Country Overview – Thailand
- Second-largest economy in Southeast Asia
- Thailand has a strong reputation for innovation, performing well in market sophistication
- Number of government incubator and accelerator programs to help start-ups in the region
- Strong food, travel, retail and fintech sectors
Thailand at a glance
Population: 70 million
Languages: Thai (Main), Lao, Karenic languages, Khmer, Malay, and others.
Average cost of living:
- Rent: USD 640 onwards
- Living cost per month: USD 900 onwards
Thailand’s easily accessible high-speed internet and its tech-savvy consumers provide an excellent environment for startups looking to penetrate the market. Although the ecosystem is young, strong support from government schemes and investment from renowned market players in the region, along with Chinese investment makes Thailand a promising region for startups. In 2016 the government unveiled its Thailand 4.0 strategy aimed at generating development in future growth industries. The strategy is focused on supporting SMEs and promoting innovation.
In 2020,Thai startups raised up to USD 364 million which included various pre-seed, Series A and B rounds. The country is also home to major car manufacturers such as Toyota, BMW and Ford that have placed their car manufacturing facilities in the county where hybrid models are being assembled, with the aim of manufacturing electric vehicles (EV) in the future.
Aside to manufacturing, the country is also ripe for various Industry 4.0 initiatives for its strong food processing sector, with over 10,000 companies exporting its products throughout the world. Thailand is ranked 2nd in the world for rice and sugar exports, top 5 in chicken and shrimp and the 11th biggest global supplier of ready-to-eat meals.
In the fintech space, Thailand Securities and Exchange Commission (SEC) had so far approved 13 crypto businesses the license to operate while both the government and private sectors are pouring in money and support to help grow Thailand into a regional fintech hub in Asia.
In terms of government support, Thailand’s Board of Investment (BOI) has focused its attention on promoting software, infrastructure, technology development and startups in Thailand. Support is offered through the following:
- Corporate Income Tax exemption of between 5 and 8 years for software development and digital services.
- Corporate Income Tax exemption of between 5 and 8 years for digital Infrastructure.
- Non-tax incentives for E-commerce companies.
- Maximum of eight years of Corporate Income Tax exemption on the revenue from the distribution of goods for smart distribution centers.
- Thailand’s Board of Investment also offers a “Smart Visa” to qualified professionals on a list of 13 industries, which allows professionals and their families to stay in Thailand for a maximum of 4 years, without having to obtain a work permit.
In addition, the National Innovation Agency (NIA) offers a range of support to startups. This support includes the following:
Open Innovation offers funding to entrepreneurs and startups in order for them to improve technology and innovation. Open Innovation allows startups and SMEs to fast track to become hugely innovative.
Thematic Innovation is available to food, farming, wellness and healthcare startups. The project is carried out through a partnership of three sectors – society, private business, and academic institutes.
Managing Innovation Development Credit (MIND CREDIT) aims to assist with the financing of startups, and SMEs by developing their product or improving their business portfolio. Suitable candidates receive a free grant of a maximum of one million baht (approximately US$32,000) per project.
The Startup Voucher created by Thailand Science Park (TSP) is in place to upskill tech startups and facilitate international networking. Support of up to 800,000 baht is offered (approx. US$25,500).
An accelerator program run by the National Innovation Agency and the Research & Innovation Sustainability Center (RISC), promotes global Agtech startups in Bangkok.
Incubators and Accelerators
There are more than 20 incubator and accelerator programs in Thailand. These include government run programs, along with a wide variety offered by the private sector and even corporate venturing arms of major multinational companies.
According to the Bangkok Post, startups in Thailand have raised more than US$130 million. Fintech and e-commerce were the two sectors with the most successful deals in Thailand in 2019. Approximately 314 startups were registered with Startup Thailand by the end of September 2020.
A large number of the incubators and accelerators are focused on growing innovation in the region.
According to Crunchbase, there are over 100 active VCs operating in Thailand. According to the Bangkok Post there have been a considerable number of Series C startup funding rounds within the last couple of years in Thailand, which would indicate that the ecosystem presents great promise to interested startups. Statista indicates that there were 35 funding deals for startups in 2019; the approximate value totaling around US$97.55M.
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