Where should an entrepreneur be based in Asia? Singapore, Hong Kong or Shanghai?

Board Member & Founder of Black Marketing – Enabling LinkedIn for You, Chris J. Reed, gives his personal view on why he chooses Singapore

By Chris J. Reed, CEO of Black Marketing-Enabling Linkedin for You

Published 24 June 2016

 

I live in Singapore but I also love spending time in Hong Kong and Shanghai. My business is global, my fastest growing market is China and Hong Kong. I have found that people I visit and know tend to love one city over the others. On a recent trip to Hong Kong and then Shanghai I met with several entrepreneurs, clients, partners and business associates who all expressed a preference for Hong Kong or Shanghai. Even to the extent of never ever even considering Singapore. Singapore to me seems like the business natural hub of Asia. They viewed Singapore in the way that I view KL or Jakarta, nice to visit occasionally but not to live and work in. I also see Hong Kong and Shanghai in that context too, great for business but I wouldn’t want to live there. Everyone has a personal choice for business.

 

So which one should you choose? Let’s look at various factors that entrepreneurs should look at when deciding on where to place their hub in Asia Pacific:

 

Internet connection

 

As my business, is all about LinkedIn, myself and my team need to be using the internet constantly. Therefore speed and reliability are key. I was in Shanghai and Beijing for a week recently and what holds these two locations back for me are two things 1) the internet speed and 2) reliability. Everyone I meet in Shanghai for example complains about the internet speed with or without VPN. The internet is the biggest thing that holds China back. If you can’t get high speed internet in the largest commercial city in the largest country in the world, imagine what it’s like for people in other giant cities in China. It is the biggest factor against putting your business here.

 

There is only so much that you can use WeChat for. The internet is still essential for everything from research to email and communications. Without it and with it at such a slow rate your productivity and ability to do any kind of white collar job is effectively decreased. Singapore allegedly has one of the fastest internet connections and speeds in the world, according to research. Even in Singapore it’s not perfect. I have 4G and like most people who have 4G I still complain about the speed. Nothing is ever perfect but when you experience China, then Singapore, you appreciate Singapore’s speeds. Hong Kong is somewhere in-between. Not as slow as Shanghai, but not as fast as Singapore.

 

Singapore wins

 

 

Censorship

 

This taps into the internet also. When I was in Beijing the Shangri-La Hotel, where I stayed, sent me a note with a list of all the internet sites I couldn’t logon to as they were banned in China. They include Google where we have our entire business on the cloud. I took a photo of this and shared it on my China LinkedIn. Within seconds it had vanished. My list of censored sites provided to me by my hotel had itself been censored! I then of course shared it on my Singapore LinkedIn site and it was not only fine but it trended for a week, gained hundreds of comments and likes, and helpful advice. Ironic. It then trended on the China version of LinkedIn anyway. Doubly ironic.

 

Needing to use VPN all the time is a drag because the Chinese authorities have clearly got wise to this and have started blocking the VPN’s too. Coupled with slow internet it does make people think twice before being located there, but then if you’re not you do risk missing out on the largest market in the world. Of course you can get Yahoo and Bing but if you’re business is on Google and you love Google then you need Google. For those of you who like their social “westernised” then you need Facebook and the like.

 

Singapore wins

 

 

Coworking

 

Since I started Black Marketing 2.5 years ago I have always worked at Jonathan O’Byrne’s amazing coworking space Collective Works. Just last week we moved from to his epic new space which is designed stunningly by Larissa Murphy’s Contrast and is 5x larger than his previous space. There is nothing like it in Singapore, it’s quite easily the best designed, best managed, most contemporary, most spacious, most entrepreneurial, most social, most business focused coworking space in Singapore if not Asia Pacific. More meeting rooms, more light, more glass, more views, more opportunities to connect and meet people - just extremely impressive all round. Our clients, partners and potential clients love coming here. I have yet to see any space in Hong Kong that comes anywhere near it. Even the best spaces there like The Cage and The Garage are pale imitations and remind me of student hangouts more than productive working spaces for entrepreneurs. They might have started earlier with coworking in Hong Kong than Singapore but Singapore learnt about what entrepreneurs wanted faster and better.

