Did S’Pore’s efforts pay off?
Joongshik Wang, President of ASEAN at EY-Parthenon, the global strategic advisory arm of EY.
However, experts interviewed by TODAY offered differing opinions on what they felt were the most important success criteria for a startup ecosystem, and how Singapore performed based on these factors.
Ku Kay Mok, Senior Partner at venture capital firm Gobi Partners, said the “most obvious” and “most objective” indicator of success for a startup ecosystem is how much investment it could attract.
“Because people vote with their money. So whether you (really) have the best talent and the best infrastructure, whatever it is — they will vote with their money,” he said.
While mega economies such as the United States and China will naturally withdraw the bulk of global financing, he said Singapore “has captured the lion’s share of venture capital financing in Southeast Asia”.
For Dr. Wong of NUS, an indicator of the vitality of a startup ecosystem is “a self-sustaining (circle), for the flow of entrepreneurial talent and capital into the system.”
This suggests that successful entrepreneurs become investors or mentors to groom the next generation of startups, or key employees in one generation of successful “expansions” who leave themselves to become entrepreneurs or help grow new startups at an early stage. Expansion refers to startups that have a stable and proven business model.
Building on this measure, Dr Wong said Singapore was “making good progress”, although he also noted that the virtuous circle had not yet reached the level that would be observed in Silicon Valley in the US.
In early October, Forbes reported that FinAccel became Singapore’s newest unicorn after it raised nearly $140 million in a Series D funding round that valued the company at $1.66 billion.
FinAccel is the parent company of the Kredivo Buy Now, Pay Later platform in Indonesia. While he may not be a household name among Singaporeans, many will be familiar with other startups that have achieved unicorn status. These include delivery company Ninja Van, and super app Grab and Sea, which owns e-commerce site Shopee.
However, the rhino’s status should not be confused with financial stability or viability.
For example, Grab is still striving for profitability while Shopee has reduced its staff as the parent company seeks to reduce operational costs. today Previously mentioned The bleak economic climate has brought forward a time of reckoning for idle companies, which are under pressure to show profitability.
Citing the macroeconomic environment, experts told TODAY that these developments are in no way reflecting negatively on the startup ecosystem in Singapore. Mr. Gerard Lim, Partner at Singapore-based XS APAC, pointed to the possibility of an imminent recession on the horizon and rising interest rates around the world.
And while it’s unfortunate that some employees have been laid off, Dr. Wong said that was a small silver lining to the startup ecosystem.
“When some of the big tech companies reduce[employee strength]it may well be in the sense that they release some of that technical talent[into the market],” Dr. Wong said.
The experience and know-how of these former employees may benefit smaller startups to which they are hired later.
Aside from startups that have successfully penetrated regional markets, Singapore is also home to those with a strong global reach such as PatSnap, a unicorn company with more than 10,000 clients in more than 40 countries.
PatSnap — a combination of “patents” and “snap” — uses AI-powered machine learning technology to comb through billions of data sets to produce what it calls “innovation intelligence” for its commercial customers. According to its website, its clients include the likes of Walt Disney, Tesla and Dyson.
Attracting entrepreneurs from abroad
Over the years, Singapore has managed to attract foreign entrepreneurs to set up shop here, including those from different countries who have decided to work together in the republic to build their start-ups – with EnterpriseSG playing the role of matchmaker.
For example, Fairmart Technologies was created a little less than two years ago by two men from Ukraine and Slovenia.
“The EntrePass visa program has made it possible for my co-founder and I to move here during the pandemic and start a business with minimal fuss,” said the company’s CEO, Jan Jasparek, who is Slovenian.
He said he and his Ukrainian partner, Daniel Moskovtsov, met in Singapore through the incubator program Entrepreneur First backed by EnterpriseSG.
“We chose Singapore because it has a more vibrant society, better infrastructure and supportive government,” said Gasparek, who came to Singapore from Hong Kong while Moskovtsov was in New Zealand for three years before coming to Singapore.