CEO Bloggers - Benson Lau
A CEO is almost always the best single human asset a company has, particularly start-ups and smaller companies. Yet many businesses hide their top asset behind a marketing curtain. A short website bio, usually without contact information, makes most CEOs appear inaccessible. If your goal is to be a customer-facing and customer-focused organization, a CEO blog can create a public face for a company. Showcasing your company’s personality can go a long way toward defining your values.
Director at Zencode Technologies
5 LESSONS FROM SINGAPORE:
VC BACKWATER TO STARTUP STAR IN A DECADE
Publish Date: 09/04/2018
This is the start of a mini-series where we explore why Singapore within a short period of time has become a startup hub in Asia and ranked one of the top startup capitals in the world by numerous lists. From swamp to industrialised nation to an innovation capital. And how Hong Kong can possibly become an equally strong global player with some small tweaks.
But in this article specifically we will explore 5 lessons Hong Kong can possibly learn from Singapore’s success as a startup hub.
LESSON 1 : Aggregation
Singapore prior to 2010 was known as a hot, boring, authoritarian, chewing gum prohibited city-state with an impossibly lush forest in a maze of concrete skyscrapers. However that all changed with 2 huge megaplexes of “resort casinos” that relatively rapidly changed how people perceived Singapore in double quick time. It didn’t have a cosmic confluence of innovative players like Silicon Valley in the 1970s, but it did have a plan to make it a reality.
Singapore at this time had a fair few startups, but they were scattered around Singapore like buckshot from a shotgun, i.e. not very organised and spread in vastly different areas of the island.
Around the same time about a year later the Singapore government renovated an old dusty building (one of the oldest industrial buildings in Singapore) and converted it into the start of what is now a connected ecosystem of venture capital funds, technology startups, research labs and incubation labs that is now collectively known as Blk71 (aka Launchpad at one-North). They initially attracted early stage startups with not just low rental (which is very important for an early stage startup), but also a community of other innovators. It brought in 2 local venture capital firms (NUS Enterprise and Singtel Innov8) to assist in advising and bringing to life this community with the right mix of startups and community atmosphere.
Lesson 1: Startups need strong community, low-cost rental and good connectivity, but not necessarily fancy infrastructure. You need the grassroots community to buy-in and assist with creating that close knit community.
LESSON 2 : Funding
But beyond all the big infrastructure (with the false mantra that all governments embrace “build it and they will come”) Governments need to look at what really powers the startup community; Capital Resources. Innovators quite frankly need capital to expand and fund their idea, but how did Singapore do it?
Through a coming together of various government agencies to come up with investor friendly policies from Monetary Authority of Singapore’s (MAS) tax incentives for investors or grants from Infocomm-Media Development Agency (IMDA) that gives grants in particular technologies or SPRING Singapore matching angel investor funding 3 to 1 (for every 1 dollar an accredited investor puts in it will put in 3 dollars). This gave famous international venture firms to have confidence to try investing in Singapore startups as the level of risk was significantly lowered. Why? Because
a) Your VC money now stretched further with every dollar your spent you got multiplier for the startup to increase their runway and therefore their opportunity for success
b) You could invest later in a more developed idea as initial seed funding by a government grant was given through a rigorous selection and ideation process.
Lesson 2: Venture Capital funds essential to growth. Governments need to take the lead in investments to “show some skin in the game” to lessen risk for Venture Capital funds. Coordination between government agencies is essential.
LESSON 3 : Pervasive Innovative Thinking
Further to that there is the way a facility is run, if you head to Blk71 you will find no security counters, no factory canteens, a lot of open space and common “run into” areas (. This is because the space was designed for collaboration throughout the day, #Bash is a place that is freewheeling for early stage startups, but later stage startups will also encounter many of these “run-into” areas. Just take a look at Timbre’s food court in Blk71, it has an eclectic collection of food concepts from all around the world, with stalls in converted containers and “pimped out” food truck stands. It runs away from corporate ideals of perfection as much as possible and introduced a physical representation of ideation as much as possible. The sterile look has given way to freewheeling ideation.
Even the corridors of the buildings are encouraging entreprenuerial behaviour; no “No Posting” signs. Just a maze of doors with startups’ posters and different ways of attracting attention littering the walls of the corridors to bring customers and investors to their products.
Lesson 3: Day-to-Day visual interaction and processes should also encourage ideation and entrepreneurship.
LESSON 4 : Talent
On top of this Singapore realised the need for a diverse talent pool which Singapore as a small city-state cannot possibly get. Thus the relaxation of visas for Entrepreneurs and deep-technology talent, which my partners were also able to leverage on (Note: I run a company called Zencode Technologies with 3 partners from Singapore and India). This helped companies that had ideas to match with the appropriate talent from a much larger global talent pool. Companies like nuTonomy were able to leverage that to be able to find the right people for their self-driving vehicle technology which requires very specific experience and skills, otherwise they would not have considered using Singapore. Incidentally the laptop i bought was from an nuTonomy engineer who needed to sell it because Macs were not supported (maybe i should keep this laptop as a souvenir).
This is especially important for more innovative machine learning, AI, robotics and other deep-technologies which require the top 3% of global talent, which cannot be found in native populations alone. Singapore has around 8,000 engineering graduates a year (although this number is slated to rise very sooner with new universities, but very few end up with engineering jobs), which pales in comparison with a single state in India (Tamil Nadu) that produces around 100,000 engineering graduates a year. So small cities and countries do need to allow for these talented individuals and teams to come in relatively easily and contribute to the community as well. But startups need to be able to confidently know that they can apply and sponsor such individuals, as when you startup your team and product will revolve around those key individuals.
But Singapore also didn’t neglect encouraging local talent to be involved in innovative startups, even students from local universities are encouraged from a university lead initiative to intern in startups. There have been various schemes initiated and continually supported by Singapore including Failcon and Pheonix Award to encourage innovation (which often comes with failure) to break the taboo of failure as a topic.
Lesson 4: Make it easy to allow foreign talent to apply for jobs and also easy for companies that require such talent to confidently apply and plan their roadmap. And encourage top local talent to try startups as well to change the perception of startups.
LESSON 5 : Legislation
When Grab and Uber wanted to set up in Singapore and push the market for ride-sharing, Singapore was one of the few countries in the world that actively worked with them to modify and come up with legislation that would work with them to legitimise such operations. The Singapore Land Transport Authority (LTA) came up with a special license for Uber and Grab drivers and a special licensing for private cars to do register themselves as ride-sharing drivers, this both encouraged yet regulated this relatively new industry and allowed for both platforms to flourish in a relatively small cityscape.
Further to this when financial startups want to test new technologies the Monetary Authority of Singapore (MAS) also came up with sandbox regulation that allowed such startups a way to test their technologies without applying for financially prohibitive licenses and lengthy legal processes for compliance. As long as these financial startups applied with MAS for consideration for the sandbox and worked within the sandbox’s timeframe given by MAS they were given significantly less regulatory hurdles.
Without these situations being worked with and ultimately “approved” by the government these startups would forever be in the grey area and never be allowed to fully disrupt a existing dominant business model.
Lesson 5: Legal frameworks need to allow for testing of new technology and allowance of startups to disrupt existing models
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