Funding, Opportunities, and Networks:
A Holistic Approach to Driving T
hai Startups onto the Global Stage
The second “Government Support for Startups” event, organized by the National Innovation Agency (NIA), underscored the crucial role of the public sector in propelling Thai startups forward.
Dr. Krithpaka Boonfueng, Executive Director of the NIA, opened the event with a key insight: government support isn’t just about “finance” or various forms of funding. It also includes “non-finance” elements, such as market linkage, business networks, and strategic guidance, all of which help startups grow steadily. “I’d like to see the government as a strong defense, ready to push startups to play an offensive game in the market, ultimately becoming a vital force in driving Thailand’s economy,” she stated.
Government’s Role in Promoting Thai Startups Goes Beyond Funding
Ms. Montha Kaihirun, Director of the Startup Promotion Department at NIA, delved into the specifics of financial support. She explained that NIA has shifted its approach to focus more on late-stage startups, aiming to scale up businesses. This support is for products or services that have already passed market feasibility testing and are ready to enter or create new markets. NIA offers two types of funding: Mandatory Innovation, which targets national-level innovative businesses, and Regional Innovation, which promotes innovation at the regional level. The NIA has developed seven funding mechanisms that cater to market entry and creation, including providing working capital. Additionally, the agency emphasizes connecting Thai startups with international markets through its Global Market Link and Global Investment Link mechanisms.
5 NIA Accelerator Programs: Pathways to Global Competitiveness
A key NIA strategy is the launch of five new accelerator programs designed to enhance Thailand’s competitive capabilities. These programs focus on “real-world action and real customer interaction,” paving the way for further funding, co-investment, and creating opportunities for new markets and international expansion.
- AGROWTH: Focuses on AgTech startups, collaborating with agricultural companies to test Proof of Concept (POC) and scale solutions with farmers.
- Thai Kitchen: Promotes FoodTech startups and SMEs for the global market through two programs: SPACE-F (emphasizing international FoodTech) and the Thai Kitchen-Crafted FoodTech Accelerator Program (focused on building both domestic and international markets).
- SpearH: Supports Medicle Health and Wellness startups by collaborating with key medical innovation districts to elevate the health ecosystem.
- ClimateX: Accelerates the growth of startups in energy, environment, and electric vehicles to achieve sustainable Net Zero goals. It includes two initiatives: the ClimateX – ClimateTech Accelerator Program and FutureMove.
- S-Impact: Targets Travel Soft Power and Social enterprises, connecting community and social-focused entrepreneurs with government agencies and universities that drive social innovation (SID).
Mr. Thatchanawat Piriyathanapat, Head of Digital Economy Promotion at depa (Digital Economy Promotion Agency), a key driver of the digital economy, highlighted the crucial role of the depa Digital Startup Institute. This institute supports digital startups from their inception to sustainable growth through four main pillars: Finance, Capacity Building, Soft Infrastructure, and Network.
The depa Digital Startup Fund offers conditional co-investment in startups. The S2 Business Formation Stage provides up to 1 million baht in funding, with a 300,000 baht grant for consulting, public relations, and intellectual property protection, and 700,000 baht for prototype development and working capital. The S3 Growth Stage offers up to 5 million baht for product development and market expansion. Additionally, the International Voucher measure provides up to 150,000 baht to help Thai startups expand into international markets and build networks, covering activities like participating in overseas trade shows to showcase their products and services to global customers and investors.
The Digital Service Provider List: A Competitive Advantage
The “Digital Service Provider List,” managed by depa, aims to elevate the standards of Thai startups’ digital products to international recognition. It promotes the ISO 29110 standard and a “DeSure Rating” system. Being on this list allows government agencies to procure services through a specific or selective method, bypassing the complex e-bidding process. This streamlined procurement, combined with pre-verified pricing, provides a tangible opportunity for startups to access the government market more easily. The initiative is expected to bring together a wide range of digital service providers, benefiting both creators and users.
Capital Gains Tax Exemption: Fueling Investment
The Capital Gains Tax Exemption measure, initiated by the Digital Council and the Revenue Department, is another crucial mechanism to incentivize investors, especially those expecting long-term returns from a company’s growth. The exemption on personal and corporate income tax on profits from the sale of startup shares—which could otherwise be as high as 35%—significantly reduces the burden and risk for investors. To qualify, startups must be certified by designated agencies such as NIA, depa, and NSTDA. These measures are vital for creating a favorable investment environment, allowing capital to flow smoothly into the startup ecosystem and benefiting the country’s overall economic drive.
The Private Sector: A Key Partner in Strengthening Thai Startups via the “Innovation One Fund”
The private sector’s role in supporting and driving the growth of startups is becoming increasingly important in Thailand. Dr. Wiboon Raksascharoenphol, Executive Committee Member of the Federation of Thai Industries and Secretary of the “Innovation One Fund” project, explained the fund’s origin. It was conceived to fill a gap in government support, which often provides early-stage grants with limited investment capital. The fund operates on three core principles, or 3C’s: Cash (providing investment capital), Connect (linking startups to networks for market access), and Coach (offering guidance on technology, innovation, and business development).
With the Federation’s expertise in investment and business operations, the Innovation One Fund was established as an Impact Venture Capital (VC) that focuses not only on financial returns but also on social impact. With a fund size of over 1 billion baht, it supports startups in the Growth Stage. The private sector’s business expertise, market knowledge, and revenue-generation skills are crucial for strengthening these startups. The fund has already invested in 19 projects totaling over 293.88 million baht across various industries, including medical devices, digital, pharmaceuticals, agriculture, chemicals, environmental management, food and beverages, and biotechnology. The fund places a strong emphasis on promoting B2B and Deep Tech-driven businesses.
Dr. Wiboon also emphasized that the government still plays a vital role in building early-stage startups’ potential before they are ready for private sector investment. For startups looking to raise capital, he highlighted three critical areas to prepare for:
– Valuation: A credible valuation from an expert is a key factor in an investor’s decision.
– Shareholder Structure: Managing the share structure is crucial, as shares are used for fundraising and will be diluted in subsequent funding rounds.
– Investment Readiness: Startups must focus not only on their technology but also on being ready in every business dimension.
Interested startups can find more information and download the application form at www.innovationone.fti.or.th.
