I have just received a LinkedIn InMail from someone who has been researching on the Taiwan startup ecosystem. And he asked me several pretty interesting questions. So instead of just responding to him, I would write my answers here.
1. The Taiwanese government has been aiming to become the next Asian Silicon Valley in Taiwan. How do you see the development of the Taiwanese startup ecosystem in the next 5 years?
Your guess is as good as mine. I am not very good at predicting the future. However, what I can observe are the following:
- The OGs (being the startups or ecosystem players) who started the whole Taiwan startup ecosystem have matured and as a result, have either evolved into the next level of success or started doing something else. This means they have very different needs now. I have seen quite a few joining the big corporate world too.
- It is much harder to start a startup now compared to say 5 years ago.
- Funding is still going to be a huge issue for Taiwan startups, especially in relation to attracting foreign capital. This will probably not change in the foreseeable future both because of the entire startup funding is drying up globally and the Taiwan capital market is closed and unpredictable.
- We are seeing the lagging effect of the government (who usually responded to the market about a few years late). After major spending from the key ministries, we are seeing cities are now pouring money into this. I would refrain from saying they are pouring money into the startup ecosystem though because of the way these programs work in Taiwan.
- In Taiwan, most of these government spending is carried out by NPOs (e.g. ITRI, III, TCA, etc). Whilst there is nothing wrong with these entities per se, in fact most of them are very good at executing these programs, these programs have to be driven by very fixated KPIs in order to avoid potential criticism from the public (after all, it’s taxpayers’ money). Therefore we are seeing very few strategic initiatives, rather, we are seeing many direct copies of existing programs (if it has been done, it must be ok) and infrastructure development (buildings, i.e. “innovation parks” and co-working space). Together with point 1, this creates a big problem. Overall, there is a lack of coordination amongst these programs and investments and there are significant overlaps. This is not about the waste of spending, in fact, over spending is necessary at this stage. The problem is that it creates confusion amongst the new group of entrepreneurs. Most of all, which is not mentioned often enough, these investments kill the “free market” which needs to exist within the startup ecosystem.
2. Universities are an important segment of the startup ecosystem. How does the university impact to the ecosystem? What value gives to?
Tech transfer and commercialisation of R&Ds are very well understood topics, it simply got revived in this latest wave of entrepreneurship push. The real question that needs to be asked is how is it different this time? What is everyone so excited about this time around? If the Internet is a big part of it (therefore the B-C angle), how is this relevant to all the deep techs in universities that are more relevant to the B-B angle?
3. How do we create an entrepreneurial mindset/culture housed in a university “academic culture” environment?
Entrepreneurial mindset/culture is always a good thing to have but we must be careful not to create a thinking that professors should be more encouraged to create new businesses. Research is something that I highly respect and it plays a key part of human development (academic culture is great!). Professors, at least most of them, should focus on this (and/or education). Having said that, what we should do is to create an environment that is more friendly for professors who have already committed and are ready to start a new venture. To me, that means joining forces with external parties, rather than building everything from scratch. Venture building works best in this setting.
4. What do you think that the difference between entrepreneurial university and common university? In some studies, the future successful entrepreneurs born the universities that have been created an incubator program and entrepreneurship culture.
Universities should be doing research and education. Having incubation centre is a good idea but if we force it mindlessly to all universities, it is a bad mistake. Also, the nature/nurture issue of entrepreneurs is called into question and that itself is a complicated topic.
5. Is it possible to create a mini startup ecosystem in a university environment or campus? How? There is have students, researchers, some service organizations (convenience store, printing, food, etc.), corporates (bank, post, computer, and electronic companies) and advisors on campuses. It seems like a mini-ecosystem.
The key is, what is an ecosystem? Many people confuse the ecosystem with a pool of loosely organised resources. An ecosystem is about giving back. If there is no capital and knowledge (of course the willingness) to give back, there is no ecosystem. So we need more success (and no, counting unicorn is not a solution). This goes back to the point where the Taiwan government needs to enable a free market within the startup ecosystem. By continuously giving out subsidies and other free resources will actually stifle any ecosystem.