i.JAM revamp? Entrepreneurs, investors weigh in on what it needs to do to stay relevant

An intense debate has raged over the weekend about i.JAM, a government grant scheme for seed stage startups, among Singapore’s entrepreneurs, developers, and investors.

While much has been written about the topic by Jeffrey Paine of Golden Gate Ventures and Willis Wee of TechinAsia, it seems that venture capitalist Murli Ravi’s blog post was the flashpoint that brought the debate to a boil.

Plenty of focus has been placed on the i.JAM grant’s supposed salary cap, which states that “a founder shall be paid up to SGD 1,000, regardless of whether he/she is concurrently hired as company employee for purpose of the Project.”

Jon Yongfook, founder of PitchPigeon, was particularly miffed when he heard about the rule. He tweeted:

iJAM deal is 8% for $60k in installments and a $1k salary rule. SG founders: you are better off getting a job at McDonalds and bootstrapping

— yongfook (@yongfook) March 18, 2013

While many others echoed his sentiment, the reactions towards the salary rule was far more nuanced. Some believe that even if the SGD 1,000 limit is a hard cap, it shouldn’t deter entrepreneurs from applying for the grant. I spoke to a couple of iJAM incubatees on the condition of anonymity in exchange for their frank opinion. All names are changed to protect their identities.

“I have bootstrapped and I can maintain a relationship, pay bills and get by on $1,000. In fact I feel that is the one good thing about iJAM, it forces founders to go to market faster,” said Carl.

Another iJam incubatee, Kevin, went as far as saying that if the salary cap is stopping an entrepreneur from applying for the grant, then perhaps he or she shouldn’t really be starting a company.

Although Singapore is seen as an expensive place to do business — and perhaps that’s why the salary rule has hit a sore point — there are a couple of mitigating factors.

Derrick Ko, a Singaporean software engineer in Silicon Valley, said on Branch that Singaporeans generally live with their parents until marriage. As such, assuming that they have no family to support, their cost of living would only consist of food and material expenses, which aren’t much.

However, much of the misgiving about the salary limit could be caused by a misunderstanding of what the rule actually stipulates. The cap does not actually restrict the founder from getting a salary above SGD 1,000. According to an MDA spokesperson, the grant is simply a cap on the amount of grant money that can go towards the founder’s salary.

This fact was confirmed by Michiel Wind, CEO of Crystal Horse Investments, an iJAM incubator. In fact, CHI itself typically allows a salary of SGD 2,000 to SGD 3,000 for tier 2 iJAM companies, which means the firm’s money is used to top up the grant’s salary allowance.

The long, excruciating wait