A year of new frontiers

PHOTO: A year of new frontiers
A sign that the start-up ecosystem is maturing is the emergence of grassroots networking communities such as Startup Grind, which holds regular meetings for technopreneurs to share experiences.

SINGAPORE - The sluggish economic growth expected next year has an upside for tech start-ups.

Industry insiders say that as fledgling businesses are pursuing fresh ideas not seen in the market, they stand a better chance in a downturn.

Mr Lim Der Shing, co-founder of JobsCentral, said: "Start-ups create new markets which have better returns on investments."

Added Singapore-based tech investor William Klippgen: "They often offer cheaper ways to solve existing problems."

E-commerce start-ups this year expanded into high-end fashion goods and luxury travel, previously thought impervious to online buying.

Fashion goods e-tailer Reebonz expanded into the region and Luxe Nomad and ImpulseFlyer emerged in the travel segment.

Ventures once thought impossible online have added a new texture to the start-up landscape.

Local start-up Crowdonomic helps other new start-ups raise funds from the public. Since it went live a couple of months ago, it now has four "campaigns" raising funds for different projects from peer-to-peer car sharing to comparing Singapore companies through video presentations.

Milaap, started by two Indians who graduated from the National University of Singapore, is the first online platform to enable anyone around the world to lend to the working poor in India.

Based in Singapore and India, the social enterprise has so far raised $530,000 globally, which has helped 13,000 Indians.

Milaap is also part of a trend where Indian companies open their offices here.

Indian start-up Idea Device will soon open its South-east Asia office here, prompted by uncertainties over the regulatory regime in India, and the availability of sales and marketing executives here. Founded in 2009, it designed an automation software called Epsilon that allows data centres to work faster with fewer faults and greater security.

The positive outlook for start-ups capped a busy year for Singapore's start-up ecosystem.

About 100 start-ups were funded this year by Spring Singapore and the Media Development Authority.

Several new tech incubators were set up, including Jungle Ventures, TNF Ventures and Wavemaker Labs. More collaboration among tech investors to mentor start-ups also emerged.

Spring Singapore also debuted an online mentoring website, Ask Ace, where anyone can ask experienced technopreneurs questions about start-ups.

One notable development was the tech boot camp in February organised by Joyful Frog Digital Incubator (JFDI). Twelve teams received intensive coaching in building a company, compressing into 100 days what a start-up would usually learn in a year.

The teams "graduated" after successfully pitching their ideas to investors and raising an average of $650,000 per team.

Another sign that the ecosystem is maturing is the emergence of grassroots networking communities, Startup Grind and Singapore Startup Club, which hold regular meetings where technopreneurs get together to share experiences and ideas.

Singapore is also seen as the best place in Asia for founding start-ups.

In the Start-Up Ecosystem report released in August, the Republic was the only Asian nation listed and ranked 17 out of 20 cities. Silicon Valley in California topped the list for having the best ecosystem where the key ingredients of ideas, funding, people and mentoring are on offer.

The list, compiled by US- based Startup Genome, looked at 50,000 start-ups.

It said Singapore had the potential to "become the central start-up ecosystem of Asia, knitting together the huge markets of China, India, Indonesia and Malaysia" because of its geographical position in Asia.

But it also pointed out two areas for Singapore to work at.

Looking ahead

TO ATTRACT talent and more new start-ups, the cultural element where people are risk averse and fear failure needs to be improved, it suggested.

The other area is a lack of substantial funding for expansion overseas.

Publicising successful start- ups would be a good way to flag technopreneurship as a challenging career. But tech winners will emerge only in about two to three years when the current crop of start-ups blossoms, said Mr Leslie Loh, a partner at tech fund Red Dot Ventures.

Getting the funds for marketing would be more challenging as there are only a handful of companies here such as Vertex Venture Holdings able to inject $3 million and above into firms.

Industry insiders believe that start-ups needing hefty funding would have to look overseas.

Next year, new e-commerce start-ups must add social networking features to keep pace with the times. Said Mr Lim of JobsCentral: "This is a major area as it has major implications on how to move products and services in front of customers."

One way to tackle the issue is to have the material curated and presented by friends in your social network, he added.

Technopreneurs would also have to seriously consider adding mobile and tablet capabilities as consumers increasingly move to these devices to go online.

So-called "big data" is another area that must be part of any new business idea. Collating information on customers, products, employees or even competitors will be key to growth and returns on investments.

Next year will see the start-up ecosystem shift to a higher gear.

Policymakers, investors and technopreneurs are expected to work together to raise funding levels and educate the public on technopreneurship.

Only one factor is left: new breakthrough technologies and ideas must be dreamt up to capitalise on all that the ecosystem can offer.