The Singapore Startup Ecosystem A Guide For Tech Entrepreneurs
Singapore is a pro-business country and one of the central business hubs in Asia. It is why entrepreneurs like you think of company incorporation in Singapore.
Is Singapore tech startup registration a viable option? Yes!
With a population of around 5.5 million, Singapore is a perfect testbed for testing your innovative tech idea. Your startup may also benefit from the Tech startup program.
Singapore Economic Development Board (EDB) is the force behind this startup program. It is aimed at attracting creative and innovative entrepreneurs to locate their startups in Singapore. If you are wondering how to participate in this program, you should know a few of its basics.
Why Opt for a Company Incorporation in Singapore?
Singapore government has launched Digital Economy Framework to transform itself into a digital-based society through its ‘Smart Nation’ initiative. It will come through being a tech hub for future technologies. It is the reason why the authorities there are focusing on attracting creative individuals for company incorporation in Singapore.
The number of Singapore tech startup registration are rising, as you can see from the number of startups in their FinTech sector. The Singapore government’s strategies are as follows:
- The digitalisation of domestic businesses and industries to spur the economic growth
- Establishing a high tech ecosystem to boost the number of local tech startups
- Developing the Info-comm Media sector as the base of the Singaporean digital economy
For the first three years, local company incorporation in Singapore benefits from the Tax Exemption Scheme for New Start-Ups. They can claim (from YA 2020):
- Corporate tax exemption of up to 75% on their first $100,000 taxable income
- 50% of corporate tax exemption on their next $200,000 taxable income
Before You Pay for Singapore tech startup registration
1 Market Research, Survey and Trends
Market research and surveys can reveal necessary information about the trends and what makes your target customers tick. You can use these activities to zero in on their wants, needs, desires, and problems.
Each place has its quirks and fancies. Singapore is no different. That is why customer data is necessary for the success of your new Singaporean startup. You may have read that Singapore is a vast property market. However, the market research will reveal that the number of these companies, in reality, is small. This may prompt you to develop a tech solution for the site developing companies.
You can use market research and surveys to identify opportunities and threats to the survival of your organisation.
You will also know that only 19% of Singaporeans own properties. On the other hand, 91% of them owns their home. Access to such vital statistics can open opportunities and suggest products, services or solution paths for your tech startup.
If you want to focus on property owners, you will need to offer them customised and costly solutions to be profitable. And for homeowners, you can promote something affordable that will appeal to the masses.
Let’s say you run a FinTech startup. Not everyone is comfortable with Robo advisors. However, the data says that many Singaporean senior populations trust them. Now the question is, “Does this data reveal a customer segment to you?” And “How can you use it to fulfil the pressing need of this group?
2 Know the Major Players in Your Niche
Yes, there is no doubt that Singapore is a tough market to breach for a new company. It is why you need to know all your direct and indirect competitors.
You will need to know their products and services in-depth and why customers prefer them. If you want your share of the pie, you will also need to know where they are weak.
The data collected may prompt you to add a few more features to your product to differentiate it from your competitors. The value addition will help your target customers’ in eliminating their problems.
If you are a product developer, you should not worry about copycats. Singapore Intellectual Property Protection laws are tough. You will not regret investing your money in product research and development. It will certainly give you an edge over your competitors.
3 Funding Your Startup
After the successful company incorporation in Singapore, you can go to banks for funding your startup. Singapore has a strong network of foreign and local banks.
After the Singapore tech startup registration, you can approach Angel Investors and Venture Capitalists. These entities get tax deductions on their investment. They also invest their money in promising startups for a share in it.
To get the funding from them, you will need to convince them about the validity of your business idea and your ability to execute it. Angel investors get involved when the startup is small, and venture capitalists firms lend funding in the later stages.
Singapore authorities also run the Startup SG Equity Scheme for new companies. The government works with selected third-party investors and co-invests in startups.
4 Ownership or Shareholding Agreement
At the time of company incorporation in Singapore, as a startup founder, you need to deal with the Shareholder Agreement (SA). The document specifies the shareholders’ rights and obligations. It is of great use to avoid future difficulties.
The shareholders’ agreement gives definite details about ownership in the company and how the profits will be shared. It protects your investment against share dilution.
It also details the goals and direction of the company. It is a great tool to attract like-minded investors to your company.
The process for Singapore tech startup registration is easy to follow. However, foreigners may find certain aspects or obligations challenging to follow or fulfil. They can get professional assistance from the providers of services of company incorporation in Singapore.
SBS Consulting Pte Ltd is a registered filing agent in Singapore. We are authorised to interact with government agencies like ACRA, submit your incorporation and KYC documents, and pay the official fees to complete your company incorporation in Singapore.