Scheme gives new start-ups a crack at govt tech deals

NEW home-grown technology firms will be given preference over established companies when applying for Government contracts under a new scheme, it was revealed yesterday.

Nine such new businesses have already applied for Accreditation@IDA, which was launched in April by the Infocomm Development Authority (IDA).

Normally start-ups without a track record or financial muscle would not meet the stringent criteria to apply for government tenders but this scheme helps them get a foot in the door.

Government agencies can skip the usual tender process and sign a contract with any accredited start-ups that meet their criteria.

IDA executive deputy chairman Steve Leonard said the scheme does not compromise "transparency in procurement" and serves to plug a gap in current government tender processes that may "unintentionally exclude" aspiring local start-ups.

Head of Accreditation@IDA Edwin Low said the scheme is not meant to be applied broadly to all technology companies.

For instance, systems integrators that install hardware and software will not be considered under the programme, which is meant only for niche software players based here.

Their products have to be unique and have the potential to make a big impact, like those that address major issues in education and transportation. They must also have an annual revenue of less than $10 million, and supply "disruptive" software typically not found in larger established firms, Mr Low said.

A review panel comprising 14 technology and financial consultants will accredit the start-ups.

IDA's assessment criteria for companies also include their operational capabilities, financial standing and product reliability.

The nine start-ups that have applied are in the fields of providing data analytics, mobility and security solutions. Their accreditation status will be valid for 18 months.

Locally-based facial recognition and video analytics software maker Trakomatic is among the nine that applied to be accredited.

Its business development manager, Mr Allen Lin, said the firm would not qualify for government projects worth more than $70,000 under current tender processes.

"Accreditation will help us get the bigger deals," said Mr Lin. Over the next two years, government agencies are expected to commence some 60 data analytics and security projects that could be relevant to start-ups.

But an industry observer with more than 10 years in procurement said the scheme may meddle with the way larger contracts are broken down and sub-contracted to smaller companies.

"If a government agency insists that the master contractor uses a start-up's solution, then who will bear the risk of the start-up's software not working with the overall system?"

itham@sph.com.sg

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