Deepak’s View on HK Startup Ecosystem: No Hype HK
No Hype HK – by Deepak Madnani, Paperclip Startup Campus
Startups, you’re not validating fast enough. Stop fund raising until you have validated. Stop attending useless events and start talking to customers. Don’t call yourself a startup unless you’re talking to at least 20 customers a week. If its not challenging you, you’re not growing as an entrepreneur; fundraising doesn’t count as a challenge, but finding your core value proposition is.
Investors, where are you? Sorry, who are you? Are you meeting startups regularly? Are you actively advising and working daily to improve the quality of the startups regardless if you are investing in them or not? Are you actively sharing your network? Are you taking risks on entrepreneurs who need support and allowing them to ‘fail forward’? Stop looking at their Profit and Loss statements, or if they have shown up at your premises or stop treating them like a real estate investment, and start looking for validation. Your job is funding and guidance. If they have traction and succeeding, work hard on getting them to Series A, so use your network. Build a network if you don’t have one or don’t start investing till you do. If you don’t know how to work with entrepreneurs, then find people who do know, get out of the way and start observing and learning. Smart, startup friendly money is what we need.
Corporates, the eco-system isn’t here for your light touch, zero risk tolerance, CSR & marketing budgets. We need your brainpower and resources to help validate and advise. Oh, and you need this too! Open up so startups can test and learn because you are structurally not designed to disrupt your business model, but to protect it. It’s ok but means you need a radically different approach, and corporate accelerators today are still not the solution. Ask yourself, could Uber have come out of a corporate? Even the language you use isn’t helpful for startups mainly because we don’t know our markets and we operate lean, with no budget, so under a totally different mindset. Us entrepreneurs have bet our livelihoods, homes, families, incomes on the future; this is where real innovation is happening and why everyone is calling you a dinosaur. Show your commitment because we will either be your customer in ten years or be your bosses – you decide but decide purposefully.
Government, please don’t mix up politics with innovation. The future of Hong Kong has spoken loud and clear last year. They are smart, talented, motivated and frustrated. They can help you if you let them. You’ve done a super job in the past in supporting SMEs. Your current efforts at supporting innovation are much too conservative and are not designed to support startup risk. HK has a hyper efficient infrastructure or is simply as I like to call it, ‘one big office’. Open it up for experiments. You already know how to deploy capital to support small businesses on a large scale. We need your brainpower and experience to do the same for early stage innovation via grants, investment support and work with the smart players who are investing their time and money doing some of your job. You are rich. You have made mistakes, so that means you have a lot of learning to share! Don’t stifle innovation further as you have run out of time. The shared economy, smart city, IOT, Fintech, blockchain, drones and other innovations are here to stay. We always want things cheaper, better and faster so support the talent that you have around you and it will directly benefit the future.