On January 10, there was an article on ST interviewing Chairman-designate of Spring Singapore, Mr Philip Yeo.
The article chronicles what he intends on doing as CHairman on Spring and I laud his approach of making the SME's more technology centric, and utilizing (hopefully) the fruits of the R&D dollars that have been pumped into the universities and research agencies.
His 4 main thrusts is:
Money
Markets
Management
Technology
While I may not be the best person to discuss Markets and Management, I can definitely hold my owon on Money and Technology.
Money: in the article, he has mentioned working with the banks to release money for SMEs. But how does one become an SME to begin with. One has to go through a start-up phase, and the bank's charter is not to put money into high risk business propositions. Insteads, banks are typically utilized to provide factoring services, capex loans etc etc.
So the quandary is still unsolved. How does one make the leap from start-up to growth (in the truest definition of the word SME, start-ups also fall into this category) stage companies.
Once again, as I run through my mind to search out funding opportunities for really young companies, and my mind tells me that there really isn't that many sources. IN the US and EU, most of the funding opporunities come from Venture Capital and Angel Investors.
But here in Singapore, VC community primarily plays in Series A or B funding rounds, and prefer to stay away from seed stage funding as it is deemed to be too risky and the outlook for an exit is... well unclear and uncertain.
Angel investors in Singapore/Asia are a different animal altogther. They are mainly formed by high net worth individuals, and from feedback (I have not directly dealt with Angels myself) is that their outlook is relatively short term, so unless you can project and super high growth rate plus a plan to be profitable from day 1, good luck courting Angel money.
But can anyone blame them (the Angels)? If I put myself in their shoes, I believe I would act the same as the source of funding came from my own sweat, and of course, the entrepreneur would have to work his ass off to make my money go the extra mile or two.
So in essence, the Chairman-designate has not truly resolved the issue of money for SMEs. Besides, banks do not offer to open the little black book that could help the entrepreneur open doors to other suppliers and customers, whereas VCs generally pitch that as their value-add, and I have personally seen this relationship work to the benefit of small companies.
As for technology, without compromising too much of the confidentiality clause I have signed, I believe one should cast a critical eye on the research work that has been done in Singapore. Reporters who write about science and technology shoulds follow up their story after 12 months of it being published to determine what has become of their story, especially those technologies that are pitched as looking for commercialization partners?
How many of these are successfully commercialized? And how many are still sitting on the shelf awaiting commercialization? THose that are still on the shelf, the question should then move towards "What Happened?" and let no stones go unturned? Is it because of unfavorable licensing terms? Is it because it would cost the licensee another 3 million dollars to take it to the market? Or is it because simply the technology does not work as touted, or is not "World-class"?
But this is definitely the next step in pushing our SMEs forward. No way back as going back would be disastrous!
technorati tags:philip yeo, spring, R&D, SME, investment, technology, banks, money
Blogged with Flock
