Update on Early Stage Venture Fund Initiative
Prime Minister's OfficeSpeakers
Summary
This question concerns the progress and success of the Early Stage Venture Fund (ESVF) since 2008, as raised by Mr Patrick Tay Teck Guan. Minister for Finance Heng Swee Keat stated that the ESVF has catalysed 10 venture capital and four Corporate Venture Funds, investing in over 60 high-technology startups. Two-thirds of these startups have achieved significant milestones in revenue or valuation, with notable examples including Aslan Pharmaceuticals and De.Mem. Beyond ESVF, initiatives like SEEDS Capital and the Startup SG platform have collectively supported over 400 startups by providing funding, mentorship, and infrastructure. Consequently, annual venture capital investments in Singapore have grown from under 70 to more than 350 over the last decade.
Transcript
3 Mr Patrick Tay Teck Guan asked the Prime Minister (a) whether he can provide an update on the Early Stage Venture Fund initiative which started in 2008; and (b) how successful has the initiative been in helping to incubate and grow enterprises since its inception.
Mr Heng Swee Keat (for the Prime Minister): Startups are an important catalyst and driver of innovation and enterprise in our economy. The Government has put in place a range of schemes to catalyse funding into Singapore startups across different stages of their development.
One such scheme is the Early Stage Venture Fund (ESVF), which aims to catalyse venture capital (VC) funding for early-stage Singapore-based high-tech startups. The scheme has evolved over the past decade in line with the needs of our startups, as our eco-system developed.
The scheme catalysed the formation of 10 early-stage venture capital (VC) funds and four Corporate Venture Funds, and has invested in more than 60 Singapore-based high-technology startups
More recently, the ESVF scheme supported the formation of the National Research Foundation Singapore (NRF)-Temasek IP Commercialisation Vehicle, announced at Budget 2018, to co-invest in startups underpinned by intellectual property generated from publicly-funded Research and Development (R&D).
Of the startups that received investments catalysed by ESVF, about two-thirds have progressed significantly, in that they have either crossed $250,000 in revenue, raised more than $250,000 in third party investments, or increased their valuation by at least 20%.
Aslan Pharmaceuticals and De.Mem are two such startups which have benefitted from the ESVF scheme:
(a) Aslan Pharmaceuticals is a biotechnology company that develops therapies for cancer tumour types prevalent in Asia. Having received more than $4 million in investments catalysed by ESVF, it has listed on both the Taipei Exchange and NASDAQ, raising more than US$75 million in the process. Aslan is headquartered in Singapore, with offices in Taiwan and Shanghai.
(b) De.Mem is a company providing solutions for drinking water generation, municipal sewage treatment and industrial wastewater treatment in decentralised applications. It is a spin-off from the Nanyang Environment and Water Research Institute (NEWRI) at NTU, having licensed Forward Osmosis and Nanofiltration membrane technologies from NEWRI. De.Mem, which had received around $3.5 million in investments catalysed by ESVF, has now achieved a S$25 million (A$27 million) market capitalisation and has operations in Singapore, Australia and Vietnam.
Besides the ESVF, NRF has also co-invested in high-technology startups since 2008 through two other schemes – the Technology Incubation Scheme (TIS) in partnership with startup incubators, and the Distruptive Incubator Scheme (DIS), which operated as an incubator investment fund. Then-SPRING also invested in startups through the SEEDS Capital, which was started in 2001. Collectively, these schemes have made investments into more than 400 startups. Beyond funding support, the Government has taken other steps to grow a conducive environment for startups. Startup SG, administered by Enterprise Singapore, has consolidated all the startup-facing support from the Government into a one-stop shop. This includes providing startups with access to mentorship, talent, local and global networks, co-innovation platforms and infrastructure, in order to build their capabilities and grow.
Through these efforts, Singapore's startup ecosystem is becoming more vibrant. We have seen positive growth in the local tech startup eco-system. A decade ago, less than 70 VC investments were closed in Singapore in a year. This has grown to more than 350 last year. The Government will continue to grow an enabling, pro-enterprise environment for startups.