On 17 August 2020, Deputy Prime Minister Heng Swee Keat announced during his Ministerial Speech that S$150 million has been set aside for the enhancement of the Startup SG Founder scheme.
First-time entrepreneurs will be able to access a higher start-up capital grant of S$50,000, up from $30,000, to help them launch their business ideas. In addition to the increase in the start-up grant, a three-month venture building programme has also been introduced to help start-ups get their innovative ideas off the ground.
The reason for the enhancement of the scheme is to spur new development and new growth opportunities. Besides new innovations and solving real world problems, start-ups also help to create more and new types of job opportunities for Singaporeans. By enhancing the Startup SG Founder programme, the government hopes to enable more aspiring entrepreneurs to start new ventures and accelerate the formation of innovative startups in Singapore.
Startup SG Founder "Train" Track
Under the “Train” track scheme, Enterprise Singapore has appointed Venture Builder and Accredited Mentor Partners (‘VB-AMPs’) with strong track records of venture building to provide 3-month Venture Building (VB) programmes to Singaporeans. The programme will provide support for sourcing innovation, commercialising these ideas into scalable businesses, getting product/solution validation from customers and finding capital.
To be eligible for this track, applicants must fulfil the following criteria:
i. Singaporean Citizen or Permanent Resident;
ii. Commit to 100% attendance for the Venture Building Programme;
iii. Commit to running a startup full time after the programme.
They will also need to pass the VB-AMPs’ screening criteria, which is not limited to:
aptitude, expertise, background and related experience.
The table below summarises the eligibilities of different categories of individuals. The
list below is non-exhaustive, and subject to changes by ESG. Categories of individuals
not listed below will be assessed for eligibility on a case-by-case basis by ESG.
|Category||Eligibility for the VB Programme||Eligibility for Stipends|
|Applicants who are full time employed, part-time employed, self-employed or freelancing|
|1||Applicants who are currently in part-time or full-time employment||No, unless applicants are willing to tender the resignations before enrolling into the programme.||If programme-eligible applicants are still serving notice during the
programme, pro-rated stipends will be provided after the notice period ends
|2||Freelancers||Yes, provided applicant can be full time committed to the Venture Building|
|3||Self employed||i. If the business is registered as a sole proprietor, the treatment for freelancers (case #2) will apply.
ii. For all other business entities, the treatment will follow that of case #5.
|Former / current startup founders
|4||Applicants who have previously incorporated a business entity on ACRA (ie. Pte Ltd / LLC / any other business entities), which was nonrevenue generating and is no longer active||Yes||Yes|
|5||Applicants with a business entity that is active and live on ACRA, registered as Pte Ltd / LLC / any other business entities, excluding sole proprietorship||No. If your business entity is a startup, you may wish to apply for the Startup SG Founder grant, provided you meet the eligibility criteria.||No|
|6||Applicants who have been awarded the Startup SG Founder grant||No||No|
|7||Applicants who are currently in full time studies||Only students in their final year of studies are eligible for the programme. However, if you currently hold a job, you will not be eligible, as per treatment of case #1.||No|
|8||Applicants who are currently in part time studies||Yes, if you can be full time committed to the Venture Building programme.||Yes|
|9||Applicants who are still studying and on scholarship that requires them to|
serve a bond after graduation
|10||Applicants who have attended any SGUnited Traineeship or SGUnited Skills Programmes||No||No|
|11||Applicants who have previously joined other Venture Building programmes (incl. commercial VB programmes)||No||No|
Startup SG Founder "Start" Track
Under the “Start” track scheme, teams of entrepreneurs with innovative business ideas can approach any Enterprise Singapore-appointed Accredited Mentor Partners (AMP) with their innovative business ideas. The AMPs will identify and recommend qualifying applicants for funding support based on the uniqueness of business concept, feasibility of business model, strength of management team, and potential market value. Upon successful application, the AMP will assist the startups with advice, learning programs and networking contacts. Enterprise Singapore will also provide the startups with a startup capital grant of $50,000. Startups are required to raise and commit S$10,000 as co-matching fund to the grant.
Applicants will need to reach out to an Accredited Mentor Partners (AMP) of choice and submit their pitch deck for the AMP’s consideration. AMP will assess applicants based on (but not limited to) the following criteria:
- Differentiated business – how novel the idea/product/service/business model/process is compared to what is available in the market
- Feasibility of the business – whether the revenue model is sustainable
- Potential market opportunity – how large the size of the target market is, and how the company intends to reach out to its customer segments
- Management team – whether the founding team demonstrate passion and entrepreneurial spirit, and have the relevant technical and business skills to execute the idea.
If the AMP assesses that the applicant has met the eligibility and evaluation criteria, they will provide a letter of recommendation to the applicant. Applicants must then attach this letter in an online application form to be submitted to Enterprise Singapore within 2 weeks from the receipt of the letter of recommendation. Enterprise Singapore will inform the applicant and AMP on the application status for the grant.
