ScandAsia South East Asia - December 2016 by Scandinavian Publishing Co., Ltd.

DEC 2016

Malaysia Indonesia Philippines Vietnam Cambodia Laos

Denmark-Vietnam

45 Years of relationship: from aid to trade BUSINESS

PEOPLE

COMMUNITY

Finnish companies at VietWater

Denmark’s Ambassador to Vietnam Charlotte Laursen

Nordic Ambassador’s Luncheon Philippines

START-UPS

TechGrind Incubator for Southeast Asia

At Stenhus High School you can either attend Pre-IB in English or take the Danish STX og HF exam. Stenhus High School is one of the largest high schools in Denmark offering a big variety of subjects and extracurricular activities.

Past Events 16 DEC 20

Malaysia Indonesia Philippines Vietnam ia Cambod Laos

m ade tna -Vie d to tr ark from ai nship: Dersnofm relatio

45 Yea

ESS BUSIN

PEOPLEAmbassador

compani Finnish er at VietWat

Nordic Ambassador’s luncheon Philippines

ordCham Philippines, in partnership with BDO Unibank and Comptel hosted its annual Nordic Ambassadors’ Luncheon last November 17 at the Fairmont Makati, which gathered Filipino and Nordic C-level executives and entrepreneurs, leaders of local and foreign business organizations and chambers of commerce, members of the diplomatic corps, and representatives of the government. Source: NordCham Philippines

k’s Denmar Charlotte to Vietnam Laur sen

UNITY COMM assador’s

Amb Nordic n Philippines Luncheo

PS r START-U d Incubato TechGrinheast Asia for Sout

Your FREE ScandAsia Magazine ScandAsia is the only magazine that covers all the Danish, Finnish, Norwegian and Swedish residents in South East Asia. We also publish a ScandAsia magazine in China, Thailand, and Singapore.

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December 2016

ScandAsia Stories

3 Nordic Ambassador’s Luncheon Philippines 15 Finnish companies at VietWater 17 Indonesia creates science parks

Ambassador Charlotte Laursen

Denmark’s Ambassador to Vietnam reflects on business and development

10 Denmark – Vietnam: 45 years of bilateral relations

ScandAsia Business 5 Denmark healthcare delegation

First Danish business delegation within healthcare to visit Indonesia

8 Sunquick expansion

12 Mr. Efraim Petterson

TechGrind incubator builds Southeast Asia’s tech start-up ecosystem

The Danish Penang-based manufacturing launched new fruit drinks

16 Swedish Philippines delegation Innovation Minister Mikael Damberg lead business delegation to the Philippines, inaugurated the re-opening Swedish embassy

17 Vietnam awards medal to Finland

Vietnamese government awarded Finland for supporting development of Vietnam’s innovation system

18 Minister Ann Linde

Sweden’s Minister for EU Affairs and Trade headed a business delegation to Indonesia, Vietnam One-Stop Shop for all your editing, design, printing and digital printing needs

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4 ScandAsia.South East Asia • December 2016

Business

Danish healthcare business delegation in Indonesia

n mid-October 2016 a Danish healthcare business delegation visited Indonesia with the aim of building stronger relations between Danish companies and the Indonesian healthcare sector. The first ever delegation to Indonesia within this sector was organised by the Danish Embassy in Jakarta in collaboration with the Danish Health Tech Group (a part of Danish Export Association). “I am proud to welcome the 1st ever Danish Healthcare Delegation to Indonesia. The purpose of the visit is to facilitate innovative par tnerships between Indonesian and Danish private and public stakeholders to address

Indonesian healthcare priorities and challenges. We believe that innovative Danish solutions, technologies and products combined with Government-to-Government cooperation can support Indonesia’s introduction of universal and affordable healthcare,” said Dorthea Damkjaer, Head of Trade at the Danish Embassy Jakarta. The delegation on 17 – 19 October featured Danish medical devices companies, including Ambu, BK Ultrasound, Dako, Guldmann, Linak, and SP Medical, that got to meet a number of key players in the Indonesian healthcare sector, including public and private hospitals and the Ministry of Health.

This gave the Danes an over view of the Indonesian challenges. The Danish companies bring with them many years of experience in the global market and solutions that could help accelerate the positive development in Indonesia’s health sector. “Indonesia’s ambitious targets for its healthcare system can be supported with the capabilities of a range of Danish suppliers, who are known for their high-quality but affordable products and their ability to create flexible and custom-made solutions. The par ticipating companies all have years of experience from Denmark, which has one of the world’s most effective healthcare systems, and from supplying solutions to the international markets. Creating the right partnerships in Indonesia can be a step towards introducing these efficient solutions to the country,” said Thomas Andersen, Head of Danish Health Tech Group. Previously, in April 2016, a delegation of Indonesian health officials and academia, led by the Secretary General of Indonesia’s Ministry of Health, visited Denmark to experience Danish competences in the healthcare sector, including patient-centred technologies and solutions that also contribute to increase efficiency of hospitals as well as the working environment for healthcare professionals in most categories. In light of the visit, a MoU between Denmark and Indonesia is being developed.

