Hong Kong's geographical location, a low tax system for companies and a simplified bureaucracy for entrepreneurs provide an ideal base for upcoming startups. Many companies in mainland China are expanding from this economic and financial center further into the global market and startups in Hong Kong tap into the mainland Chinese market as well - hence Hong Kong also serves as an ideal gateway to this big economic market.
According to a survey by InvestHK, Hong Kong's startup scene has changed rapidly from 2010 to 2015. For example, from only three co-working spaces the number has risen to now 34 in 2015. Also the total number of startups increased 46%, from 1065 startups in 2014 to 1558 in 2015. The ICT sector is the biggest with 273 startups (18% of all start-ups in HK) and is among others funded by the government-owned Incubator Cyberport. The second largest sector is occupied by the hardware segment (IoT, prototypes, wearables) with 200 startups, compared to 2014 with merely 48. This sector is followed by e-commerce with 142 startups. The survey also features in 2015 for the first time the design sector with 124 startups, indicating a growing market competition here as well.
In 2010 the government launched the initiative InvestHK in order to support a further strengthening and growth of the startup ecosystem. This initiative is directed at foreign (startup) entrepreneurs and investors, with offering free advice and support for founding a company or opening an office in Hong Kong, from the first planning phase, to the launch up to the expansion with the aim of transforming Hong Kong into a global center for innovation. In 2013 InvestHK launched the "StartmeupHK venture programs" where startups are being promoted and can connect with potential investors. The annual conference "StartmeupHK Festival" is providing a good starting point, where the international scene is gathering.