The document provides a summary of findings from the 2018 Taiwan Startup Ecosystem Survey. It was conducted through an online survey and interviews between March and July 2018. Key findings include: - 70% of entrepreneurs were starting their first business. Top challenges were funding, market conditions, and talent. - 12% of start-ups plan to go public within the next 3 years. - 55% target China as their main overseas market, followed by Southeast Asia and North America. - 68% would consider a takeover by a large company.

1. 2018 Taiwan Startup
Ecosystem Survey
Summary of findings

2. Foreword
2018 Taiwan Startup Ecosystem Survey Summary
2
Rapid progress in technological innovation and changing consumer behaviours are resulting in significant changes
to business models, operations and ecosystems around the world. This is reflected in the rise of start-ups, which are
breaking down traditional industry boundaries and introducing new competitive dynamics to the marketplace.
This isalsothe caseinTaiwan,which has athriving start-upcultureanda growinggroupof talented, buddingentrepreneurs.
Government support is also critical. In February 2018, the National Development Council launched an action plan aimed
at creating a robust start-up ecosystem, raising Taiwan’s visibility internationally, and making it aleadingstart-upnation.
To better understand the local start-up landscape, PwC Taiwan conducted the 2018 Taiwan Startup Ecosystem Survey in
collaboration with the Taiwan Institute of Economic Research, the Taiwan National Association of Young Entrepreneurs,
the Taiwan National Association of Small and Medium Enterprises, and the Taiwan Start-Up Hub of the Executive Yuan.
The survey used an online questionnaire and interviews (with venture capitalists, incubators/accelerators and advisory
bodies) to analyse Taiwan’s start-up ecosystem, looking at how entrepreneurs are influenced by a range of factors, such as
government support, funding and capital market access, and collaborative interactions with larger-scale companies.

3. Survey Methodology
2018 Taiwan Startup Ecosystem Survey Summary
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The 2018 Taiwan Startup Ecosystem Survey is based on an online survey and interviews, which were
conducted between 20 March and 10 July 2018. The Chinese-only report was released on 15 August 2018.
› Online survey conducted between 20 March and 2 May 2018.
The survey population was sourced from start-ups that had received support from institutions like the
Taiwan National Association of Young Entrepreneurs, the Taiwan National Association of Small and
Medium Enterprises and Taiwan Start-Up Hub, as well as other start-ups contacted by PwC Taiwan.
The total survey population was 3,500, and 317 valid completed surveys (out of a total of 367) were
collected, of which 178 respondents had already formally registered as companies in Taiwan.
› In-depth interviews conducted between 24 May and 10 July 2018.
A total of 25 interviews were also conducted by PwC Taiwan with various start-up entities, venture
capitalists, start-up incubators and accelerators, and large-scale enterprises from across Taiwan.
Download the full report at: www.pwc.tw/zh/publications/topic-report/2018-taiwan-startup-ecosystem-survey.html

4. Key Survey Findings
2018 Taiwan Startup Ecosystem Survey Summary
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70%
of entrepreneurs started a
business for the first time
3
top challenges on starting
include funding, market
conditions and talent
12%
of respondents plan to go
public in the next 3 years
48%
are willing to cooperate
with larger companies to
develop products/services
55%
target China as their main
overseas market, followed
by SE Asia, North America
68%
would consider a takeover
from a large-scale company

5. PwC Taiwan 資誠
Taiwan facts and governmental environment
2018 Taiwan Startup Ecosystem Survey Summary
5

6. Taiwan Economic Facts
2018 Taiwan Startup Ecosystem Survey Summary
6
 Formal name: Republic of China (R.O.C.)
 Area: 36,193 km2 (about the size of Holland)
 Population: 23.6 million (end-2017)
 GDP: US$572.8 billion (2017) – the 22nd
largest economy in the world according to IMF
data
 Foreign trade: US$576.5 billion (2017) – the
world’s 18th biggest trading nation per the
WTO
 Major sectors: Electronics, banking, chemicals,
metals, precision machinery, plastics and
textiles
 The World Bank currently ranks Taiwan 15th
out of 190 countries on
its ease of doing business index.
 The index measures the operating environment
for a business, including how easy it is to start a
company.
 Taiwan’s ranking has steadily risen since 2008
after intensive efforts to reform its regulatory
framework:

