Interview with GOGOVAN

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Looking into the Burgeoning Hong Kong Startup Scene with GOGOVAN, Hong Kong's unicorn valuation delivery platform

GOGOVAN is often said to be the pride of Hong Kong. In every densely populated city, there is a large fleet of delivery vehicles, as well as a high demand for last-mile logistic solutions. Founded in 2013, GOGOVAN is the first app-based on-demand delivery platform in Asia that connects idle delivery vehicles with users who are in urgent need to deliver goods. Steven Lam, the CEO of GOGOVAN was only 27 years old with no full-time corporate work experience when he founded the company. He and his co-founders Nick Tang and Reeve Kwan started the company with only around US$2,500. Now, the company is valued at over US$1 Billion after its merger with 58 Suyun. Its metamorphosis from a humble startup to a unicorn became an inspiring story for entrepreneurs in Hong Kong.

While GOGOVAN has quickly expanded into 6 regions and 13 cities, the startup ecosystem in Hong Kong has also been burgeoning in recent years. Entrepreneurship was not even a thing in Hong Kong a few years ago. Now, there are around 2,000 startups in Hong Kong. In the early 2010s, there were only 3 co-working spaces. Now, there are close to 80. Having been part of the Hong Kong startup community since its infancy stage, Steven has witnessed its enormous transformation. He has kindly walked me through GOGOVAN’s journey and shared his vision for the Hong Kong startup ecosystem.

Steven became an entrepreneur right after graduating from college. For Steven, launching his business in Hong Kong was a natural choice. Born and raised in Hong Kong, Steven is able to better understand user behavior in his hometown, and thus, makes it easier for him to find out how to build a product that fits the market.

Regardless, Steven believes that Hong Kong is the perfect hub to scale across Asia. “Hong Kong’s biggest competitive advantage is that it has a strong international background that enables startups to enter not just the China market but also the Southeast Asia market,” Steven explains. “Also the talents from Hong Kong have a better knowledge about expanding to these regions.”

The biggest challenge that GOGOVAN faced in its expansion was cultural adaptation. Different regions have different customer preferences and requirements in logistic services. GOGOVAN has to localize a lot of its business strategies – from differentiation and segmentation of target audiences to localization of marketing campaigns. For instance, GOGOVAN is rebranded as Kuaigou Express (快狗速运) in China. The formula of success in Hong Kong may not apply elsewhere.

For many Hong Kong startups, China is the natural starting place for expansion, but GOGOVAN has chosen Singapore as their second market after Hong Kong. “We found that Singapore shares a lot of similarity in terms of market behavior with Hong Kong.” Steven elaborates, “China is very different in terms of the logistics market that we are in, from service quality to vehicle selections. Also, Singapore provides an easier business environment for companies to start there, as the legal and company requirements are relatively open and easy to follow, just like in Hong Kong.”

While Hong Kong is known to be a gateway to the China market, Steven warns us that Hong Kong’s advantage may fade as China matures. Without a doubt, Hong Kong people have a long history of doing successful business in China. From business owners in property development, restaurants to professional services, a lot of them started in Hong Kong and expanded quickly in China. Hong Kong also has a lot of talents in law, accounting and consulting, allowing Hong Kong companies to move faster than the mainland players. Examples like these enable Hong Kong to be the bridge between China and the West. But this phenomenon will eventually fade away as China grows faster and become more mature.

With a business footprint in Hong Kong, Singapore and China, Steven is no stranger to their startup ecosystems. In terms of infrastructure, Hong Kong is still playing the catch-up game. “China has a lot of venture capitalists who are willing to invest in startup companies, whereas Singapore has a lot of good policies and infrastructure which supports startups.”

The Hong Kong government has been playing a supportive role to the startup community. Steven recalls that when he first launched GOGOVAN, the company had only an initial capital of around US$2,500. Just before the funding ran out, GOGOVAN received funding from Cyberport – an entrepreneur hub owned by the Hong Kong government – twice to continue their journey. GOGOVAN went on to join the Cyberport Incubation Program. “Throughout the 4 years of our GOGOVAN journey, we have received numerous support and valuable advice from Cyberport as well as business networking opportunities,” recalls Steven.

But Steven stresses that there is much more that the government can do. “There is always room for improvement, especially when you look at all the amazing things that different governments around the world have been doing to push the technology and innovative development.”

“The Hong Kong startup ecosystem is getting better and better compared to 4 years ago when we started. However, when compared to other regions like Silicon Valley, Singapore, and Beijing, the Hong Kong community and the government still need to do a lot more to build a healthy ecosystem,” says Steven. Instead of simply pouring money into the startup community, the government should also take concrete steps to build a culture of innovation.

Steven studied at UC Berkeley, which is located in Silicon Valley. The entrepreneurial culture there has left a profound impact on Steven. “People in California are a lot more willing to build their own startup businesses, and this encouraged me to set up GOGOVAN when I came back to Hong Kong,” says Steven. When he was still a student there, Steven worked extra hard to make money to pay off every dollar of his tuition. He sold first-generation iPhones on eBay, fixed cars (by learning how to do so from YouTube), and provided lunch delivery services for an Asian restaurant. All these experiences prefigured his entrepreneurial journey in Hong Kong.

Steven enumerates a list of things the Hong Kong government should do to build an entrepreneurial culture:

First, the government should lead by example by embracing technology. Early this year, the Singapore government launched its own chatbot. But for the Hong Kong government, its website has not been revamped for many years. Some of its pages and services are not even mobile friendly.

Second, the government should encourage the use of new technology in our city. Automated driving is an example. The Singapore government has already started a pilot scheme to test the technology last year, sending a positive message to the society that they welcome innovations. But in Hong Kong, there is not even a conversation on how to adopt this kind of new technology in our city.

Third, the government should help the community bring relevant talent from around the world to Hong Kong. The ability to attract and retain global talent is a pillar of success for every flourishing startup ecosystem.

The future of Hong Kong’s startup scene is bright, but it will shine more brightly if the Hong Kong government works with the local entrepreneurs side by side to shape the city’s future.

Further Readings

WeLab | The Future of Hong Kong as a Leading Fintech Hub

KLOOK | Hong Kong’s Own US$30 Million Series B Travel Tech

Is AI a Threat to Humanity? 4 Facts You Should Know

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