ED 47: January-February 2013

ma r k E t in t E l l i gE n C E
GettinG Started
in SinGapore
Singapore’s vibrant Startup ecosystem Attracts investors and entrepreneurs
While there is an abundance of wealth
management and financial heavyweights
in Singapore, the country is also a great
place for budding entrepreneurs looking
to launch their ventures. Over the years,
several Singaporean startups, such as
Hyflux and Creative Technology, have
grown from small operations to global
brands.
incentives for startups
Many of the reasons that attract
multinational companies to Singapore
are also the same reasons that make
the country a very attractive venue for
startups. The government’s pro-business
policies have created a stable and
efficient infrastructure where startups do
not have to jump through hoops of redtape.
The procedures for incorporation,
compliance and fund raising have been
streamlined dramatically. For example,
incorporating a company in Singapore
typically only takes 1-2 days, whereas it
takes weeks in places such as the state
of California.
Singapore has a very attractive tax regime.
It is often the cited as the example of a
country that has reduced tax rates, yet a
very healthy budget and foreign reserves.
The maximum corporate tax rate in
Singapore is a relatively low 17 per cent.
In addition, Singapore government offers
several tax incentive schemes designed
specifically to help startups. For example,
qualifying startups can avail of a full tax
holiday up to a certain amount of their
taxable income for each of their first
three consecutive years of incorporation.
Start-ups who continue to grow can also
qualify for other tax incentives such as the
Development and Expansion Incentive
(DEI) and the Productivity and Innovation
Credit (PIC) scheme.
There are a wide range of other
government-backed funding and
assistance options for new businesses,
including equity financing schemes, cash
grants, business incubator schemes, and
debt financing. A dedicated government
agency, SPRING Singapore, is focused
on the growth and cultivation of SMEs in
the country.
Singapore’s flourishing private
funding scene
The attractive startup environment,
combined with the continuous inflow of
investment and wealth into Singapore,
has led to the proliferation of angel
investors, venture capitalists, and private
equity firms. In 2011, Singapore-based
venture capital and private equity firms
registered a total of S$26.5 billion in
assets under management.
According to the IESE Business School’s
2012 Global VC and PE Country
Attractiveness Index, Singapore is the
fifth most attractive destination worldwide
for firms in the industry, behind traditional
investment powerhouses Japan, the UK,
the USA, and Canada.
Singapore is an excellent place for those
looking to invest in startups. The country
has no capital gains taxes, which makes
it very attractive destination for investors
and entrepreneurs alike. In addition, for
foreign investors looking to relocate to
Singapore, the easiest way is through its
Global Investor Programme (GIP). Under
the GIP scheme, an individual can qualify
for permanent residence by investing at
least S$2.5 million in a local startup or the
expansion of an existing company.
The country’s largest education
institutions, such as the National
University of Singapore (NUS), also have
entrepreneurship programs where they
invest in startups or facilitate third-party
investments, and provide the necessary
mentoring to help the business grow.
For example, NUS’s annual business
plan competition - StartUp@Singapore
- provides a forum where participants
can hone their skills while getting the
chance to network and pitch their ideas
to potential investors.
The upgraded Action Community for
Entrepreneurship (ACE) program, which
lists NUS and other major educational
institutions and private sector
organizations as partners, also helps
bring startups and investors together.
With plenty of options available for both
entrepreneurs looking for funding as
well as investors looking for the next big
company, Singapore is truly a conducive
environment for the creation and
development of startups.
Jacqueline low
chief operating officer
Janus corporate Solutions
Ja n | FE b 2013
En t r E p r E n E u r s’ Di g E s t
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