Finding Money for Startups in Singapore Dr. Virginia Cha Chief, Research and Innovation, Institute of Systems Science, NUS Adjunct Professor, Science Entrepreneurship, INSEAD Entrepreneur‐in‐Residence, INSEAD Entrepreneur‐in‐Residence, SMU Entrepreneur in Residence SMU Executive Advisor, NUS Entrepreneurship CentreMember of the Global Agenda Council on Fostering Entrepreneurship 2012‐2014, World Economic Forum October 2012
Entrepreneurial Ecosystem p y• Entrepreneurs and Ideas 1. Ideas & Opportunities 2. 2 Passion & Commitment 3. Strategy & Pivots 4. Go to Market• I Investors and Money t dM 1. Angel Investors 2. Incubators 3. Venture Capital 4. Corporate Venture Capital 5. Corporate Investor• Government and Economic Development 1. Funding startups 2. 2 Industry development 3. Policies, incentives, and investments
Singapore Funding Map (from Bootstrap to Seed Stage) (f d ) Source of graphics: Wong Meng Weng (JFDI Asia).
Singapore Funding Map Singapore Funding Map (Early Stage)Source of graphics: Wong Meng Weng (JFDI Asia).
Singapore Funding Map (Growth/Late Stage)Si F di M (G th/L t St )Source of graphics: Wong Meng Weng (JFDI Asia).
Angels ge s1. Not typically formally organized, but this is also changing2. Short investment process: 1-2 months, starts off innocently3. Typically invests at idea stage, no revenue, prototype stage4. Looks at oo s at: • Passion (self) and Projects • People/team/Chemistry • Motivated by desire to be engaged in entrepreneurship4. Helps entrepreneurs with: • Corporate Partners/Lead Customers • Strategy/Operations management • Sympathetic ear/positive support • Credibility • Introduction and Sourcing of VC
SG’s Seed/Angel Investors Accel‐X •SPRING SEEDS – 1‐for‐1 to qualified angels S G ( i l d) •SPRING BAF (Business Angel Funds) Image source: respective company’s website7
Incubators1. Typically organized and funded by government or quasi-gov, or associated with a university/research entity or a group of investors2. Investment process: 3 months, models after the VC process, but less stringent3.3 Bridges the gap between idea/prototype and revenue stage4. Looks at: • Idea, Opportunity, IP • People/team/fit to incubator mission • Motivated by KPI with building new businesses/value4.4 Helps entrepreneurs with: • Corporate Partners/Lead Customers • Team Building/Rent/Lab • Credibility • Introduction and Sourcing of VC
Venture Capitalists1. Organized as formal investment funds into new ventures2.2 Long investment process: 3-6 months (in SG; in USA faster) 363. Typically invests in prototype stage, or beta launch, sometimes pre-revenue (but in SG, VCs require much more validation)4. Looks at: • Sector/Industry/’space’ • pp y Opportunity/Idea/IP • People/team/track record • Valuation4. Helps entrepreneurs with: • Capital/Credibility • Executive team recruitment • Strategy/financial management/Exit
Corporate Investors1. Corporate strategic investor – direct equity investment2.2 Long investment process: 4-6 months 463. Typically invests in revenue or beta-stage4. Looks at: • Sector/Industry/’space’ • Complementary to own products/services • People/team/track record • Profit/Loss4. Helps entrepreneurs with: • Capital/Credibility • Corporate Partners/Lead Customers • Revenue5. Generally looks towards eventually a full acquisition
Corporate Venture Fund Investors1. Corporate strategic investor – corporate venture fund investment2.2 Medium investment process: 3-4 months 343. Typically invests in prototype or beta-stage4. Similar characteristics as Corporate Direct Investor except: a. Behaves more like a VC, looks at returns b. Does not make a full acquisition
Entrepreneurship Ecosystems in Asiahttp://techcocktail.com/asian‐startup‐ p // / pscene‐2012‐03#.T3EWaGHzuSp