Friday May 17, 2024
Friday May 17, 2024
Tuesday, 7 March 2023 00:05 - - {{hitsCtrl.values.hits}}
Hatch Co-Founders Jeevan Gnanam
|
Sri Lanka’s largest startup accelerator Hatch recently kick-started their partnership with Draper Startup House to position the country as a top destination for foreign entrepreneurship and angel investment.
Their new co-living space located in Orion City, Colombo 9, Hatch X Draper Startup House, was opened in January as part of Draper Startup House’s network of co-living spaces across over 20 countries attracting digital nomads from around the world.
A digital nomad is a remote worker who uses technology to work from anywhere in the world, either as a freelancer or for remote companies. They make a notable impact on the host economy by bringing in new skills and perspectives to the communities they visit, while also spending money on local businesses and contributing to the tourism industry. As a popular tourist destination known for its low cost of living, Sri Lanka possesses great potential to position itself as a hub for digital nomads.
The Daily FT sat down with Co-founder Jeevan Gnanam to discuss the significance of the digital nomad’s role in line with Hatch’s ‘Troubled Nation to Startup Nation’ vision for Sri Lanka.
By Rivi Wijesekera
Q: Hatch appears to be specific and intentional in the kind of foreign talent they aim to attract to Hatch X Draper Startup House. How would you define the ideal digital nomad?
This whole idea of the digital nomad has been around for a while. I think they definitely are here to stay, and they’re taking off as a global movement that possesses the power to uplift emerging economies.
However, the kind of digital nomad that Sri Lanka needs to attract is different.
This is why, when we describe the kind of people we want in our new co-living space, we term them ‘digital nomad entrepreneurs’—those who want to connect with the local ecosystem and develop ideas that will go on to transform the country, instead of merely being a tourist.
What we want is knowledge transfer, people working and collaborating together to help the economic development of the country in the long term, not just them being there during that time but also creating good connections with people on the ground.
As reported by Mordor Intelligence, the global market size of the digital nomad industry is projected to reach $ 6.8 billion by 2024, a 172% increase from its value of around $ 2.5 billion in 2019. The trend is even more pronounced when looking at digital nomad entrepreneurs, the kind this space aims to attract, specifically: a survey by Founders Forum found that 27% of millennial entrepreneurs identify as digital nomads.
In contrast with digital nomads engaged in remote work abroad, foreign entrepreneurs create new jobs and contribute to the local tax base. By running their own businesses, they have the potential to employ local talent, collaborate with local suppliers, and generate revenue that stays within the local economy. They may also invest in local real estate or infrastructure, which can have long-term benefits for the local economy.
Q: What has Hatch’s involvement in this movement looked like in the past? Are there ongoing programs aimed at attracting foreign talent to the local ecosystem?
Yes, we have been actively involved in not only supporting local startups with foreign entrepreneurship and talent, but also creating awareness around their role in our economy.
In fact, we worked in the last 2-3 years with the ICTA and the German Embassy to bring in Sri Lanka’s first official digital nomad—Matt de Caussin.
Matt is a German-American entrepreneur who came down as part of our digital nomad ambassador program, NOMAD4LK—a first for Sri Lanka. He was on the island for about 2-3 months on a fully funded visit, traveling to different locations, talking to local entrepreneurs, and figuring out how best to help them—essentially looking for value propositions from our people.
Q: You described the digital nomad community as a rising global movement. In this regard, where does Sri Lanka fit in, and why now?
First of all, we have to understand that, within the global context, Sri Lanka tends to be insignificant from an economic perspective. However, if you take South Asia, we enjoy strategic neutrality with countries like India, Pakistan, and Bangladesh which Hatch aims to leverage. In this regard, we hope to leverage this connectivity into other countries to become a launching hub for entrepreneurs looking to expand into the rest of South Asia.
