Managing Partner at 500 TukTuks
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Disclaimer: all content within the Startup Ecosystem Summary and Editor’s Guide sections is written by and reflects the personal perspective of the guest editor. The guest editor is not responsible for content within the Country Snapshot and Community sections, as much of this content is compiled from external sources and does not necessarily reflect the guest editor’s view.
In many ways, Thailand is more industrially developed and commercially tied to the West than much of Southeast Asia. There is also a huge amount of inbound tourism creating new opportunities, especially from China and Europe. However, this development has not fully translated to the Thai startup community. Thai entrepreneurs are limited by many of the same challenges as those in other Southeast Asian countries (e.g., lack of formalized investment channels, lack of experienced founders).
Progress has certainly been made recently: through 2018, there have been 102 funded Thai startups (as of 2012 there were less than 5). Thailand remains an intriguing market due to its tech-savvy population and its recent growth in emerging industries such as fintech. Moreover, the past year has seen increased momentum as a group of growth stage companies (Series B) have raised substantial capital (US$30M+). To date, more than one third of 500 TukTuks’ portfolio companies managed to secure follow-on investment, which signals a trend that Thai startups are becoming more and more investible despite the challenges.
Another recent trend involves local founders pairing up with foreign founders, applying global know-how to the nature of the local market. Strong founding team members with successful products are usually a combination of Thai and foreign founders. This leads to new solutions that break local status quo but still are suitable to the local consumer behavior.
Going forward, to overcome the funding challenges and attract more foreign investors, Thailand needs to create a unicorn (a startup with at least a US$1 billion valuation) and showcase noteworthy success stories.
There have been past success stories, such as Agoda, a hotel and flight booking site acquired by the Priceline Group, and current success from companies like Ookbee and Omise. But, there has yet to be a homegrown unicorn startup, nor is there the momentum needed to support growth on a large scale. Only 0.3% of Thai startups found an exit in 2016, compared to global leaders whose exit opportunity rate (exits as a percentage of the number of startups) exceeds 2%.
The Thai startup ecosystem, including local corporate venture capital, Chinese conglomerates, and the Thai government, have started to pledge their capital and invest in innovation. But it will take time for this commitment to flow through the ecosystem. There is still a mismatch between corporate or government requirements and startup solutions, making it difficult to implement new programs promoting innovation.
As for the government side, many are pushing for new regulations, especially in the fintech space. There are several government grants available for startups in the area of AgriTech, SmartCity, Tourism, FoodTech and others that are considered important to the local economy. To attract foreign talent, the government also initiated a smart visa program. However, transformation on a national scale requires more than a few years. In the meantime, the concern is that regulators do not have a thorough understanding of new technologies and their implications, so sometimes they’re not able to assess the technology or create a policy to enable real transformation while minimizing risk. Ideally, experienced startup experts would be involved in the policy making process. Looking forward, we expect to see large corporations working more closely with the startups through small pilot projects and co-developing new solutions, instead of just providing funding. From the government side, if the new regulations are passed, we expect to see more innovation being implemented at a large scale, which will help Thai startups expand and create new opportunities.
Editor’s choice of the industries with the most potential for technology disruption and growth.
Editor’s choice of the country’s top 10 emerging tech startups.
Editor’s pick of which ‘Featured Startup’ is especially worth following and why.
Editor’s perspective of the maturity level of talent in the ecosystem.
Editor’s commentary on how the country’s culture and history have impacted the ecosystem.
The traditions and social hierarchy of Thailand touch all aspects of everyday life, including business. Thai corporate culture upholds a traditional top-down approach to management and innovation, a dynamic that is not ideal for out-of-the-box thinking and disruptive innovation. There are relatively few Thai entrepreneurs and startups, as conservative thinking and aversion to risk, combined with social pressures to secure a steady income, means much of the talent that would be expected to venture into the startup world in another environment ends up working in Industry in Thailand.
As of 2017, there were around 600 startups in Thailand, which equates to approximately one startup per 113,000 people. For reference, the startup densities (startups/population) in Israel, the United States, and Singapore range from one startup for every 2,000 to 3,000 people. Overhauling the traditional Thai corporate mindset is a necessary step to encourage more risk-taking and out-of-the-box thinking in the workplace. The good news is that the Thai government has vocally noted its support and capital for increased investment in technology and entrepreneurship. That said, as mentioned above, government regulations need to evolve in accordance with the new focus on technology. Chief among these is the Foreign Business Act, which limits foreign shareholding of Thai businesses across certain industries.
Despite the cultural pressures, there is a big shift of the mindset among new graduates. These days we have witnessed the positive trends of the young generation in Thailand becoming more actively involved in the local startup scene. The universities around the country have begun to run hackathon and entrepreneurship programs, which draw their attention to the space. As of 2019, working at a startup is seen as a risky but attractive option. Additionally, a number of Thais that studied abroad have been influenced by the entrepreneurial spirit in other countries.