 

Shanghai has some cool spaces, I especially like The Naked Hub. It’s a great place to hang out and speak at but I actually think it’s not the best place to work. Too casual and not enough emphasis on the working side rather than the socialising side. The Naked Hub appears to be cool and a great place to hangout but I actually do need to work there!

 

Singapore wins

 

 

Government support

 

Singapore government support is vast, wide and amazing. Every week I receive cheques from the government for this scheme that scheme or some other scheme I didn’t even know that I was in. They literally throw money at entrepreneurs to innovate and employ locals. No one comes near matching them for investment and input.

How smart some of this is is open to question. I have heard stories and experienced it myself of people approaching government bodies EDB and SPRING and having either no reply, no encouragement or no help. Their LinkedIn company pages speak volumes for the fact that they are not really focused on understanding entrepreneurs.

 

You can throw money at something without it actually being effective. I have written previously that productivity has actually gone down since the government's Productivity Scheme (PIC) was introduced. Hong Kong would like to do what Singapore does but don’t and can’t it seems. Too many vested family businesses who don’t want the status quo to be rocked or disrupted. They wouldn’t qualify therefore they don’t want others to benefit. In Shanghai, free trade zones and enterprise grants abound. There is a plethora of incentives and benefits if you know where to look. Very much aimed at Chinese entrepreneurs more than expats of course the authorities do want Shanghai to be the financial and business hub of China and Asia Pacific. There are also many schemes here for expat entrepreneurs if only you can find them.

 

Singapore wins

 

 

The Weather

 

Having moved from the dark, dismal, cold, wet and miserable London to super sunny, hot and humid Singapore I’m in no mood to experience the other side again which to me would rule out both Hong Kong and Shanghai.  Seasons are overrated when three of them are cold, grey and wet…..

 

Shanghai and Hong Kong are lovely in the summer when there is no smog/pollution. The trouble is it’s always there. Sunny days, rainy days the smog is always there, more so in Shanghai than Hong Kong but it has a depressing effect on the city, its inhabitants and people’s moods. Give me sunny skies and warm weather every day and every night any time.

 

Singapore wins

 

 

Being a Start-Up

 

The startup and entrepreneurial scene in all three Asian hubs is vibrant and exciting. There are many areas which each respective government has designated as being enterprise zones. I always find these rather bizarre. A special place just for entrepreneurs to hangout usually far from anyone else. The main reason for being there is cheap rents. However this is often counter-productive. The zone in Singapore for example is 20-30 minutes outside of the CBD (45-60 minutes from Changi Airport on the other side of the island) and therefore anyone like us whose clients are in or are quite happy to visit the CBD would have to travel to them taking hours out of their day. That has its own cost and is more than the saving of cheaper rent. The opportunity cost of time wasted is just as important as an actual cost for entrepreneurs. I would much rather be in a CBD coworking space which is often just as cheap and more convenient. People love coming to visit me at Collective Works, they don’t so much at One North in Singapore for example.

 

Singapore wins for effort

 

 

Entrepreneur Organisations

 

All three locations have interesting entrepreneur organisations. Many have vested interests and are too local and inwardly looking. I find BNI for example in Singapore to be a waste of time which is purely full of local entrepreneurs not international ones who are put off by it. The reverse ironically is true in Hong Kong which is better. The same goes for Entrepreneur Organisations.  My experience with them in Shanghai has been amazing where they have English speaking only and Chinese speaking versions and that works well for both sides. The people I meet there have been fantastic, many are clients of ours. I have also done many LinkedIn workshops and talks to EO chapters in Shanghai which have been received engagingly and been fantastic experiences. It appears in Singapore and Hong Kong that the EO “chapters” are more for vested interests of local powerful families as opposed to real entrepreneurs. Needless to say we haven’t created any clients from these chapters or joined them.

