The Million Dollar Question for Singapore: What's Holding Back Our Entrepreneurs?

Entrepreneurship is a state of mind. - Guy Kawasaki

Over lunch, I asked my friend from the Singapore-MIT Alliance program his plans after graduation. I was curious whether he would stay here in the US, head to Singapore or return home to India. He replied he would eventually want to start his own company, and that launched an extended discussion on entrepreneurship in Singapore. He felt Singapore was the shining star in Asia for starting up due to its excellent Intellectual Property laws, I countered by saying the culture of risk-taking is absent, success stories are few and stale, and related stories of a couple of would-be entrepreneurs I know who are now bankers.

Banking
Dipankar, a Director of Technology in a small Singapore firm, wonders at the lack of Singaporean presence on BusinessWeek's Asia's Best Entrepreneurs under 25. Part of the answer can be found on the Straits Times' titillating headline today of "Young super earners" (emphasis mine). The cover story details the astronomical compensations bankers receive. The moral of ST's story? The best way to earn money is no longer through studying law or medicine, with banking you can make more - faster. Singapore is trying to do everything at the same time, attract more private wealth and develop the banking industry while encouraging local start-ups. Does banking, an industry that promises money straight up, siphon off talent that might have otherwise ventured into starting companies?

National Service
Since the BW article specifies "under 25," Paddy Tan, founder of BAK2u, guessed that "hitting it big before 25 years of age is not easy especially where majority of the males have to enter the national service for a couple of years." If age were not the issue, would Singapore measure up to the rest of Asia? I know at least Israel does really well in entrepreneurship and tech start-ups.

Lack of poster boy/girl companies
Hardwarezone, the closest Singapore gets to YouTube, was sold to Singapore Press Holdings for $7.1 million when it had an annual revenue of $6million. Tangowing encapsulates the idea in his lament that "the Creative story is just so old." Cobalt Paladin points out that Finland, with the same population as Singapore, has Nokia.

Risk Adverse Culture, Scholarships
In an interview with InnovationMagazine.com, Guy Kawasaki brings up Israel as an example where population is small but people are risk-takers: "Israel has five million people, six million entrepreneurs, and fifteen million opinions. Singapore has five million people, six entrepreneurs, and one opinion."

He also suggested some radical ideas like "eliminate government service following government-sponsored education abroad."

Money

MIT's entrepreneurship competition gives USD$100k, SMU's competition gives only USD$20k. Is that why???

My friends
Since I'm trained as an economist and an engineer, I'm always inclined to dismiss anecdotes as biased sampling. But here I would like to share some random personal stories of friends with you. Stories related people who, at one point or another, were pursuing activities for reasons like passion on top of money.
  1. A friend who was part of the team that was in the semis for the Lee Kuan Yew Global Business Plan Competition (USD $20k) He now works for a big pharma firm, a MNC. I'm not sure if he will start-up something some day.
  2. A friend who worked at O'Brien's in preparation of starting his own sandwich shop in the underserved (in terms of healthy food) CBD. I helped him draft corporate identity for the store. He now works for a big bank.
  3. A friend who took a semester off Wharton to start a boxers line under his parents' license. My other friend made a documentary. After graduating, he'll start by working for some big firm.
  4. Some alumni I met as a pre-frosh, who left banking to start a photography+film school.
  5. Close friend of mine, photographer.
  6. Another photographer, related to a close friend of mine.
  7. My favorite Singapore graphic designers (:Phunk) who made it.
  8. My friend Kaushal, who used to work with Woolert (still under development).
---
My friend says over MSN:
VCs in Singapore
but anyway, its not for the lack of entrepreneurs or wannabes.....its the mentality of VCs here, who i find very diff from those in US. VCs or even angels here demand to see a positive cash flow before wanting to invest and thats ridiculous. VCs/angels here are risk averse. yes why not just mention the VC/angel environment here
hmm but singapore is truly unique, it wont be a silicon valley, but hey, the gov is as entrepreneurial as they come by. if govs could win awards for being entrepreneurial, i dare say Singapore would be in the running for the award
My friend also points me to a success story from the NUS Overseas College program

20 comments:

fabianlua said...

More related links

Red Herring article on SG Entre

Entrepreneur 27 Singapore

fabianlua said...

