Hong Kong is considered a good location for startup companies, though it needs to overcome several hurdles to further promote entrepreneurship, according to a jointstudy by KPMG China and the Alibaba Hong Kong Entrepreneurs Fund released Tuesday.

The study, called “Transforming Hong Kong Through Entrepreneurship,”offers insights from two surveys, one of 100 entrepreneurs and the other of over 300 university students. It includes viewpoints from government representatives, academics and other key opinion leaders in Hong Kong.

“Having a dynamic entrepreneurial landscape is vital to Hong Kong’s long-term economic and social development and overall competitiveness,” said Irene Chu, head of new economy and life sciences in Hong Kong for KPMG China. “Entrepreneurship can maximize the opportunities disruptive technologies and digitization are creating and support Hong Kong’s ambitions to be a major technology and innovation hub.”

Student respondents rated Hong Kong the third leading place to found a startup company. They placed it ahead of better-known and more-developed startup hubs, including Silicon Valley, Israel and London.

And the study shows respondents believe Hong Kong has inspiring entrepreneurs who want to drive change. But only 15% of those surveyed said they believe the city’s entrepreneurial mindset is a key competitive advantage.

For the city to realize its ambitions of being a leading hub for technology and innovation, it’s going to have to clear away that view and a number of infrastructural and attitudinal obstacles. They include limited access to funding, research and mentoring resources and a lack of support from family and friends.

In terms of funding, the study found a lack of institutional money for startups. The top two listed sources of capital for startups among survey respondents was personal savings, at 81%, and family savings, at 54%. Though Hong Kong has world-class research institutes and a growing number of co-working spaces and startup incubators, nearly 60% of those responding had little or no access to official research and development support. Also, 62% said they rarely or never used mentoring.

Despite a desire from entrepreneurs and students to drive change—and the belief that entrepreneurs and startups are an inspirational influence and have a positive impact on society, developing new technologies and products, advancing community development and solving problems—the study found a risk-averse social environment. Support from friends and family for those pursuing entrepreneurial careers is low, the study found, and societal expectations prevent some from making bold decisions, like starting up their own business.

Overall, the study found Hong Kong isn’t fully capitalizing on its role as a gateway to China. While the bundle of cities that comprise the Greater Bay Area was considered by respondents to be the best place to start a business, only 31% of the entrepreneurs surveyed said they believed Hong Kong startups are well-connected with other businesses in the region.

The study offered several recommendations that would help Hong Kong create a vibrant entrepreneurial ecosystem and maintain longterm competitiveness. They include more-actively attracting venture capital, encouraging corporate funding support and setting up a broader, more-active mentor platform. That, the study authors said, would increase the appetite of investors, entrepreneurs and the public for risk. Making better use of the Greater Bay Area’s comparative advantages would provide further impetus to enhance collaboration between Hong Kong and China.

Cindy Chow, executive director of the Alibaba Hong Kong Entrepreneurs Fund, said the survey offered her group insight into how it could do more to help those pursuing entrepreneurial ambitions.

“We will work with relevant stakeholders to address the issues identified and continue to support similar studies to understand the development of the city’s entrepreneurial landscape. We will continue to deploy our resources to help startup founders in Hong Kong realize their dreams,” Chow said.

The Alibaba Hong Kong Entrepreneurs Fund is a not-for-profit initiative launched by the Alibaba Group in 2015. It invests in startups with a Hong Kong nexus, encouraging innovation and entrepreneurship among the city’s youth. Besides capital, it offers strategic guidance to help young Hong Kong entrepreneurs grow their businesses and penetrate global markets by utilizing Alibaba’s ecosystem.