Focus on start-ups and innovation in 2018 Budget
View(s):While start-ups are the way forward and expected to be the driving force for the future of Sri Lanka’s growth, the 2018 Budget is also expected to provide indepth proposals on start-ups and innovation, a top official in the technology sector in Sri Lanka said.
Venture Engine winner
Mano Sekaram, Chairman of the Lanka Angel Network (LAN) and Chairman of 99X Technology, on the sidelines of the Asian Business Angel Forum (ABAF) held at the Cinnamon Lakeside in Colombo on Thursday, told the Business Times: “The 2018 Budget will focus on indepth proposals on start-ups and innovation.” Adding to that Mr. Sekaram suggested that all up and coming start-ups should think big and disrupt the whole start-up ecosystem while watching out for potential investors around the world.
Speaking at the forum, he stated that the objective of ABAF is to showcase the opportunities available in the country and invite cross border investment and connectivity among startups worldwide. He also mentioned that there are 30 start ups set up by the LAN that have made Rs. 2 billion revenue. There are many angel investors who are interestingly keep investing on up and coming startups, he noted.
Sri Lanka, alternative destination to Singapore and Dubai
Minister of Telecommunication and Digital Infrastructure, Harin Fernando who was the Chief Guest at the forum was optimistic and confident that Sri Lanka in the next five years will be an alternative tourist destination to Singapore and Dubai. He said, “With the Port City and many other high rise buildings, complexes and apartments in the process of construction, in the next five years Sri Lanka is going to be an alternative destination to Singapore and Dubai”.
The forum brought together industry experts and the investors on one platform. Sri Lanka is now at the right place at the right time with 1.7 billion people in the region. “We need to get the right eco-system around us and take the right initiatives,” added Mr. Fernando. Coming from a telecommunication and digital infrastructure background he mentioned that Sri Lanka has the fastest Internet speed comparing to other countries in the region.
Commenting on the digital education system which is to be implemented in Sri Lanka, he noted that Advanced Level students in all schools will be given a smart tablet to carry home from next year January onwards. “Devices are things what we are trying to give to every citizen in the country. Students need to be educated until aged 19 even if they fail in Mathematics or English language subjects during Ordinary Level exams,” he added.
He also stated that Sri Lanka has to look at countries like Malaysia that have grown by 20 per cent in the Information and Communication Technology sector.
Start-ups should venture outside
Google Vice President and Managing Director for South East-Asia and India Rajan Anandan stated that the Sri Lankan start-up ecosystem is small compared to all other developing countries. During a panel discussion on ‘Cross Border Investing’ Mr. Anandan emphasised that Sri Lankan start-up founders should go out of the country and pitch to foreign potential investors. Angel investors on the other hand should invest in countries that they are very familiar with. Events are one of the fastest growing industry worldwide where start-ups must look for them and keep pitching, he noted.
Start-up success stories
WSO2 Founder, Chief Architect and Chairman, Sanjiva Weerawarana making his presentation about how the company evolved as a start-up stated that WSO2 is a middleware company that sells software to enterprises, architects and large businesses. Looking back at the company as a start-up to what it is today, Mr. Weerawarana mentioned, “Balance sheets and profit and loss accounts doesn’t matter to me right now.”
WSO2 is a US company with subsidiaries in Sri Lanka, UK and Brazil. It was a start-up invested by Intel, Quest, Cisco, Talpa Capital and Pacific Controls and in four months the company raised US$45 million. “We compete with all enterprise middleware companies worldwide and all our customers are inbound. Evaluation of a product can last for at least six months and the customer can end up buying the product or not,” he added.
The technical work is done in Sri Lanka and there are more than 300 engineers in Sri Lanka. The cash flow is positive and profitable for 2017 and the vision of WSO2 is to become the number one middleware vendor, noted Mr. Weerawarana.
Takas.lk
Takas.lk Co-founder and CEO, Lahiru Pathmalal during his presentation mentioned that the e-commerce platform in Sri Lanka will reach $13 billion by 2021. Some 77 per cent of consumers on the takas.lk platform today are from the Western Province and the balance 23 per cent from the rest of the country.
Going back to the early stages of takas.lk as a start-up, he stated, “In terms of e-commerce, trust was a big barrier we had to overcome, while today the mindset has completely changed among the consumers. Our marketing has reduced by 60 per cent. By December this year, we will have a positive cash flow. More than 30,000 customers buy products worth up to Rs. 23,000.”
He also noted that with funding, Sri Lankan e-commerce will see hyper growth through increase in Internet speed and penetration, more conducive payment ecosystem, thriving young population and GDP growth. Internet penetration is at 29 per cent and the policy is pushing for 50 per cent. More banks and intermediaries are entering the payments market.
Mr. Pathmalal also stated that takas.lk meets key demands of Sri Lankan consumers with the country’s first pure-play e-commerce site. Currently the site has built only scalable platform to capture the Sri Lankan market.
Fashionmarket.lk
Fashionmarket.lk founder and CEO, Linda Speldewinde during her address spoke of how 100 weavers in Sri Lanka are today delivering products to 5000 consumers in India. “Sri Lanka should become the hub for fashion design in the region. The county’s apparel sector is the largest in the country,” she added.
Emphasising on the untapped potential of Sri Lanka, she said, “There is an untapped potential on innovation that is coming from the village level in Sri Lanka. The company’s vision for the next 10 years is to make Sri Lanka the innovation hub for design. We are building the Colombo Innovation Tower opposite the Academy of Design building in Colombo in order to achieve our targets. With design we can move markets across the world and it has the power to change lives and create a strong impact,” noted Ms. Speldewinde. (RM)