Silicon Dragon Meets Singapore

I've managed to squeeze in an entrepreneurship talk in Singapore! Here's the details. Thanks to the Entrepreneurship Centre at the National University of Singapore for hosting the event.

NUS Entrepreneurship Centre
(divison of NUS Enterprise)
Presents

Title : "Emerging Tech and Venture Investment Trends in Asia”
Speaker : Ms. Rebecca A Fannin
International Business Journalist
Author of Silicon Dragon (McGraw-Hill, 2008)
Date : 3 March 2010 (Wednesday)
Time : 6:00pm - 8:00pm
Venue : National University of Singapore
University Hall Auditorium, Lee Kong Chian Wing Level 2, 21 Lower Kent Ridge Rd
Please click HERE for campus map

Registration : Admission is FREE
Please register your details HERE by 3 March, noon
Seats are limited so please register early to secure a place

Program : 5:30pm – Registration
6:00pm - Emerging Tech and Venture Investment Trends in Asia by Rebecca Fannin
6:45pm – Panel Discussion
• Moderator, Prof. Wong Poh Kam Director of NUS Entrepreneurship Centre;
Chairman of Business Angel Network (SEA) Ltd

• Michel Birnbaum, General Partner, iGlobe Partners

• Neo Kok Beng, Co-Founder, President & CEO, AWAK Technologies

• Dr. Jeffrey Chi, Vice President- Investments, Vickers Capital Group

• Rebecca Fannin
7:30pm - Networking and Refreshment

Mobile, Internet, e-commerce, gaming, biotech, cleantech – they’re all booming in the emerging markets of Asia. Some startups with venture funding in these spaces have already scored successes with public listings at high valuations and acquisitions. Others are poised to return profits to their investors as the IPO window begins to open. Startups in Asia scale and get to profitability quickly. The region’s rapid economic growth and switched-on digital communications markets provide the spark for successful entrepreneurship and innovation. Rebecca Fannin, author of Silicon Dragon and a columnist with Forbes, discusses the emerging trends she sees from dozens of recent interviews with entrepreneurs and investors in China, India, Vietnam, Hong Kong and Singapore.

Silicon Valley Takes Off its Blinders

It’s taken a long time, but Silicon Valley has finally taken off its blinders and recognized that there are other tech clusters out there. Today, nearly every venture capital firm along the famed Sand Hill Road is in China, India – or both. Bring up the topic of Asia tech today in the Valley, and it’s no longer an instant conversation stopper.
It’s with good reason that Valley investors are no longer in denial. Chinese and Indian startups offer venture investors an opportunity to cash in big. Over the past four years, 14 Chinese tech startups have gone public with market valuations of more than $1 billion on the NYSE, NASDAQ and the Hong Kong Stock Exchange. That compares with 11 tech startups in the same league from the U.S. India, meanwhile, is coming up fast, with recent bull runs and acquisitions of its Internet and mobile communications startups.
Venture capitalists may be optimists but they look at hard numbers to gauge where to place bets. An analysis recently shared with me by a top-tier venture firm made this telling point: it takes 12 times more dollars and five times more deals to generate the same investment returns from U.S. startups as it does with China startups.
Talk of Asia tech is no longer a turn-off in the Valley for another key reason – China and other Asian upstart nations are emerging as innovation powerhouses. Consider that China moved to 6th in the world in 2008 – up from 10th place just three years ago -- for the number of new patents applications, with a Chinese company, Huawei Technologies, in the lead spot last year among all corporations globally. Moreover, India too is in the running, and already ranks third among developing countries on the patent scale.
So it’s little wonder that these two giant Asian economies also capture the bulk of venture capital investment in Asia. In fact, China weighed in with 41 percent of the $23 billion that venture capitalists invested in the region last year, while India captured 38 percent.
Now I’m not saying that Asia has a lock on future innovation. Far from it. In fact, the U.S. still reigns as the biggest patent force in the world – with about one-third of all new patent applications. And the U.S. remains the biggest venture investment market globally, too – with nearly $29 billion invested in startups businesses in 2008.
But as innovation goes global, the U.S. lead is being chipped away. Suddenly, the talk is about whether Silicon Valley still has “legs.” Sure it does, but America’s share of global investment has slipped to 68 percent of $42 billion in 2008, from 71 percent in 2005.
The venture capital business in the U.S. now faces a low point. Investment returns have dropped by 58 percent, as few startups go public or get acquired in the tough economy. Venture firms are downsizing, and the industry is in meltdown as fewer players can raise new funds – with their own investment backers such as the giant pension funds struggling with massive declines in net assets.
The silver lining of this downturn is that it’s a good to invest. Microsoft and Apple came out of the mid-1970s recession, and major new tech brands will emerge from this bleak period too. Just don’t be too surprised to see some of tomorrow’s new brands developing from China and India.
China and India already have passed the copycat stage – where Chinese and Indian versions of eBay, Google, Monster, Yahoo, Amazon, Travelocity, Facebook and MySpace were launched. China’s trading site Alibaba and the $3,000-priced Tata Nano car are but two examples of Asian brands that have global impact. Now, investors from Silicon Valley are looking not just to the U.S. tech hotspots but also China and India to generate the next double-digit investment returns – from clean tech and biotech to new types of ‘killer aps’ on mobile phones.
The stakes are high. Just consider this one fact alone: superstar startups Microsoft, Apple, Google and Starbucks created 10 million jobs for the U.S. economy. Today, technology from China and India is an engine of their own nation’s growth – one more indication of a shift in economic power to the east. – Rebecca A. Fannin

