Startups Eyeing Southeast Asia: Key Considerations to Ponder Before Expanding (Part 2)
Tuesday, 25/04/2023 20:00 (GTM +7)
Take advantage of local human resources
The quality of human resources in Southeast Asia is improving, for example:
- Vietnam: In 2020, Vietnam’s Human Development Index (HDI) was ranked 110 out of 189 countries and just behind Singapore in Southeast Asia, where the unemployment rate in urban areas is always below 4%. (*)
- Singapore: with an average growth of 3% per year since 2015, labour productivity per capita has reached $170,000 and is among the top in the world by 2020. (**)
- Malaysia: promulgates the national strategy on university education for 2015-2025 with all domestic departments to build an international education centre.
Therefore, startups conformally give human resources policies such as salary, benefits, and promotion. According to Aon, wages across Southeast Asia are forecast to increase by nearly 8% in 2023.
Singapore is a typical country in this region, focusing on and offering special benefits for employees in 2023 when 7% of organizations offer flexible working hours. 10% of businesses are willing to take employees’ Fridays off as a privilege.
Singapore firms face a war to hunt talent
Online Branding
In Southeast Asia, the Internet is booming. It is predicted to double to $363 billion by 2015 and far outstrip the previous forecast of $300 billion (according to Google, Temasek Holdings Pte, and Bank). & Co), in which e-commerce, tourism, food, transportation, and communication are the leading sectors.(***)
Since Covid-19, Southeast Asia has recorded changes in consumer behaviour and online business got Southeast Asia into the “digital decade”, in which spending on Online shopping gained 49% and reached 174 billion USD in 2022 (Bloomberg).
Southeast Asia consumers turn to online shopping amidst the COVID-19 pandemic
Southeast Asia’s booming internet economy will double to $363 billion by 2025, far exceeding the old forecast of $300 billion, according to a study by Google, Temasek Holdings Pte., and Bank & Co. implementation coordination.
- In the first half of 2021, investments in Southeast Asia Internet companies totalled 11.5 billion USD, nearly 11.6 billion USD in 2020. Some of the most valuable technology startups, including Grab and GoTo, are preparing to Initial Public Offerings (IPO). (***)
- Indonesia is Southeast Asia’s largest digital economy, with the value of online shopping forecasted to double to $146 billion by 2025. Venture capital deals in the first half of 2021 surpassed the total of 4 years ago. (***)
- However, Vietnam is expected to experience the strongest growth in this region, with the GMV of the digital economy forecast to triple in the next four years.
Therefore, taking advantage of the above potentials for online branding and business plays an important role for startups.
Local product personalization
Nowadays, personalization plays an integral role in the buying process, and startups need to build databases and technology applications efficiently and highly interactively.
- Netcore Cloud Solution aims to be an important step forward in Vietnam and Southeast Asia with personalized product & solution based on science and data that enhances the difficult user experience.
- Geniebook – an Edtech enterprise that replaces the traditional learning model with AI technology and provides a suitable learning path for each student’s achievement, which gives an experience of learning through play.
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