Daily Times

Entrepreneurs are behind much of the well-documented rising wealth in Asia, but as a career path, becoming an entrepreneur, and nurturing entrepreneurship, is relatively new for the region. Even in Hong Kong, long a bustling city of commerce, in the 1980s and into the 1990s, “the word entrepreneurship wasn’t part of the business vocabulary,” says Elizabeth Thomson, recalling her own experience in the city as an entrepreneur. Thomson came to Hong Kong from Canada in 1977, and started ICS Trust a couple years later to connect US and Canadian companies to the lawyers and bankers who they needed to do business in Asia. Today’s it’s common for entrepreneurs to start thinking about starting a business when they’re in college, a path that would have been unusual for older generations, writes HSBC Private Bank in a recent report. And, unlike in the past, today’s successful young entrepreneurs in Asia value innovation and they intend to make money. “Taken together, these factors suggest a strengthening culture of early entrepreneurship that is being nurtured in Asia, particularly in Mainland China, where business ownership was less prevalent in generations past,” HSBC says. The private bank didn’t just look at Asia, but at the complexion of entrepreneurship globally in a survey of nearly 3,000 business owners. While the report seeks to understand what makes an entrepreneur successful, it pays special attention to the influence of culture. Interestingly, entrepreneurs from Asia (specifically China, Hong Kong and Singapore) and the Middle East share many common traits, while the same is true of business owners from the US and Europe. As a private bank, HSBC is motivated to understand what makes a successful entrepreneur tick, both personally and professionally. Not only because many of its clients are entrepreneurs, but because it hopes and expects business owners to be among its future clients. “We aim to be the leading private bank for high net worth business owners and principals,” says Bernard Rennell, HSBC’s regional head of global private banking, Asia Pacific. A business owner who worked with HSBC’s commercial banking unit for years as her business grew will likely turn to the private bank when her wealth becomes more liquid after say, a sale, or an IPO. To Rennell, the story of wealth creation in Asia isn’t over: “If you look at our neighbors in the Pearl River Delta region of Mainland China, it was once a hub for low-value-add manufacturing, and today it is rapidly becoming a center for high-tech manufacturing and services.” A report like this – HSBC’s first- can help the bank do a better job of understanding who its clients are and how to serve them. What follows will you give you a glimpse of what sets Asia’s entrepreneurs apart: o 37% of business owners in Asia, as well as the Middle East, decided in school or college to become entrepreneurs compared to 27% of business owners in the US and Western Europe. But the most successful ones likely spent a number of years in a professional role before striking out on their own. o “Value creation” in China, Hong Kong, Singapore and the Middle East, is defined not so much by personal fortune but by the size of their business. Business turnover in Asia and the Middle East was nearly USD10 million, HSBC says, almost twice the average in the US and Western Europe. o Business owners in Asia like to collaborate, “leveraging multiple sources of advice.” In fact, building a dependable network, often before they go into business, is crucial to these entrepreneurs, and more than a third believe a lack of connections can hold them back. That figure climbs to 46% in China. o “For Asian entrepreneurs who are proud to have built successful empires, there is more of a focus on consolidating and growing their current enterprise,” HSBC says. “We often see family members in Asia reinvesting into the business to drive further growth.” o Across Asia and the Middle East, one in three second-generation entrepreneurs have joined the family business, compared to just 15% of those in the United States and Western Europe. o The highest proportion of millennial entrepreneurs are based in the Middle East (63%), but then again, Mainland China and Hong Kong each have 44%. o 71% of Asia’s entrepreneurs go into business to have a positive economic impact. That’s true for 50% of entrepreneurs in Europe, 60% in the Middle East and 57% in the US o More than half (56%) of Asia’s entrepreneurs want to have a positive impact in their community, compared with 48% of entrepreneurs in the US, 47% in the Middle East and 38% in Europe.