Interested in becoming more involved in this ecosystem and connecting with local ecosystem leaders? Let us know.
500 TukTuks (Bangkok): The local operation of global seed investor 500 Startups. Beyond providing seed capital, 500 supports startups via their Seed Accelerator Programs that emphasize digital marketing, customer acquisition, lean startup practices, and fundraising for pre-Seed companies. (Source: 500 Tuk Tuks)
Add Ventures (Bangkok): Invests in Series-A rounds and later stage startups with a focus on smart agriculture, robotics and automation, supply chain optimization, and energy efficiency management. (Source: Add Ventures)
Ardent Capital (Bangkok): Invests in early stage technology companies across Southeast Asia with a focus on eCommerce opportunities - including sourcing, fulfillment, retail, demand generation and payment gateway among others. (Source: Ardent Capital)
Ascend Group (Bangkok): Utilizes cloud data and digital technologies to offer nano-finance and credit services that improves the underserved quality of lives and business opportunities. (Source: Ascend)
Beacon Venture Capital (Bangkok): Invests in early to growth-stage technology startups covering not only financial technology (fintech) but also consumer internet and enterprise technology such as artificial intelligence (AI) and enterprise IT. (Source: Beacon Venture Capital)
Cento Ventures (Singapore): Invests in series A startups with a focus on applying innovative business models to large industry sectors that are set in their ways, using technology as an enabler. (Source: Cento Ventures)
Digital Ventures (Bangkok): A subsidiary of The Siam Commercial Bank (SCB), was established in February 2016 to uncover innovations and redefine banking in a digital era. Amidst an ever changing fintech landscape, DV's strategy is to invest in, experiment with, and integrate technological innovations for SCB. (Source: Digital Ventures)
Galaxy Ventures (Bangkok): Invests in seed stage startups with a focus on innovative technologies and services. (Source: Galaxy Ventures)
Golden Gate Ventures Thailand (Singapore): Invests in early stage startups with a focus on internet & mobile startups across many sectors, including e-commerce, payments, marketplaces, mobile applications, and SaaS platforms. (Source: Golden Gate Ventures)
Inspire Ventures (Bangkok): Invests in early stage and high growth businesses that are scaling proven, and sometimes novel, business models in the Southeast Asia markets with a strong emphasis on localization. (Source: Inspire Ventures)
InVent (Bangkok): Invests in early to growth-stage tech startups focusing in Thailand and overseas, regardless of sector from digital lifestyle consumer to digital enterprise and emerging technologies. (Source: InVent)
Jungle Ventures Thailand (Singapore): Invests in consumer brands for the digitally native; platforms that enable digital transformation of SMEs; global technology leaders born in Asia. (Source: Jungle Ventures)
K2 Ventures (Bangkok): Invests in start-ups with a focus on technological changes that have the potential to greatly impact society. (Source: K2 Ventures)
Krungsri Finnovate (Bangkok): Invests in growth stage, Series A or later stage start-ups with a focus on fintech. (Source: Krungsri Finnovate)
Line Ventures (Bangkok): Engages in flexible investment opportunities on a global scale, in areas such as Japan, the United States, China, Southeast Asia, and more. (Source: Line Ventures)
Monk's Hill Ventures Thailand (Singapore): Invests in post-seed stage tech startups that will take advantage of the fast growing Southeast Asian markets. (Source: Monk's Hill Ventures)
PTT (Bangkok): Invests in startups with a focus on technologies that electrify energy system, enable better transportation, make energy usage more efficiency, enhance sustainability, enable the use of internet of things in industries and other new kind of solutions which could become growth drivers. (Source: PTT)
Singha Ventures (Bangkok): A corporate venture capital unit of Singha Corporation, part of Boonrawd Brewery Group, that invests in startups with a focus on consumer products, logistics, and enterprise solutions. (Source: Singha Ventures)
Siri Ventures (Bangkok): Invests in startups with a focus on construction tech, property tech, food tech, and health tech. (Source: Siri Ventures)
AIS The Startup (Bangkok): A program run by leading telecom in Thailand offering select startups support across technology, market development, and business model development. It hosts monthly pitching events offering 5 startups the chance to pitch. (Source: AIS The Startup)
Activator (Bangkok): A program focusing on co-creating new insurance technology ventures. (Source: Activator)
Bangkok Innohub (Bangkok): A dedicated champion will be assigned to each startup to understand their unique needs. Mentors from Bangkok Bank’s business and technical teams will guide each startup towards a potential pilot that will help them secure meaningful partnerships in the future. (Source: Bangkok Innohub)
Depa Accelerator Program (Bangkok): A smart city accelerator program aiming to develop potential digital startups and maximize growth opportunities from national scene to regional level. (Source: Depa Accelerator Program)
