Southeast Asia is one of the preferred destinations of young enterprisers establishing startups. Among these countries, many choose to start a company in Singapore or open a business in Hong Kong, both states offering incentives for startups.
Singapore is one of the countries in which the government is highly committed in supporting startups through incentives. Apart from the incentives offered by the government, startups in Singapore also have access to various financing options, some of them private, while others are public.
Private financing options for startups in Singapore
Until recently, apart from the Singapore incorporation matters, young enterprisers struggled to gather working capital for their firms which has led to seeking solutions for obtaining this capital. Among these solutions available at the moment is private equity funding which can be divided into various categories. Venture funding, angel investor programs and loans.
Venture funding is one of the most popular ways of raising funds for a startup all over the world and this method has also started to gain adepts in Singapore. Startups interested in attracting venture capitalists must have a solid and feasible business plan as most investors can provide up to 25% of the working capital of the company. They will also be interested in playing an important role in the development of the business by advising on different projects.
Angel investors are another way of attracting private investors and Singapore is no stranger when it comes to drawing the attention of successful businessmen who are interested in putting money into projects they believe in and most of all in startups in their early stages of development. An angel investor alone could award up to 100,000 SGD to a project, but some Singapore startups could be lucky enough to attract a whole group of angel investors who can grant up to 250,000 for a single project.
There is also the option in which a startup can rely on loans designed especially for them by various Singapore banks. These loans are usually guaranteed by the government and offer a high degree of security with little to no collaterals.
Public financing options for startups in Singapore
After describing the financing options which can be acquired from the private business community, it is good to know that the government has taken a large interest in offering public financing solutions to Singapore startups.
Let’s say one wants to start a plumbing business in Singapore for which private funding solutions are not exactly a match, that startup can access public funding from the government who can support it through equity financing programs, business incubators, tax incentives or cash grants. The latest public financing solutions launched by the government for Singapore startups are the SPRING Startup Enterprise Development Scheme, the Business Angels Scheme which is supported by SPRING Singapore and the Early-Stage Venture Funding Scheme.
Foreign enterprisers who are still seeking for a good business environment where they can start their own business and have access to financing options which will not burden them along the way, should check what Singapore has to offer.
In case you want another business destination in Asia, registering a company in Thailand could prove to be a good move for your business.