Taiwan Tech Tour-Hsinchu

I've recently returned from a wonderfully productive trip to Taiwan, where I had the opportunity to check out what this island nation is contributing to our tech future.
Not only did I meet with CEOs of some of the leading technology companies in Taiwan--semiconductor giant UMC, networking equipment company D-Link and PC maker Inventec-- but I also had the chance to interview several entrepreneurs of up and coming companies.
Did I find much original breakthrough technology? Some. Indeed, the venture capitalists that I interviewed--from YK Chua from WI Harper and Ben Yang from Pacific Venture Partners--are finding it difficult to find new startups to support financially. Many venture capitalists in Taiwan have started to invest in deals across the straits instead, in Mainland China. Still, I did get to visit with two entrepreneurs who claim they have breakthrough discoveries in the field of light-emitting diodes.The first, photographed here, is Jeffrey Chen, CEO of NeoPac Lighting. My driver had a tough time finding the firm, on a side street of Chubei City near Hsinchu Science Park--Taiwan's equivalent to Silicon Valley. But once there, I was treated to a bright display of the firm's LED lights, which shine for up to 50,000 hours with less power. By the way, Chen has a wall of patents in his office to show for his work.
It was unfortunate that we were rushed for time. I didn't want to keep the director-general of the Hsinchu Science Park, Dr. Randy Yen, waiting. He told me that today the science park houses the two largest semiconductor producers in the world, TSMC and UMC, in addition to leading IT design house Mediatek. But it wasn't always that way.In fact, in the early years of 1980s, Taiwan had intentionally copied the Silicon Valley tech model but had trouble attracting firms. It wasn't until 1989, Dr. Yen said, that the government adopted a policy to foster the development of the so-called integrated circuit business. Once the PC took off soon thereafter, the foundries ramped up quickly. Now that sales are slowing with the financial crisis, the science park is developing a biomedical campus, just a 15-minute drive away on the other side of the river. Right now, these companies generate less than 1 percent of the park's revenues, but Dr. Yen predicts it has "great potential to grow," developing new drugs and medical devices.
Later that same day, I interviewed another entrepreneur--Trung Doan--whose firm SemiLEDs has figured a way to make LEDs on copper, not the typically costly material, sapphire. The company has more than 60 patents for the process, which makes those little LEDs relible, high quality and and low cost, according to Doan. Strange but true that this startup has $10 million in funding from the Simplot family of Idaho potato fame! How? Chips and chips? No, not really. Well, Doan tells me he immigrated to the states in 1975 from Vietnam to earn an enginneering degree from UC-Santa Barbara and work at a series of tech firms in the U.S. and Europe, and eventually settled in Boise, working at Micron (which got its start thanks to Simplot). Doan said he chose Taiwan to base his current operation because of the goodies that were offered--no tax for the first five years, and great infrastructure at the Hsinchu Science Park. So far, so good. The company is selling 5 million units per month and chalked up revenues of $16 million last year with a team of 230 people.

Nanjing: Life Science Valley?

