Accelerator programme to give business an IT focus
08 October, 2014
Hong Kong Economic Times
Swire bolsters tech startups by launching free business platform without requesting equity in return
Startups have emerged and grown in Hong Kong in recent years, and this has become a trend. The number of coworking spaces – the cradle for startup entrepreneurs – has almost doubled in a year.
Now Swire Properties the property developer, is also eager to give startup businesses a chance. Their blueprint accelerator programme was launched with the support of Chief Executive Martin Cubbon, who himself represents this programme as a mentor.
The programme will support ten tech startups for six month rent free, and there will be no equity taken in return. It will also provide a co-working space at low rent, with the hope of bringing a new high-tech and innovative image to TaiKoo Place, further strengthening this business district which is already home to many technology and creative companies.
blueprint is an initiative that stemmed from Cubbon’s strong interest in the technological developments that have taken place in recent years. He set up an internal committee early this year, the Digital Taskforce, to work with staff members in different departments and explore how Swire Properties could benefit from technology. Charlie Melvoin and Henry Bott, two millennials respectively from the US and the UK who graduated from Swire’ Management Trainee Programme, captialised on their overseas experiences and proposed the idea of designating available office space for tech startups and thereby creating an environment for innovation. This received internal support, allowing the concept to take shape.
The two millennials in charge of implementing blueprint identified two floors in Cornwall House, TaiKoo Place, which have a total floor area of 20,000 square feet. One of the floors is to be occupied at no cost by ten startups selected into the accelerator programme, whilst the other floor is set to become a shared working space that can accommodate up to 300 tech startups at any one time – each may rent the facility at $2,000 per month.
“Similar to ArtisTree, which is a space specifically for art and cultural services in the community, blueprint is conceived as a platform to bring technology entrepreneurs together,” said Charlie, who worked for Baidu and Groupon in Beijing before joining Swire.
Gathering entrepreneurs in one shared working space
This accelerator programme is attractive in many ways. Swire not only provides free office space for the ten B2B (Business to Business) tech startups, but also requires no equity in return. The startups may even have the opportunity to test their tech products within Swire’s various business networks. Shortlisted overseas companies will be awarded free air tickets to Hong Kong.
B2B tech startups are the programme’s chosen targets because incubators for such companies are rare in Hong Kong. There are no fixed criteria for eligible startup applicants in terms of business operation and development stage. Moreover, applications are not just open to Hong Kong companies.
“Through attracting B2B tech startups, Swire becomes their mentor, advisors and even potential customers,” said Charlie, who also pointed out that any companies involving in data management, cloud services, storage, communication and staff management solutions may apply to the programme as long as their target customers are other businesses.
“Retail products can be tested in Swire’s shopping malls, while those that relate to hotel management can be tested in Swire’s hotels. Swire may consider investing in or acquiring such products if they turn out to be profitable.”
Charlie explained that the programme follows the existing model of its British and American equivalents, which is why the number of startups is set at ten. “There would be a certain degree of diversity among this community of ten. Besides, from a realistic point of view, we cannot accommodate more than ten if we wish to provide effective support and resources to each.”
Top executives and entrepreneurs as mentors
blueprint may be the first accelerator programme in Hong Kong with no strings attached. Swire has recruited experienced people from overseas, including an incubator programme expert formerly employed by the famous European Seedcamp investment fund, to form a team to assess applications and operate the programme. Swire’s top executives including Martin Cubbon and Patrick Healy, Managing Director of Swire Beverages, along with top executives and entrepreneurs from different business sectors, will also be mentoring programme participants. Charlie pointed out that the business title of a mentor is not the only criterion for recruitment; Swire also took into account a mentor’s personality and support for blueprint’s vision. “We do not have to hard sell. The CEO is very excited about the programme, and many management staff members are also actively involved.”
There are currently 53 mentors including Sam Gellman, General Manager for Hong Kong of the ridesharing service company Uber; Rui Ma, partner of business incubator and seed fund “500 Startups”; and David Zhu, founder of Divide – a Hong Kong mobile business management software developer that Google acquired. “There are CEOs of large corporations alongside startup entrepreneurs in the network, and the number (of mentors) will continue to grow.” With such attractive terms for startups, the two millennials hope to “inspire talented people and provide a new environment for businesses.”
Changing culture with support of large corporations
An earlier survey by Google indicated that there has been nearly 30 percent growth in the local startup eco-system since 2009 in terms of startup communities, co-working spaces, accelerator programmes, and fund providers. The two young millennials frequently participate in entrepreneurial activities in town. They believe that the future for startups in Hong Kong is promising and look forward to transforming how local people think of starting a business.
“It is said that, in Hong Kong culture, young people are encouraged to look for a stable ‘good job’ and are afraid of starting their own ventures. This is a problem that Swire wants to address. If a business plan is supported by a well-known large corporation, then it would be easier for the entrepreneur to convince him/herself and the family of the decision to go into startup business. With blueprint, you will find yourself affiliated with a large corporation regardless of how your company fares,” Charles said.
Henry cited a study stating that young professionals in the past who received educated overseas could be under the pressure to take over their family businesses or to enter large corporations when they returned to Hong Kong. This kind of pressure, however, is decreasing nowadays.
Swire’s blueprint co-working space is located in Cornwall House, TaiKoo Place, and is available on a monthly membership fee of $2,000.