Southeast Asia

Singapore embarks on entrepreneurship
By Tony Sitathan

SINGAPORE - When Landy Eng first came to Singapore almost five years ago, he was amazed at the cleanliness and the robotic efficiency of the country. "Everything seems to work like clockwork in Singapore, where it exudes an air of efficiency and cleanliness," he said. But he was also struck by its lack of entrepreneurial spirit.

As an entrepreneur himself, running businesses since the age of 10 when he delivered newspapers, Landy had gradually moved on to manage a modeling agency and later a semiconductor-equipment manufacturer in the United States before making it public and starting to look east for his next conquest.

He first was drawn to China, where he became one of the first American-Asians to do business there, setting up a trading venture in office commodities while representing OEM (original equipment manufacturer) dealers in the United States. He called it quits after the competition heated up but not before grossing record sales of US$550 million per annum.

He also started an assembly plant in the Philippines and later started thinking of settling down in Asia permanently, and made Singapore his second home away from the United States. He now is a permanent resident in Singapore, having decided that setting up roots in the city-state presents him many opportunities to influence others to look at entrepreneurialism as an alternative way of working in Singapore.

Entrepreneurial activity in Singapore is low compared with other Asian economies such as Taiwan or Hong Kong. It is estimated that only one out of 10 people in Singapore is self-employed. Given the fact that its population base is only 4 million, entrepreneurs must at best play second fiddle to the government, which is considered the No 1 employer in terms of sheer size. Unofficial estimates maintain that the Singapore government together with its linked companies employ more than half a million people in the island nation.

Singapore does not have a long tradition with entrepreneurialism, and Landy feels that it is not a nation of entrepreneurs but rather a nation of managers who, while excellent, lacked the spirit of inventiveness and did not risk thinking "out of the box". He says, however, that the overall stifling climate for risk-taking is gradually changing as the government slowly changes its mindset regarding self-made entrepreneurs. He now heads an angel venture fund called Hao Ventures while operating a dot-com company called eAngelz that is used in organizing workshops and networking events for entrepreneurs across the Asian region.

Landy has reached out to hundreds of potential entrepreneurs forking out advice and presenting opportunities to network with angel investors, as well as being a sounding board for entrepreneurs to sell their ideas. EAngelz' membership list has grown from 1,000 in 1999 to more than 45,000 in Singapore alone. He says angel investing ("angels" are private investors who finance business start-ups or new business ventures) is still new in Asia and many small and medium-sized enterprises should tap the strengths offered by angel investors since banks have traditionally been slow to invest in SME-type businesses and companies. "Where can entrepreneurs go to for funding especially if they do not have a track record of success?" he said.

Inderjit Singh, the founder and chief executive officer of Infiniti Solutions, a semiconductor test and assembly company established in Singapore last year, says the environment in Singapore is slowly changing for entrepreneurs. Inderjit Singh himself if a highly successful entrepreneur who has founded or invested in more than a dozen companies in Asia. He started a local electronics trading company called Tri Star Electronics Pte Ltd during the 1997 crisis and made it a hugely profitable business in Singapore, since venturing into markets in India, China, Bangladesh and the Middle East. He also started TriSecurity Singapore, a systems and Internet security company, and his last major investment was in a semiconductor testing and assembly company called United Test and Assembly Center (UTAC).

"When I started UTAC, for instance, there were no immediate sources of funding available in Singapore. I had to look for private investors in Taiwan and Japan to jump-start my operations," he said. But he says the mood has changed markedly in Singapore.

Inderjit Singh has been a member of parliament since 1998 and sits on the boards of Standards, Productivity and Innovation for Growth (SPRING). He is also a member of the Technopreneurship Committee of Singapore that is involved in marrying entrepreneurial elements into the mainstream of Singapore. He is also the president of the Singapore chapter of the Indus Entrepreneurs (TiE), a global organization responsible for promoting entrepreneurship and business networks. "This attitude of the Singapore government is slowly beginning to change with regards to perceiving entrepreneurs and their contributions to Singapore as well as identifying what qualities are needed to nurture entrepreneurship and to fund such enterprises," he said.

Since Singapore has always taken a top-down approach, implementing government policies that favored attracting foreign direct investments by multinational corporations (MNCs) into the country, it has overlooked some of the strong potentials of having SMEs and entrepreneurs run successful companies locally. Singh says it will take a while before some of the recommendations made to the government by his steering committee on technopreneurship take effect.

He recalled when he started UTAC, he had a tough time finding funders to back his idea in Singapore since they were more risk-averse at that time and called for very high levels of guarantees for his business to succeed. His business did in fact succeed and had a market capitalization of more than US$142 million before he left UTAC to set up Infiniti Solutions.

The Singapore government has recently made it possible for technopreneurs under the Technopreneur Pass scheme under the Economic Development Board (EDB) to reach out to potential technopreneurs from overseas as well. Now technopreneurs are eligible to apply for a work permit or employment pass based on their merit of having a sound business plan that is approved by the EDB. So far more than 100 technopreneurs from Britain, China, India and the United States have decided to locate themselves and their companies in Singapore. Although for the time being the scheme attracts high-tech ideas and investments, it will later be opened up to other feasible business ideas that serve to develop the economy into, according to the government, "a vibrant enterprise ecosystem, where it acts as a natural ecosystem that is self-renewing and self-sustaining, where new businesses would constantly come into Singapore and venture out of Singapore."

Whether all this makes it much easier for small and medium companies or entrepreneurs to operate in Singapore is still an open question, as a lot more has to be done than simply opening the floodgates, remarked Jason Lim, a self-made businessman who ventured into the recycling of plastics.

"Singapore still is a long way off from countries like Taiwan and Hong Kong, where entrepreneurs are faced with the do-or-die mentality of success or failure," said Lim. "Singapore is still very risk-averse and sheltered in its decision-making process. Sometimes that can be a stumbling block to its lead-up to be an entrepreneurs' dream home in Asia."

(©2002 Asia Times Online Co, Ltd. All rights reserved. Please contact content@atimes.com for information on our sales and syndication policies.)
 
Nov 27, 2002



 

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