500 items of recommendation from startups for aspiring startups and entrepreneurs in Asia

Khailee Ng has a keen nose for discovering promising startups.

As managing partner of the venture capital company 500 Startups, his task is to identify and promote some of the companies of the future.

And he has advice for budding founders hoping to build the next big thing: look beyond the top tier of society.

You can actually make a lot of money serving a population that doesn’t have that much money.

Khailee Ng

managing partner, 500 startups

Too often, startups focus on developing products and services for wealthy consumers in advanced economies, Ng said. However, there are many important – and potentially lucrative – problems to be solved in poorer developing countries.

“I don’t think a lot of people think about it,” Ng told CNBC Make It. “You can actually make a lot of money serving a population that doesn’t have that much money.”

A starting strategy for Asia

In fact, Ng, who is part of the Silicon Valley company’s Southeast Asia office, is focusing on much of its funding.

The investor was one of the earliest supporters of the now multi-billion dollar Indonesian e-commerce market Bukalapak, which provides technology for the country’s traditional family-owned street stalls.

Other regional investments by his teams include the Singapore-based Einhorn Grab and the Malaysian on-demand work platform GoGet. Unicorns are tech startups valued at $ 1 billion or more.

Khailee Ng, managing partner and venture capital firm 500 startups.

500 startups

Because of this, Ng encouraged aspiring entrepreneurs to take a long-term view of developing markets and consider some of the more general trends that are likely to arise.

“I encourage entrepreneurs to look into one of their markets, especially when looking at large markets like Indonesia and Southeast Asia in general (and) thinking of the bigger picture and the longer horizon,” advised Ng.

For example, 500 startups consider the relationship between consumption, productivity and gross domestic product in a given market and how this will develop when considering potential investments. More demanding markets tend to focus on productivity while developing countries remain dependent on consumption, he said.

Southeast Asia has now entered a new phase … startups that (will) increase people’s productivity will be the next wave.

Khailee Ng

managing partner, 500 startups

“The first wave of great unicorns, many of whom are very consumption-oriented. Later, when a lot of people are saturated with consumption points, you try to think about productivity,” he said.

These metrics can help a start-up determine what a particular market wants and needs, Ng continued.

“When I think of these lenses, I definitely think that Southeast Asia has now entered a new phase where building startups that help increase people’s productivity (will) will be the next wave” , he said. “I look forward to more entrepreneurs actually building more businesses that can serve the wider population.”

A unique opportunity