Home Thinking Aloud Singapore Needs A Support Ecosystem For Its Startups

Singapore Needs A Support Ecosystem For Its Startups

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Daniel Goh
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Singapore - Where're our startups?

I submit to you that, in Singapore’s entrepreneurial scene, there is a lack of a proper ecosystem around our fragile startups to nurture, sustain and help them survive in this increasingly difficult times.

It’s not about the lack of money. There are good schemes out there for startups to tap on. I am referring to the lack of a support system – the media, for example, and legal, financial, public relations and other kinds of consultancy services that cater to the unique needs of a startup.

I asked TODAY journalist Hedirman Supian, who writes for the paper’s technology desk, what he thought about my view. His reply:

“I think startups and entrepreneurs have to grapple with the reality that they exist in an ecosystem that’s unfavorable for them at the moment. I wouldn’t exactly say it’s nonexistent.

There are various Government initiatives to drum up funding and support for local entrepreneurs and networking sessions to get them connected to the right people – and to be honest, they’re actually very passionate about pushing local companies to the world stage. Yes, it’s not quite organic but it’ll form the bedrock for a better ecosystem once we’ve got a good track record of launching successful startups. There are also a handful of local entrepreneur communities like The Digital Movement and e27 that foster a more grassroots approach. If you look at the attendance for their meet-ups and events, you can see that the crowds are slowly swelling.”

If it is not money or grassroots support, so what are the missing pieces in our ecosystem then?

1. Lack of Specialized Services catered for Entrepreneurs

Interestingly, Hedirman reveals that he’s never been approached by a specialized PR agency on behalf of a local startup before. This to me is somewhat shocking, as he’s been writing about local startups for more than two years now. Is it because there are no public relations agencies in Singapore that is specially catered to the needs of startups, or is it just because startups simply cannot afford one?

This does not apply to public relations alone. How about specialized legal services, since many startups are not equipped with dealing with intellectual property issues or even something as basic as crafting a contract? Or financial services to help startups balance their books?

2. Where are our Mentors?

One of the key reasons why Silicon Valley has been so prolific in producing successful startups is because it has an ecosystem of successful entrepreneurs who give support to newer startups. Here’s what Sarah Lacy wrote in her book, Once You’re Lucky, Twice You’re Good: The Rebirth of Silicon Valley and the Rise of Web 2.0:

“But the earlier generations would play a huge role in their Internet lives, ensuring that this wave of companies would go about their business in a manner totally different from those of a few years earlier. For every youngun with a cool new project, there was a guardian angel of sorts from previous startup cycles, making sure he or she didn’t get screwed. These guardian angels would frequently find their young charges.”

Josh Schachter of del.icio.us may not have gone anywhere without the backing of Netscape‘s Marc Andreessen. Kevin Rose of Digg.com got help from Equinix‘s Jay Adelson. Mark Zuckerberg and Facebook? Peter Thiel of Paypal. The list goes on.

So where is the Singapore equivalent of such mentors? Sim Wong Hoo of Creative Technology – what’s he been up to these days anyway?

3. Publicity and the Media

Singapore media who are interested to write about local startups are few and far between – such stories are rare and on an ad-hoc basis. Very few, like Hedirman, actively seek out startups to write about. That’s one of the key reasons why I have this blog in the first place, and why the folks from Techgoondu.com has to do this.

4. Market Adoption

Of course our startups should aim for markets beyond our shores, but it’s thoroughly sad when many don’t even find market acceptance in Singapore.

For all the government talk and support that EDB, Spring Singapore, MDA and IDA throw at our local startups, the rest of our civil service seems reluctant to give our startups any business. More government agencies should take the lead of the Land Transport Authority, who is currently working with local startup Gothere.sg to develop a user-friendly travel advisory for public transport journeys.

With government projects in their portfolios, it will only be easier for the startups to penetrate the private sector.

We need an ecosystem for our startups. And we need it fast.

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30 COMMENTS

  1. […] In the long term, Cheng Wei says they intend to start other peripheral services and a community-based platform for Asian startups. ”We really love startups! We have plans for a bigger community within Singapore and Asia – we’ve seen how vibrant the startup industry is in the States, and we’re out to bring this same vibrancy into our home ground. There’s really a dearth of this in our region, and we’re out to fix that problem.” (I can’t agree more, as I pointed out in a previous blog post.) […]

  4. Hi Andrew,

    My recommendation is to approach one of the independent entrepreneur networks such as SGEntrepreneurs or E27 who should be able to mobilize the Singapore startups. They have a vested interest in seeing this sector grow to their fullest potential.

