Shenzhen a good place for Singapore hardware startups: IE Singapore

OPPORTUNITIES abound for Singapore hardware startups in Shenzhen, a metropolis that has in the past few decades incidentally become Guangdong's most innovative city, said April Oh, regional director for South China at IE Singapore.

Despite its reputation as a haven for copycat products and fake goods, Shenzhen is home today to a vibrant startup ecosystem, Ms Oh told The Business Times in a recent interview.

The city is synonymous with youth - its average age is 32 (Singapore's is 40.5) - technological innovation, and hardware startups, that is, companies that deliver products and services to users through physical electronic devices.

This stems from the city's strong manufacturing base and it having been the "factory to the world" in the past few decades, Ms Oh said.

"Shenzhen has developed an entire supply chain of product development enablers, intermediaries and hardware startups to support the high concentration of electronic manufacturers."

For one thing, the city promotes the use of open source hardware, where anyone can buy different electronic parts, innovate and create a new product. A remarkable variety of electronic parts can be found at Shenzhen's Huaqiangbei, for instance, which is said to be the world's largest electronics market, and has been dubbed the "Silicon Valley of hardware" and a "maker's dream".

Shenzhen also offers open solutions known as gongban (public board), gongmo (public case) and white labels that allow makers to create as much as 80 per cent of the functionalities of a new product, reducing the need to create a product from scratch, Ms Oh said.

"The availability of small-batch prototyping and accessibility to hardware solution providers allow startups to transform ideas to products in a shorter time and with lower cost."

The mature supply chain in Shenzhen has also led to the development of prominent hardware startups such as drone maker DJI, accelerators such as HAX Accelerator, and makerspaces such as Chaihuo. Makerspaces are where people with shared interests, especially in computing or technology, gather to work on projects while exchanging ideas, equipment and knowledge.

Igloohome, a Singapore startup that makes smart digital locks, in May opened an office in Shenzhen to do hardware research and manufacturing - citing cost and speed advantages. It has created a "Smart Keybox" that can be fastened onto a wall outside an apartment and can be used to secure keys until unlocked via passcode or Bluetooth, making it popular with Airbnb home renters.

Walter Wang, founder of Igloohome, said that he liked that buying electronic components such as sensors in Shenzhen takes less than an hour. In other parts of China, however, if a component is not available, one may have to order online and wait a few days for it to be delivered.

"This heavily speeds up the whole R&D (research and development) process. Our smart keybox product is made up of 70 different components - any component delay will cause a final delay to production," he said.

More Singapore hardware startups can leverage Shenzhen's advantages as did Igloohome, said Ms Oh, who has spent the last four years in Guangzhou, the capital and most populous city of Guangdong.

Meanwhile, IE Singapore is working with and identifying makerspaces and accelerators in Shenzhen as potential partners for Singapore hardware startups, she shared.

"Guangdong is no longer just a manufacturing hub for the world. A mindset change is required. Companies need to view Guangdong not just as an end market, but also as a partner for technological innovation."