The grant is open to all Singaporeans/Permanent Residents who meet the following conditions at the time of application:
- The team has at least 3 SC/PRs, who are the main applicants of the grant;
- At least 2 of the 3 main applicants are first-time founders;
- The main applicants who are first-time founders must hold a minimum of 30% equity in the company collectively;
- The company must have a minimum 51% SC/PR shareholdings;
- The company must not be more than 6 months of incorporation at the point of application to the AMP;
- The 3 main applicants must contribute meaningfully to the company, and not be employed by another employer;
- At least 2 of the 3 main applicants should be committed full time to the company, and must be key decision makers of the company;
- The main applicant(s) must not have received any funding for the proposed business idea from another government organization;
- The proposed business idea must not be in the following list: cafes, restaurants, night clubs, lounges, bars, foot reflexology, massage parlours, gambling, prostitution, social escort services, employment agencies (including recruiting foreign work permit holders and workers/support staff, relocation services, and manpower services), and geomancy.
When will the enhancements to the Startup SG Founder grant take effect?
The enhancements will take effect on 25 Sep 2020. Any applications received by ESG prior to this date will follow the current Startup SG Founder grant conditions, which include:
i. Grant amount of $30,000 over a 12-month period
ii. Co-matching ratio of 1:3 (ie. Founder(s) must raise $10,000 in capital)
iii. Only one main applicant required
Any applications received by ESG from 25 Sep 2020 onwards will follow the new Startup SG Founder grant conditions, (refer to Para 2.ii). Some key conditions include:
i. Increased grant amount of $50,000 over a 12-month period
ii. Reduced co-matching ratio of 1:5 (ie. co-investment of $10,000 required)
iii. Minimum 3 SC/PR employees (including the founder), two of whom must be first-time founders.
How will the grant be disbursed?
If the AMP wishes to recommend the application, the AMP will decide on appropriate milestones together with the applicant(s). The AMP’s recommended application and milestones will then be surfaced to ESG for vetting and approval. The grant will be disbursed in 2 tranches based on agreed project milestones. You will have up to 12 months from the date of letter of offer to meet the milestones to draw down on the grant.
Is the Startup SG Founder enhancement intended to be a one-off? Or will the S$150 million support startups with further enhancements in the future?
ESG continuously reviews all our programmes including the Startup SG Founder and its appointed AMPs. Any further enhancements will be subject to a review in FY2021. In addition, there are various forms of Startup SG support catered to different stages of startups, e.g. Startup SG Equity and Startup SG Tech schemes. The National Innovation Challenges were also recently launched to spur demand from companies and government agencies for innovative solutions by startups.
Some may consider joining a startup or pursuing entrepreneurship at this point in time as something fraught with risk. Why does ESG encourage individuals to pursue such pathways at this time?
Pursuing entrepreneurship in this time is challenging. But the Government is providing various forms of support to mitigate this risk.
a. The enhancement of Startup SG Founder programme is example. Startups under our Startup SG Founder scheme are closely supported and mentored by ESGappointed AMPs, who provide useful resources, coaching and networks for startups and entrepreneurs to tap on. There is also significant support from government effort and community-led initiatives to help the local startup ecosystem, to mitigate risks in pursuing entrepreneurship during this time.
b. In June 2020, the Special Situation Fund of S$285 million was launched to support promising startups with strong growth potential to continue with innovation and product development in Singapore.
c. The Startup SG Equity scheme was enhanced earlier this year with an additional S$300 million to catalyse more investments into Singapore-based deep-tech startups. Both are done through co-investments with the private sector. Several ecosystem partners have also stepped up to provide mentorship virtually to startups on a pro bono basis. For example, community builders AngelCentral and Found8 launched online sites that list tips and advisories for any startups during this tough time. VCs such as Antler also launched a call to invest in early-stage startups with solutions to tackle COVID-19. It will invest up to US$500,000 by this year in such startups, with the aim to generate more innovative solutions from startups to solve immediate challenges relating to the current pandemic crisis.
With the introduction of the “Train” track, does that mean that startup who wish to apply for the Startup SG Founder must attend the Venture Building programme first?
No. Startup founders who have ready business plans and do not require entrepreneurial training can continue to apply to any existing AMPs to be considered for the Startup SG Founder grant. The introduction of the “Train” track merely offers more support for entrepreneurs who wish to get training and advices for market validation of their business ideas before launching their startups.
Can I request for a face-to-face consultation? How do I set up a business? Who can help me?
If you would like to explore the various support available for startups, you may find it helpful to check out the Startup SG website (www.startupsg.gov.sg) or to make an appointment with one of the SME centres (https://partnersengage.enterprisesg.gov.sg/book-appointment). The business advisors will advise you more on the appropriate schemes and assistance for your business. ESG is unable to vet through or give comments on the business proposal, as ESG can only evaluate grant applications submitted in accordance to the stated requirements of the programme.