“We believe that we can learn from and collaborate with one another in developing effective solutions with global significance,” said John C Tsang, Founder of Esperanza as he kick-started the webinar on EdTech opportunities in Greater Bay Area (GBA).
John gave a brief introduction of the GBA, which comprises the two Special Administrative Regions of Hong Kong and Macao, and the nine municipalities in Guangdong Province. It is the world’s 11th largest economy ahead of Russia, and behind Canada). The region has a unique mix of finance, manufacturing, innovation, and logistical capabilities, and is fast emerging as an international tech and innovation hub.
Panel 1: Socio-Economic Development of the GBA and Opportunities for Ed Tech Business.
The panel moderated by Eric Chan, Chief Public Mission Officer, Hong Kong Cyberport took a deep dive into EdTech opportunities in GBA, market entry strategy and tips for startups.
Laura Shi, Executive Director, Investment at Greater Bay Area Development Fund Management Limited believes that the innovation education resources present in Hong Kong combined together with high-level manufacturing in Guangdong represents the support that GBA has given to companies like DJI and SenseTime, making them world-famous unicorn companies. She also pointed out the numerous financial channels in the region, making it very attractive to startups and global institutional investors even under the current economic environment.
“It’s always a right move to start from Hong Kong” said Laura, who specializes in investment, advisory and asset management for companies.
Catherine Tsang, Partner – Tax & China Business Advisory Services at PwC Hong Kong gives examples of major infrastructure developments in the GBA such as the Hong Kong Shenzhen Technology Cooperation Zone that will make it a major global powerhouse with a diverse set of priorities and technology innovation. She added that the municipal governments in the GBA have also introduced corporate tax incentives to qualified businesses.
“Hong Kong being an international financial center will take up the role of providing the platform for investment and financing!” states Catherine.
Ming Kwok, CEO, Founder of Trumptech Group emphasizes the focus Asians put on education, spending lots of time and effort to make sure their children are successful.
“In many cases, children are not educated by very good teachers. That’s why, the EdTech market can solve this inequality in having better education opportunities and parents are willing to pay for it.” In this connection, Ming mentioned that many middle class families in China are prepared to spend RMB 2000 – 5000 per month on their children’s education.
Ming iterates that EdTech companies should start in Hong Kong as a test bed for the China market, where the education system is one of the best in world. “Hong Kong is a good experiment ground to test the market and understand the schools and parents of your tech before you move to Mainland China,” concludes Ming who has been an EdTech advocate for 20 years.
Joe Lam, Managing Director at Pearson Greater China and India Hub, who is active in cultivating digital transformation in education and emphasizes on the unique combination of hardware and software in the GBA. He highlighted 3 key success factors for edtech startups:
- An innovative business model: The way companies innovate and drive the customer to purchase the services will help them to scale.
- Payment models: Modes of payment that are extremely flexible in China. For e.g. Alipay, WeChat pay, making people’s purchasing easier and bigger.
- Good user experience
Joe pointed out that Shenzhen is made up of immigrate families. Their income is higher and also are more receptive to new product offerings.
The panel concludes with a legal perspective provided by Eunice Chiu, Partner, Disputes Resolution , Oldham, Li & Nie, Solicitors. She said “Hong Kong is a great launchpad and gateway to the GBA area because it provides lots of legal resources” in terms of arbitration and IP protection. And it is not just about China, as Hong Kong is also one of the major international arbitration centres.
Panel 2: GBA as Product Development Supply Chain Management Hub
The panel, moderated by Derek Kwik, Managing Partner, Brave Soldier Venture Capital focused on the unique contributions of the inter-connected GBA cities.
“There is a lot of help you receive with respect to design, prototyping, putting a product together and finally putting it out to market globally within a very short amount of time!” he said.
The panel begins with Stanley Zou, Project Director, LKKER SCM. His company specialized in prototyping and low volume production. He draws learnings from 2 product examples to talk about the difference between rigid vs. pseudo demand for products.
Kevin Brisebois, Director of Sales & Corporate Partnership, Brinc highlights the relevance of a centralized supply chain in the GBA region and how it can accelerate the time to market for startups. He pinpoints that having suppliers in Shenzhen that are within 30min away and then being able to pull components in a factory in Guangzhou 1.5 hour away is a compelling advantage.
“Through the 9 different cities, you can find everything in one place – especially for companies that are combining both hardware and digital solutions.”
Supplementing Kevin’s points, Chadwick Xu, Co-Founder & CEO, Shenzhen Valley Ventures Build reiterates that having synergy between the main GBA cities can create a huge opportunity for companies.
He continues to share that Hong Kong and Shenzhen both serve as a technological transition hub between China and the rest of the world.
“This is why a lot of corporates are setting up their innovation offices in Hong Kong and Shenzhen especially.”
In conclusion to the panel, Winson Kwok, Co-Founder, Corporate Hub Limited, suggests companies to start their first structure in Hong Kong, then set up their company in GBA (specifically Shenzhen).
“Lots of organizations like Cyberport and Hong Kong Science & Technology Park support startups in Hong Kong to get partners and products from Shenzhen and outside.”
Talking about the hot edtech trends in China, panellists believe immersive experience, coding and English language learning are some of the fast growth areas.