Aug 15, 2016

Myanmar's first tech accelerator is propelling forward the next generation of start ups

On the 11th floor of a downtown Yangon high-rise, a crowd of budding entrepreneurs listens attentively to advice on how to successfully pitch investors. Andy Annett, managing director of TODAY Ogilvy & Mather Myanmar, gives tips on public speaking and branding, while Aung Sithu Kyaw, CEO of market consultancy Xavey, describes how to structure a pitch deck.

It’s a scene not so dissimilar to what happens in Silicon Valley and other tech capitals, yet it would have been unimaginable in Myanmar five years ago, when less than one percent of all Burmese had access to the web.

Nowadays, thanks to Phandeeyar, the 6,000 square foot tech hub that’s organizing the event, it’s an almost weekly one. Buoyed by a booming economy and a youthful population of over 52 million, Myanmar’s startup ecosystem is thriving. Phandeeyar, whose name means “creation place,” stands as one of its central nerves, and its role is bound to expand as it launches the country’s first tech accelerator.

Founded in 2014 by Australian entrepreneur David Madden, the self-described “innovation lab” emerged from one of Myanmar’s first hackathons, Code for Change, with the ambition of being a space for the tech community to come together and drive forward social innovation.

“Our overarching mission is to foster the technology ecosystem, help it grow, and help the people in the entities within this ecosystem increase their impact,” explains Jes Kaliebe Petersen, the director of Phandeeyar’s accelerator.

The launch of the Yangon tech center came simultaneously to the entrance of foreign telecoms on Myanmar’s newly liberalized market, resulting in a meteoric drop in SIM card prices and millions of new subscribers. But unlike other developing nations, Burmese mobile users overwhelmingly leapfrogged basic handsets in favor of smartphones.

“What’s happening here, it’s unprecedented,” says Petersen. “I’ve worked in other emerging markets, but I’ve never heard of anywhere else like this. There’s probably around 45 million active SIMs in the country.”

For those customers, right now, the web signifies mostly Facebook and Viber. If Phandeeyar gets its way, that will soon start changing, as it helps startups capitalize on Myanmar’s fast growing internet user base.

The Phandeeyar accelerator team (Courtesy of Phandeeyar).

Since its creation, the ICT hub has hosted over a hundred tech related events, including founder meetups, seminars, and workshops with international speakers. It collaborates actively with civil society and NGOs on how to maximize their use of data and digital advocacy, as well as on designing civic tech.

A number of tech’s heavy hitters have proven early supporters. Core backers include Ebay founder Pierre Omidyar’s philanthropic investment firm Omidyar Network, Google’s Eric Schmidt’s namesake family foundation, and George Soros’ Open Society.

“We’ve been focusing more and more on how we can support the development not only of the tech community but also of tech startups, and that’s really how the idea of the accelerator came about,” comments Jes Kaliebe Petersen.

Startups accepted into the accelerator each receive $25,000 in seed money as they undergo a 6 months training program. Fifteen to twenty startups are expected to take part across the next three years. The first cohort, which will start on September 1st and is currently being selected, will only contain around four to six teams.

“It’s really important to us that we only take in startups that we believe can actually succeed,” says Petersen. “What we are looking at is, first the quality of the team and then an ability to understand the Myanmar market.”

For the capital heavy initiative, Phandeeyar received $2 million in grant funding from Omidyar Network and is raising further funds.

“There’s a lot of startup activity in Myanmar, but all the funding they raise is outside the country, usually through investors in the region,” he notes.

According to Thar Htet, who acts as Phandeeyar’s startup coach and is the founder of IT firm Zwenexsys, local investors tend to lack an understanding of the tech world and get disappointed by its lack of quick financial returns.

“On the consumer side, things are moving really fast,” says Thar Htet. Yet, “on the infrastructure side, there a lot of challenges to be solved, like payments and logistics. But it also means good opportunities for startups.”

Source: Forbes