Rapid economic development in Asia has brought tremendous change to the region but it has also brought significant challenges and gaps in the market, and there is desperate need for entrepreneurial talent. Meanwhile, foreign companies are facing increased pressure from local companies, while traditional jobs for expats are also facing pressure from local talent.
Working in Beijing in a traditional job, I’ve been surprised and impressed with the number of young people from abroad working on their own newly formed companies in one of the most competitive markets on the planet. From importing wine to digital media marketing, employment platforms, and an online marketplace for translators, each of these young people have seen an opportunity and run with it. Meeting these inspiring young entrepreneurs also made me realise that getting involved in start-ups here in Asia is not out of reach for young people and there are definitely some perks from taking this avenue.
With this is mind I have highlighted six benefits of living and working on start-ups in Asia.
1) Traditional expat jobs are shrinking
The boom and golden days of 9-5 (or 9-6 in certain Asian countries) expat jobs in Asia are drying up as more local grads return home with degrees from the U.S, the U.K and Australia. As a result, more and more expat packages in Asia are being replaced with local hires, expat wages are growing slower compared to local wages, and there are less opportunities for non-English teaching professionals. Visa regulations in certain countries, notably China, are also tightening for foreign workers. Starting-up your own business may well be the best way to preserve your job and to secure a work visa if you eventually get through all the business registration paperwork!
2) Market size
Australia might seem like a safe and comfortable place to establish a start-up but 22 million is a diminutive market compared to other countries in Asia. Australia is also isolated geographically from the rest of the world. Add on top the expensive cost of labour and transportation, and there’s good reason to look outside of Australia. Setting up in almost any country in Asia will allow you to take advantage of a much larger market and Asia itself is becoming increasingly integrated under regional trade agreements. ASEAN countries, for example, are integrating their economies and drastically lowering barriers to provide companies with cost-effective and fluid channels to transfer goods along regional production and supply lines. However, this doesn’t mean you need to target an entire region or country, but instead home in on a niche market that in a county as big as Japan or China might be more than a million potential customers!
3) The opportunity to travel
Working on a startup in Asia provides the opportunity to travel and especially for those working on an online start-up with a virtual team. Imagine working from an internet connection in Seoul, Singapore or Shanghai and the next week sitting on a beach in South-East Asia. Start-ups also involve a significant amount of relationship building and the development of supply chains, distribution points or external partnership management, and which all offer the upside of domestic and international travel. My Aussie friend working with a social media start-up in China lives in Nanjing but works part of the week in Shanghai and then travels around the country as far as Beijing, Qingdao and Guangzhou once a month. The bullet train that connects Shanghai, Nanjing, Qingdao and Beijing make light work of vast distances and there are even power outlets on board to power up your laptop as you smash out a report on the way to your destination. Relationship building in Asia also provides endless opportunity for language practice and cultural learning.
4) The thirst for innovation in Asia
Asia is still going through rapid and unprecedented levels of economic and social transformation. Even the first economy to take flight, Japan, is undergoing dramatic changes to cope with a rapidly aging population and is an economy in desperate need of innovation. China is also desperate to support new technology and expertise to improve food safety, improve productivity, secure water resources and to feed the world’s largest middle class. China is even opening the door for foreign companies to work on cloud computing systems – a sensitive industry for China – with a trial on joint ventures in the Shanghai free trade zone. Seoul is another hotspot avid to attract entrepreneurs through various incubator projects and co-working spaces. Wherever you look, Asian countries are vying to attract innovation in order to solve new challenges and bolster economic development.
5) Local market advantages
One of the massive perks of living in Asia and working on a startup is tapping into the competitive advantage of various locations. Are you looking for somewhere cheap to keep your living expenses, overheads and wages low while you invest money into your startup? Think Thailand, Indonesia or the Philippines. Are you working on a tech start-up? Seoul has one of the fastest internet connections in the world, and India is an option if you want to talk to your tech support face-to-face. Does your startup rely on a fast, reliable and affordable logistics system? Think China. Or are you looking to establish your start-up 500 meters from the beach for after hour drinks? Think again Thailand, Indonesia or the Philippines!
6) Leveraging currency difference
Finally, take advantage of the currency difference. Imagine earning USD or Singapore dollars in Asia, and then exchanging that to the depreciating Australian dollar when you finally decide to move back home. Or earn USD or AUD while living on the cheap Rupee or Baht in India and Thailand.
Setting up a new enterprise in Asia is by no means easy and while there are certainly benefits to working in Asia, there are also ample challenges to overcome. These challenges include having to decode local business law, overcoming corruptive practises, high barriers to market entry for foreign companies, domestic competition and reverse engineering, as well as the traditional language and cultural barriers. But hey, isn’t solving problems part of the fun and attraction of being an entrepreneur? And if you don’t have a start-up idea yet, jump on the back of someone else’s to get you started.
Just make sure you do as much research and gather as much knowledge as you can beforehand and then begin applying that to your startup. Seek out other foreign entrepreneurs through Chambers of Commerce to test your business model and learn from their success and failures. Understand the implications of what if your business collapses? Do you have an exit strategy plan? For example, in China it’s actually more time intensive and expensive to close a company than to register a company.
Finally, read like crazy! Bookmark Tech in Asia and digest every installment of Dezan Shira’s Asia Briefing (China, Vietnam, India and ASEAN) to keep up with industry trends. There’s also a fantastic selection of start-up books out there including the Blue Ocean Strategy, Lean Start-up, ReWork, and Seth Godin‘s work on creative marketing. Tim Ferriss’ The 4-Hour Work Week is also another entertaining and inspiring read to get you started.
There’s no guarantee you will be successful, but for those who get started, there’s never any regrets. What you’ll eventually learn and take out of the experience will most certainly outweigh the return of teaching English at a local school or Happy Giraffe English Academy!
Check out JingJobs Founder Samantha Kwok’s article on Lessons learned from launching my start up in China
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