be met by a truly revolutionary capacity for tech-driven products and services to scale across the country.
In the meantime, success often means hacking together new tech with workarounds to educate and distribute to consumers. The upside is that ventures with the closest ties to the tech and social landscape in Myanmar have a chance to build up market share before the country becomes more accessible to larger, more conventional firms. That’s why, with our partners in Myanmar as in other countries, we stress locally formed solutions above all else. Force-fitting outside ideas simply won’t work in frontier markets. The work of our entrepreneurs serves to illustrate that on a daily basis.
For our part, we’ve been supporting our ventures in Myanmar through strategic consulting projects, recruiting top tier talent, and brokering connections to investors and advisors. As our partners there land impressive rounds of funding and hit new milestones in their product development and distribution, we couldn’t be more excited to help them take their next steps on the road to scale.
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