Cultivating a Thriving Startup Ecosystem in Thailand

Thailand’s tech startup ecosystem needs to shift from competition to collaboration, integrating venture building programs. Despite challenges like funding limits and traditional business hesitance, potential for growth exists. Depa’s funding aims to span all startup stages, addressing a decline in new ventures. Thailand’s ranking in global startups has slipped, highlighting urgent reform needs for a thriving landscape.

Thailand’s tech startups are at a crossroads, presenting a unique opportunity for innovation through new collaboration models, such as venture building programs. These initiatives aim to unite aspiring entrepreneurs with experienced technologists to foster a thriving, cooperative startup ecosystem. “Strengthening a collaborative rather than a competitive startup ecosystem is essential,” emphasizes Warin Ratchananusorn, director of the Digital Startup Institute.

Despite the burgeoning potential, Thai digital startups grapple with formidable challenges, including limited funding access, insufficient mentorship, and inflexible government systems. Mr. Warin notes that many traditional enterprises struggle to embrace digitalization, stifling growth opportunities for local startups to test their innovations in real-world scenarios. Currently, about 400 active startups exist in Thailand, with only 200 receiving around 800 million baht in support from the Digital Economy Promotion Agency (depa).

Highlighting Thailand’s strengths, Mr. Warin mentions the country’s human resources and technological readiness, which are crucial for building a formidable startup ecosystem. However, he cautions that the number of emerging startups has dwindled, particularly at the idea stage, due to inadequate support structures, outdated regulations, and insufficiently innovative incubation models focused on deep tech.

Depa has tailored its support to provide funding across three development stages: idea, early, and growth stages. “This year we’re eager to seek specific idea startups applying for our funding,” Mr. Warin states, indicating a proactive approach. According to StartupBlink’s Global Startup Ecosystem Index for 2024, Thailand slipped to 54th place from 50th in previous years, though it holds steady at 11th in the Asia-Pacific region.

Notably, Thailand ranked 17th globally in 2024 for the impact of global startup events on the ecosystem, with its startup activities heavily centralized in Bangkok. The funding landscape for local startups saw fluctuations, with US$400 million in 2020, rising to $600 million in 2021, and peaking at $1.3 billion in 2022. However, it dipped to $1 billion in 2023, reflecting broader trends in Southeast Asia, which experienced a drop from $23.5 billion in 2021 to $4.5 billion in 2024.

The Thai startup ecosystem teeters on the brink of critical transformation, marked by the need for a more collaborative approach to nurture new businesses. While challenges like funding, mentorship, and regulatory hurdles persist, the potential for success remains strong. With initiatives like depa’s funding at various development stages, and an acknowledgment of the concentrated nature of innovation in Bangkok, Thailand must innovate its support structures to foster a vibrant startup landscape.

Original Source: www.bangkokpost.com