  7. Well, I could organise this networking session from my end but need someone in Singapore to mobilise these entrepreneurs. Categorise them into industries and enquire from them who they want to meet while in Malaysia. I could organise the 1st one in JB, just to get the flavor as well as a visit and briefing on the Iskandar Development Region. After that, we can strategise to see what other areas of collaboration that we could foster for our entrepreneurs.

  9. Hi Daniel,

    Just replying your reply to my note left in this topic quite some time back. Looking at collaboration between Malaysia and Singapore entrepreneurs, I am sure we will be able to come up with some ideas on how to engage these startup entrepreneurs. One of the ideas that I think about is to have joint activities, firstly with a networking activity between Malaysian and Singapore entrepreneurs. That’s usually done to break the ice and eventually foster some sort of business collaboration. We can do this frequently enough in different places so that Singaporean entrepreneurs are also exposed to different parts of Malaysia.

    Secondly, perhaps to jointly organise an ASEAN or Asian regional entreprenuers conference. That could provide a platform for all entrepreneurs to learn from one another.

    Thirdly, to cement a good collaboration, we need to have proper infrastructure in placed to create low cost market access. I suggest using incubators in our respective countries to work together and nurture both our countries’ entrepreneurs when they decide to seek market access in the respective countries.

  11. Hi Sharon,

    Thank you for your very well thought-through comments. I must say I am very impressed by your train of logic and analysis behind those comments.

    Market adoption:
    Most local SMEs, if they make it, do it through sheer grit. In 77th Street’s case, Elim Chew had to struggle a long time – 77th Street started in 1988, and only expanded to China in 2004 with support from IE Singapore and SPRING. That’s 16 years of sheer determination.

    In any case, it’s a case of walking the talk. If the government agencies believe enough in the startups to promote them to others, shouldn’t they eat their own dog food too?

    Lack of mentors:
    Touche. In most cases, disciples can only go as far as the master. In our mentorship schemes locally, that means not very far.

    Cross-interaction of sectors/industries:
    1. Copying technology to start a business – Technology is not the end-all and be-all of business. It is a matter of applying the right technology with the right business model to the right market at a right time – and that is the difficult part. Think Creative vs Apple for MP3 players.
    2. Reliance on others – It’s better to start something and own 50% than to own 100% of nothing? Everything in business is a risk.
    3. At the end of the day, we need to consider the objectives of cross-pollination across industry sectors. It may make sense for a SME 500 company which has hit a plateau to look for ideas from another industry, but is unlikely to matter much to a new startup.

    Most importantly, it is good that you’re already thinking along the lines of entrepreneurship at the age of 19. The future of our country depends on your enterprise and creativity.

    Go and make a difference!

  13. Hi Daniel,

    This is a very interesting and relevant topic you have talked about!

    I was previously an intern at MTI under the enterprise division, and am currently thinking to go into a venture this summer break (I am still an Undergraduate).

    I agree that there is a lack of ecosystem in terms of specialised services to help jumpstart start ups. While Singapore is still a small country, it seems that our small geographical area has no created a aggregation effect which Silicon Valley has enjoyed. This is perhaps due to to the dilution of many goals the government has for this tiny red dot.

    Market adoption:
    While I was an intern, I realised the importance of having anchor customers, especially for the high-tech coys. If one considers starting from the local market, there are really very few big players that can serve this role for the new start-up. Furthermore, it is hard to expect the government to be an anchor customer if it does not even seek to fulfill any need of the government agencies. However, it is still useful to note that most government-backed (not as customers) SMEs/post IPOs do make it big in the international scene. Some examples are 77th street, CapitalMall/land etc.

    Lack of mentors:
    This is perhaps due to the lack of success stories in Singapore. And when i mean success stories, i mean business that are truly innovative to begin with and have grown from there. Much of our successful businesses started off with our pioneers mimicking what is offered overseas, and simply bringing it into our then underdeveloped nation. Furthermore, much of our economic development was based on us riding on foreign MNCs. Hence, with little experience in truly starting up, there is few local mentors around. However, the governemnt has started to realise this and embarked on several mentorship programmes in NUS and SMU. However, the quality of mentorship and extent of networks these programmes offer are still questionable.

