Singapore recently outlined its latest Research, Innovation and Enterprise (RIE) 2025 plan, with plans to invest some USD 20 billion over the next 5 years. Here, three key stakeholders from government, academia, and industry weigh in on what Singapore’s current performance and future potential as an innovation hub, translating its world-class basic research into viable and profitable companies that can take Singaporean innovations to global markets.
Looking Beyond Singapore’s Shores
Beh Kian Teik of Singapore’s National Research Foundation (NRF) outlines the role that Singapore plays within the APAC region’s innovation ecosystem.
Singapore is a small island, so from a size perspective we must look beyond our shores and plug ourselves into the global market to achieve success. This is evident within the timeframe of COVID-19, as our scientists played an important role to help us manage the crisis. We were able to provide assistance to neighbouring countries, such as providing ventilators to India
The success of any start-up acts as a lighthouse for other seed enterprises
Taking a step back, it is obvious that when the region booms, so do Singapore-based enterprises; there is always a reflection. In Singapore today, there are over 3,600 start-ups and venture capital groups. And in the last three-quarters of 2020, these companies participated in over 450 deals worth over 5 billion dollars – a 16-fold increase as compared to 2010.
The success of any start-up acts as a lighthouse for other seed enterprises. They can look ahead and see what is possible with success. This not only creates a competitive environment, but also attracts and nurtures talent. Equally, successful companies invest back into start-ups, and this creates a positive cycle of funds going back into the system. This, along with SMEs growing into more innovative companies, builds a strong entrepreneurial atmosphere that can rival other parts of the world.
Finally, multinationals are strengthening their footprint in Singapore. With this comes greater investment into the nation and region as they strive to create products and services.
Play to Existing Strengths & Address Weaknesses
World-renowned oncologist Professor Ashok Venkitaraman examines how Singapore’s world-class research can be better translated into commercial success.
Singapore has a lot going for it in this area, but it will be very important to play to existing strengths and plan strategically to address weaknesses. I think that one focus here should in future be on developing disruptive technologies that address unmet needs in drug discovery and development, and not simply on building portfolios of assets, which may be inherently risky.
One focus here should in future be on developing disruptive technologies that address unmet needs in drug discovery and development, and not simply on building portfolios of assets
New companies that are technology-driven have a better chance to become durable commercial successes. Of course, this is easier said than done, and I think that it will be important in future to build an ecosystem here that encourages technological innovation of this kind.
There are several challenges. One is to encourage a greater appetite for measured risk, along with the view that failures are sometimes the beginning of the journey, rather than the end of it.
A second is to encourage entrepreneurship, particularly amongst younger researchers. Training younger researchers to harness their entrepreneurial mindset will help to create a pool of talent from which to identify the next CEO’s or CSO’s of budding companies.
A third is to develop local networks to attract the funding required for the leap from initial start-up to larger commercial enterprise. I am heartened that these issues are recognized by government agencies and senior researchers in Singapore, and if there is the will to find ways to address them, Singapore has the potential to grow rapidly as a technology and science hub in the future.
Fit for Market Products, Talent & Funding
EY’s Abhay Bangi looks at how far along the path to building a globally competitive innovation ecosystem Singapore is and highlights some of the challenges that healthcare start-ups are facing.
There are three main challenges. The first is the ability of Singaporean start-ups to develop products that are fit for market. Unlike their counterparts in India, China, or Indonesia, Singaporean firms to not have a big local population, which makes testing products more difficult. The Singaporean government offers sandboxes to companies which are typically built in a fashion where all the regulatory and compliance aspects are taken care of. However, for these companies to be successful, the product must be appealing to a mass market in the bigger countries. Those sandboxes are useful to progress the product to some extent, but the full value can only be unlocked if a product is able to be launched in the US, China, or India, where the big populations are. International cooperation also needs to be increased to extend these sandboxes to other markets.
When a company becomes revenue-generating, it cannot be limited to the Singaporean population alone, meaning that companies must implement an international focus from the outset
The second challenge is talent. Tech start-ups need data scientists and, on the biotech side, the country needs to continuously churn out biochemistry PhDs, which can be a challenge for such a small population. Volumes are not enough currently, although the government is working to attract talent to study and work in Singapore, offering grants, and creating incubation centres in universities.
The third challenge is funding. Singaporean companies tend to have no problem accessing Series A and B funding, but Series C funding and beyond is a different story. The government is trying to address that by inviting big VCs – which generally provide Series C and D funding – to set up offices here. When a company becomes revenue-generating, it cannot be limited to the Singaporean population alone, meaning that companies must implement an international focus from the outset.
Bangi also points out the work that Singaporean biotech start-ups need to engage in to bridge this funding gap.
Many companies here are getting smarter and starting to look at the US market early because of the reimbursement and funding mechanism that is available there, as well as the clarity. For example, a diagnostics company can very quickly in the US market identify specific codes for reimbursement of diagnostics tests. That kind of clarity is missing in most other geographies.
As well as companies becoming smarter, the Singaporean government is working to share the stories of successful start-ups and foster a more collaborative and integrated ecosystem. EY works with government stakeholders to advise some of these start-ups on market, organization, talent, and from a funding standpoint.
