Singapore offers billions to boost high-growth start-ups

Singapore investment start-up

Singapore has announced a range of measures in September to help promising high-growth start-ups raise capital – moves set to boost support for the country’s growing fintech sector.

Support and financing will be available at various stages of fundraising in the public equity market.

The Singapore Government and its investment company Temasek will set up Anchor Fund @ 65, with S$1.5 billion in the first tranche to offer pre-IPO financing and support and help high-growth companies head to public listings.

The investment arm of the Singapore Economic Development Board, the EDBI, will establish a new Growth IPO Fund, starting with up to S$500 million, to invest in later-stage start-ups which are two or more funding rounds away from listing.

The Monetary Authority of Singapore (MAS) will also expand its Grant for Equity Market Singapore (GEMS) scheme to help companies with listing expenses and increase Research Talent Development grants by co-funding hiring costs.

​​​​In addition, the Singapore Exchange’s Strategic Partnership Model will develop bespoke capital market solutions to link start-ups with market makers for fundraising and liquidity building.

These new measures follow Singaporean fintech initiatives such as the API Exchange partnership, which connects fintechs with financial institutions so they can experiment with new ideas.

Heng Swee Keat, Singapore’s Deputy Prime Minister and Coordinating Minister for Economic Policies, said the country’s fintech ecosystem has grown by leaps and bounds to more than 1,400 fintechs today, up from just 50 firms five years ago.

“Our local fintech sector attracted US$1 billion (S$1.35 billion) in equity funding and M&A last year. This is 34 per cent higher than in 2019, despite Covid-19,” he said.

“Singapore became the first country in Southeast Asia to issue digital banking licences last year, another major step in the liberalisation of our banking sector. There is potential to do much more, especially with the digital economy in Southeast Asia projecting to triple to US$300 billion by 2025.”

Heng was speaking at the official launch this month of the Asian Institute of Digital Finance (AIDF) which is training new fintech talent in Singapore through Masters and PhD programs in Digital Financial Technology.