December 2016 • ScandAsia.South East Asia 5

Business

Danish Foreign Affairs Minister very satisfied with Vietnam visit

anish Minister for Foreign Affairs Mr. Kristian Jensen has completed an official visit to Vietnam on 11 – 12 October, covering both Hanoi and Ho Chi Minh City. During the two days the Minister held various meetings with Vietnamese leaders to discuss measures in promoting the bilateral comprehensive partnership. He also visited Danish companies to learn about opportunities and challenges for Danish companies in doing business in Vietnam. In 2015 Denmark phased out its official development assistance (ODA), which had been going on since 1993. The focus onwards within the Denmark-Vietnam bilateral partnership lies in quality growth, including political dialogue, economic and commercial activities and targeted ODA-projects matching Denmark’s strengths within green growth, food & agriculture, health ser vices, and education to Vietnam’s agenda. These are areas where Denmark and Danish companies enjoy a high level of experience and knowledge, which match Vietnam’s agenda. The Southeast Asian country’s goal is to become a modernized and higher middle income country by 2035. “I am very pleased with my visit in Vietnam. It makes me even more confident that the relationship we have built over the past 45 years of diplomatic relations and the goals we have for sustainable environment and commercial growth will continue to show results in the years to come. Also, the three Danish companies I’ve visited are good examples of how successful business can go hand in hand with corporate social responsibility and production of quality products. It makes me proud to see the high standards Danish companies’ request of themselves,” Minister Jensen concluded, before leaving Ho Chi Minh City.

Wrap up of minister visit: On the first day Minister Jensen discussed various bilateral and global issues of mutual interest during the meeting with Deputy Prime Minister and Minister of Foreign Affairs Mr. Pham Binh Minh. The minister appreciated the long and outstanding relationship between Denmark and Vietnam, which, after more than 20 years of successful development cooperation, transformed into a comprehensive partnership in 2013. The Danish minister also co-chaired the 5th Joint Governmental Committee meeting with Minister of Planning and Investment, Mr. Nguyen Chi Dung to discuss measures in enhancing bilateral trade and investment. Danish business representatives, including Lego and Maersk, also participated in the meeting. Finally, he had a courtesy meeting with Prime Minister, Mr. Nguyen Xuan Phuc, to promote the bilateral relationship and the comprehensive partnership. In the meeting the Foreign Minister expressed his appreciation of the government of Vietnam for their support to facilitate Danish companies’ setting up business and production in Vietnam. Minister Jensen also paid a visit to Ngoc Lam Primary School in Long Bien district, where

schoolchildren and teachers use the new national system for art education in primary school based upon Danish child-centered pedagogical methods. At the school, he got to see results of Denmark’s engagement in developing Vietnamese children books through cooperation between Danish writers and illustrators, Kim Dong Publishing House and Vietnamese writers and illustrators. During day two Minister Jensen visited Mascot factory in Hai Duong before leaving for Ho Chi Minh City. Mascot International Vietnam is a subsidiary of Mascot International A/S, Denmark’s biggest manufacturer of high quality work wear and safety gear. The company has three production units in Hai Duong province and one unit in Laos, with 1,800 staff in Vietnam and Laos. Mascot is known for a clear CSR profile and has been awarded with Prince Henrik and Danish Export Association’s award for contribution to the development of commercial cooperation between Denmark and Vietnam. In Ho Chi Minh City, Minister Jensen visited ScanCom, a Danish outdoor furniture manufacturer. ScanCom’s wood production in Vietnam was launched in 2003 with the initial support from the Danida Private Sector Development Programme. ScanCom has a high CSR profile and has received the Forest Stewardship Council (FCS) certification as the

6 ScandAsia.South East Asia • December 2016

first company in Vietnam. After that a meeting with Mr. Le Thanh Liem, Vice Chairman of Ho Chi Minh City People’s Committee followed, where he expressed hope that Danish companies could support sustainable development of Ho Chi Minh City, and thereby continuing the strong cooperation between Vietnam and Denmark. Finally, he made a stop at the Danish Osterberg ice-cream shop. Denmark is one of the first European countries to recognize Vietnam in 1971 and is one of the biggest contributors of official development assistance (ODA) since 1993. Danish ODA focused on e.g. water, sanitation, agriculture, environment, and good governance projects and is considered among the most successful of Danish ODA. The new bilateral partnership has delivered concrete results as the trade of goods between the two countries in 2015 set a new record with an increase in value of traded goods of 44.5% compared to the year before. During 2016 the 45th year anniversary of diplomatic relations between Denmark and Vietnam is marked with activities in Hanoi and Ho Chi Minh city incl. Danish Film Weeks, establishment of an Alumni Networ k for Vietnamese who have studied in Denmark and a Gala Performance at Hanoi Opera.

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Business

Sunquick introduces ready-to-drink fruit beverage

unquick of Denmark, the trusted fruit beverage brand, on 11 October 2016 announced a refreshing addition to its product range with the Sunquick Fruit Drink. Specially crafted to be enjoyed at home or on the go, these ready-to-drink packs boast greater convenience and can be purchased in four refreshing flavours at all major retail stores in Malaysia from October. The factory expansion and launch of the new ready-to-drink product in Penang was officiated by Denmark’s Ambassador to Malaysia, Nicolai Ruge. While Sunquick is widely known for its glass-bottled fruit-based concentrate, the new fruit drink is a refreshing new take on this classic look, without compromising on the distinctive Sunquick taste that both children and grown-ups have come to know and love.Targeted at families, it is a thirst-quenching treat and a perfectly convenient solution for modern mothers who want to provide their children with a delicious fruity refreshment, amid their busy lifestyles and time-strapped Schedules, writes Barkath CORO, the Sunquick manufacturer for Southeast Asia. Besides being a convenient and refreshing beverage, Sunquick Fruit Drink continues to

