4 Things You Must Know About Venture Capital In Singapore

Are you too among those entrepreneurs who often fantasize about raising venture capital in Singapore? No wonder! This is the only source of capital that can solely enable you to take your business to successful heights. Till now, many have successfully raised venture capital in Singapore while a majority have failed either because they did not have all the prerequisites in place or they made a wrong approach.

How much money you need isn’t the most important thing in the VC industry. The biggest concern is making the right approach to convince a VC for the deal. Once you are successful in making a venture capitalist sign the deal, rest assured that the investors themselves will make the best of their efforts to help you succeed. No doubt, they have their own motive behind this endeavour, which is gaining a huge profit, but this aim of the investors will only enable you to grow and expand your dream business. Just in case you are looking for venture financing in Singapore, there are certain basic information that you may want to gather before embarking into the campaign.

Things To Know About Venture Capital In Singapore

1.     The Industry Scenario

If compared with that of US and UK, the VC industry in Singapore is still in its nascent stage. However, the active government along with its business-friendly policies is playing a major role in driving foreign investments. Over the years, many local and global VC firms have set their base in the city-state giving entrepreneurs a firm ground to raise their dream business. 

2.     How Do VCs Operate?

Venture capital firms do not use their own money to back your ideas. Instead, they pool money from other wealthy investors and pour that money in the growing markets. Their prime investors include limited partners which include institutions like pension funds, insurance companies, charitable foundations, endowments and other wealthy individuals (like HNIs) or families. The core partners of the VC firms make only 1 percent of the total investment.

Now they start with doing a research on the growing industries which currently include sectors like Technology, Finance, Energy, Software Development, E-commerce  and others. They first choose an industry/industries of their choice and then start looking for unique business ideas craving to erupt within those industries.

3.     Most Active Venture Capital Firms In Singapore

Some of the top VC firms that are currently most active in the city-state include Adam Street Partners, Ardent Capital, JFDI.Asia, Carlyle Group, GGV Capital, Extream Ventures, Golden Gate Ventures, Gobi Partners, Flag Capital, Innosight Ventures, Intel Capital, Singtel Innov8, iGlobe Partners, Infocomm Investments, Jungle Ventures, JAFCO Asia, McLean Watson Capital, Merger Alpha, SEAVI Partners, Stream Global, Upstream Ventures, Welden International and many others.

4.     How To Convince A VC Firm In Singapore?

Though known for their high-risk investments, venture capital firms are, usually, very particular about choosing a portfolio company. To minimize risk, especially at the seed stage investments, the VCs maintain extreme caution as their aim to gain a huge ROI by minimizing the risks.

Some of the prerequisites for convincing a venture capitalist include a unique product/service, a scalable business, a sizeable market, an innovative business model, a great team, a strong value proposition to demonstrate market traction, an interesting pitch, important documents and, of course, the right attitude. If any one of these goes missing, you will find it extremely difficult to attract an investor.

Conclusion

There is no dearth of capital in the Singapore VC industry. All you need is to have the right idea with which to approach the right investor at the right time. Also remember that not all venture capitalists would invest in all startups. Every firm is different; they have their own industry and investment stage preference. If yours is a seed stage startup, make sure you chose only those investors who are willing to invest in that particular stage.

For faster access to a VC, you can also choose to become a part of an intelligent network like Merger Alpha that connects entrepreneurs to their potential investors and investors to their potential investment opportunities.

For more information, feel free to visit Merger Alpha.