Big companies have global reach and make global decisions. There’s nothing new or unusal about that.
But Ian Kwan of PSB Security is an entrepreneur who makes global decisions too. When he started his facial recognition software company PSB Security in 2008, he was living in Los Angeles and he looked around the world for a home base that would increase his chances of success.
His criteria were:
- financial resources
- talent pool
- seed capital
- external intellectual capital
- proximity to end users
Ian chose to come to Honk Kong. Even though, he says, the talent pool is not as deep as the Silicon Valley, it is adequate and improving. With R&D salaries at 1/3 the level of those in the United States, proximity to manufacturers and integrators in Shenzen and Guagzhou, strong institutional markets and plenty of private capital, Hong Kong won out over locations in the United State, Asia and the Middle East.
It doesn’t hurt either that the Hong Kong government has invested heavily in the Hong Kong Science and Technology Park– a 2M SF (2.5B USD) piece of infrastructure designed to woo entrepreneurs like Mr Kwan.
The Park houses many large corporate tenants (such as Phillips) and has a 3 year incubation program for entrepreneurs that includes heavily subsidized rents, intellectual property services, product marketing assistance, and opportunities to socialize new products with potential investors and acquirers.
It’s working. The first two phases of the Park are full, Phase 3 is scheduled to open in 2014, Hong Kong has more than doubled its R&D investment in less than 8 years, and the 3 of the incubatees have gone on to IPO’s.
With more and more entrepreneurs thinking like Mr Kwan, the competition for talent has the potential to open a new front. No longer is it enough for corporations to offer better compensation for the best and brightest: regions and countries will need to compete at the infrastructure level to attract entrepreneurs.