deliver on the promise of providing customers with goodness from the fruit.These treats contain real fruit juice, are packed with Vitamin C and do not contain any artificial sweeteners, flavours or colours. It is available in two child-friendly sizes –the unique 125ml pack, which is perfect for smaller children, and the popular 200ml drink pack. Each handy treat is sold in a convenient Tetra pack that is easy to handle, transport and dispose of, and includes a smart Z-straw to ensure minimum spillage. “Sunquick products have been enjoyed by families around the world for decades, and we always strive to keep up-to-date with current demands by improving our product range so customers can enjoy the great taste of Sunquick in a variety of ways, according to their needs,” said Dato Seri Barkath Ali, Chairman of the board of Barkath CO-RO Manufacturing S/B. “Similarly, our fruit drink has been specially created to cater to the demands of the modern family, with its practical size and refreshing flavours. This addition to our current product line will create a more holistic Sunquick experience for our consumers, while allowing them to savour the goodness of our Sunquick flavours on-the-go, no matter where they are.”

8 ScandAsia.South East Asia • December 2016

Sunquick Fruit Drink flavours ORANGE: A nice, refreshing taste of ripe, sunny oranges MIXED MANGO: A really yummy taste full of tropical sweetness APPLE: An applelicious thirst-quenching flavour full of joy BERRIES: An exquisite, sweet mix of the happiest berries ever Similar to all Sunquick products distributed within the region, Sunquick Fruit Drink will be produced by Barkath CO-RO Manufacturing in Malaysia and exported to Brunei, Singapore, the Philippines and other markets like Cambodia, Myanmar and Vietnam. Incorporated in 1992, Barkath CO-RO is a joint venture company between CO-RO A/S in Denmark and Penang-based Kumpulan Barkath, to manufacture Sunquick products in the ASEAN region. The joint venture has been marketing Sunquick fruit drinks in Malaysia for 35 years and it is today one of Malaysia’s best known household brands.

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Business

Denmark – Vietnam

45 Years of relationship: fro By Joakim Persson, Photos: Embassy of Denmark, Hanoi

n August 2007, diplomat Charlotte Laursen ended her position in Vietnam as Deputy Head of Mission at the Embassy of Denmark in Hanoi. Since 20 August 2015, she is however back, this time accredited as Denmark’s Ambassador to Vietnam. During her absence, Vietnam has undergone a number of changes, described by a fascinated ambassador as an “impressive socio-economic development – a development that goes very well in hand with the dynamic of the bilateral relationship between Vietnam and Denmark.” “Besides the visible changes due to Vietnam’s yearly economic growth of above six percent, which has had a significant effect on infrastructure, new buildings, shopping malls etc., I think the main changes since my last posting to Vietnam are related to use of social media; a growing middle class; and a young generation who are better educated, and who are more exposed to the western lifestyle through the Internet. These changes, I believe, have also caused a change in mind-set, which has made huge changes within Vietnam,” Denmark’s Ambassador to Vietnam, Charlotte Laursen elaborates to ScandAsia. And not only has Charlotte Laursen’s job

changed, but so has the relationship between Denmark and Vietnam. “Last time I was in Vietnam, the main focus was management of our big development cooperation programme. Since then changes economically in Vietnam have of course also meant changes in our work.Today we have phased out the traditional development assistance and are focusing strongly on trade and investment. Vietnam has remained a global priority country for the Danish government, and the main task for the Embassy in the years to come is to further strengthen our relations, not least our commercial ties,” the ambassador explains.

1.3 billion dollars from Denmark The traditional development programme lasted until 2015, where Denmark had in total provided Vietnam with the whopping amount of over $ 1.3 billion (DKK 90.8 billion) over a twenty-year period, making the small Scandinavian nation one of the largest bilateral donors in Vietnam, when it comes to Official Development Assistance (ODA). The phasing out of the development programme took place gradually. “In the beginning, we suppor ted Vietnam

10 ScandAsia.South East Asia • December 2016

with loans to rebuild after the war, but in 1994 the Danish assistance changed into actually development programmes, such as sector based programmes and budget suppor t,” says the Ambassador. ” Many years of close development cooperation has created a very strong par tnership and friendship between Denmark and Vietnam that still exists. We have managed to transform our relationship from development par tners to a broader, and more mutual and respectful par tnership, with a focus on commercial, political, cultural and environmental issues. I think Denmark has succeeded in our transition here in Vietnam due to the economic development in Vietnam, but also due to the ver y strong par tnership and friendship we have between our two countries.” “Vietnam is no longer a priority country in an ODA sense, but is a very important commercial priority in Southeast Asia for Denmark; it’s an interesting market for Danish companies and in that aspect the transformation to a closer par tnership in trade and investment is ver y important,” states the Ambassador. But even with the traditional ODA closed,

there are still envelopes in the overall Danish ODA to which there can be used to support Vietnam. “In that sense we will continue to support Vietnam, when it comes to climate change and we have, as a number of other countries, started up with strategic sector cooperation, a kind of peer-to-peer cooperation. From August 2015, two growth advisors were posted at the embassy, one working with environment and food safety, and the other with education and health. The strategic sector cooperation is basically a technical assistance programme, where Denmark facilitates technical assistance from public experts to their Vietnamese counterparts. This matches well with Vietnam’s ambition to develop into a modern and higher middle-income country by year 2035,” explains Charlotte Laursen.