Most people know Nanjing as the site of the Japanese invasion during World War II and subsequent Nanking Massacre. But few realize that Nanjing, an eastern Chinese city of 8 million located along the Yangtze River, is today angling to be known as "the famous software city of China" - to quote promotional materials from the Nanjing Municipal People's Government. Granted, a lot of Chinese cities from Shenyang to Hangzhou are vying to become hubs for information technology, particularly cities like Nanjing and Shenyang that have long had industrial economies.
I recently had the opportunity to to make my own assessment of Nanjing's prospects as a Silicon Valley. Invited to join a delegation of business executives and investors traveling from the U.S. to check out the city's high-tech ecosystem, I spent several days in this historic city that has served as the capital of China through several periods, including when the Republic of China was founded in 1912 by Sun Yat-sen and later, in 1927, under Chiang Kai-shek and the Kuomintang.
I toured the Sun Yat-sen Mausoleum, climbing endless steps to reach its perch on Purple Mountain above a vast forested park. And I peeked in rooms of the Presidential Palace, situated downtown near an ultra-modern building that houses the city's library.
But most of the time in the city was spent exploring the Nanjing High-Tech Zone, which was established just 10 years ago, and a newly opened biomedical business development center there. See photo taken at the opening ceremony, held in the ballroom of the five-star Jin Ling luxury hotel, where we listened to a translated Chinese speech by Zhao Xiaojang, Nanjing's deputy mayor. At a Chinese luncheon banquet to celebrate the opening, seemingly endless ganbei toasts were made by party officials, high-tech execs and the visiting delegation - which by the way included some who's who firms in U.S. investment banking leagues. A charm offensive meant to facilitate more such exchanges was launched by both sides, with individuals circling around the tables, saying they are all friends and downing the potent Chinese liquor baijiu in one shot to show they meant it. One stand-out example of grace under pressure - particularly for a first-timer to China - came from New York businessman James Gomez who spoke of "cooperation for common benefit" and praised one party secretary in attendance for "great vision."
While most of the delegation was jet-lagged, having arrived on a flight from New York City the night before, we trudged off in the afternoon to tour the still-unoccupied offices of new anchor tenant - NJ Pharma Tech Corp. of Raritan, N.J. CEO Chuck Zhu showed us around. He told of the reasons why he decided to base his operation there, key among them the abundance of talent from 48 universities and colleges in Nanjing, including three even within the 82 square kilometer zone, to staff his budding operation. He has the company of 200 enterprises, including 50 high-tech outfits, that have already set up here. Indeed, the high-tech park is a miniature city with its own international school, two hospitals, three supermarkets, banks, a golf club, hotel resort, villas, gardens - and what else could you want (though Nanjing is known as one of the three furnace cities of China for its soaring summer temperatures). The high-tech park is so new that freshly planted trees look more like shrubs. While impressive compared to many such zones in the Valley, I must admit that it pales next to the mammoth software parks I've visited on the Pudong side of Shanghai. The Nanjing park could use better rail transport links to the city, which are coming by 2015, and some in the delegation pointed out the tech zone, at 50 kilometers from the airport and separated by bridges from the main part of the city, could be more convenient too.
That said, the highlights of the tour was yet to come. And one has to keep in mind that Silicon Valley took some 20 years to develop, while China has only begun to tap into this high-tech arena for economic development.Back to the tour, we got a glance at the research center of a facility that is seeking to standardize the process of using herbs in traditional Chinese medicine. See photos. The brains behind this operation is Zisheng Xu, a PhD in pharmaceutical sciences from Osaka University of Japan, who has just moved here from a research post at a Hong Kong university. Ok, it may not be a San Diego or Singapore Biopolis yet!
At what's called the Transportation Industry Park - one of three key areas of the zone - our delegation hopped on golf carts and proceeded through a sparkling clean plant that has the capacity to churn out 200,000 spiffy MG sedans. Yes, the Chinese have bought the assets of the former British automaker, though "Charles," the deputy general manager of the operation, tells me that the cars are still designed by engineers in the U.K. The cars cost $30,000 and 10,000 were sold last year in China. I'm pictured with a few classic MGs that the operation now owns.
What's more, we got a pitch about the Enterprise Park, one more element to fertilize entrepreneurship here. With funding from four governmental bodies, this initiative offers an attractive incentives package of tax holidays, free office space and free residential housing for overseas students returning home to establish a base here. More than 100 students have taken up the offer and founded 50 research enterprises here.
That night for dinner we feasted at a banquet with yet more toasts at the Pearl Spring Hotel, overlooking a tranquil lake that we could see from our picture windows. As 9pm neared, we called it a day and our delegation headed by police-escorted bus back to the Jin Ling Hotel, ready for a good night's rest.
Not finished yet! On the Sunday morning of the Dragon Boat weekend holiday in China, we listened to a speech by Zhu Shanlu, a "Standing Member of Jiangsu Provincial CPC Committee and "Secretary of Nanjing Municipal CPC Committee." His talked was peppered with phrases that were translated like this: "We appreciate that you have shown confidence in our cooperation." At a luncheon where I was seated close to the provincial party leader, I had the opportunity to 'gift' a copy of my book to him. Through a translator, we exchanged a few words. He likes my Silicon Dragon book title and said it reminded him that he wants Nanjing to be known as "Life Science Valley." Sounds like good branding to me, I said. It's connections like these that may have led to my sudden VIP-like treatment on my Air China flight back to the U.S. One has to wonder.