Unraveling Multimodality with Large Language Models.pdf
Future Asia Ventures Corporate Accelerators & Booming Startup Sectors - January 2016
1. Page 1Copyright 2016 Future Asia Ventures
Corporate Accelerators &
Booming Startup Sectors
January 20, 2016
2. Page 2Copyright 2016 Future Asia Ventures
Disclaimer
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Table of Contents
• Executive Summary
• Global Accelerator Overview
• Fintech Startups: The Boom & the Challenges
• The Coworking Boom
5. Page 5Copyright 2016 Future Asia Ventures
Executive Summary
This report, similar to the prior two reports, contains a global overview of the corporate accelerator
landscape. In addition, it also features two startup sectors which are globally experiencing high levels of
growth – Fintech and Coworking. Key findings and themes are summarized below:
There are 116 corporate accelerators worldwide. Europe leads this count with 54 accelerators, mostly based
in the UK and Germany. 2015 was a strong launch year for all regions around the world, with a total of 45
launches. In the coming year, accelerator launches may slow, but corporate innovation will continue. Expect
to see companies designing tailored open innovation programs which fit their specific growth strategy and
agenda.
The fintech startup sector now has over 6,000 startups worldwide. The sector, while gaining popularity in
recent years, is decades old. Startups in this sector face unique challenges given the stringent regulation on
financial service providers and the risk of cyberattacks on highly sensitive data.
Coworking space providers have sprouted in hundreds of cities worldwide. It is estimated that over 7,000
coworking spaces exist in cities around the world. New York, Hong Kong and Singapore have some of the
priciest real estate on the planet. Coworking players in these cities are on the forefront of designing new
programs, services and business models. The future of coworking will involve more collaboration with
corporations.
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1 2
12 13
15
26
45
2009 2010 2011 2012 2013 2014 2015
Number of Corporate Accelerators Launched Each Year
Source: Company Websites and Florian Heinemann Accelerator website www.corporate-accelerators.net
Accelerator Launches May Slow, But Innovation Won’t
Corporate accelerator launches have peaked. So far in
2016, 2 new accelerators have launched. Going forward,
companies will design tailored open innovation
programs and formats to engage and collaborate with
startups.
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2015 Was a Strong Launch Year for All Regions
1
8
2
7
8
12
1 1
3
9
7
13
20
1
2
1
5
13
2009 2010 2011 2012 2013 2014 2015
Americas
EMEA
APAC
Number of Corporate Accelerators Launched Each Year by Region
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39 54 23
Corporate Accelerators by Region
116 Corporate Accelerators Exist Worldwide
The global corporate accelerator count stands at 116. Companies are increasingly launching and
adding more accelerators in EMEA and Asia Pacific locations. In EMEA, the UK leads with 19
accelerators and Germany follows second with 12. In Asia, Hong Kong, Singapore and Bangalore have
16 of the total 23 accelerators.
Around the World
10. Page 10Copyright 2016 Future Asia Ventures
Technology, Financial Services and Telecom Lead the Race
Technology, 23
Financial Services, 21
Telecom, 18
Media, 13
Cross Industry, 12
Health, 6
Consumer , 6
Retail, 4
Education, 4
Travel, 3
IoT, 3
Logistics, 1 Energy, 1
Real Estate, 1
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Fintech Startups:
The Boom & The Challenges
14. Page 14Copyright 2016 Future Asia Ventures
What is FinTech?
The FinTech sector is made up of 8 categories:
1)Marketplace lending platforms
2)Payments & mobile wallet apps
3)Equity crowd funding platforms
4)Robo-Advisor platforms
5)Blockchain enabled software
6)Financial data analytics software
7)Brokerage & trade systems
8)Treasury & financial risk systems
FinTech Defined
Marketplace Lending
Payment &
Mobile Wallets
Block chain Data Analytics
Equity Crowd funding Robo-Advisors Brokerage & Trade
Treasury &
Financial Risk
Consumer Focus Enterprise Focus
FinTech Definition:
A portmanteau of the words financial and technology
used to refer to both enterprise and consumer focused
apps and software which are used in financial services
transactions, record-keeping and analysis.