For example, just yesterday, I was advising a local startup founded by Pakistani entrepreneurs looking to begin operations in India and Bangladesh. Given political context, really the most direct way for them to achieve this is by being based in Sri Lanka.
As for timing and the context of our slow recovery from an economic crisis, I believe we have nothing to lose to position ourselves as a startup nation. Right now, we as a nation are literally starting up once again, putting ourselves out there, and trying to regain momentum. It is not without risk, but it’s a risk that we should be willing to take.
One of our greatest assets as a nation is our people—we maintain this global perception as a people who are friendly, and inquisitive. This cultural aspect will convey really well if we position Sri Lanka as a startup nation in the South Asian context.
In 2021, Sri Lanka earned the No. 2 spot in Club Med’s “Top Countries in the World to Live as a Digital Nomad” list, demonstrating the potential that Gnanam envisions. Contrary to public perception, there are several factors at play that position Sri Lanka in the ranks of similar destinations in the region, such as Goa in India and Bali in Indonesia, such as its No. 9 ranking in the Digital Nomad Index for Internet Speed.
Q: Given your wealth of experience in supporting startups here, have you seen any trends in terms of specific industries in which Sri Lanka has found particular success?
Digital nomad entrepreneurship is an up-and-coming movement in Sri Lanka so I’m not sure if we can see any trends yet. However, if you look at the 500+ startups that Hatch supports, they tend to be strong in a range of industries in sustainability and technology such as Fintech and Agritech.
Of course, as an island nation, tourism will always be a great industry for entrepreneurship, and there are also a few things that could layer on top of tourism.
I want to reiterate that it’s still too early to say if we have a winning area, it will happen over a period of time, but I see areas such as sustainability and cleantech as interesting spaces where Sri Lanka could lead South Asia. If we look at tech for example, we wouldn’t want to place ourselves as yet another IT hub like India, but one that is looking at intersections of areas with strong potential, such as green tech. This could differentiate our story from the rest.
Q: How will Orion City play a role in supporting startups created and ideas born at Hatch X Draper Startup House?
The main reason we chose Orion is that it’s known as the centre of excellence for IT in Colombo.
A big question for those looking to invest and start up shop here is “will I be able to find the right talent here to work with, and will there be enough of it?”
If we house digital nomads right next to the many startups and businesses that thrive at Orion City, they can realise and be assured that they actually can scale and think globally in Sri Lanka. Orion City hosts a mature tech ecosystem, housing companies that employ around 1,000-2,000, for example.
So, that initial concern is pacified, and for good reason as our talent is only untapped—not lacking.
We plan to connect the Hatch Startup House to startups based in our Fort location, but for now, we’ll focus on the talent housed in Orion.
As we have seen at our co-working space Hatch Works, we expect to see a lot of cross-pollination of ideas, and a lot of partnerships being sparked. It’s exciting to see the possibilities that arise when ideas are shared as a community.
Orion City is located in the heart of Sri Lanka’s IT/BPO Industry. Known as Colombo’s first IT park, Orion City houses a diverse mix of Nasdaq-listed global companies and up-and-coming local startups.
Q: You brought up an important concept in the world of startups—cross-pollination. As a company that values community, how can Hatch encourage the exchange of business ideas in this space? Do you consider it to be more of a natural process instead?
It’s a bit of both. While creativity and ideation certainly cannot be forced, there are steps we can take, especially as an accelerator/incubator space, to encourage cross-pollination. We at Hatch achieve this through community-building.
There are weekly programs and special events already in place at Hatch Works in Fort in which we invite the startup community in Colombo to meet up and brainstorm—Smartups for Startups was a Hatch event that demonstrated the power of community-building.
It would be very integral to the co-living model to make sure that this exchange is encouraged, but it’s even more important that people meet up to really get those ideas off the ground.
Personally, with our space being located next to Sri Lankan tech giants such as Virtusa, I’m excited to see our startup and tech ecosystems interacting with each other—the possibilities are endless.
