Southeast Asia is brimming with opportunities for growth and expansion for businesses.

The region is most known for its white-sand beaches and lush rainforests but, for a few years now, it has caught the attention of investors around the world. The startup scene in the region has been witness to numerous successes.

Southeast Asia’s Startup Landscape

You might have heard about Grab, a ride-hailing app born in Malaysia in 2012. It is not even a decade old and, yet, in 2018, it pushed its competitor Uber, a global brand, out of Southeast Asia. Since then, Grab has expanded beyond transportation. In addition to being a ride-hailing app, it also now offers food delivery and financial services to its customers.

Grab is not the only startup that has seen success in the region in the past couple of years. Shopee, a mobile e-commerce platform, was launched in Singapore in 2015. Now, it is one of the leading e-commerce sites in the region with a presence in six other countries, namely Indonesia, Malaysia, the Philippines, Taiwan, Thailand, and Vietnam. In June 2018, it saw 147.6 million monthly visits.

Not even the pandemic can slow down the growth of startups in the region. In 2020, Southeast Asian tech startups raised over US$8.2 billion. The trend continued in 2021, with M&A in the region crossing US$124.8 billion during the first half of the year alone.

It is a good time to start a business in Southeast Asia right now, whether in tech or another industry. Despite the challenges of the pandemic, entrepreneurs should seize the opportunity to establish their brand and expand across Southeast Asia. There are business loans in Singapore and other financial aids available to aspiring entrepreneurs who have a promising product in mind.

Here are the reasons to start a business in Southeast Asia now.

Many Potential Customers

Southeast Asia has a large population. As of 2019, there are around 676 million people living across 10 countries. Indonesia has the largest population with over 270 million people, followed by the Philippines with over 109 million residents, and then Vietnam with over 97 million citizens.

A large population means there are so many potential customers for businesses to reach out to. Moreover, many of them have disposable income to spend.

The combined gross domestic product of all 10 countries in the region is US$3 trillion, with the potential to grow even further. By 2030, the percentage of the population in the region that is categorized as middle class is predicted to reach 51 percent, more than double from 24 percent today. In 2020, Southeast Asian middle class households are estimated to have over US$300 billion in disposable income.

Untapped Market

In the United States, big corporations such as Apple and Amazon have a hold on the market. In Southeast Asia, however, there is still space for small businesses to organically grow and conquer their respective industries.

It is easier for small businesses to thrive in countries where they would not be competing with billion-dollar companies. There is no threat that they will be displaced by a competitor that has an almost bottomless source of funds for marketing.

In addition, even if the 10 countries in the region are diverse and far from one another, e-commerce is growing in popularity. More Southeast Asian consumers now have access to the internet. When online, they are shopping for goods and services. 

Affordable Talent and Easy to Do Business

There is a wealth of professionals in Southeast Asia who are highly talented and, yet, because of the low cost of living, ask for lower compensation. Many major companies from around the world actually outsource certain responsibilities to the region because there are a lot of highly-educated individuals ready for work.

Moreover, Southeast Asian countries have performed well on the World Bank’s Ease of Doing Business index. Singapore is in second place in the East Asia and Pacific region. Meanwhile, Malaysia is at 15th place and Thailand at 27th place. Other large economies Indonesia, Vietnam, and the Philippines placed at 73rd, 69th, and 124th respectively.

Governments of each country have also expressed strong support for startups. Singapore, for example, is on a trajectory to becoming Asia’s Silicon Valley. The Singaporean government has created policies that provide benefits to startups and big companies alike. Vietnam has also won over global corporations like Samsung and Qualcomm, becoming an R&D hub in Southeast Asia.

The Southeast Asian market is rapidly flourishing. Despite the pandemic, now is the right time to open a business and take advantage of the hot regional market before other competitors emerge.