7. Government resources for start-ups
2018 Taiwan Startup Ecosystem Survey Summary
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1. Resources and guidance for all stages
of entrepreneurship
The Taiwan government currently provides a
wide range of resource support in 82 areas,
including the development of entrepreneurial
ability, professional training courses,
consultation, subsidy programmes, national-level
investment funding, and start-up matchmaking
platforms.
2. Parallel support programmes at
national and local levels
Central and local governments operate similar
programmes for entrepreneurs.
3. Well-established start-up incubation
system developed over the past 20 years
Q. Which of the following
fields should government
focus on to assist in the
development of start-ups?
Surveyed start-ups said they would like to see more
government support in the form of more funding options
(21%), tax incentives (15%), and resources to assist
expansion into overseas markets (13%).

8. PwC Taiwan 資誠
Entrepreneurs and Start-ups
2018 Taiwan Startup Ecosystem Survey Summary
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9. 2018 Taiwan Startup Ecosystem Survey Summary
9
Age
under 30
41~45 years old
over 45
31~40
years old
Profile: Entrepreneurs
Gender
Prior work experience
Key reasons for starting a new
business:
1. A profitable market opportunity (35%)
2. Development of superior products or
services (33%)
Academic backgrounds
57% have business or
liberal arts backgrounds

10. 2018 Taiwan Startup Ecosystem Survey Summary
10
Profile: Start-ups
Innovation focus
of start-ups
Top 3 overseas market targets
China
55%
SE Asia
30%
North
America
10%
Sector segmentation
of start-ups

11. PwC Taiwan 資誠
Operational status of start-ups
2018 Taiwan Startup Ecosystem Survey Summary
11

12. Revenue status
2018 Taiwan Startup Ecosystem Survey Summary
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Lack of marketing channels
or customers
Initial outlay too high
Manufacturing costs too high and
inability to scale up operations
Lack of effective business model
Recession
48%
In the red
Gaining profit
but not meeting
expectations
Profitable and
expected to
grow
48% of surveyed start-ups said they were
in the red, 24% reported they had started
to turn a profit but not in line with
expectations, and only 28% considered
themselves to be profitable and growing.
The main reasons cited by start-ups for
being in the red or underperforming
were a lack of marketing channels or
customers (25%), high initial outlay costs
(18%), and high manufacturing costs and
unable to scale up their operations (14%).
Q. (for those are still in the red or
profit did not meet expectation)
What’s the major two reasons that
caused your revenue status?
Q. Which of the following
describes your revenue status?

13. Breaking into
new markets
Talent
mgt.
provide new
tech/product
Financial
mgt.
Development of
product/service Process or
administrative
mgt.
Marketing and
promotion of
sales
Top challenges and priority investment areas
2018 Taiwan Startup Ecosystem Survey Summary
13
Our survey showed that the biggest challenges
for start-ups are funding(33%), market
conditions(20%) and talent(16%).
Surveyed start-ups were asked what areas of
their business are priorities for investment, and
the top three cited were marketing and sales
promotion (23%), development of products and
services (20%), and entering new markets
(19%).
This suggests they are comfortable with their
products and technologies, but need to improve
their approach to market and customers. Also,
high R&D costs and scaling up are the biggest
sources of pressure for start-up companies.
Essentially, entrepreneurs should consider if
they have sufficient funding strategies and the
necessary financial management capabilities.
Q. Given that there is
abundant funding, what items
are the most in need of
improvement or rectification?

14. 71%
12%
17%
Domestic
market
Geographic sources of revenue
2018 Taiwan Startup Ecosystem Survey Summary
14
This suggests a lack of internationalisation among
local start-ups, and is something that should be
addressed by ecosystem stakeholders.
The top 3 overseas markets for start-ups are China
(55%), South-east Asia (30%), and North America
(10%).
Aside from the general lack of resources for start-
ups seeking to expand abroad, they also need to
improve their understanding of overseas markets
and tailor their offerings.
Constraints on overseas expansion
Operation and overseas expansion status

15. PwC Taiwan 資誠
Funding and capital market access
2018 Taiwan Startup Ecosystem Survey Summary
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16. 2018 Taiwan Startup Ecosystem Survey Summary
16
Funding and capital market access
Looking for external investment
The survey found that 69% of respondents plan to attract
institutional investors in the next three years.
Those start-ups that have already obtained external
investment said their main reasons for doing so were to
gain access to globalised networks, new funding, and
professional or industrial expertise. Another important
consideration is whether an investor will be hands-off.