 

Shanghai wins

 

 

Talent

 

Singapore is notoriously hard to employ the best person. Easy to employ a local or Permanent Resident but expats have a hard time being employed under a Singaporean-first policy. It is somewhat ironic that Singapore is expanding its CBD. More and more commercial real estate is being built and Singapore is always offering international companies tax breaks and incentives to come here. However at the same time Singapore is restricting who they can employ once they get here. One counters the other in a city where there is effectively full employment. You win on one side but lose on the other.

 

Yes not everyone has their dream job but not everything can be equalised by force, some things are actually based on experience, personality and characteristics. The best person should always be employed not be forced to be in my view. That is not always the person with the MBA or degree as Singapore is obsessed by. Experience trumps qualifications every time for me. Hong Kong has a more relaxed attitude towards employing foreigners and is therefore potentially more attractive to employers. There are restrictions but not enforced like they are so enthusiastically in Singapore. Like Singapore you can also become a PR although in Hong Kong it’s based on time living there (7 years) as opposed to political pressure and quotas as in Singapore. I have known millionaires to be declined PR status in Singapore and have subsequently moved to Hong Kong.

Shanghai is a mixture of the two. Some people have told me it’s easy to get a permit, while for others the bureaucracy is immense and prevents it.

 

Hong Kong wins

 

 

Corporate hospitality and entertainment

 

This is very much down to your personal choice but each city has amazing nightlife, incredible views (when you can see them in Hong Kong and Shanghai) and fantastic food and drink choices. To me the deciding factor in is the weather and getting around. Both favour Singapore where you can go out to network or entertain on that rooftop bar 24/7, 365 days of the year. The other two can compete on views and food/drink quality but not that.

Each is as expensive as the other. Even Hong Kong with zero alcohol tax is as expensive when it comes to buying it in a bar/restaurant as massively taxed Singapore.

 

Singapore wins because of the availability and access to venues and corporate hospitality venues

 

 

Logistics

 

Setting up a company - easy in Singapore, you only need a local or PR to be a shareholder. Hong Kong is even easier you don’t even need to be that or even be a resident to do so. Shanghai is a mixture of the two.

 

Getting around - Singapore is easy to get around partly because of the size and partly because the Uber/Grab/taxi system along with the MRT/bus network. It is faster, cleaner and better. Hong Kong’s MTR works well and it’s trying to resist Uber to protect its vested taxi interests but traffic is worse than in Singapore, the taxis dirtier and only Chinese speaking compared to Singapore. Shanghai is more of a challenge to get around, even if you can find a taxi it takes forever to get anywhere. Uber is coming in force because of this. Their MRT is also ever expanding but not yet complete.

 

Airports - Singapore’s Changi airport thrashes both the other two based on every factor. From the design and ambience to the queues, Singapore trumps the others. Why do I turn up at HK or Shanghai airport and there are queues to check in, queues to go through security and queues to go through passport control when Singapore doesn't have any of these? Arrivals in Changi are also stress free, quick and you feel you have arrived in a tranquil garden whereas this is the opposite in HK and Shanghai where the design of the airport alone looks like it’s anti-customer friendly and oppressive not positive and enlightening as I always feel coming and going in Changi. Simply the world’s best airport let alone Asia’s.

 

Getting things done - each has its ups and downs, some more bureaucratic than others. I find Singapore less so, employment issues aside that is.

 

Taxation - each has very low and very competitive company taxes and no taxes on company dividends which makes all three attractive especially compared with any western country.

 

Singapore wins

 

 

Singapore wins for me. It's a personal choice.  Everyone is different.

 

 

- END - 

 

 

All opinions expressed are of a personal nature by the author and not should not be attributed to the British Chamber of Commerce Singapore.

 
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