Big dreams for startup sector in Singapore

Action Community for Entrepreneurship is looking at creating more opportunities for interaction between startups and companies.

IT is barely past 9am, and Blk 79 and its surroundings are already teeming with activity. Blk 79, and its (for now) more famous neighbour, Blk 71, are part of Launchpad@one-north in the Ayer Rajah Industrial Estate.

Officially opened by Prime Minister Lee Hsien Loong a month ago, the centre - which currently comprises three blocks - houses about 500 startups and 35 incubators. It is also the home of Action Community for Entrepreneurship (ACE), which in 2014 was relaunched as a private sector-led movement for entrepreneurs.

Being private sector-led means that it now has more autonomy to think about what is needed from the ecosystem, says Prakash Somosundram, vice-chairman of the Board of Trustees. It also means that it is able to move a lot faster.

"Because we're on the ground, it's a lot easier for us to very quickly think of programmes. But we're still getting a lot of support from Spring Singapore - and each time we need to tap into other government organisations, they are always willing to help us," he adds.

Mr Somosundram, who is also the co-founder of digital marketing company Yolk, has been "serving" at ACE for almost six years.

"I was a beneficiary when I started out in entrepreneurship - they used to have something called Blue Sky meetings once a month, which I attended, and met a lot of fellow entrepreneurs. What was interesting about ACE is that it wasn't industry-specific whereas most other networking events were very industry-focused and everyone is there to fish for new contacts and business opportunities.

"ACE always had a (sense of) camaraderie of entrepreneurs supporting each other."

Today, this sense of cohesiveness and camaraderie is still a cornerstone of ACE and the wider Launchpad community. "I know for a fact that there have been a lot of interesting collaborations between smaller teams," he says.

"After you're in the system for a while, there's some familiarity, and it's a lot easier to walk up to a VC (venture capitalist) and say 'Can I buy you a cup of coffee and pick your brain on something.' So I think that's the opportunity (that being part of the ecosystem provides) whereas traditionally you sit in a dark room, you go online, and start panicking when you read the 10 things you shouldn't do when you start a business and you've already done seven."

In the main welcome centre, which features a large event space and 30 smaller desks, plans are in motion to create more opportunities for interaction between startups and companies. "One of the things we did identify is that there wasn't sufficient corporate involvement with the startup ecosystem. Previously, in Blk 71, most of these guys built a lot of solutions independently and then when it's time to commercialise, they start looking for corporate partners.

"What we're doing is to get some of these corporate sponsors to come in and work with us at ACE, with us acting as a gateway. So we've managed to bring in Cisco Systems, SGX and DBS," says Mr Somosundram.

DBS Bank will, for example "deck up" one of the meeting rooms and also offer - when the room is not booked for meetings - startups the option to open bank accounts there instead of going to a bank branch.

"It's beyond just sponsorship-in-kind," Mr Somosundram is quick to note. In the case of DBS, ACE has tied up with the bank's BusinessClass to tapinto its talks and events.

ACE is also looking at ways to work with DBS to feed its pool of mentors onto DBS's BusinessClass platform. This is more effective compared with replicating the app or developing another platform, he says.

Separately, ACE is in talks with Cisco to bring in some of its domain experts to the welcome centre to hold talks and/or set up a temporary booth at one of the hot desks. Cisco has also provided the welcome centre with some hardware.

"We're still trying to reach out to more corporate sponsors, those not traditionally involved with startups, and there's a lot more that can probably be done," he says. "I think that's the thing that really needs to change. We need to bring these two worlds together and just let them jam and come up with ideas spontaneously as compared to holding hands and 'please meet so-and-so'. We're trying to create that environment so that such things can flourish."

The other area that ACE is looking into is funding and finance. "Currently we're looking at crowdfunding, and we're trying to see what it is ACE can do and the role that we can play using the space here (for example by) inviting people who have actually done crowdfunding successfully to run workshops and training here.

"It would be an effective manner of raising capital, so that's a space that's fast evolving. It's one area where we can look at to improve finance and funding, because that's constantly a problem for all startups."

Despite the amount of funds (and the amount of angel activity in Singapore, which is unprecedented anywhere in the region), startups still complain that there is not enough capital for growth or regional expansion.

"Crowdfunding could be a method towards addressing some of those challenges. The good thing about crowd funding is that it is a marketing effort at the same time," says Mr Somosundram. In January, the Singapore Exchange (SGX) and high-tech venture capital firm Clearbridge Accelerator announced plans to launch an online crowdfunding platform for startups to sell equity to accredited investors.

The current model is that startups make an announcement only after they have raised the capital. With equity fund raising however, the entire process is public, says Mr Somosundram. "You see the founders sharing what their vision is, and it allows for a narrative to be built for the startup. So I'm anxiously waiting for crowdfunding to happen in Singapore."