My problem with “Emerging Markets”

A look into our beliefs with co-founder and managing partner, Amit Anand

The terms “emerging markets,” “developing nations” and the antiquated “Third World” have always rubbed me the wrong way – and not just because I grew up in Mumbai, live in Singapore, and do business across Southeast Asia.

These terms bother me because they prevent people from seeing how dramatically the world has changed especially over the last decade. For investors, this means not just missing the train but not even realizing that there is one.

BandungSurabayaYangonBruneiPhnom PenhNaypyidawHanoiHo Chi Minh CityMedanKuala LumpurBangkokManilaJakartaSingaporePenangDiliDavao CityPalembangMakassarVientiane

Region of opportunities

The traditional view of Southeast Asia is that it’s a fragmented region of countries with more differences than similarities. The practice of labelling some countries as emerging and others as developed prevents investors from seeing the opportunities. If investors look at what these countries have in common, rather than what they don’t, the opportunities become obvious.

Proliferation of the internet and social media

Consider the skyrocketing use of the internet and social media in the region thanks to increasing ubiquity of smartphone and mobile technologies.

  • 330
    million internet users

    Now the region has the third-largest number of internet users, more than the population of the U.S.

  • 4.2
    hours a day on mobile internet

    Asians on average spend more time on mobile internet than anyone else: compare to 2 hours a day in the U.S.

  • US$240
    billion in 5 years

    The region’s internet economy is expected to quadruple over the next five years.

Burgeoning middle class

A young middle-class woman in Singapore probably has more in common with her counterpart in Ho Chi Minh City – in terms of consumer profile – than with someone from a different socioeconomic class in their own country. As a result, there is now a fairly homogenous addressable market of about 200 million middle-class consumers in the top metro areas of across Southeast Asia that didn’t exist less than a decade ago. Companies that have leveraged technology to address and serve this mark are growing fast.