Red Herring corrected

nofearSingapore said...

Hi Fab,
A well researched post. Very thought provoking.
Did anyone mention the crowding out of wannabee entrepreneurs by govt-linked companies? Whether real or perceived, these govt-heavyweights will prevent anyone from even starting a start-up. True?
Thanks for an impt post.

Dr.Huang

Cobalt Paladin said...

Hi nofearsingapore,

I've posted regarding competition for local entrepreneurs from GLC's before. In summary, we are facing global competition now. Globalisation has greatly shrunk the distance between the world. Even if our starting market is Singapore, there may be a similar product started by entrepreneurs in other countries. Whoever is able to grow faster, will have the advantage. We may soon see the same product by different company competing with us in the home turf. My point is, if we are to face the world, we must be ready to beat GLCs at home first.

Cobalt Paladin said...

Hi Fabianlua,

I'm sorry but I can't locate your email address so I post it here insted. Thank you for referring to my blog in your entry but the link had some typo. It should be this Thanks. :)

nofearSingapore said...

Hi Cobalt,
I am glad you are so happy for GLC's to be sparring partners for you before you conquer the world.

But wouldn't it be better if the GLC's leave SME's in S'pore alone so that these SME's have a better chance of succeeding before they venture out into the whole wide world? As it is now, SME's hardly get a chance to off the starting blocks.

Dr.Huang

fabianlua said...

Hi Cobalt
I was linking to your post that has a reference to Nokia. But anyway, I've modified the links.

Hi Dr.Huang
I agree with Cobalt that we shouldn't shield SMEs from GLCs. YouTube didn't get protection from any of the big guys - Yahoo!, Google, Microsoft...

Anonymous said...

I think it's just too easy to say that it's the GLCs that are blocking the progress of any potential entrepreneurial activity.

For the record—if you reflect on the industries that the GLCs take on—those are capital-intensive markets, be it SIA or Singapore Technologies or SingTel.

It would be more fruitful to ask a very basic question, as I've asked of Prof. Png when he was Vice-Provost of NUS:

Why is it that on versiontracker.com, I keep seeing how it's the US kids, the German kids, the French kids who, in trying to find some practice for their newly-found programming skills, attempt to create some small but nifty software, distribute it free, then post it on a software update site like versiontracker.com and then ask users if the GUI is user-friendly, if the program fulfills a certain need on the part of computer users?

Why is it—if our graduates are THAT GOOD—that Singaporeans don't pursue such efforts? Even if they do not attempt to create software of their own, how many Singaporeans do you know and can we mention off our heads, who attempted to participate in some open-source effort either by volunteering their coding skills or, doing language localisations for open-source software?

Even if you reference people like Richard Branson or Steve Jobs or Kevin Rose of Digg.com, you'll still see that they started very small.

Virgin Air was created after Virgin Music. Virgin Music was created after Richard Branson opened a conventional music store, leveraging on the hippy movt of his time to tap into the folksy, gypsy music tastes.

Steve Jobs started, as we all know with Steve Wozniak, in a garage.

Kevin Rose started as a TV presenter, for goodness' sake!

Then when interviewing Steve Wozniak on TechTV, he felt that '[Steve] has actually done things...while [he's], like, a visual stenographer. [See: (http://www.businessweek.com/magazine/content/06_33/b3997001.htm)]

In other words, it is easy to say that the govt-led-whatever made the barriers, or that the govt didn't instill enough passion (nor provide enough avenues for passion to be expressed, which btw, I frankly think is VERY true).

And therefore, if one deems oneself passionate; of 'Oh my God. I could do this SO. MUCH. BETTER.' (following Kevin Rose's testimony on how he came to believe in Digg.com, see BusinessWeek link above)...

Why is it that no one, no one even those in blogosphere, did anything?

After all, people in the 'developed countries' leave home to work in their teenage years ya know...

So don't tell me you didn't have enough money, nor time.


kh

Anonymous said...

So the URL got truncated...

In that case, google for 'Kevin Rose, BusinessWeek, Valley Boys'.


kh

fabianlua said...

