Why you should be setting up shop in Hong Kong
Fast becoming Asia’s answer to Silicon Valley, William Berry discusses how the emerging business hub could work for your business
Hong Kong is fast becoming Asia’s answer to Silicon Valley, luring entrepreneurs from across the world.
In the past four years, 200 start-ups have relocated to HK, with those from the US, France and UK leading the charge and a growing number of firms are opening HK subsidiaries. They’ve discovered an environment geared toward up and coming tech firms, offering unparalleled access to the Chinese market and manufacturing hubs, as well as UK common law, high education rates and low tax.
As a global city where English is widely spoken, HK offers a raft of benefits for businesses with the clear intention of bringing more to its shores.
Access to markets
The most blatant advantage of Hong Kong is its access to mainland China; the world’s second largest economy. With a population of 1.3 billion and a rising middle class eager to buy western products, China is a crucial market for innovation in the consumer technology sector. Disruptive technologies in the healthcare and lifestyle sectors are being particularly well received, as these areas are currently top priorities for Chinese consumers. In addition, HK is a booming market of its own, attracting 54 million visitors last year, many of whom come just to shop.
Through InvestHK, the government’s scheme set up to encourage foreign direct investment into Hong Kong, start-ups and growing firms are receiving an enormous helping hand. The organisation’s StartmeupHK Venture Programme this year awarded a £500,000 prize pool to six winners (among them a UK business) that included professional services, mentoring and work space provided by corporate sponsors.
In response to the growing business market, other avenues of funding and support are opening up. Nest, an early-stage venture capital firm, and AIA, one of Asia’s largest insurance providers have teamed up to launch AIA Accelerator, which will help fledgling Hong Kong businesses grow.
According to the World Bank’s annual Doing Business report, HK is one of the best economies in the world for conducting business. A low and simple tax regime is a major draw card, while the government offers extra incentives, including interest-free loans and subsidised rent. Among the many other benefits are laws protecting minority investors and the ease of trading across borders, dealing with construction permits and setting up a business – a company can be created and registered within 24 hours.
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Going hand in hand with a simplistic business environment is the peace of mind offered by HK’s rule of law that protects your design. Contractually, it’s a safer place to protect your work from copycats by keeping a firm grip on your IP.
While in its infancy as a business hub, HK is undoubtedly on the map as a thriving centre for innovative commercial development. The city’s credentials are becoming common knowledge and the more new businesses that make the move, the better the experience will be for all.
For all of these reasons it may be time to consider HK as the new base for your venture.
William Berry is a serial entrepreneur and in 2006 was named a Young Gun by Growing Business. He is the founder-director of accommodationforstudents.com, and Vincentbond.com. William is also CEO of the new video start up p6.com, based in California.