As an entrepreneur, what are the opportunities and challenges of starting a business in Hong Kong?

Many prospective MBA candidates aim to increase their chances of securing a high-powered and lucrative job. However, an MBA is also a great place to start to establish your own business. Here, the HKU MBA department met with Karl Li, HKU MBA Class of 2019, who has successfully turned his MBA studies into a startup journey.

HKU: Can you explain how you became an entrepreneur?

Karl Li: It was a fairly simple decision. I have always wanted to have my own business.

I have quite a diverse industry background. I started my career as an engineering trainee at Hong Kong Airlines, then I shifted my career into Canon and AirAsia as a marketing professional. After all these years, I began to question whether this was my real passion.

Luckily,  an opportunity to build a new company derived by investor’s funding presented itself. It was a mobile fashion application, targeting Hong Kong-based  fashion designers to help them promote their designs. Despite receiving HKD1 million in funding from the Hong Kong government Innovation Technology Fund & Hong Kong Polytechnic University, the platform couldn’t generate any revenue to sustain the business. However, this experience became a solid foundation for me to build my network, and experience starting my own business later on.

Moving to a second startup company as a CTO, I could cultivate and build my knowledge in the technology industry. After 4 years of gaining industry experience and knowledge, I decided to start my own company.

HKU: Can you introduce your startup company, Hazedawn?

Karl Li: We offer ERP (Enterprise Resource Planning) solutions for different businesses such as social media, web & application development, UX/UI designs, system development and implementation.

The company was initially formed by three people, including myself. Coincidently, my previous colleagues from my first startup didn’t have a full-time job back then, so it was easy to recruit the other founding members. After starting with three, three years later we now have a total of 12 people, and I am looking to hire two more developers soon

We cover both SMEs and multinational companies by providing a customised solution. For SMEs we bring in a new framework with new system development, where we provide integration services along with new application features for multinational companies. Our companies have special industry domains in Medical, Insurance, Real Estate and Education. As a next strategic move, we plan to launch an ERP product for individual customers through a customisation tool to build one’s own solution.

HKU: It is amazing to see the company grow so fast. What was the main driver of the growth?

Karl Li: We aim for organic growth, so we don’t push aggressive expansion. With our professional technology solutions and services, we have experienced a steady growth.

However, the recent COVID-19 pandemic has largely contributed to an acceleration in our expansion. Up until last year, we had our 62 institutional clients. Amid surging interests and demands for digital transformation post-COVID-19, surprisingly, we have signed and onboarded over 200 institutional clients in the past 6 months. We have recently signed with Bupa (Asia) Limited for their Azure SSO integration and Hong Kong St. John Ambulance to develop their e-learning system.

HKU: What are the main challenges for a startup in Hong Kong?

Karl Li: Mainly two things.

Firstly, talent recruitment. Hiring the right talent is the most difficult task, especially with the programmer position. A few years back I hired fresh university graduates, but the retention rate was not so great. The global companies have strategically placed their development teams in Vietnam, China, or India for talent development and retention purposes. I am also considering this plan in the long term.

Secondly, when it comes to office rent, it is always a challenge. In the 1^st and 2^nd year, the company was located in an industrial building in the Kwun Tung area. It was an evitable choice in order to save costs, however, iI couldn’t invite any of our clients to our office due to its appearance.

HKU: What are the benefits of running a startup in Hong Kong?

Karl Li: There are lots of funding schemes available from public and private institutions.

Whilst I was working at PowerMew Technology Limited, the company won HKD10million in funding – 50% from a private investor and 50% from Innovation Technology Fund from the Hong Kong government. The solution was targeting local real estate agencies by providing 360 pictures through mobile platforms. The company was also nominated as the Alibaba Cloud Champion and received USD50,000 in funding.

At Hazedawn, my current startup, I was able to start the company due to receiving HKD300,000 in funding from the The Hong Kong Federation of Youth Groups. Later on, the company received HKD860,000 in funding from Hong Kong Science and Technology Parks, where we were also  offered free office space.

In addition to this, the size and amount of project costs is quite decent. Recently, I have seen affluent business potentials and new project demands in the medical and insurance sectors. There are always opportunities in the Hong Kong market.

HKU: Being as an entrepreneur, what is the most exciting part?

Karl Li: I get thrilled when my company win over HKD1 million deal. Additionally, I feel very fruitful when I hire the right person within our team. It is like forming a dream team.

Most of all, making my own decision to the company brings me an energy to operate the business every day.

HKU: You have started the startup company during your MBA studies. How HKU MBA program has helped your startup journey?

Karl Li: Deciding to launch a startup while studying for an MBA was the best decision I have made. I get my own startup off the ground and study in the evening. The MBA study was incredibly useful in entrepreneurship by learning a variety of business expertise in HR, Law, Accounting, Marketing, and Finance. Particularly, I found the Finance subject extremely useful as I could directly apply my classroom learning to the investor presentation.

Enrolling in a program that caters to full-time employed students has helped me to expose different industries, job roles and situations. I could utilize my school networks and connections for advice and fresh perspectives on my projects outside of my studies.

Overall, completing an MBA allowed me to oversee the big picture.

Karl received the “Bright Future SME’s Youth Creative Entrepreneurship Award” from the Hong Kong General Chamber of Small and Medium Business

Industry: Information Technology & Services
Company: Hazedawn Limited
Job Title: CEO