What are the major challenges that startups face in today’s business environment?Manisha Shah, CFO at MoMo and a judge for the KPMG Global Tech Innovator
In the current business environment, startups in Vietnam have favourable advantages for growth, especially for dedicated entrepreneurs with innovative ideas. The primary challenge lies in scaling the business from the initial seed stage, where a good idea exists, to a more advanced stage. At this point, startups must prove their revenue model, establish a product-market fit, and develop basic management systems. This process is inherently difficult, regardless of the market conditions.
Compared to 2020 and 2021, the fundraising environment has become more challenging, making it a bit harder for startups today. Economic challenges impact both startups and mature businesses alike, causing many investors, employees, and customers to become more conservative. Employees may be less inclined to join a startup during a tight funding environment, and customers tend to reduce their spending.
However, economic challenges also create opportunities for people and companies to explore new ventures. Historically, economic slumps have been the birthplace of many great businesses, such as Pinterest, General Motors, Walmart, IBM, Groupon, and Instagram. The constraints during an economic slowdown provide the right environment for entrepreneurs to identify and capitalise on opportunities.
How should management at startups respond to these changes, and what advice would you give them to secure funding for their business?
They need to understand that investors have shifted their focus. Unlike the “growth-at-all-costs” mindset prevalent in the 2018-2021 period, investors now expect startups, even at Series A and Series B stages, to demonstrate a revenue model and engage in conversations about achieving self-sustainability.
Therefore, it is crucial for entrepreneurs to effectively articulate how their business addresses a specific problem or customer pain point, exhibit a product-market fit, and present a convincing revenue model.
What challenges do women face in the tech industry, particularly in setting up businesses and maintaining work-life balance?
Women in the tech industry face common challenges such as the workload and limited access to capital and mentors. Startups demand significant dedication, which often creates an imbalance between work and personal life. Anyone starting a business should be aware that other aspects of their life, such as hobbies, family, and friends, may receive less attention during this period, necessitating additional support.
It is essential to acknowledge that work-life balance is not solely a women’s issue but a challenge faced by all individuals. Men also take on parental and familial responsibilities. In Vietnam, there is often access to broader family support and the ability to hire assistance more easily than in some other western countries.
Vietnam boasts numerous remarkable female entrepreneurs and managers, with high female participation in the workforce across all levels. However, the under-representation of female founders in tech startups is a global phenomenon.
To address this imbalance, two approaches can be effective: firstly, investors should actively support startups founded by women; secondly, we should encourage girls to pursue computer science and engineering studies.
At MoMo, we observe this when recruiting directly from universities. While we have an even split of women and men in the company, the applicants at entry level jobs in technology are disproportionately male. By promoting computer science education among high school girls, we can gradually change this trend. When there are more female engineers, the number of women starting tech startups will naturally increase.
What advice would you give to companies participating in competitions such as the KPMG Global Tech Innovator?
It is crucial to approach it with strong conviction in your product and its ability to solve a customer pain point or address a user need. Your presentation should highlight not only the big idea behind your startup but also the short-term plans for the next 12-36 months.
The judges not only evaluate the idea, but also the entrepreneur behind it. Therefore, it is essential to showcase what sets your idea apart.
KPMG Private Enterprise Global Tech Innovator 2023 in Vietnam & Cambodia
The KPMG Private Enterprise Global Tech Innovator competition is looking for technology breakthroughs and the entrepreneurs who are ready to grow their businesses.
Shortlisted companies will be invited to present their innovations and pitch their growth plans to a panel of Vietnam and Cambodia’s top business, technology, and finance leaders who will provide professional feedback on the market potential for each innovation and the company’s growth ambitions.
The country finalists will be announced through local, national, and social media and will reach the attention of the region’s tech and business influencers. The winner will be invited to compete on the global stage for the KPMG Private Enterprise Global Tech Innovator crown during Web Summit 2023 in Lisbon, Portugal.
Application round: April 17-June 30, 2023
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