The term is often used to describe the recent boom in
startups focusing on such technologies, however,
financial technology has been developed and used by
firms and individuals for several decades and continues
to evolve.
15. Page 15Copyright 2016 Future Asia Ventures
The Evolution of Fintech
1950s 1960s 1970s 1980s 1990s 2000s
Online Crowd
funding
Mobile wallets &
payment apps
Robo-advisors
Marketplace
lending
Block chain
Online banking
Online payments
Online stock
trading
Bank risk
management
systemsPhone banking
Electronic Stock
Trading on
ExchangesATMsCredit Cards
Fintech is a very broad sector with a long history. Most fintech and consumers equate fintech with the latest
mobile app or crowdfunding website. But technology has always played a key role in the infrastructure of the
financial sector in ways that most people take for granted and might not ever see.
Fintech has a long history reaching back 65
years. The recent innovation boom is
marked by an increase in retail banking &
consumer focused services.
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Challenges Faced by Fintech Startups
The fintech startup boom is a global phenomenon. From Silicon Valley to New York and from London to
Singapore and Hong Kong, more than 6,000 fintech startups are contending to serve the needs of retail
banking customers and financial professionals. But the sector also faces some very strong hurdles, making
it a uniquely complex space for founders.
While fintech startups have certainly
innovated new platforms and gained
traction among retail banking
customers, the scale of their
achievement, whether measured by
lending or investments is still a small
sliver of the retail banking market in
developed nations. Banks in
developed nations still have a strong
branch presence and manage
deposit bases that measure in the
trillions, making them a central hub
for most households who need
savings accounts, credit cards, loans
and payment services to manage
their finances. Until a majority of the
deposit base shifts away from banks,
they remain fiercly entrenched.
Regulation is a barrier for many
fintech startups that need to
establish themselves globally.
Regulatory filings just to establish in
one’s home country can be
daunting and expensive. Legal fees
to file and apply for licenses can be
a burden on an early stage startup.
The U.S. alone has ten regulating
bodies which oversee different
parts of the financial sector and
additionally each state has its own
rules and regulators. As fintech
startups gain scale, policymakers
may need to reconsider more
relevant regulations to account for
new business models and
technologies.
The risk of a cyberattack on fintech
startups is an open issue. Startups
at a seed or early stage growth may
not have the funding to establish
the same level of protections that
large banks might have in place, but
it is a very real risk that grows as
more customers join and use a
fintech platform. The ideal scenario
would be to have a full-time Chief
Information Security Officer, but it’s
not a realistic proposition. Few
early stage startups can afford a
dedicated function and staff. There
have not yet been attacks on
fintech players, but a single point of
failure in the fintech ecosystem
could threaten the future of this
sector.
Entrenched Competition Regulation Cyber Threat
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Fintech Startup CEOs Share Advice on Raising Seed Capital
“With cloud and open source technologies being so
easily accessible today, innovation becomes more and
more a question of hard work and creativity instead of
available resources. Therefore it's important to get a
product released as quickly as possible and acquire first
users. Raise your first round only after you have first real
users.“
CEO, Radoslav Albrecht
“Being persistent has proven to be the most crucial
lesson I learnt when raising the first round of capital for
my startup Spotcap - especially when it comes to
pitching. As an entrepreneur, it’s easy to be convinced
by your idea. Nevertheless, you have to be aware other
people initially may not - you have to address their
concerns and persuade them. So, be open to taking
feedback on board, refine your pitch and be concise in
your presentation. Believe in your vision and always
target a wide range of investors .”
Cofounder and CEO, Tony Triebel
“Think of this as a team sport – successful
startups are founded by great people. Bring your
co-founder along to pitches and showcase your
team whenever possible.
You also have a choice, so make the right one.