Dtac accelerate (Bangkok): A 3-month program that will bring together an amazing community of entrepreneurs, experienced mentors and investors with a common trait to dream big and making an impact on the world of technology. (Source: Dtac accelerate)
ImpacTech (Bangkok): A program for startups who use technology to tackle social issues. ImpacTech aims to empower social tech startups in Thailand and create a vibrant social tech community of startups and supporters. (Source: ImpacTech)
Krungsri Rise (Bangkok): Works with corporates and government across Southeast Asia to run a tailor-made “Growth Accelerator” program that creates an environment for startups and corporates to create a win-win partnership that can drive the local economic growth, technological and innovation progress, and improve the standard of living for Southeast Asia (SEA). (Source: Krungsri Rise)
SPARK Thailand (Bangkok): Supports high-potential Thai startups in early-stage through intensive mentoring sessions with regional and international experts to guide and improve startups’ capabilities, products and solutions to reach the global market’s needs. (Source: SPARK Thailand)
SPRINT Accelerator Thailand (Bangkok): The first specialized accelerator and incubator for science and technology in Thailand. (Source: SPRINT Accelerator Thailand)
The FinLab (Bangkok): Operates acceleration programs focused on propelling the growth of innovation financial technology (FinTech) and technology companies and catalyses the digital transformation of businesses. (Source: The FinLab)
True Incube (Phra Khanong): Program that selects high potential startup businesses to help scale and form synergies within the TRUE and CP Conglomerate. At the same time, our goal is to help drive a thriving startup ecosystem here in Thailand by providing the support and opportunities to connect and grow startups wanting to take their businesses to the next level. (Source: True Incube)
Techsauce Global Summit (Bangkok): A diverse cultural festival that goes beyond tech into music and fashion. Mix with communities such as social entrepreneurs, musicians and artists, filmmakers, athletes, LGBTQ and more. (Source: TechSauce Global Summit)
Bangkok Technology Entrepreneur OpenCoffee Meetup (Bangkok): A fixed time and place where entrepreneurs, investors, developers and visionaries can get together in a truly informal setting to meet, chat and make connections. (Source: Meetup)
Bitcoins in Chiang Mai (Chiang Mai): Meetup to talk about Bitcoin and other promising applications of blockchain technology. (Source: Meetup)
Internet Entrepreneurs Network (Thailand) (Bangkok): A group for anyone who is interested in internet entrepreneurship and internet marketing. (Source: Meetup)
TechGrind Bangkok (Bangkok): An online and offline community with the sole focus of enabling entrepreneurs from all walks of life to succeed in building their ventures. (Source: Meetup)
DBD: The Department of Business Development establishes quality standards for Thai businesses. (Source: DBD)
DEPA: The Digital Economy Promotion Agency aims to support and promote the development of digital industry and innovation, support and promote digital technology adoption. (Source: DEPA)
DGA: Provides digital technology infrastructure services and service systems or fundamental applications engaging with digital government. (Source: DGA)
ETDA: Created to meet the economic structure that has changed from an analog society to a digital society, an era where everyone can access information at the touch of a finger. (Source: ETDA)
NIA: Supports Thailand’s innovation system, in both the way of improvement and initiation, to promote economic restructuring and competitive enhancement. (Source: NIA)
NSTDA: National Science and Technology Development Agency (NSTDA) aims to promote research, development, design and engineering (RDDE) until it can be transferred to use and promote human resource development and infrastructure in the areas that are needed to build competitiveness and sustainable development of the country. (Source: NSTDA)
SEC Thailand: Ensures a fair, efficient, dynamic and inclusive capital market. (Source: SEC Thailand)
Software Park Thailand: A government agency under the National Science and Technology Development Agency, it was established to stimulate the development of the Thai software industry. It has also maintained a close association with the private sector. (Source: Software Park Thailand)
Startup Thailand: A national organization that was established to support and promote Startup and Startup Ecosystems in accordance with the policy of the National Startup Committee (NSC). The Ministry of Science and Technology is the primary responsible unit for Startup Thailand. (Source: Startup Thailand)
Thailand Board of Investment: Aims to promote investment in Thailand and Thai overseas investment to enhance Thailand’s competitiveness, to overcome the “Middle Income Trap” and to achieve sustainable growth in accordance with the sufficiency economy philosophy. (Source: Thailand Board of Investment)
Chulalongkorn University - CU Innovation Hub (Bangkok): Through research, education, competitions and activities, the center is responsible for developing the creativity, critical thinking, and entrepreneurial skills of CU students and personnel, and distributing innovative ideas for the benefit of the society and economy. (Source: Chulalongkorn University - CU Innovation Hub)