What comes to your mind when you think about Singapore? Skyscrapers, beautiful aquariums or the Merlion? But these aren’t the only attractions of the Lion City. Many entrepreneurs believe that Singapore is a ‘startup paradise’. In this part of the Startup-Nation Series, we will dive into the thriving startup ecosystem of Singapore.
According to a 2017 report by US-based Startup Genome, Singapore has overtaken tech mecca Silicon Valley as the world’s number one in startup talent. It ranks 17th on the Startup Genome list and 8th on the Global Innovation Index 2020. Numerous factors have enabled the country’s rise to the top, such as strategic geographic location, high research output, well-laid rules and regulation, and government support.
1. Tech-enabled ecosystem
Singapore is the regional base for many of the world’s top tech multinationals, including Microsoft, Oracle, Amazon Web Services, Google, and international technology startups. It is a global data management hub that is connected to 15 active submarine cable systems. Being a smart nation, Singapore has significantly better living conditions, stronger communities, and numerous opportunities for all its citizens. With the help of the latest technology, society strives to solve problems and address existing challenges rather than the complexity of the technology.
The Singapore Govt. has laid down many policies to facilitate innovation and nurture experimentation, innovation, risk-taking and adoption of new ideas. In 2019, the govt. had set aside S$40 million (US$29.3 million) for supporting 5G research and innovation and developing the country as a 5G innovation hub. The government has kept research and development (R&D) spending at a constant 1% of GDP every year.
Singapore is famous for its fintech landscape. The MAS (Monetary Authority of Singapore) had set aside US$165 million to develop the sector over the next five years in 2019. The Singaporean government is looking forward to creating an artificial intelligence (AI) hub in the country with the help of a dedicated data science consortium.
2. Top startup sectors
Blockchain and fintech are the most notable sectors in Singapore in recent years. Singapore ranks third globally in Blockchain in the size of initial coin offerings (ICOs). One of the top startups in the Blockchain sub-sector is Fusion, a crypto-finance startup.
Singapore’s fintech startups are also experiencing a boost, as they are also getting tremendous support in innovative ways from the government. The Monetary Authority of Singapore introduced a fintech regulatory sandbox program, a Fintech Innovation Lab and has launched a fintech innovation village called LATTICE80 as well. The Singapore FinTech Festival is the biggest fintech event globally, attracting more than 45,000 participants from 130 countries.
3. Financial assistance
Singapore’s startup-friendly policies include subsidies and incubation schemes such as the National Research Foundation’s Early Stage Venture Fund that catalyzes the formation of funds to invest in startups.
The Research, Innovation and Enterprise (RIE) 2020 Plan of Singapore has set aside SPD 19 billion for investment in R&D over four years. Singapore has a StartupSG program that consolidates startup assistance schemes and provides early-stage startups with access to mentorship, cash grants, equity financing, and business loans. Enterprise Singapore promises SGD 3 to match every SGD 1 raised by entrepreneurs.
4. Top Startup incubators and accelerators
Being a hotspot for entrepreneurs, Singapore boasts a long list of incubators and accelerators that will help you kickstart your startup journey. Some of them are:
Incubators
1. Block71: An NUS Enterprise initiative, BLOCK71 incubates tech startups. It aims to help startups form collaborative and strategic partnerships with corporates and government agencies. With its technology-focused ecosystem builder, it allows startups to make global connections. Block71 provides mentorship and growth opportunities in key local, regional and international markets.
2. Get2Volume: It invests in and incubates innovative B2B startups. Get2Volume has incubation managers and venture partners in Columbus, Ohio and Singapore. They provide mentorship, operational, and execution capabilities to enable success for their portfolio companies.
3. PayPal Innovative Lab: The PayPal Innovation Lab of Singapore is mainly focused on the fintech sector. It aims to build a strong community of developers, entrepreneurs and students in which they can thrive. It supports the creation of a new generation of technology companies. It thus provides the initial infrastructure, structured curriculum, access to fintech domain experts, mentoring and access to a network of investors.
Accelerators
1. Antler Singapore: It conducts a 6 months accelerator programme, selecting the most passionate entrepreneurs. Antler helps them find the right co-founder and connects them to a broad network of business and academic domain experts worldwide. It provides funding of SGD 5K per month per founder for two months since day 1.
2. Entrepreneur First Singapore: The accelerator focuses on deep tech companies. It also provides a 6 months programme giving SGD 15K total per founder and SGD 75K if the company is offered a place on Entrepreneur First Launch. One does not need a team or an idea to apply for the accelerator programme. EFS helps participants find a co-founder, develop their ideas, get customers, and raise funding from top investors.
3. ICE71 Accelerate Programme: ICE71 ‘Innovation Cybersecurity Ecosystem at Block71’ is a cybersecurity entrepreneurial hub. It is a 10 weeks programme that has been founded by Singtel Innov8, the corporate venture capital unit of Singtel, and the National University of Singapore (NUS). The accelerator aims to strengthen Singapore’s growing cybersecurity ecosystem.
5. Venture capital landscape
Singapore has a large pool of high-net-worth individuals, corporations and institutional investors. Even the initiatives led by the government such as SPRING Singapore and the National Research Foundation (NRF) support regional startups encouraging investments through co-investment schemes. Singapore boasts more than 200 venture capital firms ranging from independent limited partnership venture capital firms to corporate-backed venture capital firms. Some of the top ones are as follows:
1. B Capital: The venture capitalist firm B Capital Group was launched in 2014 by the prominent angel investor and Facebook’s co-founder Eduardo Saverin. The VC firm is focused on India, Southeast Asia and the US. It backs ground-breaking technology companies. B Capital has offices in Los Angeles, San Francisco, and Singapore.
2. Golden Gate Ventures: It is an early-stage VC firm in Southeast Asia bridging Silicon Valley and Asia and has over 30 investments across seven countries. The firm focuses on consumer internet, social media, digital entertainment, e-commerce and crowd-sourcing.
3. 500 Startups: It is a global venture capital seed fund with a network of startup programs headquartered in Silicon Valley. 500 Startups has over US$ 350 million committed capital across four main funds and 13 micro funds. Since its launch in 2010, the firm has invested in many prominent startups such as Twilio, Grab, Udemy, Talkdesk, Credit Karma, Intercom and MakerBot.
Conclusion
The success of Singapore’s startup ecosystem is due to the efforts of both the private and public sector. The govt. has played a significant role in supporting the ecosystem by accelerating innovation and nurturing startups. While the impact of the pandemic has been challenging for many countries, posing severe economic downfall, yet the Singapore market has continued to be an attractive investment destination. A significant amount of money has also been poured into Singapore’s healthcare and biomedical sciences sector to alleviate the concerns raised by the pandemic and prepare for future health crises. With a competitive atmosphere and talent from all over the world, Singapore is on its way to becoming the best country to conduct business globally.
Read Startup nation Series: Israel’s tech startup ecosystem
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