On the flip side, supporting later stage companies increases chances of profitable exits and financial success. Just as in nature, the evolutionary process doesn’t offer guarantees. As organisms evolve, they get stronger. Drawing parallels, thousands of teams begin a journey, that only the best-equipped and agile will survive. As incubators in a medical lab offer optimal conditions for growth, collections of specialised organisations now exist in the business world offering supporting services needed to thrive. Together with the entrepreneurs, they form the Startup Ecosystem or community. Today Hong Kong’s FinTech Startup Ecosystem can best be described as infant. According to FinTechHK data, there are some 46 fintech startups in Hong Kong, with 28 fintech events and 2 recently launched accelerators. How well supported are these companies and how can an integrated approach improve their odds of success.
Helsinki is considered one of the world’s leading tech cities producing innovative companies and teams of global renown. By way of an example, in recent work done by Grow Advisors with the City of Helsinki, it is estimated that from a total of 25,000 ideas among 2,500 teams, 10 companies valued at US$1billion were eventually created. Additionally, the data shows us how many startups drop out at each development stage (by sector), which services were the most supportive and effective, and which were under or overused.
If there is a growing offer from accelerators, who is assisting with developing ideas and teams at early stages and ensuring follow-through? Investing at the beginning of the innovation funnel is often expensive and time consuming, it also offers no immediate ROI. That responsibility often falls under the remit of local government and public funds. In work done by Grow Advisors for the European Union as part of the EU2020 Project, one of the biggest challenges is adapting the front-end of the funnel to ensure there is enough local talent to be ‘incubated and accelerated’ at subsequent stages. It’s an important challenge and one that affects many tech communities around the world. Business schools for example, teach how to run companies yet rarely teach how to create them. Universities innovate through R&D yet the handover to create new companies is often not very efficient.
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A Grow Advisors article originally produced for FinTechHK