Q: You mentioned sustainability and sustainable tech as potential industries that Sri Lanka’s startup ecosystem can champion. What would Hatch X Draper Startup House offer in terms of facilities and programs that align with this potential?
Firstly looking at where Hatch X Draper Startup House is located, Orion City is LEED Gold Certified, meaning it’s globally recognised in terms of how environmentally sustainable it is in all aspects of its construction.
Hatch has a wealth of experience in supporting sustainability ventures, and we often expect our entrepreneurs to focus on sustainability as a core concept of their business idea and operational culture. The Hatch startup culture is guided by 6 of the 17 SDG goals, including Quality Education, Gender Equality, and Affordable and Clean Energy—our community of entrepreneurs reflects this in the way they target sustainable economic development through their business ideas.
We also focus on sustainability in terms of mindset and impact: a question we will always ask ourselves and the people we support is “are you solving this certain problem in a way that is allowing our communities to learn and grow?”
As a digital entrepreneur in Sri Lanka myself, I know co-living and have stayed in many such spaces. What sets Hatch X Draper Startup House apart is that the space is very luxurious. Ondřej Lang, a Czech entrepreneur who had been involved in the European e-commerce industry since 2009 is a good example. Lang now considers Sri Lanka his second home and co-founded Feelo in 2022, a Sri Lankan inspirational and experience e-commerce platform.
If people who want to work from abroad need inspiration while having the same lifestyle they had abroad, this is the place for them. I’ve been to spaces Down South in Sri Lanka and Bali in Indonesia, and this is completely different in terms of the architecture and feel of the space.
Q: This new space marks the first development since Hatch joined forces with Draper Startup House. What does this partnership bring to the table in terms of supporting local talent and ideas?
One of the strengths of Draper Startup House is that they have co-living across the globe, with their strongest presence being in South and South East Asia. Hatch aims to leverage our strengths in co-working and connecting with the local ecosystem, matched with their tight-knit network of co-living entrepreneurs, to create something new for Sri Lanka. This ties back into why we specifically want to attract digital nomad entrepreneurs—it’s their perspective matched with our talent.
Speaking from his wealth of experience dealing with investors in Europe, Ondřej Lang gave his advice to potential digital nomads on Sri Lanka’s base of local talent.
“There are a lot of talented people in Sri Lanka. They just need some inspiration from successful businesses from all over the world. They need to see the best case studies, be given the potential to grow, and be offered better education.”
Lang runs Feelo with a local team of software engineers and other tech talent, and has engaged with Hatch’s efforts to support local businesses on various occasions.
“Sometimes it’s about the mindset. I love seeing young Sri Lankan entrepreneurs working on their own creative business ideas because they understand that we cannot be limited by the island—the world is their target now.”
Q: What’s next for this partnership in the context of Hatch’s ‘Troubled Nation to Startup Nation’ initiative?
For this space specifically, we want to get it up and running with events and programs by March. We’re also looking at a location Down South, an area in Sri Lanka where the co-living culture has already been established.
Having Draper Startup House invested in us is great because they’re looking to grow with us, so once the space is up and running, our plan is to put together global programs to support our local talent—that is very exciting for us.
For example, we’re looking at 3-4 month programs where foreign entrepreneurs can work with Sri Lankan startups to work on innovative products in sustainability using up-and-coming technologies such as artificial intelligence or blockchain.
This is just a glimpse of the possibilities in store for us once the basic facilities are up—I truly believe this partnership will help lead us to the kind of transformational change this country needs.
One of the strengths of Draper Startup House is that they have coliving across the globe, with their strongest presence being in South and South East Asia. Hatch aims to leverage our strengths in co-working and connecting with the local ecosystem, matched with their tight-knit network of co-living entrepreneurs, to create something new for Sri Lanka. This ties back into why we specifically want to attract digital nomad entrepreneurs— it’s their perspective matched with our talent