95% of Mobile App Start-ups Rely on Their Own Funds

Mobile app companies are springing up rapidly. However, a survey found that 70% were first-time entrepreneurial ventures, while 95% said their start-up funding came entirely from their own pockets. Some start-ups hope the government will simplify its funding schemes so that more young people can successfully start businesses.
One software developer started a business with $2 million in savings, but two years later faced difficulties managing employees born in the 1990s. The developer believes that, with limited time and assets, small businesses can easily make poor decisions that lead to losses and force them to close.

59% Turn Down Orders Due to Staff Shortages

The Hong Kong Wireless Technology Industry Association and the Hong Kong Productivity Council yesterday released the Hong Kong Smartphone Apps Survey, which interviewed 100 local mobile app developers and found that most company founders were under 30. Nearly 70% of the companies were first-time entrepreneurial ventures, and 95% said their start-up funding came from their own pockets. More than half of the respondents had participated in previous years, and nearly 90% were small and medium-sized enterprises, indicating that the industry is driven by creativity and technology rather than being capital-intensive.
The permanent honorary chairman of the Hong Kong Wireless Technology Industry Association noted that organisations such as Cyberport offer facilities on favourable terms. Among the companies surveyed, 56% said rent accounted for less than 10% of total expenses, while more than 70% were breaking even or making a profit.
However, many companies face bottlenecks in expanding their businesses just as they begin to establish themselves. Only 24% had successfully attracted overseas funding since their founding, while 59% had turned down orders because of staff shortages, suggesting that the industry still has room for new talent.