by Crystal Neri, JFDI, Singapore
For startup founders, here are some fundamental differences between Asia and the United States
It’s easy to assume that just because a startup worked in America, it would work in Asia too. Why wouldn’t it? Don’t we all need assistants? If so, why did the TaskRabbit clones in Singapore fail?
Before you decide to clone a popular startup that you read about in TechCrunch or build a version of “Facebook for Asians”, you probably should understand some key differences between building a company in Asia and the West.
Asia is a continent with a vast geographical landscape, a huge, diverse population with untapped resources from unique and emerging markets. In other words, for startups, this is a place that gives them a chance to build something truly authentic and resonant. Not one that simply copies a Western idea hoping it would blindly flourish in a different continent. But one that is sincerely relevant and life-changing to the target market.
Ideas That Resonate
Rappler is the most popular social news network in the Philippines
In the Philippines, Rappler couldn’t have been more on point. As a news startup, Rappler combines journalism in print, broadcast and tech to produce news optimized for mobile devices. When Typhoon Haiyan hit the country in 2013, I was in my San Diego living room, glued to Rappler’s Twitter coverage. Even if I had other options, I wouldn’t get news anywhere else — Rappler as a resource is succinct, fast, and elegantly designed. Nothing else is like it in the Philippines. They focus on the market’s strength: that Filipino netizens (net-connected citizens) are very active on social media.
SALt’s device is also changing a lot of lives in Lipa City, Philippines. The startup developed a sustainable and ecologically cost-effective lamp powered by only tap water and table salt. Alternative lighting, a perfect product for a Third World country riddled by poverty and natural disasters.
Rappler and SALt are only two examples of successful startups that solved the relevancy question early on, and met huge success in the Philippine market. Other examples are: Viki, a hybrid of Youtube and Hulu that focuses on popular Asian shows and was reported acquired for $200 million by Rakuten (watch our interview iwth CEO Razmig); and OurHealthMate, an India-based platform that books and pays for family healthcare.
Here are some fundamental differences between Asia and the US that you should look out for:
1. Money and Fragmented Populations
The United States has a population of about 350 million. Americans have one currency; they all own credit cards, and consider buying a hobby. Meanwhile, Asia has 4.4 billion people with extreme diverse cultures, climates and geographic features. When you’ve made an economy that thrives in consumerism as much as America does, expect a more conducive and forgiving market than Asia.
Granted there are distinct accents across the US, but if you’re understood in the Midwest, you’ll surely be in Hawaii. In Asia, there are 48 countries. Some of them has hundreds of dialects in one country alone, like the Philippines. As Peng Ong of Match.com said, “If you don’t speak the language, it’s a big problem. You have to understand the culture and local norms to do business.”
3. Differences in Culture
Young Americans are raised to stand up in class and talk about summer camp. On the other hand, most Asian cultures consider speaking up as impolite or confrontational. Understanding customs in Asia will help you better understand the market, focus on your strengths and overcome the barriers to entry.
4. Access To A Willing Demographic
Take for example, research. In San Francisco, it’s easy to go online and Google the best companies, their practices, target markets, etc. You can go out on Union Square to cajole people into control groups. But the same couldn’t be said in Asian countries. Understanding the market by tangible metrics is a comfort of the First World. In Asia, you must improvise ways that’s completely authentic and original to get what you need.
When TaskRabbit was brought to Singapore to follow it’s success in the US, it failed. On the other hand, Zalorafocused on the market that Amazon ignored — South East Asia. Today Zalora is one of Asia’s leading online leading fashion destinations, but they didn’t get there without multiple iterations and adapting different strategies for each market.
One must not fall into thinking a startup brought from the US, on it’s own, will just “adapt.” Nobody has come up with solutions to Asia’s challenges yet, but being informed is the best bet.