Lessons From the Co-Founder of Hong Kong’s First Startup Accelerator

No location has a monopoly on innovation. However, out of simplicity and because of selective media awareness, we often focus on a small number of innovation hubs rather than look more broadly. That focus of attention has some downsides—one is that you might end up building something that doesn’t match your customers’ needs outside of the innovation hubs. Another downside is that it becomes easy to miss out on all the innovation happening outside of these locations.

Years ago, when I co-founded Hong Kong’s first startup accelerator I used to notice a strange phenomenon. Some local Hong Kong startups would act as though they were somewhere else in the world. Most often they acted as though they were in Silicon Valley. (Or, they acted like they were in a movie version of Silicon Valley.) That is, their go-to model for business growth was to build a highly scalable service fueled by rounds of VC and with a revenue model that only worked at scale. The trouble was, the infrastructure to get that scale—investment, talent, culture, and customers—was lacking in Hong Kong. Hong Kong was a wealthy city, but investors typically looked to later-stage or more traditional investments. There was tech and business talent, but that talent was typically absorbed by large corporates. There was family and peer pressure to work in a “respectable” job. And while Hong Kong has a population similar to New York City, that is not enough to sustain a scalable company.

Why Hong Kong startups looked to Silicon Valley

So why did Hong Kong startups back then look to Silicon Valley? There were a couple of reasons for this, but the most interesting one to me was how the “movie version” of Silicon Valley startups influenced people’s actions on the other side of the world. Those Hong Kong startups were overly influenced by what they thought the tech hub reality was. That is, they read the major US tech publications and repeatedly saw examples of large funding rounds, what seemed like concept-stage companies progressing quickly to rapid growth, giving influential presentations to large audiences, and more.

These founders were playing at running a startup based on what they thought it should look like, rather than actually figuring out how to run one and what their startup should be.

At the same time, however, there were local startups that were conscious of their local reality. These companies took a different approach, for example using local expertise in areas where Hong Kong has historically been strong—logistics and shipping, mobile communications, finance, and manufacturing—developing products and then taking them to other markets. Those startups were the less noticeable ones—possibly even the less newsworthy ones—but they played to local strengths.

Something like this also often holds true for people based in the large tech hubs. The innovation and startup-building patterns that work there might not be the best for them but there is pressure to conform. If they follow typical advice, they will go down a typical path.

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How to think more broadly about innovation

How can you escape these limitations and think more broadly about innovation and what is happening around the world?

Be aware of what the international innovation hubs are doing, but also look for innovation locally. Rather than apply the same formula internationally, learn about other locations.

A good way to learn about what’s going on in another startup and venture community is still an old-school answer: visit. Before you go, reach out to people you can find online. People in startup communities tend to be generous with their time and want to make these connections. Outreach like that was my start to becoming involved in Hong Kong’s startup community years ago. With some prep work, it is possible to set up meetings in advance, possibly host (or at least join) events, and meet people. In my case, those early meetings influenced me greatly. While other international groups had come and gone after concluding that accelerators just didn’t work in Hong Kong, gaining local knowledge helped me do something different. I built that first startup accelerator in a way that was a fit for Hong Kong and our portfolio companies rather than a generic program.

It is usually easier for people outside of the tech hubs to know something about life there than it will be for people in the large tech hubs to know about life elsewhere. That means you’ll have a different set of advantages if you go out and spend time in other locations. That knowledge will make you a stronger contributor wherever you are.