Don't approach just any investor, be patient and
choose investors who will help you post-
investment with resources, connections,
mentorship, and are willing to invest in future
rounds.
Can you explain your product simply? At the
same time, demonstrate a high attention to
detail.
Don't hide your competition; every smart
investor wants to invest in a successful market.
Saying there is no competition is the equivalent
of saying there is no market.”
Jon Medved, Founder & CEO
19. Page 19Copyright 2016 Future Asia Ventures
The Coworking Business Model
Value to Customer
1. Simple pricing and easy to
execute contract
2. Flexibility to grow or reduce
space as needed
3. Community & networking with
like-minded and similar size
businesses
4. Affordable location in a metro
area or downtown city center
Customer ExperienceCoworking Space Expenses
Space Related Fixed Expenses
• 2-10 year lease
• Design & fit out
• Furniture
• Maintenance
• Janitorial
• Utilities & wifi
• Office supplies
Program Related Variable Expenses
• Event planning
• Mentors & coaches
• Membership marketing
• Food & beverage
• Office & reception staff
Single Price Point
Flexible Rent Terms
Deskmag estimates that there are more than 7,000 coworking space providers worldwide. The coworking business model
relies on a mix of office space, community focused programming & events and flexible short term rental. Coworking
founders bear the risk of committing to a fixed term lease and charging their customers enough to make a profit, while
maintaining a competitive price point that is attractive to small businesses and startups.
20. Page 20Copyright 2016 Future Asia Ventures
Office Space Real Estate Dynamics in Three Markets
Real Estate Market
Singapore
Office vacancy 9.5%
Office vacancy 3%
Office vacancy 6.1%
Proj Rental Value Chg +10%-20%
Market Conditions
2015 2016 2017
Market Conditions
2015 2016 2017
Market Conditions
2015 2016 2017
Source: JLL Global Market Perspective Q4 2015
Proj Rental Value Chg -10%-20%
Proj Rental Value Chg +5%-10%
Prime Office Rent
Landlord favorable
Neutral
Tenant favorable
$255.50 /Sq Ft
$153.00 /Sq Ft
$93.25 /Sq Ft
Source: Knight Frank Global Cities 2016
# of Coworking Spaces
100
50
60
HongKongNewYork
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New York: The 2nd Largest Startup Ecosystem
A Growing Workforce
New York’s coworking market is growing. The city now has slightly over
100 coworking spaces. Coworking has found a thriving startup
ecosystem, a growing number of freelancers and small business owners
who are opting for new office space models. According to Angelist,
New York has more than 13,000 startups and was recently ranked by
Compass as the 2nd largest startup ecosystem in the world. According
to a study commissioned by the Freelancers Union and Upwork, New
York saw an increase of 700,000 freelancers in 2015. These numbers
feed the coworking market with a strong supply of renters.
Changing Needs or Unmet Needs?
But coworking is not just about growing numbers. According to Shlomo
Silber, CEO of COWRKRS, a growing coworking provider in Manhattan
and Brooklyn, “The independent workforce is growing and coworking
caters to the lifestyle changes and flexibility that today's workforce is
continuing to gravitate towards." Silber, who has a background in real
estate and construction was drawn to coworking when he himself
experienced the energy and friendliness of sharing workspace with
other businesses. Coworking provides a stimulating and social
atmosphere. Providers actively plan events and provide services which
cater to the needs of their renters. Silber believes that this intangible
value is something that makes coworking a permanent part of the
office space landscape going forward. "Coworking is becoming a way of
life for a vast amount of small businesses and entrepreneurs. Similar to
visiting their local lunch spot, gym or grocery, the coworking space is a
part of their daily routine and integral to their neighborhood and
community.” The growth in small businesses and freelancer is feeding
this need. Shared services and networking opportunities are creating a
value add and ROI effect for coworking customers. The simple and
flexble pricing is now a standard offer, but it’s community that
differentiates a player.