    Perhaps one more point to add to the lack of ecosystem: the need for cross-interaction between different industries/sectors.
    As a current student in a university that is highly skewed towards business but less on technology, it is hard for aspiring entrepreneurs to develop an innovative product. The lack of technology background can lead to two worries: (1) having to copy other technology in order to start a business. This is non lucrative as it is likely the new startup will not be able to sustain its unique proposition. (2) the heavy reliance on others make it hard for aspiring entrepreneurs to know how to start. To share your idea and get a tech-guy to develop it? However, this might risk him selling your idea, unless you have such strong customer network that he has to stick to you. However, it is unlikely for youngsters to have such sales power.

    Perhaps a summary of what is needed is: An aggregation effect of different specialised services, having a cross-pollination of ideas between different sectors, and finally, to have real mentors to guide the new entrepreneurs.

    Hope this makes sense! As only 19years old, I am afterall a newbie is the scene 😉

  14. Hi Dan,

    A very good article and discussion thusfar. Here are my 2cents. With regards to your 4 points above.

    1. Lack of Specialized Services catered for Entrepreneurs

    Since we have no ecosystem, and we will probably not have one for 10-15 years that will be so called an “ecosystem for startups”, we need to take it as it is. Singapore will never have a niche legal firm specializing in structuring term sheets for startups and also have VC fund lawyers drafting their PPMs like Wilson Sonsini and 2-3 other notable firms in the Valley. We have to “make do”.
    As long as we can identify 1 practitioner in each service field who has experience with startups from PR, Legal to HR are good at what they do, we are good to go.

    Solution: Find these practitioners, get referrals, and rank the top 10 with a certain metric/methodology and publicize who they are. Put this list and reviews/comments on a PORTAL (see more below).

    2. Where are our Mentors?

    This is indeed a good question. We do have tech entrepreneurs but they have started years back in industries that don’t mean much to Gen X entrepreneurs anymore. Which means we don’ t have our version of the Paypal mafia (entrepreneurs I mean) funding the latest startups out here or anywhere for that matter. However, we do have Singaporean VCs who are “in the know”, for that we need to dig them out. e.g. would be David Su from Matrix Partners in Beijing, solid investor but a bit skewed to the Chinese market.
    We just need to round up people who are “in the know” about sectors that are driving the next wave of change, whether its digital media, mobile apps, energy technology etc. The truth is, the best mentors for us are not based in Singapore, we need to reach out or form a panel of some sort.

    Solution: Put together a mentor list (not limited to Singapore – infact start with the Valley). We can call it a special name or a Panel of sorts, and if possible get Spring/IDA/MDA to fund the setup of this. We just need to put the budget and system in place. The Panel:

    1. Can meet virtually once very quarter to give feedback on policies by Spring/IDA/MDA and give constructive feedback for startsups who are filtered and have presented their ideas. This will be much more constructive than pitching at BANSEA or pitching to mentors of MDA iJam (who are not exactly the people you want to give you feedback with due respect).

    2. Host startup/members visits in the Valley, and introduce right people/network to them. We have no time to BS or do “feel good” trade missions, just go straight to the point. Entrepreneurs need advice, feedback, and capital if needed, no time to waste.

    3. Publicity and the Media

    I agree with you on this. But with Techgoondu and Youngupstarts, and the other sites leading the way, we can get there to provide the latest information for people who are interested. A RedHerring or FastCompany Singapore style? It can be done but the best way is to put a PORTAL together to be the PLACE to go to find information.

    4. Market Adoption

    Truth be told. If we start innovative disruptive companies, it don’t matter where we are located. If we start, a me-too company or a Singapore version of something else, the market size alone will eat you alive. If you want to shoot, please shoot for the stars. The world is smaller than you think. Just do it properly the first time, you will get market adoption from all over the world. Once that is achieved, rest assured, risk capital/mentors/govt subsidies will come knocking.

    PORTAL
    How about working on a PORTAL to aggregate news/blogs/sites together, plus set up a REAL community platform to share ideas etc. We can also aggregate various financing options (free & risk capital options), mentor platforms, etc. We can do this all online. One place to go, no government involvement except information support, sponsorships/banner ads.
    We need to be privately held, independent with fair bit of support from the govt agencies.
    Aggregate all of the above plus more onto this platform, and start from it.
    You won’t know till you try.

    Anyone interested in this endeavor, please email me, we can take this off line. Cheers.

