Southeast Asia is in its Golden Age - E701

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Is Southeast Asia entering a tech golden age and why does it matter?

Jeremy Au 0:00
Why are VCs hunting for unicorns? VCs must hunt unicorns in order to become vegetable capital successful funds. What we see here is that United States is number one. in the world unicorns. China obviously is a hundred and twenty plus. And then the UK and India about twenty plus. Uh and then obviously Europe. But what's interesting is that if you look at Indonesia and Singapore, I think Southeast Asia, uh you see about ten unicorns. And actually I think if you look at the latest count is even more because we actually see A lot of Chinese companies actually relocating the headquarters to Singapore and getting counted as Singapore unicorns. So a little bit of debate whether you'll count them as that, but the crux of it is that the there's a little bit of uh power law itself for the amount of unicorn value in terms of number of count.
Jeremy Au 0:43
And that roughly corresponds as well to the value of these unicorns, right? Because these unicorns all have a certain amount of market cap. And so United States and China actually. Are the top two countries in terms of numbers of unicorns, followed by India. So I think it's interesting because when we think about Southeast Asia and these ecosystems, you have to think about The fact that Singapore is not just a count for the countries but also we tend to be the Dorma Salt unicorn destination for Southeast Asia and f also for Chinese companies. This is an interesting report by Asia Partners, and Asia Partners basically has made a thesis. And I think there's something for us to think about. But their thesis is that Southeast Asia is entering a golden age.
Jeremy Au 1:23
So what they've done is that they've shown and plotted that GDP per capita for USA, Australia, Japan, South Korea, China, Southeast Asia, and India. And their thesis is that uh as these uh economies grow in terms of the wealth, then technology companies tend to emerge out of those markets. And so I think basically you're saying that uh India started out with the basic stuff in terms of flip card, make my trip so it's like travel and logistics. Uh and then Southeast Asia is a hit. Yeah, Southeast Asia, grab, go to Bucala Park, travel local. QASM, SCI, which is in Thailand. And obviously China has Tensan, Alibaba, Mewan, Biden Dance. And then of course in the US with the highest GP capital. It shows Apple, Microsoft, and your classic high tech of the high tech companies is out there.
Jeremy Au 2:13
So I think the thesis is that there's a golden age for Southeast Asia. And I think there's something for you to think about, whether it's true or not true, whether you believe or don't believe, but you just have to understand that there's a thesis that has been underwritten by many VC funds and actually by many limited partners in America and globally writing checks into the Southeast Asia VC funds. And that's something for you to think about. But the crux of it is that The Asia Partners' perspective is that Chinese IPOs show a certain growth of the country that explains the development of technology ecosystem. So if from 1995 to 2022, They have put, from their perspective, technologies from the bottom, the most basic or fundamental, and then at the top end, technologies that are dependent on the bottom technologies.
Jeremy Au 3:01
If any of you have ever played a game, Civilization, or some sort of computer game, there's something called the technology tree. It's like you need to unlock fire. And chemistry and steel in order to make a gun, right? You need to have wheel unlock wheels and horse therefore to make a chariot. So I think there's this concept that technology requires certain things to unlock, right? And the word progression of technology is important because when Japan was forced to open up because an American sailed in the ship with all those guns, Japan was at a certain technology tree where they had samurai. And then the Westerners had guns and steam power and all this other stuff, right? So that technology stack is important.
Jeremy Au 3:41
And what China did a speed run of building out those technologies. And it's a good map because in America a lot of these technologies were actually built over a longer time frame, over fifty years.

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