Ensuring even stronger partnership In 2016 the two countries celebrate 45 years of diplomatic relations. “This is quite significant, Denmark being one of the first western countries to recognise Vietnam back in 1971. It is impor tant to celebrate such long term relations, so we have been carrying out a number of activities to mark the 45 years. The visit by the Danish Minister for Foreign Affairs was an important part of these activities, which was interesting and rewarding. He had meetings with top gover nment representatives, including meetings with the

Vietnamese prime Minister, Foreign Minister and Minister for Planning and Investment. The main purpose of the visit on 11 – 13 October by the foreign minister Mr. Kristian Jensen was to further strengthen the bilateral partnership, not least with a strong commercial focus,” the ambassador states. “As one of few European countr ies Denmark signed a Comprehensive Partnership Agreement (CPA) in 2013, which is the umbrella for our partnership. It has five important pillars and it was in that context the visit took place,” the ambassador comments on the par tnership going forward. She adds: “This agreement sets the platform for the shift from a par tnershipbased almost exclusively on development cooperation, to one embracing all aspects, including political dialogue, commerce, and culture. It is followed by targeted action plans. In my opinion, the CPA a very good platform for the work we are doing, with a strong focus on sectors where Denmark has also strong commercial competences.” Those are: environment, green growth, energy and climate change, education, culture and food safety.

Commercial services in the north and the south “Basically some of these ODA programmes and projects are ver y useful also when it comes to dialogue on a commercial scale,”

om aid to trade

have a professional trade team here in Hanoi and another in Deco and they work closely together. I travel frequently to Ho Chi Minh City myself and take par t in the work they are doing.”

Danish solutions needed Commenting on the business climate and progress for foreign companies in terms of doing business in Vietnam Ambassador Laursen paints a positive picture. “Overall it’s ver y interesting market for Danish companies, and I would also think to Scandinavian companies in general.You can point to the fact that Vietnam still has high growth rates; it is expected to continue at about six per cent in the coming years. So Vietnam is keeping up its high economic growth. And, looking at Danish companies, what Vietnam demands in its fur ther economic development, is actually solutions where Danish companies are ver y strong; when it comes to green energy, energy efficiency, quality food products, farming, pharma and education. So in that sense I can see a huge potential and I also think that many companies see Vietnam as such.” The Danish embassy stays in touch with many of these companies and also regularly gets contacted by new companies that want to explore the market. “Until now it has mainly been for production, but we now see that also retailer companies look at Vietnam with interest, a market with a growing middle class and with almost 100 million people. But there are also challenges in doing business in Vietnam. Challenges like bureaucracy, corruption and lack of transparency. So, for many SME’s Vietnam should not be their first export market”, the Ambassador comments.

FTA a driver for change

says Char lotte Laur sen and explains that as Denmar k transformed its par tner ship Vietnam some of the staff who worked with development assistance has been transferred to do commercial work. “With this transfer, we have been able to keep some of our good and knowledgeable colleagues at the embassy, creating a strong position for our commercial work. Is has proven very useful for Danish companies especially within the agricultural sector. To a large extent, the embassy’s commercial work takes place via the Danish Economic and Commercial Office (DECO) in Ho Chi Minh City, which assists Danish companies with commercial services. “Deco is a fully integrated par t of the embassy here in Hanoi. A satellite office, which is of great value to us as Vietnam’s commercial centre is in the south,” the ambassador explains and adds: “When we look at the number of Danish companies in Vietnam, we have app. 130 companies established here, of which two thirds are in the Ho Chi Minh City area. At Deco, Denmark offers the same kind of service to companies as at the embassy in Hanoi. We

Finally, it is of course of great significance for Denmark that Vietnam so far is only the second ASEAN country, with whom the European Union signed a Free Trade Agreement (called EVFTA) in late 2015. This agreement presents opportunities in a global trading partnership valued over 28 billion Euros in 2015. “A very big sector for Denmark is food and agriculture. For this sector I believe EVFTA will have a positive influence, but also other export sectors will benefit. I fully trust it will generally have a positive influence on the Danish export to Vietnam, which, I may add, is increasing year by year and has done so for many years.” Denmark’s ambassador also believes that this FTA will drive other changes: “It has been seen by many of us as a force for some of the continued economic reforms in Vietnam. Vietnam is ver y much aware of the need for a more sustainable economic growth model. Renewable energy and environmental issues are high on the agenda as well as the establishment of a strong domestic private sector. That will also include privatisation of State Owned Enterprises and creating a fair domestic business environment, including incentives for SME’s”, Ambassador Charlotte Laursen concludes.

December 2016 • ScandAsia.South East Asia 11

Business

The true start-ups of South TechGrind the region’s first By Joakim Persson

n 2016 the start-up hype in Southeast Asia (SEA) has reached new heights. But there are different perceptions of what ‘start-up’ really comprises. Join ScandAsia for a lesson by Bangkok-based Techie Efraim Pettersson, a Swede who is undoubtedly an authority on the subject matter, and get really valuable insights concerning the start-up world and SEA. Efraim and his team are bravely spearheading the first private technology incubator in SEA, the three-year old TechGrind Incubator. Seeing SEA as a market of immense oppor tunities it was founded as a grassroots tech star t-up founder’s community, which as an organization subsequently built an entire technology economy - a “mini silicon valley” in SEA. It was a process of tech start-up founders coming together and validating the needs for tech start-ups to exist and thrive in this developing region. Some of TechGrind’s first accomplishments in the region included building an accelerator program, an incubator, a tech angel syndicate and more recently a tech VC fund. TechGrind offers

free mentorship, start-up offices and co-working space as well as many monthly events, quarterly workshops and larger yearly conferences. “A major need out here was a systematic program building credible internationally competitive tech companies. There was literally no start-up or tech economy out here in SEA before, though people talk about it a lot. Until a region produces technology on a global tech market it cannot claim to have a tech industry, that’s just farce,” states the TechGrind General Partner. “Now, SEA and Thailand specifically can claim to have a tech economy - since some of our por tfolio companies have products with users and customers globally from Russia to UK, Germany, USA, Australia, Latin America, and of course all over this region too. That’s what a technology economy is.”

