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Ian Kwan, President of PSP Security, demonstrates the facial recognition technology his company is developing at the Hong Kong Science & Technology Parks |
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Ian Kwan needs no keys to unlock his office. The president of PSP Security simply glances at a device that can recognise his face. Seconds later the biometric security system opens the door to a company that has benefited from one of Hong Kong's crucial business support services.
Once inside, visitors meet the small team operating the fledgling company Mr Kwan started with two other entrepreneurs in 2007. The pioneering device developed by PSP Security is poised to hit the market, but Mr Kwan admits the company would not be where it is if not for the Hong Kong Science & Technology Parks (HKSTP).
"We wanted to take advantage of HKSTP's resources, which reduce operating costs and help us find other companies to network with," Mr Kwan says.
The Hong Kong Government set up the HKSTP and its unique Technology Incubation, or Incu-Tech Programme, in 1992. To date, it has helped at least 180 technology start-ups, like PSP Security, get off the ground. At least three former "incubatees" are now listed on the Hong Kong stock market.
Business Incubator
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New companies find advantages in setting up at the business incubator facility at the Hong Kong Science & Technology Parks, says Vice President of Business Development and Technology Support Allen Yeung |
According to HKSTP Vice President Allen Yeung, incubatees first get help with a business plan, along with product marketing and business matching.
"Then, what we look at are training programmes, legal services and also one very important thing – laboratory support services. Some people, especially those in small companies, cannot buy all the equipment they need. But when they come here, they pay a fraction of the cost," Mr Yeung says.
For Mr Kwan, the laboratory support was critical to his company's quick path to success. He says he is also impressed by the way the venue creates opportunities with other companies.
"To give you a specific example, after a product launch we hosted in conjunction with the Science Park last month, we actually were able to connect with a few companies right here that are doing something else. By combining our two different technologies, we found we could target a new market that we had not even imagined we could go after."
Legal Backing
While HKSTP partner companies benefit from group discounts on such support services as legal representation, there are plenty of other options in Hong Kong. Some business experts, however, worry that many companies do not realise the dangers they face by not enlisting support in the critical three years after a business starts operation.
Business support services were among the key topics discussed at last month's Entrepreneur and Continuing Education Day, organised by the Hong Kong Trade Development Council and sponsored by the Hong Kong Government's Education Bureau. The event highlighted opportunities and services for new business start-ups through seminars led by successful entrepreneurs.
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| Wilfred Tsui of law firm Gallant YT Ho & Co says investing in legal advice is a cost-effective way to avoid longer-term problems with doing business on the mainland |
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One of the seminar speakers, legal expert Wilfred Tsui, warns that start-up companies are more likely to cut corners in tough economic times.
"Legal costs will be one of the areas they would like to save, because this is not something they see as an imminent issue to deal with at the moment," says Mr Tsui.
"I've met talented people who have good connections and can do successful business, but due to some mistake in entering into cooperation agreements with other parties, they let the other parties acquire all their shares or ownership in the company."
Mr Tsui says the legal fees are relatively small compared with a disastrous mistake. He says he has regularly seen cases of companies doing business on the Chinese mainland use "unlimited" companies rather than "limited" firms, which have better legal protection.
"There are people from the United States, Europe and Canada who bring with them investors who want to go into the mainland. We tell them they are better off coming to Hong Kong first because all the professional support is here," says Mr Tsui.
"We know English, we know Chinese and we know the culture. So we can be the bridge – we can be the gateway for you to enter the mainland."
Serious Competition
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Accountant Simon Cheung says too many start-up businesses fail to get enough help to plan for the future |
Professional accounting services are another of the many advantages available to small and medium-sized enterprises (SMEs) that use Hong Kong as a platform. Simon Cheung, a certified public accountant, told last month's seminar that his advice to SMEs goes beyond basic compliance on accounting, finance and tax.
"That's not enough for them to survive in business. I'd emphasise that entrepreneurs should have a more competitive model – covering one, three or even five years. Then their financial, legal and tax compliance should all deal with that model across those different stages," says Mr Cheung.
"They should focus on the market and the related competitors in the industry, especially for those businesses that start with the potential market on the mainland. We must ask ourselves whether those services or products would be too easily copied by a mainland enterprise. That's very important for today's businesses, because competition is getting much more serious."
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PSP Security's AccuFACE device, developed at the Hong Kong Science & Technology Parks, uses infrared facial recognition technology to make the system more accurate and reliable
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Mr Tsui also notes that global product and economic cycles are getting increasingly shorter because of globalisation, as well as the fast flow of cash, information and people.
"So entrepreneurs today must have much better planning, and their financial management style should deal with that."
Programmes on offer at the HKSTP make that planning process easier, according to Mr Kwan. He says PSP Security has more credibility because investors and collaborators realise the company gets the support it needs.
"This programme verifies our creativity, and that our research project is at least on par with others at the Science Park," says Mr Kwan. Even though HKSTP does not directly endorse the products or services of its partner companies, Mr Kwan says simply being there is an advantage.
"It gives people a sense that we are a legitimate technology company that has passed a certain valuation and verification process. That's an advantage, especially when we are marketing our product to folks on the mainland."
Related Links
CK Cheung (CPA) Co., Ltd
Gallant YT Ho & Co
Hong Kong Science & Technology Parks (HKSTP)
PSP Security