Employee Engagement
The appeal of coworking, the community and the energy that it
engenders, create a level of workplace engagement that most
companies lack. Year after year, the Gallup Survey has revealed
disturbingly low rates of engagement among the U.S. workforce.
According to a JLL study, Full Engaged, published this month, larger
companies are rethinking and redesigning their workplaces into more
open and evocative spaces. Coworking layouts and design are showing
larger corporations a way forward. For some large companies,
collaborating and sharing space within a coworking arrangement has
proven to be effective for certain teams and departments.
Strategic Players and Innovators in the Market
New York has its “unicorn” coworking provider in WeWork, which was
founded in Soho in 2010. The provider now has 19 locations around the
city, all of which are below 42nd street, a demarcation line for the
startup scene in the city. New players are entering the market across
locations in Manhattan and Brooklyn. The coworking boom has affected
even the most unlikely places, as at least 5 coworking providers are
based in the Financial District, some located directly on Wall Street. The
largest concentration of players is along the 23th and 30th street stretch
of Broadway, known as Silicon Alley.
Coworking entrants are experimenting with different models. For
example, The Writer’s Room is for authors and writers who need a quiet
space to work. Krash, another provider, is experimenting with a
combined coworking & coliving concept. Grind Spaces has partnered
with Verizon, to create a coworking space which will include the
corporate incubator and corporate ventures team. As coworking begins
to mature as a category, operators are building new revenue streams
and creatively partnering with shared service providers and
corporations.
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Hong Kong: Where Topography Reigns
“Paperclip has been built to
address more than just office
space. We are a startup
campus. Our workshops,
programs, mentoring and
partnerships brings a unique
mix of services and expertise
designed to help
entrepreneurs and large
corporations.”
Deepak Madnani, CEO and
Founder, PaperclipHK
“The coworking space
business is a great one to be
in. Although it can get tough
as any other business, once
you get the model sorted,
not only can you make good
returns, you can also make
great connections and friends
through the community you
build.”
Elaine Tsung, CEO and
Founder, Garage Society
Founders’ Perspectives A City Around a Hill
The Hong Kong Special Administrative Region measures 423 square miles. But Hong Kong
Island, where the region’s commercial and political hubs are centered is only 30 square miles.
The majority of the island is made up of country park, mountain ranges and hills, with only a
perimeter which serves as the habitable area. This important characteristic drives Hong Kong’s
prime office rents to $255/ sq ft, $100 more than New York and almost 3x the price of
Singapore. Hong Kong has the most expensive office real estate market in the world.
Survival of the Fittest
New coworking players have been entering the market rapidly over the last two years. Some
have specific niche focuses, but given Hong Kong’s pricey market, providers are relying on a
diverse mix of renters to mitigate risks. Most spaces charge approximately $1500 to $2000
HKD per month, but the large government owned Cyberport space drives tough competition
at only $800 HKD per month. As Hong Kong rents remain high, coworking space owners make
thin margins. According to some, only 20-30% of coworking spaces are profitable in this
market.
Creating Value
For those who are finding success as a coworking space provider, maintaining a strong value
proposition through prime locations, well designed facilities and high quality events, have
been key ingredients. Hong Kong’s entrepreneur class, especially first time entrepreneurs,
face the risk and stigma of creating a company, with no stable income and a high chance of
failure. Culturally, this is a difficult avenue for employees and founders in the city as family
expectations and the city’s high living expenses have steered people into more stable,
corporate jobs. Coworking spaces allow those taking the risk to find community with others
who face the same pressures. More importantly, coworking providers are realizing that they
can play a stronger role in mentoring and educating young founders on how to run their
startups while also providing valuable connections to investors and potential customers.
When coworking providers demonstrate this value, in addition to their flexible rentals, the
package begins to look very reasonable.
24. Page 24Copyright 2016 Future Asia Ventures
Singapore: A Competitive Coworking Market
“Coworking takes a balance of both left brain business logic and
right brain creative engagement in almost equal measures.”