  15. Hi Daniel,

    Kudos on an excellent article. Posted your article on my blog as I thought more readers should get to read it, hope you don’t mind.

    Anyway, my comments and points of view below:

    1. Lack of Specialized Services catered for Entrepreneurs

    There are multiple government agencies providing grants and fundings for various start up activities but as you correctly mention, there are no specialized services or should I say creative services catered for start ups. I just posted an article on my blog about the Australia government assisting their own mobile start ups to New York to do their sales pitch to a group of targeted buyers. This is far more valuable than a 50k funding from MDA.

    2. Where are our Mentors?

    It’s a fact that there are not many big success stories coming out of Singapore, however, its the herding theory that is missing in us Singaporeans. The Taiwanese are so successful in China not because they are smarter but they stick together and support each other, they move as a pack, collectively they are much stronger and gain more attention. This is what is severely lacking in Singapore.

    3. Publicity and the Media

    Press? What press? Can barely recall the last PR or article I read about promising start ups, the best we get usually is about those that have made it, we really need to write for those that can make it or even if we don’t know if they can, we need to give them a shot at stardom.

    4. Market Adoption

    Couldn’t agree more with this. Local start ups almost don’t get any opportunities with our civil services. Take the example of Gebiz, our government bidding system. The size of the projects you can bid for depends on the amount of paid up you have, this basically strikes off all start ups. Of course in reality, civil servants will be reluctant to give projects to new start ups for fear of failing. Perhaps this is where supporting agencies should come in to give that assurance of support for our very own start ups.

  17. Hi Abel,

    Thanks for your input.

    I’m sure many of the government agencies are acutely aware that they need to help many of our fledgling startups. The key issue is how – without carrying all their financial burden and taking on all that risk. Plus it defeats the entrepreneurial spirit!

    A one-stop bureau is available in Business.gov.sg, which is a great platform and resource for new businesses.

    And yes, startups need to help themselves when it comes to publicity, which is why I wrote this: https://youngupstarts0.wpengine.com/2009/03/12/do-yourself-a-favor-startups-and-get-yourself-media-ready/

  18. Hi, I came across this post from Tomorrow.sg. This is all from my personal POV and I’m not really an entrepreneur kind of person so forgive any ignorance displayed.

    I think the problem here is really that there really aren’t that many successful private companies in Singapore that can provide the sort of mentoring that you talk about. Particularly in the technology field. Besides Creative Technologies which as I understand is quite troubled right now due to a lack of demand for their goods, there aren’t any technology companies in Singapore which can be called a household name.

    Also if one looks at the development of most technology startups from the 90s till now in the US, most of them were a combination of people with the ideas(Sergey Brin and Larry Page of Google) with someone with the money and business acumen(Eric Schidmt). But as readers have noted above, without a few successful examples, it is difficult to attract the attention of such VCs. This is especially a problem for Singapore due to our small market. Why would a VC set up in relatively high cost Singapore where the entrepreneurial culture is not very strong instead of China/India?

    Therefore, I believe that the government should give a helping hand to these companies if they are to succeed. However, the way in which the government intervenes can become problematic as well. A move to go local might create a dependency on lucrative government projects. They might then become another version of GLCs and the government’s already large share of the economy will increase further.

    I’m not sure if this is already being done. Perhaps, the EDB and IE Singapore should strive to become more friendly to such startups and offer a one stop bureau where startups can be coached on the business side of things and matched with companies offering services like PR or legal advice.

    And as much as the media should try to seek out startups, should such start ups also not be proactive about this media coverage thing and seek out the media? Should it not be imperative upon the startups as the people who benefit ultimately from such media coverage to make sure they get it?

  19. Hi Nai,

    You are absolutely right about exit potential, although the first barrier startups here face is really market acceptance. Without a successful portfolio of customers (revenue potential) or even user adoption, startups are most unlikely even to attract the attention of investors – much less buyers!

    Your point about our ‘instant generation’ is a poignant one. I’d blame our nation’s “growth at all costs” approach, but that may be a bit simple (and worthwhile of an entire series of posts).

    There are those who buck the culture, I’m happy to say, and I’m glad I count some of them as my friends.

