2. Speeches
Parl Sec Low Yen Ling at the 2nd CrowdFunding Asia, Global-Singapore Summit
9 November 2015
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SPEECH BY MS LOW YEN LING, PARLIAMENTARY SECRETARY, MINISTRY OF TRADE & INDUSTRY, at THE 2ND CROWDFUNDING ASIA, GLOBAL-SINGAPORE SUMMIT, on 9 NOVEMBER 2015, 9.45 AM AT MARINA BAY SANDS
CEO of Phoenixict, Ms Kwek Hong Sin
Distinguished Speakers and Guests
Ladies and Gentlemen
Introduction
1. It is a pleasure to be here at the 2nd CrowdFunding Asia, Singapore Summit 2015.
Entrepreneurship & the Economy
2. Singapore is a nation built on enterprise. In the past 50 years, we have transformed from a trading port to a global city with a diversified economy. Entrepreneurship has played an important role in bringing Singapore to where we are today. Start-ups add vibrancy to the business environment, create jobs and contribute to innovation by bringing in new ideas. Moving forward, advances in technology and globalisation will bring about many opportunities for innovation. Entrepreneurs will continue to have an important role to play in helping Singapore take advantage of such opportunities.
3. Singapore start-up scene has made good progress over the last decade. The number of active start-ups has increased from 24,000 in 2005, to 55,000 in 2014[1]. Total early-stage entrepreneurial activity in Singapore, which represents the percentage of working-age population who are about to start or those who have recently started a new business, has grown from 4.9% in 2006 to 11% in 2014[2]. Singapore was also ranked 10th among global start-up ecosystems, and top in Asia, in the 2015 Global Start-up Ecosystem Ranking by Compass. Although we have made a good start, we need to press on and keep up the momentum to support the continued growth of our start-up ecosystem.
JTC LaunchPad @ one-north
4. Earlier this year, Prime Minister Lee Hsien Loong launched the JTC LaunchPad @ one-north to provide a nucleus for technology start-ups in Singapore. By bringing start-ups, incubators, and venture capitalists together, the LaunchPad has become a fertile ground for start-ups to scale into successful businesses of the future. By 2017, we expect the LaunchPad to house as many as 500 start-ups and 35 incubators.
Funding Support for Start-Ups
5. Beyond infrastructural support, we also recognise that start-ups need access to funding to get them off the ground. The Government has been working to address funding gaps through tax incentives, grants and co-investment programmes. For example, through the Business Angels Scheme (BAS) and Start-Up Enterprise Development Scheme (SEEDS), SPRING co-invests with business angels and venture capital firms in promising start-ups. Since 2001, more than S$80 million in funding support has been committed to more than 220 companies.
6.To further support start-ups, during Budget 2015, we announced a top‑up of S$75m to SPRING’s equity investment programmes. Specific focus in implementing the programmes will be start-ups with emerging areas such as clean technology, advanced manufacturing, and engineering.
7.To provide alternative avenues of financing for start-ups, SPRING is also piloting a venture debt financing programme with selected financial institutions to provide loans to promising start ups, with SPRING sharing 50% of the default risk. Venture debt makes it possible for start-ups to use debt financing as a lower cost alternative to equity financing, and has been found to be useful in overseas markets such as the United States. SPRING aims to catalyse 100 venture debt loans, totalling to about S$500 million over a pilot period of two years.
Crowdfunding for Start-Ups
8.Crowdfunding is another emerging financing modality that is increasingly used by start-ups all over the world. According to Massolution, global crowdfunding experienced accelerated growth in 2014, expanding by more than 160% to reach US$16.2 billion raised, up from US$6.1 billion in 2013. In Asia, crowdfunding volumes have also grown significantly, with the amount raised increasing from US$809 million in 2013, to US$3.4 billion in 2014, an increase of 320%[3].
9.The crowdfunding landscape in Singapore is also growing rapidly. Over the past few years, several crowdfunding sites have launched in Singapore. Some examples include ToGather.Asia, Crowdonomic and CoAssets.
10. Entrepreneurs in Singapore have taken advantage of crowdfunding to get their projects off the ground. One example of this is Bamboobee. Bamboobee’s 2013 Kickstarter campaign to design and build bikes from non-processed bamboo raised a total of about US$64,000 from 120 backers, 60% more than their initial goal of US$40,000. With the initial funding, Bamboobee was able to produce its first batch of Bamboobee bicycles. Today, Bamboobee has sold more than 1,300 bicycles globally and has clinched various awards such as the Core 77 Design Award in 2013 and the Young Enterprise Gold Award at the 28th Taipei International Cycle Show in 2015.
11. I am encouraged that events such as CrowdFunding Asia have been initiated from ground-up by members of the start-up community, to share the latest trends in crowdfunding, and provide opportunities for our start-ups to connect with potential investors.Today's event will feature plenaries across overarching themes such as social innovation and bridging gaps with talent. We trust this will contribute to the development and growth of the crowdfunding scene in Singapore and in Asia.
Conclusion
12. On this note, I wish everyone a fruitful session and pleasant day ahead. Thank you.
[1] Source: DOS / ACRA data
[2] Source: Global Entrepreneurship Monitor (GEM)