VCs to play significant role in age of innovation and disruption

Their greatest value-add is their networks, experience and macro view: Heng


VENTURE capitalists will play a significant role in the coming years as technology continues to blur the lines between industry sectors, said Singapore Finance Minister Heng Swee Keat at Vertex Ventures' 30th anniversary event on Tuesday.

These startup investors will help to "connect the different dots" in an age of innovation and disruption, where the lines between industry sectors are increasingly blurring, Mr Heng said in an onstage conversation on building an innovation-driven economy.

"The greatest value-add of venture capitalists is the networks and experience, and a macro view of the industry and the world, that they bring to startups."

When asked how Singapore can compete against other digital economies, Mr Heng said that the Republic should aim to both compete and cooperate with the other economies because "this is not a zero-sum game".

He said that while Singapore has formed extensive networks and relationships with universities and researchers from around the world to facilitate cooperation, it also needs to identify what it can do to distinguish itself and areas in which it has a head start, such as artificial intelligence.

"We don't pretend that the government knows everything as a planner. The command economy has not worked. We need a huge dose of initiatives from the ground, entrepreneurship, and people to think in innovative ways. The job of the government is to create the environment and support for that."

When asked how Singapore plans to attract talent from other parts of the world and simultaneously avoid a brain drain as local talents move overseas, the minister first said that this flow of talent in and out of Singapore is "not negative". The resulting exchange of ideas will "always be useful or you might just look at the world in a narrow way", he added.

"What is important is the vibrancy of that flow and the connections that we can make out of that flow." When asked if blockchain and cryptocurrency will become a market segment in Singapore, Mr Heng said that the Republic will "progressively" take to blockchain, which he hailed as a powerful technology.

"I see long-term benefits of this. But as with all innovation, it's always easy to overestimate its impact in the short run and underestimate its impact in the long run."

The minister was asked to give a date when autonomous vehicles will become a reality in Singapore. He noted that trials are ongoing and said: "I've learnt from technology that we cannot be smart about it. Whatever number we put out will be wrong."

Vertex Ventures, a member of Temasek Holdings, invests in high-growth startups in Asia. Its portfolio companies include ride-hailing giant Grab, peer-to-business lending marketplace Validus and patent search engine Patsnap. It held its 30th anniversary event in Capella Singapore.