17. 2018 Taiwan Startup Ecosystem Survey Summary
17
IPO considerations
1~3 years
3~5 years
5 years
and above
IPOs are an important funding and exit strategy for
start-ups and early investors. Most of the respondent
are still a long way from going public, with only 12%
planning to IPO in the next three years, and 55%
after another five years.
Q. When will
your current
start-up put IPO
into practice?
The key factors for start-ups in deciding whether
to list through an initial public offering are
revenues and profits (41%), being able to retain
control of the company (22%), and the robustness
of operating and management mechanisms (19%).
Only 12%plan to
IPO within next 3 years
Revenue &
Profit
Compliance of
regulations
Talent
availability
Retain
control of the
company
Robustness
of mgt.

18. PwC Taiwan 資誠
M&A and corporate collaborations
2018 Taiwan Startup Ecosystem Survey Summary
18

19. How do start-ups view the prospect of being acquired?
68% of the respondents for the survey said they
would consider a takeover by a larger company if
it benefited the long-term development of the
business (66%), and they had already achieved
their founding objectives (28%).
Of the other surveyed start-ups not open to a
buyout, 76% said that they wanted to protect
their founding intention, 16% believed their
company was in a stable growth position, and 5%
were unable to reach an internal consensus.
In addition, some start-up ecosystem
interviewees recommended that start-ups should
more positively view the benefits of a takeover
given the lengthy and involved process of an IPO.
Some other interviewees offered alternative
suggestions such as the integration of a group of
start-ups to form a larger entity to better compete
in the market.
2018 Taiwan Startup Ecosystem Survey Summary
19
Protect founding
intention
Beneficial for company’s long-
term development
Already met founding
objectives
Ready to exit
Others
Stable growth
5% No consensus
Other
Will
consider
Q. In the coming 3-5 years, would you consider to
accept an M&A deal proposed by a large-scale
company? Why or why not?

20. Start-up and corporate collaborations
20
Cooperate to develop
products or services
Other
Funding
Become supplier
Regarding possible cooperation between start-ups
and larger companies, the majority (48%) of survey
respondents would favour a product/service co-
development relationship, 32% a supplier
relationship, and 15% a funding-type relationship.
Not all start-ups lack funding, and are more in need
of marketing resources or access to a wider business
network. Hence, the rationale for a collaborative
arrangement of some sort with a large-scale
company as away to their business.
Q. What kind of interaction
or relationship do you
expect to make with a
large-scale company?
2018 Taiwan Startup Ecosystem Survey Summary

21. This publicationhas been prepared for general guidance on matters of interest only, and does not constitute professional advice. You should not act upon the informationcontained in this
publicationwithout obtaining specific professional advice. No representation or warranty (express or implied) is given as to the accuracy or completeness of the information contained in this
publication, and, to the extent permitted by law, [insert legal name of the PwC firm], its members, employees and agents do not accept or assume any liability, responsibility or duty of care for
any consequences of you or anyone else acting, or refraining to act, in reliance on the informationcontained in this publication or for any decision based on it.
© 2018 PricewaterhouseCoopers Taiwan. All rights reserved. In this document, “PwC” refers to PricewaterhouseCoopers Taiwan which is a member firm of PricewaterhouseCoopers
International Limited, each member firm of which is a separate legal entity.
Ryan Huang
Leader of Innovation and Entrepreneurial Services
+886 2 2729-5672 ryan.huang@tw.pwc.com
Violet C Lo
Director, Markets Leader Office
+886 2 2729-6666 x 26600 violet.c.lo@tw.pwc.com
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Ecosystem Survey (Traditional Chinese version)