Southeast Asia should be well positioned to thrive in a more geopolitically complex world. The region is rich in natural resources, has a young and increasingly affluent population, and maintains economic and trade links with major economic powers such as the United States, China, India, and the Gulf Cooperation Council.
However, during the Fortune Innovation Forum in Kuala Lumpur on Tuesday, Asia Partners co-founder Nicholas Nash challenged Southeast Asian entrepreneurs to be more ambitious in achieving their goals.
“We don’t think big enough,” he said when asked how talent moves about why. “If Southeast Asian talent can be connected to companies whose market capitalization can exceed $40, $50 or $100 billion, they will stay.”
The only way to get to that level is consolidation, Nash said. “None of our countries in ASEAN are big enough to produce a multibillion-dollar company,” he said, noting that fewer than a dozen companies in Southeast Asia have a market capitalization of just 1% of Nvidia’s $4.6 trillion.
The most valuable company in Southeast Asia is Singaporean bank DBS, which has a market capitalization of $116 billion. This is just a small fraction of the total value of Asia’s most valuable company, Taiwanese chipmaker TSMC. Only seven companies based in Southeast Asia are on this year’s Global 500 list, luckAnnual ranking of global companies by revenue; By comparison, China has 124 companies on the list.
“Given the short lifespan we have, would you rather associate yourself with a company that could become a three or four trillion dollar company, or a company that could become a two or three billion dollar company?” – Nash asked.
Nash’s concerns about talent resonated with Dato’ Seri Wong Siew Hai, president of the Malaysian Semiconductor Industry Association. The Southeast Asian nation has been part of semiconductor supply chains for decades, since Intel opened its first factory outside the United States in Penang in 1972. (Some of the world’s largest chip companies, such as Broadcom and Intel, are now led by executives with roots in Malaysia.)
“Singapore offers ASEAN scholarships, and our people go there. Even when we don’t get the scholarships, they still hire our Malaysian talent,” Wong said. “Today, we don’t just have Singapore, we have China, Taiwan and the rest of the world trying to exploit our talents.”
Wong put a positive spin on this rivalry, saying: “That tells me we have talent.” “How can we create the ‘Malaysian Dream’ like the ‘American Dream’, where you can get all these opportunities in Malaysia?”
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