Bold numbers Talking to Efraim it quickly becomes clear that he represents the genuine tech industry in SEA

- those that live and breathe tech. His ambitions are high: “We can build a trillion dollar technology economy here. Literally, on the market that exists right now,” the Swede says without flinching. “My goal with TechGrind is a hundred billion. But just looking at the numbers, we have the potential to build a trillion US dollar organization network of tech companies here in the next 10 to 15 years.” O.K… definitely sounds like there are business opportunities here, and these numbers feel… bold, to say the least! “I build technology companies that figure out new models, create new solutions, and products with more strictly defined market fit. I like technology that creates superior value to what is currently available, that disrupts or improves processes to improve human conditions - whether it is in the business sector or daily life. That’s what a good start-up does, and when you solve a problem in this way, you then scale it to the world, and to as many people as possible that fit the solution.” Efraim’s own track record includes: being tech lead in six start-ups and 3rd engineer in a seventh. Out of those seven three became unicorns ($1bn+ market cap or exit). “This is now the land of opportunity, that’s why I’m here. My team and I can share our knowledge with a talent pool that desperately needs it in order to build successful tech companies.”

No billion-dollar companies It was when Efraim was temporarily visiting Thailand back in August 2012 that some techies on the local scene, and who had done some really good research on the region, showed him all the numbers and how big the Southeast Asian market really is. This was a complete game-changer for him in terms of what to focus on, where to go next in the world, after a 15+ year tech start-up career. “It was really convincing; there is a big market oppor tunity here,” Efraim had realised, and wondered: “Why aren’t there billion dollar tech companies here?” “It is quite surprising how ignorant we are of what’s going on here in the developed world. Nobody I talk to back home has any idea what is happening here; which was the same thing for me before I got here and decided to spend time and investigate. This region is undergoing tectonic shifts. It is a third-world region that is rapidly developing into a second-world economy, raw production of goods into manufacturing of those goods. Along with this and a 600+ million population we are seeing one of the top three fastest growing economies in the world, the fastest and most stable growing middle class in the world - and much more.” “There are huge problems that can be 12 ScandAsia.South East Asia • December 2016

heast Asia: t tech incubator solved here. When you have an entire economy evolving to the next phase, there are entirely new experiences, problems, and needs - as well as the economic fiscal support to pay for them. The biggest problem out here in the developing world is that there is no technology solving their problems because so few in the developing world know how technology works or how to make it. That is why we are here, to help leapfrog SEA to a first-world economy by building local tech solutions for the entire developing world.” As a consequence of investigating fur ther when he first arrived here, Eraim asked his Thai wife if they could stay in the region for six months. He wanted to see if he could make tech companies actually happen given the resources and people available - and it worked. TechGrind began when he sat down with five founders of other local start-ups in Thailand and discussed their mutual problems with building tech start-ups in the region. “It was an interesting mix of three local Thai start-up founders and three foreigners.” They decided to build an organisation that would solve all their own problems and build a start-up economy. “The only limiting factor to growth here is the amount of quality people we can bring in. That is the hardest struggle in this region: human resources. Nobody out here has experience in building tech companies, even less working in one. It’s an uphill battle laying foundation knowledge in the best people and equipping them with the tools to do the job. This is one of the most complex and intellectual industries in the world. It takes a lot of brainpower and effort.” So the challenge for Efraim is not only to just build another global start-up in the developing world, but the entire start-up economy.

First world skills Access to knowledge then becomes one of the most important things: “We have active hubs that run activities and build communities across the region. These communities are where start-up founders begin their journeys, share knowledge, network to find partners and resources. This is the foundation.” TechGrind puts a lot of effort and support specifically into the locals, to help bring their abilities up to the first-world economy level, where the tech industry sits. The goal is to also invest in and support start-ups founded by locals that can be globally competitive. Efraim explains how even the basics are new here, such as rules and regulations that govern techies professional work and that all must abide by strictly, including zero tolerance for corruption – entirely new concepts in the workforce out here.

This region is undergoing tectonic shifts. It is a third-world region that is rapidly developing into a second-world economy, raw production of goods into manufacturing of those goods

“Behaving ethically is intrinsic to succeeding at business in the global economy. Transparency and honesty. We are very strict about it and those that want to work in the first-world economy must do so regardless. There is no flexibility in this. They also need to learn how the first world economy even works - there are much more complicated business models. It isn’t just selling X for $Y and having your Z% margin.” “Our policy here is to put double the amount of effort into local founders that we incubate. We

need to have Thai companies with Thai founders, Malaysian companies with Malaysian founders etc. We learned really hard the problems that Thais face, and have huge sympathy for that and respect the struggle they are going through. In fact we are quite impressed - that with so much going against them they are learning and adapting so quickly. It’s very inspiring.” Efraim evaluates. “The majority of investments in SEA are going to come from outside. However, our focus is building a healthy local economy. As a business it is the biggest opportunity I have ever seen in the world.”

