Singapore

Southeast Asia: Startup Ecosystem 2.0

Singapore: Economy Over view

SINGAPORE - Real GDP and GDP Growth Rate (US$ Bn/US$), 2011-2020

Overview

Singapore is one of the top-performing economies in the world with GDP per capita among the highest. The average real GDP growth rate between 2011-2020 is around 2.89%.

Sectoral Highlights

Singapore is one of the global financial centers and key trade hubs. The country’s expertise in semiconductors and data storages also makes it Asia’s high-tech manufacturing hotspot.

Business & Investment Climate

Singapore ranks 2nd globally in terms of ease of doing business (2020). Supported by robust regulatory and IP f ramework, pro-business policies and stable political environment, the advanced business ecosystem has attracted global investors, MNCs and regional startups.

Notable development priorities in recent years include: - Focus on high-tech manufacturing. - Accelerate national digitalization. - Supporting local businesses. SMEs are expected to be the future impetus of the country. Some of the challenges the country is facing include an aging population and increasing competition f rom China and India in maintaining the inflow of foreign talents.

Digital economy

- Singapore ranks 1st in Asia in terms of digital inf rastructure and 1st worldwide in terms of technological readiness. - The digital economy is estimated to be around US$9 Billion in 2020 with a growth rate of 19% toward 2025.

Source: MarketLine

SINGAPORE - Digital Economy

Source: MarketLine; Google, Temasek, Bain & Company SEA E-conomy Report 2020

Southeast Asia: Startup Ecosystem 2.0

Singapore: Government Suppor t

FOR STARTUP

Special Fund for Startups (SSFS) (2020-2021)

● EDBI & SEEDS Capital ● A time-limited scheme for co-investment in startups to sustain growth momentum through COVID-19. Startup SG Founder provides mentorship and startup capital grant to first-time entrepreneurs. Corporate Venture Launchpad provides co-funding for corporates to build new ventures. Startup SG Tech POC/POV: Funding for Proof-of-Concept and Proof-of-Value projects to support commercialization of technologies.

FOR INVESTORS

Startup SG Equity:

● EDBI: Fund-of-funds investment into deep-tech focused VC funds. ● SEEDS Capital / SG Innovate: Direct co-investment in tech and deep-tech startups.

Section 13H/ Fund Management Incentive (S13H/FMI)

● S13H provides tax exemption for income f rom funds, while FMI offers a 5% concessionary tax rate on income f rom managing S13H approved funds. Section 13 series: Other tax incentive schemes for Singapore funds. Angel Investors Tax Deduction (AITD): Tax deduction for approved angels by Mar 31, 2020.

Ministry of Trade & Industry (MTI)

● EDB fosters Singapore’s business ecosystem and invests in selected technology sectors through its investment arm EDBI. ● Enterprise SG (formerly Spring & IE) supports enterprise development and invest in startups through its investment arm SEEDS Capital. ● Startup SG: an array of startup-support programs ranging f rom funding, coaching to inf rastructure and talent sourcing. ● A*Star: the R&D agency incubates deep-tech startups through A*StartCentral and commercializes its IP portfolio through A*ccelerate.

IMDA under the Ministry of Communications & Information (MCI) regulates and promotes the infocomm and media sectors. IMDA has launched a number of initiatives and grants to support startups/SMEs in the ICT sector such as iJam, SG:D Spark and Accreditation@SGD.

SGInnovate

Singapore’s investment arm for Deep Tech.

National Research Foundation has launched a number of funding initiatives (eg. POC & TRD, TIS, EVSF) and programs to strengthen the country’s R&D capabilities for innovation (eg. AI, Cybersecurity).

INSTITUTIONS INFRASTRUCTURE

Singapore has 10 Centers of Innovation as of Mar 2021 according to the MTI.

Southeast Asia: Startup Ecosystem 2.0

Singapore: Government Suppor t

“In the last decade, Singapore has positioned itself as a launchpad in the region, by growing its startup and VC community through co-investment and other startup-oriented schemes. We are encouraged to see the VCs seeded by our ESVF scheme attracting international LP capital as they grow to support the next generation of entrepreneurs and startups. As the local startup scene enters a new phase of maturity and growth, we are confident that these startups will extend towards global markets by leveraging on Singapore's vibrant innovation ecosystem and strong international networks.”

Professor Low Teck Seng

CEO of National Research Foundation Singapore

“Singapore has long been the location of choice for multinationals anchoring regional headquarters in Asia, and in the last decade has grown into a hub for global tech companies and the nexus of the regional startup ecosystem, offering unrivaled access to funding, a progressive IP f ramework and deep talent pool, coupled with a market that is distinctly suited to accelerating commercialisation f rom test-bedding all the way to full-scale deployment. These provide the competitive edge for the next generation of startups to take on an increasingly fluid and competitive global environment. The government continues to build on the success of earlier programs to catalyse private sector venture capital investment, with EDBI playing a pivotal role in stimulating and nurturing development in select high growth technology sectors across healthcare, information & communication technology, and emerging technology, and looking to further spur development in areas of strategic national importance such as advanced manufacturing, pharmbio, medtech and agri-food tech amongst others.”

Ms Chu Swee Yeok

CEO and President of EDBI

Southeast Asia: Startup Ecosystem 2.0

Singapore: Key Industries

EMERGING INDUSTRIES

Aerospace

● Government supports R&D programs and encourages private sectors to participate in the sector. ● Advanced ecosystem to develop, test bed and commercialize satellites solutions, with presence of global satellite players. ● Experience in electronics, precision manufacturing and ICT.

Biomedical Technology

● Favourable regulatory environment for R&D and products commercialization. ● Ecosystem supported by global pharmaceutical companies and government’s initiatives. ● Growth driven by increasing demand for medical devices during the pandemic.

Precision Engineering

● Driven by demand f rom other growing industries such as semiconductors, medtech and aerospace. ● Continuous R&D innovations by global leading OEM companies in the ecosystem open new avenues. ● Government plans to enhance competitiveness in the advanced manufacturing sector.

Urban Solutions

● Incentives to address problems of small, densely populated urban areas. ● Solutions in the space are also pioneered by well-funded startups in sectors such as

Transport & Logistics, Real

Estate, AgriTech.

Key Pillars

● Singapore’s position as the financial and professional services hub of the region is cemented by the robust growth of the sector over the past 10 years. ● The country’s expertise in semiconductors and data storages also makes it one of

Asia’s high-tech manufacturing hotspots. In recent years, the sector has seen expansion in the biomedical manufacturing, electronics and precision engineering clusters. ● Wholesale, Retail Trade & Hotel continues to be one of the key sector, contributing 19.4% to the 2019 gross value added (GVA).

SINGAPORE - Nominal GVA by Sectors, 2011-2020

Source: MarketLine