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Market Launcher
Riding the Southeast Technological Wave
Frederick Ng
Southeast Asia (SEA) is beginning to reap the benefits of a massive demographic dividend. The region’s 650 million-strong population has a median age of 25; the middle class continues to flourish, whilst tech-savvy and mobile-first numbers continue to grow unabated with 3.8 million users signing up to the internet for the first time at any given month (Techcrunch). These are all strong indicators of an ecosystem ripe for technological disruption.
Unsurprisingly, the region has received a massive influx of investment (USD 6 billion for H1 2019, according to Cento Ventures) into technology start-ups, creating eight unicorns in the process including Gojek, Grab, Tokopedia and Traveloka. What is lesser known, however, is the rapid formation of the talent pool supporting these tech-driven solutions.
The Push Factor for SEA Tech Talents
In 2018, Alipay rolled out the Tech for Inclusion project to nurture 1,000 tech talent per year in e-commerce, fintech, and cloud technologies over the next ten years in emerging economies, with Indonesia announced as its first destination.
The Indonesian government has also been doing its part to embrace the technological revolution. In early 2016, President Joko Widodo launched a nationwide initiative to create 1,000 startups before 2020. This initiative was underpinned by numerous hackathons, workshops, and boot camps across the country to lure high caliber talents into the digital economy. The private sector is responding accordingly to Joko’s commitment to the technology revolution as multinationals such as AIA, FWD, and Gameloft have established development centers and large offshore IT teams to augment their teams in Singapore and Hong Kong.
It is not only in Indonesia that is experiencing the technological wave; Vietnam, has seen the number of engineers double over the last three years (500 Startups) with more than 250,000 technology talents in the market.
Unbeknown to many, Vietnam has a very high-quality science, technology, engineering and mathematics curriculum; the foundation for proficient developers and consistently ranking highly in global coding challenges. Given the rising costs of traditional technology hubs in China and India coupled with the trade war between China and the US, many companies are turning to Vietnam as an alternative destination for IT outsourcing jobs.
Given the rising costs of traditional technology hubs in china and india coupled with the trade war between china and the us, many companies are turning to vietnam as an alternative destination for it outsourcing jobs
The Pull Factor
The returning SEA diaspora have been powering the booming digital economies in the region. For instance, Bukalapak, an SME-focused Indonesian unicornscaled its 1,100 strong tech team without any research and development (R&D) centers outside of the country. They did so successfully by filling the leadership ranks with returning engineering talents from abroad to disseminate the best engineering practices from Silicon Valley to its junior engineers. As more diaspora are drawn to the burgeoning SEA region, homegrown software engineers and application developers will quickly become equipped with the fundamental know-how to build successful startups.
Bukalapak is not the only unicorn building up their tech talent base in SEA. Grab, for instance, based three of their R&D centers in the region: Ho Chi Minh City, Jakarta, and most recently, Kuala Lumpur. Lazada’s development hubs are located in Singapore and Ho Chi Minh City. Tokopedia, the Indonesian answer to Alibaba, uses local tech talent.
The Challenge and the Opportunity
In order for SEA to become the next global talent pool for technology, it needs to overcome a few obstacles. The first is English proficiency which can pose a challenge for companies seeking talent in Vietnam, Thailand and to a lesser extent, Indonesia. The second is creating a legal entity in of itself can be both onerous and expensive. The third is to know where to source the best domain experts in different countries across SEA: one may need to find e-commerce or application development talent in Cambodia, web developers in Thailand and digital marketers in Indonesia in order to execute their go-to-market strategy.
Obstacles aside, the ecosystem of a young educated population and rising middle class paired with forward-thinking government policies bodes favourably for SEA towards becoming a global talent hub for technology talent.
The articles from these contributors are based on their personal expertise and viewpoints, and do not necessarily reflect the opinions of their employers or affiliated organizations.
