Rising tide of tech startups in Singapore is riding the digitization boom

SINGAPORE – There has been a wave of startups in Singapore hoping to emulate the successes of Sea, a global consumer internet company with a market capitalization of over $ 200 billion, and Grab Holdings with its food delivery app and digital payments.

Singapore offers many advantages beyond its central location and easy access to other Asian markets and English-speaking economies. The government’s efforts to attract foreign capital – including tax breaks – have made the island state a haven for tech startups.

TDCX provides business process outsourcing services, including customer service structures and advertising strategies, primarily to Asian and European companies. It is only the second Singaporean company after Sea to list U.S. certificates of deposit on the NYSE, where it debuted on October 1. TDCX raised $ 350 million on its IPO and now has a market cap of $ 3 billion.

In the first six months of 2021, startups raised a total of S $ 5.3 billion ($ 3.93 billion), up 1.5 times from S $ 3.4 billion from the same period in 2020, according to Enterprise Singapore, a government agency that supports entrepreneurs.

“In addition to communication in English, Singapore has the advantage of attracting a large amount of capital, which makes it easier for foreign investors to invest,” said Avi Naidu, co-founder and managing partner of Taronga Ventures, a Australian venture capital firm that invests primarily in Southeast Asian technology companies. “Singapore has a clear and consistent tax system, making it simple and attractive to foreign investors.”

Avi Naidu, co-founder and managing partner of Taronga Ventures, applauds Singapore’s favorable financial environment for imaginative startups. (Photo courtesy of the company)

Singapore startups hope to replicate Sea’s “10 bagger” status – an investment that appreciates up to 10 times its purchase price – despite some of the headwinds generated by the COVID-19 pandemic.

“Our mission is to transform the way people grow their money and to make wealth management a part of everyone’s life, regardless of their investment goals and stage of life,” said Dhruv Arora , founder and CEO of Syfe, a robo-consulting platform for the active. management.

Singapore is teaming up with greedy investors. According to Franklin Templeton, a global US investment firm, 80% of Singaporeans between the ages of 18 and 35 manage their assets. For its robotics advisory service, Syfe offers four different portfolios – global equities, bonds, gold exchange, negotiated funds – as well as other instruments. A robo-advisor provides digital financial advice based on mathematical models and algorithms.

The average annual returns on investment recorded by Syfe since April 2013 include 14.7% until June of this year of the Core Equity 100 portfolio, which is fully allocated to shares of exchange-traded funds (ETFs). Even Core Defensives, a low-risk portfolio that invests primarily in high-quality bond ETFs, returned almost 5% during this time frame.

When managing their assets, people need an idea of ​​how much money they will need in their lifetime. BetterTradeOff is a technology company that provides financial planning solutions to give an answer.

BetterTradeOff offers Up, a life planning platform, to asset management advisors and others, allowing them to simulate asset management online. When a client’s information, including income, family structure, and asset conditions – such as home ownership – is entered, the platform creates simulations and a graph that shows when the client will run out. assets and their balance at age 90. The client can then visualize how the assets are constituted and depleted.

“Only wealthy people can access such a service,” said Laurent Bertrand, CEO and founder of BetterTradeOff. “We want to democratize it.

Startups have also increased in non-financial sectors. Launched in 2015, Flying Cape is a growing educational technology company. It offers services that combine real classrooms with information technology. Thousands of lessons are given by some 1,000 providers, including dance and cramming lessons. These are listed on the company’s “Marketplace” website where reservations can be made.

Flying Cape uses artificial intelligence to make recommendations based on basic information entered by visitors, such as age and topics of interest to them. Classes designed for adults include robotics and finance.

Flying Cape of Singapore is a growing educational technology company providing services that combine real classrooms and information technology.

Flying Cape uses a feedback loop to improve understanding of its customers, says managing director Jamie Tan, who founded the company after working in information technology for 15 years.

“Before COVID-19, there was no rush to see how technology is impacting education,” Tan said. “[The pandemic provided] an opportunity for technology companies to demonstrate their capabilities. “

The reduction in the face-to-face teaching pandemic has caused online lessons to flourish in all directions – even piano lessons in Singapore can be taught by a teacher in London these days.

UnaBiz, a developer of end-to-end solutions connected to the Internet, seized the opportunities created by the pandemic. For example, the demand for building management sensors to track visitors has increased dramatically.

“The Internet of Things industry has become too fragmented, and our mission is to simplify it and eliminate friction,” said Managing Director Heri Bong. On October 12, UnaBiz announced that it would raise $ 25 million from SPARX Group, a Japanese asset management company, and others.

Historically, California’s Silicon Valley has been the main attraction for startups and venture capitalists. “There are now ‘centers of gravity’ all over the world,” said Naidu from Tarponga.

“Over the past two decades, China has grown with its huge market and India has created its own ecosystem of startups,” he said. “Singapore is different in that government is a major driving force, making it an important destination for startups and venture capitalists.”

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