Helping hand for Singapore startups in China
SINGAPORE — Hangzhou, the hometown of Chinese e-commerce giant Alibaba, eight million residents and hundreds of technology-linked companies, is fast becoming the Silicon Valley of China. Startups from all over the world are flocking there, attracted by an easy entry point into the vast Chinese market.
Beginning next month, Singapore tech startups will be given an opportunity to join in this boom.
Venture capital platform Venturecraft has made it its business to help these entrepreneurs set up shop at the Singapore-Hangzhou Science & Technology Park (SHSTP), for free. The company supports high-tech startups with getting working capital and funding, as well as connections to mentors.
The company will sign an agreement next month with the Hangzhou government, which will pay rentals to Singapore urban planning and development firm Ascendas, the developer of SHSTP, to house up to hundreds of Singapore start-ups at a nine-storey building at the integrated park. Each floor spans 25,000sqf.
The Hangzhou government is also giving grants of up to 11.5 million yuan (S$2.53 million) per company, Venturecraft said. In order to qualify, the founder or researcher of the company should have a PhD, the product or service should solve a need in China, and it must be high-tech in nature, Mr Isaac Ho, principal partner at Venturecraft, told TODAY. He added that the company has already identified its first 11 startups.
“It is the government’s wish to bring in high-quality companies, and ensure the commercialisation of products,” Mr Ho said. “Hangzhou is just an hour or two away from Shanghai. It’s also where (e-commerce giant) Alibaba is. The entire belt is one of the more advanced economies, and consumers there are more ready to accept new products from foreign companies. Any startup that wants to acquire customers in a Tier 1 or 2 Chinese city should be there.”
Venturecraft, backed by Sun Tongyu, one of the founders of Alibaba, is also looking to capitalise on Hangzhou’s efforts to become a smart city by helping Singapore companies bid for its smart-city projects.
“Many Singapore companies are only into one function, say water or electricity,” said Mr Ho. “But we are going to look at the specifications, then bring in several companies that can form a total solution. The Hangzhou government is not interested in dealing with separate companies offering piecemeal solutions.”
China is pulling out all the stops to emerge as a legitimate contender to Silicon Valley, fuelled by an Alibaba initial public offering that brought in more money than any in history. Chinese tech companies raised US$30.3 billion (S$42.7 billion) through IPOs last year, compared with US$4.97 billion for their US-based peers.
But China isn’t the only country the Singapore tech community is looking at. In January, Infocomm Investments, NUS Enterprise and SingTel Innov8 set up Block 71 San Francisco, the US version of the startup community in the Ayer Rajah area in Singapore. This initiative is intended to link startups in both countries, to help Singapore firms tap into business opportunities in the US.
Accelerators have also been looking elsewhere. Venture accelerator Apple Seed helped startups here pitch to investors in Malaysia and Thailand this year. Such activities even saw one such startup, Trakomatic, which does analytics about retail traffic at malls, snare a deal with a Thailand mall.
