Original article by Judy Lin, Taipei; Rodney Chan, DIGITIMES, posted December 4, 2020 on DigiTimes
DigiTimes – Startup Tenacity: Q&A with SparkLabs Taipei founder Edgar Chiu
COVID-19 has been hammering the world, with many companies facing tremendous challenges amidst risks and uncertainties beyond their control. But many startup teams demonstrating their prowess at the recent Demo Day held by SparkLabs Taipei have seen double-digit growths.
Q: At SparkLabs Taipei Demo Day, you mentioned that 2020 is a year when many startups will be severely impacted by the pandemic. But the teams at the event stage have had brilliant results and rapid growths. How did they make it?
A: For entrepreneurs, the unknown is an everyday occurrence, but during an epidemic, it is double uncertainty, and some entrepreneurs may be blaming bad luck, as they were ready to soar, only to be hit by an epidemic. I tell them the same thing: Be patient, keep your feet on the ground, and reexamine what your users need. Has it become a different form? Has it translated into more demand? For example, our investment in teams working on cloud kitchen, online education and Internet of Things (IoT) devices around year-end 2019 and early 2020 have all seen rapid growths because of the pandemic.
The best example is the cloud kitchen team Just Kitchen. In early 2020 it was a team of only only 10 people but has now expanded to 70, opened eight satellite kitchens, and expanded to Taichung (central Taiwan). It will enter Hong Kong in the first quarter of 2021. Few would understand what cloud kitchen was in later 2019, but the pandemic has sparked strong needs for food delivery.
Innovation teams should not only see whether there is demand in the market, but also whether their services and products deserve the money that people pay for them. Innovation is not just about satisfying demand, but also about establishing loyalty among customers would want to use them again and again, as if a habit.
In addition, FunNow, which announced in late October its acquisition of Malaysian restaurant reservation startup TableApp, was supposed to be a company that would solve the problem of consumers making last-minute decisions to book hotels and local leisure trips for overseas travels. The pandemic has completely shut the door on cross-border travels, so FunNow has turned its business focus to domestic travel, and moved all of its overseas team members to Taiwan. In second-quarter 2020, FunNow’s sales grew 60% year-over-year.
Q: We saw a very mature team, Kneron, on Demo Day. Why would such a successful team need the help of an accelerator? When training such a mature team, what are the goals you want to help them achieve?
A: Most of the SparkLabs teams are in fundraising rounds of Series A or Pre-A. It is worth noting that the definition of fundraising rounds in the US is that Series A is when the team has readied the app, wants to expand or has already entered one to three countries, and wants to become the market leader. Series B is for teams that are market leaders in more countries and want to raise funds to widen the gap with competitors those in second place. However, many startup teams in Taiwan are not adhering to the definition, and they move up one notch in the fundraising rounds every time they raise funds.