Jonathan O’Byrne, Founder, Collective Works
A Vibrant Startup Scene
While many Singaporeans are bankers and technology professionals at
large multinational companies, entrepreneurs make up a vibrant
ecosystem which has grown with government support. According to
statistics from the SPRING Singapore program, there are more than
5,600 startups employing over 33,000 people. In a city known for its
high rents, coworking spaces that offer flexibility and amenities have
become a key component in the ecosystem.
A Transient Market
Coworking in Singapore has had a very steep growth curve. There are
now 60 providers on the island, with most being based in the Central
Business District and surrounding areas. While there is a strong supply
of startups, the market is competitive and coworking remains a tough
business. Singapore’s high expat population means that there is a
seasonal aspect to coworking revenue streams when these workers go
on extended holidays. Dips in revenue are expected in December,
January and certain summer months. Adding to that is the very
expensive cost of rent in Singapore. Between revenue variability and a
high fixed cost, coworking providers need to make sure they have
forecasted accurately while also creatively differentiating their offering
in a crowded playing field.
Potential Oversupply
Recent entrants and some older players are expanding their spaces.
Collective Works in the CBD has an 8 story building in the CBD. The Hub
has expanded it space to a new larger location and The Working Capitol
has combined five shop houses into 33,000 square feet of office and
event space. With several expanding players, competition will be fierce
and discounting may drive smaller players out of the market.
"Coworking is an awesome game-changer for women. Too often,
women, and especially working mothers, are stuck working out of
their kitchen or only having the time and space to get their work
done late at night, after they have taken care of their
family. Coworking can address the need for a separate space for
women and help with the gender equality struggles women face."
Michaela Anchan, CEO Woolf Works
"The coworking boom is real in Singapore and has grown from 6 to
60 spaces in the last 4 years. At Hub Singapore, we have become
the living room not only for startups but also forward-thinking
corporates and government. For spaces who get it right, it's never
just a real estate game - it is the home of a global collaborative
movement."
Grace Sai, CEO & Founder, The Hub Singapore
Founders’ Perspectives
25. Page 25Copyright 2016 Future Asia Ventures
The Future of Coworking
More spaces targeted to specific
sectors, demographic groups,
professional groups will continue to
grow. This will enhance community
building and create affinity towards
providers.
Niche Target Markets
Coworking spaces will increase their
mentoring, advisory and
educational curriculums to help
startup founders. Programs may
mimic or partner with accelerators.
Tailored Advisory Programs
Coworking providers and
corporations will partner on
programming and space initiatives.
Corporations will become a key
component in stablizing revenue for
coworking spaces.
Corporate Partnerships
Several coworking providers will
expanding into multiple locations,
nationally and internationally.
Membership style services across
locations will enhance loyalty and
branding.
Multiple Chain Locations
Coworking providers will expand
their current spaces to generate
more event based revenue and
accommodate growth. Larger
spaces will enable coworkng
providers to negotiate more
effectively with building owners.
Larger Spaces
Innovative new models will offer
renters services which are non work
related (concierge, discounts, etc).
Offering may mimic “hacker house”
style arrangements for young
startup employees.
Beyond Work
1 2 3
4 5 6
26. Page 26Copyright 2016 Future Asia Ventures
Past Reports by Future Asia Ventures
Published August 31, 2015
CLICK HERE FOR DOWNLOAD
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Published December 1, 2015
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Corporate Accelerators
2016 Outlook
December 1, 2015
Corporate Accelerators:
A Growing Force
August 31, 2015
About the Author – Falguni Desai
Falguni Desai has over 18 years of corporate strategy, innovation and M&A experience. She has
worked with business leaders at global firms in the financial, media and technology sectors to foster
growth & expansion. She holds a BS in Economics from The Wharton School of the University of
Pennsylvania.
27. Page 27Copyright 2016 Future Asia Ventures
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Working with corporations, private investor
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We select our clients and only work with firms
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