14 Things To Know About Venture Capital Financing In Singapore
by Ashish Kumar Digital MarketerVenture Capital In Singapore
When it comes to doing a business in Southeast Asia, the first destination that strikes our mind is Singapore. The business-friendly policies and strategic location have turned the city-state into a lucrative destination for investment. If you are, currently, looking to raise capital for your startup in the city-state, you will find a wide variety of options among which venture capital financing is the most powerful one as the investors are playing a crucial role by undertaking high-risk investments.
To understand the real picture of venture capital financing in Singapore, simply read the points given below. Once you read them, you will find it much easier to build a proper strategy for your venture capital raising campaign in the city-state.
Venture Capital Financing In Singapore - An Overview
●
Venture capital
industry in Singapore is the most developed in the whole of Southeast Asia.
However, it is still in its nascent stage compared to that in the U.S.
●
Today, there are
more than 100 venture capital firms in Singapore.
●
The firms look
for startups with a unique idea and great market potential.
●
The VC firms
invest with an aim to earn huge profits;
they, usually, expect a ROI of about 25 to 35 percent for each year of
investment.
●
They usually
invest nearly four to five times the revenue of your startup.
●
The overall
tenure of venture capital investment is three to five years.
●
The venture
capitalists are mostly interested in sectors like service, manufacturing and
high-tech. Some even look for biotech, cleantech and genetic engineering.
●
The investors
mostly prefer later-stage financing although there are many who are ready to
invest right from the seed stage.
●
The basic
prerequisites for raising venture capital in Singapore include, a unique
product or service, a scalable market, a smart and efficient management team,
an innovative business model, a strong value proposition, an interesting pitch,
business valuation papers, etc.
●
The investors do
not rely on long-term financial projections and vague promises. They invest in
companies that have the potential to earn revenues in, at least, a billion.
●
Venture capital financing is definitely a great source of capital but it
is better if you first try out the other options and then consider venture
capital as your last resort. If you can invest 10 to 50 percent from your
personal fund, it will be much easier for you to convince the private
investors.
●
The venture
capitalists take part in your company’s management team to ensure that the
capital gets utilized in the best possible way to bring back maximum profit.
●
Apart from
offering capital, the VCs also offer additional assistance like proving regular
guidance (especially, if you are a first time entrepreneur), knowledge sharing,
contacts sharing and planning the exit policy.
● If you are ready to share a part of your ownership in the company with the investors, then only you should proceed for raising venture capital, otherwise not.
Conclusion
Both private and government-backed venture capital firms in Singapore are contributing to its startup ecosystem. Some of the top venture capitalists in the city-state are Angel Investors, JFDI. Asia, Jungle Ventures, Welden International, Accel Partners, Innov8 Ventures, Intel Partners, Golden Gate Ventures and many others.
You can select a few potential investors depending on their sector and stage preferences and start chasing them simultaneously on various channels. Remember, a single cold call can destroy your campaign so make sure you make the right approach. You can either type a short, crisp and catchy email or introduce your startup through a familiar person in their close circle. Once you manage to find the right investor, it becomes your responsibility to make the most fruitful utilization of the fund so that both you and the investors can earn profit from your startup.
For more information on venture capital financing, feel free to get in touch with us at Merger Alpha. We are a Singapore-based M&A platform offering an intelligent network to bring buyers, sellers, financiers and advisors of the startup ecosystem under a single roof. Feel free to become a part of this network to get faster access to investors and take your startup to a successful position without wasting your valuable time.
Feel free share your thoughts and queries with us in the comment box given below.
Good luck!
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Created on Dec 31st 1969 18:00. Viewed 0 times.