Singapore does not count “When it comes to SEA Singapore however does not count: “It’s a fully developed country; it does not have many problems. Those it does have are not similar at all to the rest of the region (and vice versa).” Efraim also points to the crucial fact that nothing you do in Singapore proves anything. You haven’t solved a big market problem. “Even if you build a tech product and capture 100% of the Singapore market, your product or service still won’t accomplish anything outside of Singapore. You have no product/market fit anywhere else. This basically means you’ve just built what we in the star t-up industr y call a ‘zombie’. A successful start-up is meant to grow and scale and solve a big problem. You simply cannot do that in Singapore as it is too small.” Having studied Singapore carefully during

December 2016 • ScandAsia.South East Asia 13

Business effect, of course. Founders need to know where they are going and their daily practice is like being a GPS for their company: figuring out how to get there. This process is called validation, and is what building a leanstart-up is all about. We invest in individuals capable of doing that.” This is accepted as a best practice in the industry, but the start-up scenes around the world still generate a lot of failures. Efraim explains that this is mostly due to leanstartup still not being followed by many; or not taken as seriously as it should be. Ego and emotional attachment to one’s product are the bane of a start-up founder, as two of the biggest reasons for failure. “Emotional decision-making is suicide. Everything in the tech industry is data and logic. If your business isn’t built and operated this way you will eventually fail no matter what in this industry.” says the serial entrepreneur. “The fact is that when you are building a startup, you must learn everyday what you are doing. The #1 business goal of a start-up is learning, through testing and validation. You prove yourself wrong on a daily basis as a start-up founder. Well, if you are a successful one anyway.” three years and Efraim’s conclusion is that he will never invest in any Singapore-based start-up. Though, he uses Singapore as a base of corporate and legal operations since it is world-class in that regard. “Singapore doesn’t really exist on the tech industry map as it does not to produce actual technology for the tech market. It seems obvious but so few people recognize that.This whole startup “ecosystem” in Singapore is also a complete farce and a scam on the Singaporean tax dollar. They started these government programs in 2006 with grants and funding of institutions etc. - but haven’t created a single successful tech company and I heard from a good inside government source that the total amount spent has so far reached over SGD 82 billion. Numbers speak for themself: 82bn and not a single successful tech company?” “Singapore doesn’t have (and has never had) an entrepreneurial culture. Cer tain mentality, attitude, and behaviour are required to build star t-ups and technology companies. This has been proven for many decades. Also, core skill sets are required. For any tech industry veteran, it is a trivial issue that all of this is missing in Singapore. Singapore will never be a start-up hub.” Efraim says that he is seeing much more potential in Thais in comparison.“Thais are already ver y entrepreneurial. They build businesses anywhere they can, pursue opportunities, take risks, much more than most in the Asian culture of risk-averseness.”

Attitude and ability “So as far as investment of our time and capital we are putting that into start-ups that are going to take advantage of the opportunity in SEA and pursue solving as big of a problem as they can. So we try to find teams that are very dedicated to building companies around such a vision.” “It comes down to two things: attitude and ability. Ability defines the soft and hard skills that they have, and, of course the quality of that work. It is the amount of tasks that they can accomplish

Hitting a billion

I heard from a good inside government source that the total amount spent has so far reached over SGD 82 billion. Numbers speak for themself: 82bn and not a single successful tech company?

off the huge list of things that a start-up needs to get done. The other side of the coin is attitude. If they don’t have the right attitude it doesn’t matter how much money, resources and amazing research you throw at them - they won’t build a successful start-up anyway.” And data supports this to be a fact and not an opinion, Efraim claims. Among the minimum cr iter ia those considered for incubation by TechGrind have to undergo an intense program designed to build a solid founding team, before being connected to world-class investment and growth-capital. A team must have at least one full-time founder, and one founder with domain exper tise. The founding team has to be able to actually do the work themselves. “Start-up founders are the hardest working people there are. They have to be. Having a high quality of work and a lot of skills also amplifies that

14 ScandAsia.South East Asia • December 2016

Another TechGrind criterion is that the project must have a $1bn minimum potential if successful; considering that Efraim and his team have already built $10bn in tech companies globally in the past 15 years - and want to stay focused on the really big problems. “Hitting a billion dollars is actually not that hard. If you take any of the major problems that we deal with on a daily basis out here, and you say: ‘I’m going to build a company that solves this for Southeast Asia’, then you have a billion US dollar company.” He says that there is actually little to no competition, very high adoption rates and low friction for tech products in SEA. He mentions as an example that there are currently about 180 million SMEs in the developing world that use no financial software. “We are leap-frogging the solution, in one of our portfolio companies, by building financial software to provide for the entire developing world. So you can look at the market size, the amount of people that would use that, the average cost they can afford and then you output revenue that way - which is only the most simple of business models and by far not the largest we will tap. Yet it is already a $bn company at scale based on what it has already proven and validated in the market.” Efraim adds that this exciting company - Pymlo - is growing rapidly. He also mentions Google as an tech start-up example: “Theirs is not as simple as a traditional business model. Its a complex value chain with lots of inputs and outputs, and the net result is that you can make a lot more money by NOT selling your software than by creating a healthy ecosystem or value chain within the technology.” On what is next for TechGrind, Efraim concludes with a smile: “From here on out it’s just a matter of scaling, and improving the quality of what we’ve done. Constantly learning. Building a star t-up economy requires practicing what we preach. It’s the only thing we’re good at anyway.”

