Block 71 has been a home to startups in Singapore for some time, but with this new announcement from the country's minister for trade and industry, Singapore is seeking to invite more new talent than ever onto its shores. Minister of State for Trade and Industry, Dr Koh has announced a new startup regime aiming to simplify its awarding of grants with an umbrella brand (Startup SG) and other strategic changes.
What about Singapore?
Singapore has risen to become the cream of the crop when it comes to the best countries for businesses. An efficient legal system, business-friendly tax rates, strong protection for intellectual property, an ideal location and ease of access has kept Singapore at the forefront of the minds of businesses everywhere and of all sizes.
However, it can be hard to capture the lightning-in-a-bottle environment of places such as Silicon Valley, which can provide the right nurturing atmosphere that allows new businesses to thrive. Making a move or expanding for established companies is one thing, but creating a vibrant startup industry is entirely another, and it is this that the government is seeking to further tap into.
The startups that stand to benefit
Dr Koh noted that the changes to the current approach to startups were meant to contrast the 'closing doors' of increased “global protectionist sentiments that emerged in 2016” and take advantage of Singapore's comparatively open-door policy to businesses. One of the points Dr Koh made in his speech was the acknowledgement that different types of startup need different things, such as variations in initial fund injection depending on the intended product or service. This will please those operating outside the software sphere, perhaps, who need more funding for manufacturing from the outset.
Funding with Startup SG Equity
It was made clear that deep tech was a new focus, with government's co-investment cap doubled to SGD 4 million, as well as a 20% increase in its funding support. The often complex nature of deep-tech startups may have made them a struggle for investors to fully get on board with, but it has become clear that they are leading the way with some of the most innovative ideas. As a result, it comes as no surprise that Singapore is looking to increase it's involvement in this area.
The search for new talent
In order to make it more enticing for early-stage businesses to establish themselves in Singapore, there will no longer be a requirement for entrepreneurs applying for the scheme to have at least SGD 50, 000 as paid-up capital. This is a crucial change for international innovators looking for somewhere to move from start-up to an emerging company and could be of significant benefit to Singapore's economy.
The aforementioned change (along with a few others) highlights the global nature of this endeavour, encouraging innovators the world over to get their wheels spinning in the country. There is also the wider-scope of evaluation that will be applied to international entrepreneurs with a proven track record with startups. Furthermore, the Entrepass system will be altered so that after two years of renewal (at the end of each year), the term of validity will extend from one year to two.
