Last week, I read a recent report from the IMF that underscored the rapid economic growth taking place across Asia right now. According to the report, Asia has the most countries of any region in the “Top 10” for GDP growth this year (including Cambodia, Laos, India, and Vietnam). Some of this growth is no doubt due to China’s Belt and Road Initiative, but much of it is also coming on the back of a rapidly rising middle class across the region. For the entrepreneurs out there, this economic growth will unlock a lot of new markets in the near future. For the foreseeable future, Asia is the place to be if you want to take advantage of the many new opportunities being created here.
If you’re going to be starting up a new business in the next year or so, I’d recommend basing yourself in one of the cities on this list – especially if your venture is focused on Asia.
1. Shenzhen, China
If you’re an entrepreneur of any type, Shenzhen is the place to be right now. This city already has a vibrant community of makers, startup founders, and investors, and it’s recently become a hub for anyone wanting to get involved in robotics and AI.
The startup scene in Shenzhen is truly diverse. If you’re into software and web apps, there are startup incubators like x and x to provide advice and support. Interested in bringing your hardware idea to life? Firms like x.factory and HAX are 100% focused on providing a space for makers to work on new hardware projects, iterate on them, and receive expert advice along the way. There’s also a great community in Shenzhen, with organizations like Global From Asia making it easier than ever for founders to get started in the region. Shenzhen is ideal for hardware startups because it’s a central node of the global manufacturing ecosystem, and cost of living is relatively low. As an added bonus, it’s just across the border from Hong Kong, making it easy and convenient to travel throughout the region.
This trend is set to continue, as Shenzhen will be hosting its globally-renowned Maker Faire later this year and For more insight into why Shenzhen is ideal for founders looking to start up a hardware venture, I’d recommend checking out James Giancotti’s piece on the topic.
2. Da Nang, Vietnam
As the less-developed sibling of Ho Chi Minh City (Saigon) and Hanoi, Da Nang has historically been overlooked as a startup hub, but things are rapidly changing as the country continues to open up to outside investment and develop its infrastructure in second-tier cities. There’s a fast-growing startup and creative scene here that’s been bolstered by the numerous cafes and co-working spaces popping up throughout the city. The Vietnamese government is focused on turning this city into the “startup hub of Vietnam”, and to that end, several startup incubators have recently begun accepting the first few rounds of applicants.
Even tech heavyweights like IBM and Apple are beginning to set up R&D outposts here, owing to the city’s glut of affordable tech talent. Obtaining a long-term visa to Vietnam is becoming easier each year as well – something to consider as countries like Thailand make their visa policies increasingly arcane and difficult to interpret. And on top of all of this, Da Nang is situated along the beautiful coastline of southern Vietnam, and opportunities for outdoor activities are abundant.
3. Taipei, Taiwan
Taipei isn’t quite the bustling center of trade that its neighbors Hong Kong and Shanghai are, but it’s an ideal place to bootstrap your business. Always important for entrepreneurs, Taipei has a low cost of living and a low-tax environment – but it also has a nascent startup scene thanks to government initiatives like Taiwan Startup Stadium and private incubators like Garage+.
Taiwan’s visa policy is also fairly relaxed relative to China, as most entrepreneurs with western passports (US, UK, Australia and the like) can get 90 days visa-free on arrival. Extending that timeframe can be done easily with a visa run, and it’s even possible to obtain residency if your company happens to be incorporated there.
The food in Taipei is delicious and cheap, and quality of life here is regularly ranked as among the highest in the world. If you’re looking to explore North Asia further, this is a great hub to do it from, with low-cost flights to most major destinations within the region. And Taiwan itself is easy (and fun) to explore as well, with an extensive high-speed rail network spanning the entire length of the island.
4. Tokyo, Japan
Tokyo has long been a massive business hub, but recently it’s become more open to startups thanks to increased availability of VC funding and an immense amount of business deregulation happening all at once. Organizations like 500 Startups Japan are also helping foster the startup ecosystem here with additional VC funding and startup expertise. One of the biggest recent changes for entrepreneurs is that it’s now easier than ever for entrepreneurs to obtain a visa, and the Tokyo Metropolitan government has truly streamlined the process.
There are now more startup hackathons, pitch sessions, and conferences happening in Tokyo than ever before, and the entrepreneurial energy one feels in the city these days is palpable. All of this is indicative of the fundamental changes going on in Japan’s business environment – and they’re for the better.
Side note: if you’re interested in learning more about the current state of Japan’s startup ecosystem, I’d highly recommend listening to this episode of the excellent Analyse Asia podcast, which is a conversation with James Riney, Head of 500 Startups Japan.
5. Ubud, Bali, Indonesia
Bali has always been on the radar of digital nomads and entrepreneurs, so this may be the most “cliche” entry on this list, and it’s for good reason. Bali has a thriving startup scene, and it remains a great place to go for creative inspiration. Personally I’d recommend sticking to Ubud, which is more laid-back and has quality co-working spaces like Hubud and Roam.
Despite the recent influx of tourists and remote workers, cost of living has remained low, and this remains one of Bali’s biggest draws (in addition to its abundance of outdoor activities available). If you need to travel within Southeast Asia, Bali is a great hub for doing so – but if you need to travel further afield on a frequent basis, I’d recommend somewhere like Manila or Bangkok for your home base.
As time goes on and new markets continue to develop in Asia, I’d expect to see other cities become new hotspots for startups (Yangon and Phnom Penh come to mind), but for the next year or so, these five cities are likely going to be the best places to get involved in Asia’s startup scene and take advantage of the many opportunities available for entrepreneurs in the region.