Business

15 Finnish companies in pavilion at VietWater

uring 8 – 11 November 2016 representatives of 15 Finnish companies exhibited in a Finnish pavilion and met Vietnamese businessmen at Vietwater event held in Ho Chi Minh City’s Saigon Exhibition and Convention Center. These are Finnish companies looking for oppor tunities in Vietnam’s waste, energy and water industries. It was also the fourth time Finland had a pavilion at this Vietnam’s largest exhibition in the water sector, to which Finpro Vietnam Trade Center had invited local companies based on the needs of Finnish companies registered to the event. The business delegation was organized by Cleantech Finland, Finnish Water Forum and Finpro, with the goal to create new contacts and opportunities for Finnish and Vietnamese companies, to boost Finnish water sector export and to offer innovative and environment-friendly solutions for Vietnam’s current issues regarding waste management. Vietnam’s demand for water sector knowhow is rising, because local water supply and sanitation systems are inefficient and the capacity

of the water treatment plants cannot handle the country’s growing quantities of wastewater. Because of this, unmanaged wastewater emissions are causing serious environmental hazards across the country. With its population growing fast, the rapidly urbanizing Vietnam needs new wastewater treatment plants and modern technology for increasing the efficiency of its water supply systems. Vietnam intends to build 40 new treatment plants by 2020, and the cooperation between Finnish and Vietnamese companies seems promising, because Finland has a good reputation in Vietnam and Finnish know-how is well known in the water industry. The event brings together thousands of industry professionals, businessmen, consultants and government representatives from around the world. The pavilion of Finland ‘Water, waste water, waste to energy, bioenergy technologies and knowhow of Finland’ was awarded the best design prize at the expo. On 9 November the Ambassador of Finland and Deputy Minister of Construction Phan Thi My Linh visit the Finnish booth. December 2016 • ScandAsia.South East Asia 15

Business

Swedish delegation in Philippines, embassy re-opened

weden is to re-open its embassy in Manila in December 2016 and on 7 November Economic Development and Innovation Minister Mikael Damberg, who arrived with the largest business delegation ever to the Philippines, inaugurated the mission. “Sweden has missions in 93 countries. The Philippines, with its 100 million inhabitants, the largest country in which Sweden has for a long time lacked san embassy. Our presence gives the opportunity to broaden our relations with the whole of society. Philippines is also an interesting export market with an average economic growth of 6-7 percent,” said Mikael Damberg. “I see great oppor tunities to deepen our trade relations with the Philippines by promoting Swedish solutions and now with a strong Swedish presence on the ground. I believe that a Swedish embassy in Manila will help to open doors for increased Swedish exports and encourage new contacts,” he continued. “A year ago, the Prime Minister of Sweden decided to reopen the embassy and he did this in recognition of the very positive developments of this country, at least the economic developments,” Swedish Ambassador-designate to the Philippines Harald Fries told local media. Before continuing to lead another high-level Swedish business delegation to India, minister Damberg, along with the Ambassador-designate and the rest of the delegation, paid a courtesy visit to Department of Transportation (DOTr) Secretary Arthur Tugade and expressed support for the infrastructure and transportation plans of the Duterte administration. The meeting signified interest on various transportation projects of the government such as development of a bus rapid transit system using high quality and high capacity buses, promotion of electric cars and cleaner fuel alternatives. The business delegation expressed support for government’s infrastructure and transportation

plan, the transportation department said. The delegation, with some 70 companies, organizations and authorities are represented, expressed interest in government projects such as the development of a bus rapid transit system using high-quality and high-capacity buses, promotion of electric cars, and cleaner fuel alternatives. “The expression of support from the Swedish delegation is not only a welcome development following the launch of big-ticket transportation projects, but also demonstrates a strong business climate that goes beyond the country’s strengthened partnerships with China and Japan.” Ambassador Fries repor ted that minister Damberg had ver y constructive talks with Transportation Secretary Arthur P. Tugade and Trade Secretary Ramon M. Lopez. “The business representatives coming from Sweden had ver y fruitful meetings with the Philippine business counterparts and the Swedish delegation went back to Sweden, very optimistic and hopeful about coming business partnerships with Philippine business partners here,” Harald Fries said, adding that businessmen had very positive comments on the Philippines, according

16 ScandAsia.South East Asia • December 2016

to Philippines News Agency. The Ambassador-designate also cited the positive factors in the Philippines such as high growth rates; growing market; stable inflation; sound fiscal situation; and young talented, welleducated, and English-speaking population. “So many of the fundamentals are right here for increasing business relations,‚“ he said. “And then with the new administration, I think there are reforms taken here which are positive for increased business relations.” Trade between Sweden and Philippines however, he thought, “is much too low.” “So threes a great potential for enhanced trade and investment relations between our two countries.” Fries said he hopes to increase people-topeople relations, such as in the tourism sector, in academic or student exchange, and in the exchange of professionals. According to the Swedish government minister Mikael Damberg also met with representatives of a human rights organization, as well as the opposition in the country. Photos cour tesy of Business Sweden + Twitter sources

