Singapore to inject $332m into deeptech startup scheme

Singapore will add S$440 million (around US$332 million) to a scheme aimed at boosting private-sector investments into deeptech startups based in the city-state, Deputy Prime Minister Heng Swee Keat announced on Monday.

The funds will be injected into the Startup SG Equity scheme, which was established in 2017 and is part of Singapore’s US$21 billion Research, Innovation, and Enterprise (RIE) 2025 plan.

This comes amid a “slight decline” year on year in the total venture capital raised by Singapore-based startups so far this year – the figure stood at US$4 billion across close to 370 deals. DPM Heng noted that this was “well expected” given the global decline in venture funding at around 15%.

Deeptech is “both difficult and expensive to get right,” and a strong ecosystem is needed to aid innovators and startups in this field, said Deputy Prime Minister Heng Swee Keat. / Photo credit: The Business Times

The new funds will let the government invest alongside global and local investors in a bid to stimulate greater private-sector investment in deeptech startups.

DPM Heng noted that deeptech is “both difficult and expensive to get right,” and a strong ecosystem is needed to aid innovators and startups in this field.

“To better support deeptech startups through the early stages of their development, we will also expand our funding support to cover early growth-stage companies,” DPM Heng said during his opening address at the Singapore Week of Innovation and Technology (Switch) 2024 held at the Sands Expo and Convention Centre.

This includes seed to series B and C startups, according to a joint statement from Enterprise Singapore (EnterpriseSG) and the Singapore Economic Development Board (EDB).

The cap of total government equity investment into each startup will be raised to S$12 million (US$9 million) from S$8 million (US$6 million), DPM Heng added.

The Startup SG Equity scheme will be administered by EnterpriseSG and the EDB, through which the government will partner with private-sector investors to support deeptech startups that have strong potential to scale globally.

The funds would allow Singapore to attract and partner with “an expanded pool of global prominent VC firms” to invest in such startups, said the two agencies in the joint statement.

Other initiatives

The deputy prime minister also announced several other new initiatives to support startups during his speech at Switch 2024.

This includes StageOne, slated for launch in the first quarter of next year. The initiative aims to connect local and global startup communities, as well as to help them leverage Singapore as a launchpad to scale overseas.

There will be programs to help startups establish their base in Singapore and build capability for business growth, EnterpriseSG said in a statement.