According to BCG – Boston Consulting Group report, in the vibrant landscape of Southeast Asia’s startup scene, Thailand has often found itself overshadowed by its neighboring countries. Despite being the second-largest economy in the region, Thailand has witnessed fewer high-profile startup exits in recent years compared to countries like Singapore, Indonesia, Vietnam, and the Philippines. However, a shift in investment preferences and the government’s newfound emphasis on a digital economy might soon propel Thailand into the spotlight.
Highlights of the Report:
Changing Dynamics and Investment Appetite
Thailand’s startup ecosystem is poised for transformation, driven by a changing investment landscape that favors quicker paths to profitability. Additionally, the government’s commitment to fostering a digital economy adds momentum to the country’s startup potential. While Thailand may have lagged behind its Southeast Asian counterparts, its structural strengths and untapped potential could soon pave the way for a revitalized startup environment.
Key Strengths of Thailand’s Startup Ecosystem
- Large Economy with High Spending Power: Ranking second in GDP and third in GDP per capita among ASEAN-6 nations, Thailand boasts substantial spending power, driven by exports, manufacturing, and tourism. The backbone of its economy comprises SMEs and family-owned enterprises.
- Robust Connectivity Infrastructure: With the fourth-largest population in Southeast Asia, Thailand’s connectivity infrastructure is robust. The majority of the population has internet access, making internet usage extensive.
- Government Support and Media Engagement: The Thai government actively supports the startup ecosystem through various initiatives. Media outlets, large companies, and communities contribute to the ecosystem’s growth.
- Diverse Funding Sources: Thai startups benefit from diverse funding sources, including Corporate Venture Capitals (CVCs), Venture Capitals (VCs), and angel investors. Notable VC, 500 TukTuks, has been actively investing in early-stage startups.
- Community Building and Events: Thailand hosts a myriad of startup communities and events, fostering connections and knowledge-sharing. Platforms like Techsauce, Startup Thailand, and True Digital Park play pivotal roles in community building.
- Accelerators and Incubators: Local accelerators, both corporate-driven and sponsored by governmental bodies, play a crucial role in identifying and nurturing startups aligned with their values.
- Technology, Infrastructure, and Platforms: Equipped with strong digital and connectivity infrastructure, Thailand’s government introduces platforms like digital ID, electronic payment, and open data, supporting innovation in the digital economy.
- Regulations and Policies: Government agencies like DEPA, NIA, and BOI lead in startup support, emphasizing early-stage startups, innovation, and foreign and domestic investment.
Challenges and Opportunities
While Thailand has approximately 180 startups securing funding, the figure is modest compared to other ASEAN-6 nations. Despite its economic stature, the startup scene appears underrepresented, indicating vast untapped growth opportunities. Seed funding scarcity, limited local investors, and competition for regional funding contribute to the challenges. However, this landscape presents ample opportunities for exploration and growth, requiring adept navigation of the country’s economic landscape and leveraging its inherent strengths for expansion.
In conclusion, Thailand’s evolving startup ecosystem holds promise, and as the government and stakeholders continue to foster growth, the country’s entrepreneurial spirit may soon shine on the global stage.