Business

Finland earns medal for Vietnam innovation and start-up support

uring Techfest 2016 in Hanoi the Finnish government was awarded by the Vietnamese government for long-ter m commitment and excellent results in the development of Vietnam’s innovation system. H.E Mr. Chu Ngọc Anh Minister for Science and Technology presented H.E Mr. Ilkka-Pekka Similä Ambassador of Finland in Vietnam with a medal for Finland’s support to innovation and start-ups there. The Finland-Vietnam Innovation Partnership Programme (IPP2) has since 2009 played a central role in Vietnam with its focus on supporting the Vietnamese start-up ecosystem. The bilateral relations between Finland and Vietnam are in transition. After almost 40 years of development cooperation, the relationship is shifting towards business and networks led cooperation. The Embassy of Finland in Vietnam, along with trade promoting organisations and programmes in Vietnam, are now focusing on building these future relations and prerequisites for businesses and innovators to succeed and find each other. One of the promising areas of business collaboration is in the star t-up and growth company sector. The annual Slush event in

Helsinki Finland, which attracts more than 15,000 companies, investors and media from around the world, is a wonderful platform for cooperation. In 2016 almost 50 start-ups, ecosystem developers and policy-makers will attend Slush as a delegation from Vietnam. Source: Embassy of Finland in Hanoi, FinlandVietnam Innovation Partnership Programme

Indonesia to create 100 Science Parks based on Swedish IDEON

DEON and Sven Tore Holm, the first CEO of Ideon Science Park, has been active in a program that Lund University has organized in cooperation with an Indonesian delegation. The Indonesian government and its universities want to learn how Ideon Science Park was built and has grown since 1983, in cooperation with Lund. This knowledge will be used in creating one hundred new Science Parks in Indonesia.

A certification ceremony took place at “Gula Villan” (Yellow Villa) in Lund on Friday 21 October. The event was followed up by a visit from the Indonesian ambassador Bagas Hapsoro S.H., M.A, with the title Ambassador Extra Ordinary and Plenipotentiary of the Republic of Indonesia to Kingdom of Sweden and Republic of Latvia, which took place on 28 October. The education in Entrepeneurship & Science Park Development is tailor-made for Agency for

the Assessment and Application of Technology (BPPT) in Indonesia. The program is a part of the established cooperation between Sweden and Indonesia, aiming to strengthen and develop the cooperation within science, technology and innovation. The target is to increase the capacity of a realisation of a national innovation ecosystem in Indonesia. By further promoting capacity building and initiate joint research and innovation among academics, companies, industries and government institutions, the long term goal of the program is to contribute to increased capacity for the realisation of a national innovation ecosystem in Indonesia. Ideon Science Park - placed close to Lund University, one of the world’s top 100 universities - is one of the most exciting places in Europe where the smartest minds meet to develop the future. It is the ideal place for companies who want to grow, a place where people improve their ideas and others, a place where anything is possible. For more than 30 years, it has attracted the best competences in the World. The science park not only attracts competent individuals. Companies like Bosch, Sony, Ericsson, Continental, Volvo, Huwawei,Texas Instruments and Schneider Electrics are placing their R&D depar tments or offices here, to benefit from the mix of competences when developing the future.

December 2016 • ScandAsia.South East Asia 17

Business

Ann Linde leads Swedish delegation to Indonesia, Vietnam

By Joakim Persson

nn Linde, Sweden’s Minister for EU Affairs and Trade was heading a business delegation to Indonesia followed by Vietnam during 2-6 October, for talks with government officials and business representatives. During the delegation visit Ann Linde showed how Swedish world-leading system solutions in infrastructure, sustainability and innovation can help to meet the demand for long-term smart investments in two of Asia’s fastest-growing emerging markets. The trips were part of the implementation of the government’s expor t strategy. “I see great oppor tunities to deepen our trade relations with Indonesia and Vietnam by promoting Swedish solutions and increase the Swedish presence in these emerging markets. I hope to help open doors for increased Swedish exports and encourage new contacts,” said Ann Linde. Part of the program in the two Southeast Asian countries is face-to-face meetings with

top-level decision makers in both the private and public sectors in Indonesia and Vietnam. Par ticipating companies got to present their solutions and services. Roundtables with business leaders are organised, as well as business forums to showcase innovative and sustainable concepts to wider audiences of key industry stakeholders. In Jakarta Minister Ann Linde met with Basuki Tjahaja Purnama, Governor of Jakarta to discuss Jakarta and Stockholm’s smart city and future collaborations In Jakar ta Ann Linde also par took in the Bike2Work Indonesia event on the Car Free Day, together with Sweden’s Ambassador on 2 October, in a bid to promote sustainable transportation in Indonesia. “I wanted to make a statement, I think it would be good if more people would use bicycle,” she told media adding that as a minister, she often travels with a bicycle in Sweden. On Monday 3 October the ‘Sweden – Indonesia Business Forum: Partners in Growth’ was held - a platform for sharing best practices

18 ScandAsia.South East Asia • December 2016

and strategies for building innovative and successful industrial companies, including publicprivate partnerships and triple helix constellations between government, companies and universities for innovation and economic development. A high-level roundtable focused on recent reforms for attracting foreign investments in priority sectors, with a presentation of Swedish footprint and investment plans in Indonesia and how successful companies are maximizing their profitability on the Indonesian market. Ann Linde also met with the Minister of Transpor tation, Budi Karya Sumadi, to discuss sustainable transpor tation solutions, where a Letter of Intent was signed between Indonesia and Sweden. The Swedish Ambassador to Indonesia, Johanna Brismar Skoog said that Sweden is looking to cooperate more with Indonesia in the transportation sector. The Swedish minister also had a dinner with local businesswomen, hosted by H.E. Ambassador of Sweden to Indonesia.

December 2016 â&#x20AC;¢ ScandAsia.South East Asia 19