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TSMC and tech came much later. And it was originally government owned (51%).
Most of the startups today are by business and marketing majors, not STEM people.
Ok, but you need engineers and at least where I am from in the UK, there is a shortage
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Well if everyone is squeezing each other then nothing gets done.
But I don’t understand how investors are giving money to open coffee shops.
Like some guy asks 5 million to open a coffee shop and I ask 1 million to be an independent luthier… And the coffee shop guy gets the money.
Or you’ll never save enough working for someone in Taiwan. They pay you just enough to not starve but not enough to break out.
Whom exactly did you ask? A bank?
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It’s hypothetical… I really don’t even know who to ask.
Forget banks. They are extremely risk adverse and would only loan you if it’s something they can take as collateral (such as a house). This isn’t the USA where loans are really easy to get regardless of ability to pay especially with a high FICO score.
There’s truth to this, especially in places like the SF Bay Area, although given the cost of living, not everyone working at a startup is super super comfortable. Making low 6 figures there, which people at startups that haven’t raised a Series A yet frequently do, isn’t so awesome financially, especially if you aren’t a bachelor.
But I think there’s more to it than just money. It’s the mentality. Risk taking isn’t seen as a bad thing. People are generally optimistic and confident that even if things don’t work out, the future is bright.
If you start or join a company that doesn’t succeed, nobody will hold it against you. There are no issues of “face.” You can work at a company that fails and nobody will judge you for that in a job interview. You can start a company that fails and your investors very well may be first in line to invest in your next business.
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That’s the problem. Not to say that STEM founders don’t have blind spots and need business/marketing resources, but it’s usually easier for STEM founders with something innovative to fill in business/marketing gaps than it is for business/marketing founders to fill in tech gaps.
I know many ‘start ups’ in the life science industry in Taiwan but they were all funded by select groups of individuals and wealthy investors. I know at least ten different glucose test manufacturers and the same story in other areas I am familiar with. The issue of course is that they largely do similar things and need to make profit now rather than an undetermined time in the future on some untested tech. I’ve worked for one failed startup , that was pretty tough.
The money was invested by the employees and their families I believe as well as some rich business people.
I also know one that was a spin off from ITRI with awesome med tech developed over years, it was snapped up by an electronics conglomerate and subsequently pretty much disappeared into the background as it’s too small to make an impact. That was a real pity.
I also know and have worked for companies listed on the private market in Taiwan ,some good ones , well funded, but it’s just really hard to make a breakthrough on the global market. Their major aim, 90% of these newly funded companies with tradeable shares , is to be listed on the public stock market in Taiwan and get a high return on their investment.
Well if someone’s going to do a startup it will never be anything worthy of kickstarters. Taiwan doesn’t allow that.
Chances are it’s to do something that every Taiwanese does, buy machines, develop production flow, etc. and get orders from overseas customers to produce stuff for usually US companies who did all the marketing and stuff. Basically stuff that made Foxconn famous. And everyone aspires to be Terry Guo or Formosa Plastics.
If you want to be like Elon Musk in Taiwan you better be very rich because you will have no backers.
Gogoro
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The likes of Peleton would never ever work in Taiwan. Not because of lack of talent in marketing or capital but because of a lack of market access. Not enough people would have bought Peleton here. It would have needed to target a foreign market from the very beginning which would have put them at a massive disadvantage. This is a big drawback and one that is often overlooked when people say why Taiwan doesn’t have startups.
Taiwan had a big market in scooters and behold Gogoro. Similarly Taiwan had an outsized market in whiskey and we got Kavalan. There may be other examples that I can’t think of but the point is Taiwan is small and has access to a small market which makes it hard to get big initially before the dough rolls in and you can buy out your competition.
OEM just makes sense for Taiwan.
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So what Taiwan can do is remove as many trade barriers as possible. Because otherwise Taiwan is too small when it comes to market.
I’m curious how other island nations like NZ and Australia do with small markets? Australia is big but has population similar to Taiwan (but spread out over a much larger area)?
The size of the market is a significant challenge but there are counterexamples showing that if you create the right environment and have the right strategy, size doesn’t have to be everything. Look at Israel and Singapore, both of which are much smaller than Taiwan.
Israel had 138 exits in 2019 worth over $21 billion in total, and startups there raised over $8 billion in the same year.
Singapore has a pretty vibrant tech startup ecosystem and has lured hot companies like Grab to move their headquarters there. The government provides a lot of support and has been strategic about where they focus. For instance, there’s a big push for fintech startups, many of which are founded by foreigners who have been incentivized to come.
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That’s incredible, hats off to them.
Israel has a lot of access to Europe and preferential treatment from US but you are right it is doable with the right policies and the right zeitgeist. And Taiwan should at least try to do better.
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Untrue, Taiwan has absolutely excellent product design and kickstarter style products
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The Taiwanese market isn’t small though.
But Taiwanese seems to be very singular in terms of wants… so market is heavily focused on a small types of items and not much else (scooters for example).
That and the rest of the world “says” they support Taiwan but really are quite indifferent to Taiwan, and so caves to any pressure from China to exclude Taiwan.
Just look at every major product launch or support that is only limited to a small number of countries that almost, always, exclude Taiwan. Lots of E stores will ship to a small number of countries that always exclude Taiwan. Google Stadia supports a small number of countries that excludes Taiwan. Some media outlets like to call Taiwan first world but almost always excludes Taiwan in most foreign affair consideration or markets. They’ll always include Japan, South Korea, HK, or Singapore but always excludes Taiwan.
It is reasons like this why Taiwan is stuck doing OEM.
Taiwan has 23 million people and decent spending power. It’s not small at all.
Anyway with the startup stuff, we are moving in the right direction, but conservative Investors restricts everything.