SGEntrepreneurs would like to introduce Aaron Chua (Manager, Media Development Authority of Singapore, Interactive Digital Media office) as our latest Resident Contributor. He heads a nation-wide IDM R&D incubation fund and has been focusing on early stage startup investment in digital media. He also founded a startup back in 1998 with moderate success. We are happy to have him on board on team. This is his post! Enjoy.
I have been investing and advising startups in Singapore for the past 2 years now. It has been a fun ride and it gives me great pleasure to be able to contribute to the startup community. However, there are certain broad issues which I am seeing across Singapore’s startups, especially those in the digital media sector.
Lack of depth in their thinking
Many of the Singapore startups are well aware of the latest companies and trends in the digital media space through blogs such as TechCrunch, Mashable et al. If you know these blogs, they are good in providing coverage on the latest news. Unfortunately, they don’t touch on strategies and structural opportunities, which are covered by less well know blogs such as John Hagel, Umair Haque, Taylor Davidson et al. Hence, most of our startups are learning the forms from the US counterparts without understand their true economics. Without that understanding, you can’t built real competitive advantages.
Lack of global ambition
There are very few examples of Singapore startups that we funded who want to change the world. Most of them talk about building cash flow positive businesses in a local context. While there is nothing inherently wrong with that, this means you are solving problems in a different scale. This has implications. When you are solving global problems, you might fall short but in the process of tacking these hard problems, you might have built a stronger and more durable competitive advantage that otherwise will never be built if you focus on a small scale business.
Lack of collaboration
This is a bit ironic. Most of the Singapore startups are building 2.0 services and yet I have never seen much collaboration between themselves. This is perhaps an example of my earlier argument that they lack true understanding of what is important. Capability leverage for example, is a powerful lever that very few of our startups are using. Even the incubators are not helping these companies to build that kind of new advantage in our hyperconnect economy.
Lack of belief in building dynamic capability in the team
Some of the startups I have seen have no technical capability at all. They rely on outsourcing instead. This method might be ok if the environment is stable. Unfortunately, that era has past. In our sector, that means you need the ability to constantly evolved your technology and that cannot be achieved with a outsourcing model, unless you have created a new form on coordination like what Li Fung has achieved. Outsourcing, in the traditional sense, cannot help the company to create any sort of capabilities.
This is not a criticism. All these are issues that as government, I need to think about resolving.
*Editor’s Note: This post was originally published in the author’s blog.
Photo courtesy of ralphbijker.
Aaron Chua is a Manager at the Interactive Digital Media Programme Office, Media Development Authority of Singapore, where he heads a S$40M R&D program that supports startups with innovative ideas in the interactive and digital media space. Having founded a startup back in 1998 with moderate success, he is looking to run another one in the near future.