Meet the Govt is a new series by e27 that focus on how government agencies in Southeast Asian countries work together with startups and other industry players to build a healthier and stronger ecosystem.
Incepted in 2009, The National Innovation Agency (NIA) has been playing a leading role in the development of Thailand’s innovation ecosystem by encouraging entrepreneurs to help solve grassroots economic problems through the use of technology –and to get more people in every region to launch their own startups.
e27 speaks to the leader of innovation management in Thailand, Dr. Pun-Arj Chairatana, the Executive Director of NIA, to get a deeper insight into the kingdom’s dynamic startup scene. We also seek to understand how it plans to compete with others in Southeast Asia.
A founder himself, Chairatana has been involved in several international and national research projects for both private and public sectors for a decade. These projects include “Trendnovation Southeast”– a project under the Searchlight Network of the Rockefeller Foundation; he was also involved in designing social innovation system and policy for the Thai social economy.
Chairatana is also the programme leader of Startup Thailand– a national startup promotion platform by the Ministry of Higher Education Science, Research and Innovation (MHESI) – that established a national-level policy to make Thailand an open area for startups. Not only in Asia, but also the world.
Spreading the startup word
The government of Thailand first set up a national startup committee in 2016. Since then, NIA played a crucial role as a leading agency to develop awareness and build an ecosystem for pioneers, startup investors, young entrepreneurs, corporates, and even capital markets and universities.
“Firstly, NIA strived to generate awareness among youngsters, big corporates and even governments on why startups are very important for the innovation ecosystem, and how they can act as a new economy warrior for Thailand,” says Chairatana.
While the startup scene in Thailand took off a bit late as compared to Malaysia, Singapore, Indonesia or Vietnam, there are quite a few startups that have already received big-ticket investments and they are starting to expand regionally and globally, says Chairatana. And at the same time, international investors are trying to learn and work with Thailand.
“We do not believe that startups by themselves will be able to manage Thailand’s economy. But they will create innovative jobs and their evolution will provide high potential sources of new income for SMEs. So startups will indirectly help us kickstart a key growth engine,” he clarifies.
Also Read: 5 growth-stage startups that are leaders in Thailand’s ecosystem
Chairatana also adds that Thailand has a very active and strong large national corporates (LNCs) who back Corporate Venture Capitals (CVCs) with a majority stake in the startup investment scene in Thailand. This, he believes, is a “unique proposition” of the startup ecosystem in Thailand.
He lays down the key strategies and goals for NIA to shape the startup ecosystem of Thailand:
- It will be more internationalised. There will be more and more new faces from around the world to work closely with the Thai ecosystem
- The role of CVC will be more and more important for the startup ecosystem in Thailand. Next steps will be to brand CVCs, develop the capacity and capabilities of a fund manager, and work together with them to make key national strategies on investment for startups both in Thailand and abroad
- There will be increasing concentration on deep technology and creative startups
- Innovation districts in Bangkok and Chiang Mai are set up to attract international investment and stimulate the local startup scene
- The government will play a very crucial role in accelerating growth and there will be greater collaboration between government and startups.
2020 ready
While the first phase was about generating awareness about startups and entrepreneurship, 2020 will mark the second phase of the startup ecosystem building in Thailand.
“We will shift from awareness and building infrastructures– both tangible and intangible to making the Thailand ecosystem more friendly for not only fresh faces from the university campuses, but also from all over the world,” says Chairatana.
To achieve this goal, Chairatana says, the NIA has three focus areas:
- Catch ’em young
The first one is to bring in new firms, new startups. This is important since the existing startup numbers in Thailand is not very high as compared to others in SEA.
They have around 147 universities out of which 40 universities are already engaged with the Startup Thailand League. “This year we will extend support to them with the ‘You Startup Fund’ or YSF,” adds Chairatana.
The fund aims to support students from the day they decide to be an entrepreneur or startup founder. NIA will support them financially and technically on ideation and team building. It will also support them to accelerate growth with registered companies, using the university facilities.
Chairatana affirms that some public banks and other corporates have joined the bandwagon to support the youngsters.
- Deeper in deep tech
“University startups in Thailand are capable of deep technology and creative innovation and hence this time we are choosing to focus on building and increasing the number of firms with a focus on deep technologies,” he says.
They will be emphasising on agritech and food tech, springing from the economic strength of the country in addition to health tech and medtech.
“Apart from that, we will focus on the application of IoT, 5G and also blockchain or even AI startups, which is a must,” he adds.
- What’s MARtech
Bearing that creativity sells big in Thailand, they curated a new sector, called MARTech or music, arts, and recreation tech.
“We are talking about supply chains for startups working on MICE, art, design, e-sports or even sports tech. Thailand is internationally known for hospitality, tourism; hence there is an increasing number of startups in travel tech and media too,” says Chairatana.
“But our main focus will remain at universities and we expect to have an in-campus startup establishment of at least a 100 companies or more a year,” he continues.
From agrarian to industrial and now to digital
Thailand moved from being agriculture to nearly manufacturing-oriented OEM countries in the 1980s. The contributions of agriculture to the GDP is only around eight per cent while the service sector accounts for more than 50 per cent of its GDP.
“I don’t think we heavily depend on agriculture anymore. About 30 per cent of the population depends on agricultural income, more than half of the population lives in cities. So the agricultural supply chain has already shifted and changed into contract farming. The landowners don’t depend on agricultural income but instead on agricultural industries,” Chairatana elaborates.
Also read: How Thailand is making strides to mold Bangkok into a global startup destination
Thailand does not have many agritech startups and their key challenge is to develop smart farming for those who need it, reducing the consumption of bio-pesticides and also chemicals in agriculture and water management.
Chairatana adds, “These kinds of challenges will be very good opportunities for startups working on agritech in the near future. That’s why we launched e-growth programs, which is an accelerator dedicated to agritech startups for not only Thailand, but also the rest of the world, so they can join hands and work together.”
Going beyond Bangkok
In SEA, only Thailand and Singapore have subscribed to the concept of an innovation district, he says. In Thailand, they do not just have an innovation district in Bangkok, but also in Chiang Mai, to attract more international faces to the arena.
Taking the pressure off Bangkok, Chiang Mai is further being designed to become the best landing pad or landing city for startups and investors in Thailand. They are already working with global startup hubs in Europe, Southeast Asia, East Asia, the US, and also Latin America.
Pandemic effect
The current economic slowdown owing to the COVID-19 pandemic has concerned all nations, Thailand included. Logistics and the global supply chain have been affected by this economic downturn.
“It seems that an entrepreneur needs to be more cautious about the uncertainties in the world. And the uncertainties go beyond that of daily operations. Be it climate change, geopolitics or even the recent pandemic,” warns Chairatana.
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NIA is a co-creator and part of the annual forum member of the Southeast Asia Startup Assembly (SEASA). Co-hosted by the agency and e27, the platform brought together a total of 12 innovation and startup government agency representatives from ASEAN Plus to discuss the main issues faced by the startup ecosystem and the solutions that a united effort by this forum can provide.
Image Credit: Kelvin Yup on Unsplash
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