  20. Hi Daniel,

    I came across your blog from while browsing tomorrow.sg. I think you’re totally right in your observations and I wish more can be done to boost the entreprenuerial scene (internet startups in particular) in Singapore.
    In addition, and I don’t have any hard facts on this, I would think the lack of exit potentials by way of either acqusitions from bigger companies or through an IPO (so web 1.0) is a big factor in the dearth of tech startups. Also, you (the entire team really) got to have mad skillz to successfully pilot a startup from incubation to exit; talent that is all too often snapped up by the banks and other MNC’s. I also get the feeling by observation of my fellow peers that the risk/return profile of being a tech entreprenuer simply does not conmensurate with the expectations of the ‘instant gratification’ attitude that seems to be the case with the current generation.

    Nai

  22. Hi Daniel,

    Quite a timely article. Singapore’s potential is indeed stagnating in this regard. There is a vicious circle here. Startups don’t generate excitement with the investment or media community because there aren’t enough homegrown success stories here… and that in turn limits the potential of those who could have been successful.

    Either VC/Angel investors from overseas will have to set up shop here (like they are doing in India) and jumpstart the engine, or else we will have to wait for a handful of headline grabbing success stories that demonstrate the possibilities out there.

  23. Hi Aaron,

    I am heartened that the civil service is finally walking the talk. However, we need to extend acceptance beyond a mere project – correct me if I’m wrong, but the deal is likely to be once-off. But yes, progress is being made and we should be thankful.

    Your points are well taken, and I fully agree. I’ll address these points in future blog posts.

    In any case, please keep me in the loop and add me to MDA’s media list if you please.

  24. Hi there,

    I agree that the environment here is not as conducive for startups, relatively to other parts of the world but we have to start somewhere 🙂

    For your #4 point, we (as in MDA) are trying to help by bundling and bringing our startup to agencies and national events for adoption. For example:
    – in this year National Day Parade, the committee has decided to use 8 of our funded projects
    – In the upcoming Youth Olympics, 2 of our projects have also been selected
    – we are working with Singhealth, NHB, JTC and SLA to promote the adoption of our projects within their sectors. NHB for example is working on a virtual Temasek with one of our supported companies (magma studios).

    Beyond what you have stated, I think we can do more to build up the ecosystem.

    1) creating opportunities for young startups to leverage on the market access and the promotion capabilities of bigger companies such as Singtel, Apple et al

    2) providing technologies for startups to build their competitive advantage upon

    3) provide access to private funding from angels and VCs, and in the process, helping startups to find good mentors

    The ecosystem definitely needs more shaping and supporting but I am happy to see our startups, our incubators as well as ourselves working towards that goal.

  25. Hi “MICA”,

    Thank you for your comments, but hiding behind a pseudonym while making unsubstantiated comments is somewhat cowardly. I’m sure you’ll sound a lot more credible if you put down your real name instead.

    1. Most of the private and public sector use “foreign tools” for media analysis, because at this point there is no equivalent local option that compares to a Factiva or CISION.

    2. Turning to China and India for media analysis – I assume you are generalizing here.

    3. Hosting in Singapore is expensive is because of electricity prices? I am not sure how that relates, perhaps you can enlighten us.

    4. Sim Wong Hoo doesn’t need a job; he has more money than he knows what to do with it. I reckon he has little interest in lending his name to startups in any case.

  26. MICA seems very happy to use foreign tools for media analysis. They wouldn’t consider using locally made ones unless their budgets get slashed and that makes them start looking for help.

    At that point in time, they will turn to india and china. Singaporeans do not provide value for startups. Even hosting is expensive in Singapore (thanks to electricity prices)

    So unless the startup makes money in 6 months, its unlikely that it will survive and thrive. Sim Wong Hoo has enough problems of his own. He might be looking for a job soon. There are no other mentors to speak of with suitable experience and a willingness to lend their names to a startup.

  27. Hi Andrew,

    Collaborations between Malaysian and Singaporean startups will be ideal in helping both flourish. If you have any ideas how we can do that, do share!

  28. Hi Claudia,

    Thanks for your compliments! Entrepreneurs also have to do their part… I will be sharing more on this in future posts.

  29. Looks like this problem is the same everywhere especially in Malaysia. I thought only Malaysian startups have this problem. I guess it is not longer a right perception. Well, maybe what we could do is to try to bring greater collaboration between Malaysian and Singaporean startups especially more so during these challenging times.

  30. Very well written piece! And yes! We startups need all the support and mentorship we can get. If local government or companies doesn’t support local startups, who will?

    Thanks for this post. Hope more enterprise will start looking out for potential ones to work with.

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