Why Telcos are Investing in Tech Startups in Thailand

Why Telcos are Investing in Tech Startups in Thailand

When a tech startup hub like Silicon Valley emerges out of the East, people want to know about it.

A lot of these people are investors. If there’s money to be made out of Thailand’s version of Silicon Valley, investors will do what they can to cash in on the profits.

So why, then, are Telcos companies choosing to invest in Thailand’s newest tech startups? Let’s take a look.

No Choice?

In a way, from where we’re sitting, it doesn’t look like tech startups in Thailand have much of a choice when it comes to accepting investment from Telcos.

This is because the startup scene in Thailand is already dominated entirely by three major Telcos – TRUE, Dtac and AIS. While there are other incubation programs available from both private and governmental resources, there aren’t any available that match the marketing power of these big three conglomerates.

Telcos know that they hold the power when it comes to these new tech startups in Thailand. Because they’re at an advantage, they’ve got their pick of the crop when it comes to determining where to invest and with whom.

The biggest reason why these small tech startups are choosing to invest with Telcos is that they offer them advice and money. They also have an already established marketing and distribution network, that these startups would otherwise have to develop themselves, which could take years.

Investing in tech startups is an excellent way for these three Telcos to remain relevant and the people’s choice when it comes to mobile connection and communication.

People trust Telcos. When downloading an app created by a startup, many people are skeptical at first and hesitant to make direct payments through the app in case their credit card details are stolen. If one of these three Telcos has verified this payment system, the customer is much more likely to relinquish sensitive information like this.

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If Telco companies like TRUE can hold onto its market share and increase its value by investing in local startups, it will inevitably knock out the competition and keep this booming tech startup bubble internal.

The biggest threat to the assets Telco companies are set to inherit from tech startups is external sources swooping in and investing either instead or as well. The more money these Telco companies put into backing these tech startups, the more market security they’ll have as Thailand continues to form a new path to the future of technology.

Telcos in Thailand also have the government backing them when it comes to local investment. In fact, foreign investors are only allowed to own 50% of a facilities-based carrier, leaving the rest of the funding up to Telcos like TRUE and AIS.

The Thai telecom market is changing rapidly, bringing in new business and heated competition with tech startups as investment options. What Telcos need to be focusing on right now is building up their customer base and developing their network for a permanent stake in the market.

Getting behind Thai tech startups is an effective way to do this.

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