Hi Kwok Heng
I agree with your comment that most success stories start small. Even in non-tech businesses, in Philadelphia, Stephen Starr started very small with his restaurant business. Tiny compared to big name chains like Morton's or ritzy hotels. I doubt Philadelphia gave him any special breaks. Recently, his empire has grown such that he decided to "invade New York" with two restaurants that cost him $26 million. Even with the success in Philly, he could have failed in New York. But for now, he has managed to get a foothold in New York - one of the toughest environments for upscale restaurants with fickle diners. Singapore has plenty of small F&B start-ups and we're beginning to see a great scene, but often it's still too much of the same thing when there's so much more space doing something different. Stephen Starr earned his stripes (and money) daring to be different, and daring to fail.

"Entrepreneurship is a state of mind." How true.

---
BusinessWeek "Valley Boys"

Lea said...

Fabian > Thanks for leaving a comment on my blog entry at http://kuzzuk.net/index.php?itemid=26. Great post and I was nodding away as I read your blog entry. Yes, Singapore's slowly but steadily changing and I hope we become as entrepreneurial as the founders and architects of Singapore.

Cheers,

Dipankar

Anonymous said...

Hi Fabian:

On this entrepreneurship issue and since you referenced Guy Kawasaki, maybe you'll be interested in TED Blog [http://tedblog.typepad.com/tedblog]


ta,
kh

fabianlua said...

Hi kh
thanks for your link. Yeah Ted is a great resource, I've watched many of their videos and they've opened my mind to new ways of thinking. In case you haven't watched Warren Buffett's talk from a few years back, you might want to check that out.

Do you have a blog? I've noticed you leaving comments at other blogs, and from the clarity of though displayed in the first comment you left on this post, I hope you do.

Anonymous said...

Hi Fabian,

I used to write blogs like this one that you have here.

But not anymore, because I pursued something that had to be mutually exclusive with writing analytical blogs.

So my blog, is for personal rants these days.

:)

On a somewhat related note: Good to know that you're doing aki. I had a scholarship to do Fine Arts but parents didn't allow.

So for a very short intro as to why some thoughts are clear: I did Political Science at NUS, only because I didn't know anything about it. Then I used that knowledge to understand and learn about other things, while doing creative stuff on the side.

If you've been searching for me, you can easily find my email and meet up for teh tarik some day.

Chats are okay. Not blogs.


tata,
kh

Anonymous said...

Thanks for the Warren link btw!

The following is one of my fav links. Depending on whether you like edgy stuff, you may or may not like it: notes from somewhere bizarre

Anonymous said...

Sorry for multiple comments. You may like:

• Charles Spinosa, Fernando Flores, Hubert L. Dreyfus, Disclosing New Worlds: Entrepreneurship, Democratic Action and the Cultivation of Solidarity (MIT Press; the arguments in this book will tie back to one of Guy Kawasaki's blog spots regarding how VCs in the US want to be convinced of how the start-up is going to "create meaning".)

• 'Design thinking' blogs/sites ('Design thinking is VERY BIG now in businesses looking for innovation strategies. You may well identify with the structures and systems you read in these blogs given your architectural background)

- http://www.cph127.com/
- www.bplusd.org
- BusinessWeek: Nussbaum on Design
- FastCompany.com
- NoiseBetweenStations
- How to Save the World

And seeing that you're an aki student who likes to read 'we make money not art', here's v-2.org

I've stopped reading them all because I'm trying to concentrate and specialise right now. I just keep getting distracted.

So I thought I'd pass them to you or anyone else who might be interested.


tata,
kh

fabianlua said...

"I just keep getting distracted."

That's a problem I struggle with everyday.

Oh, and I'm not an architecture student, in case I gave the wrong impression. I'm a transportation systems student and specialize in airlines/airports. I attend as many architecture talks as I can, and I've always been interested in design.

Thanks for the links.

emy said...

Anyone who decides to give up a respectable $10k income, and at the same time, be willing to dip into their own savings to start their own business is often deemed crazy or seen to be falling off the bench.

I am one of those but yet, am blessed my hubby who is able to provide for the basic needs of both of us so that I can pursue a small dream of mine.

At the end of the day, it's all about having passion and believing in yourself and rallying support from those around you.

So a millionaire or towkay I am not (and may never be) but I'm glad I could try my hand at doing something I like in this lifetime.

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