EXCLUSIVE - One year later: SGInnovate continues to nurture deep tech startup ecosystem in Singapore
SGInnovate was launched in November 2016 as a private limited company wholly owned by the Singapore Government to support and develop the deep tech startup ecosystem in Singapore.
As reported earlier, SGInnovate does so by investing in deep tech startups, helping them source talent and finding early adopter customers for them. It aims to leverage off Singapore’s strengths in academia and scientific research and create globally relevant companies by filling a gap in “business-building” capabilities.
At the recent EmTech Asia 2018, Founding CEO of SGInnovate Steve Leonard gave a presentation on the development of deep tech and how to bridge the gap from research to commercialisation.
To learn about the journey of SGInnovate and its role in the Singapore startup ecosystem, OpenGov had a conversation with Mr Steve Leonard at EmTech Asia.
In its first year of establishment since late 2016, SGInnovate had achieved several milestones including the completion of equity investments in 15 deep tech startups, generation of 400 potential customer leads for early-stage companies and built a network of more than 1,000 technical individuals interested in joining early-stage tech companies.
In last November, SGInnovate unveiled its Deep Tech Nexus Strategy to further strengthen deep tech startup ecosystem in Singapore through adding tangible value in the two key areas of human capital and investment capital for startups. Artificial intelligence (AI), blockchain and, medtech have been selected as key areas of focus. During the interview, Mr Leonard also touched on SGInnovate’s interest in these technologies.
According to Mr Leonard, SGInnovate is interested in how these emerging technologies can affect important markets such as healthcare, transportation and energy sectors.
“For example, in healthcare, AI, blockchain, and medtech can develop in various directions.” Said Mr Leonard.
Mr Leonard also shared that SGInnovate is focusing more on the bigger picture, rather than specific applications of these emerging technologies of AI, blockchain, and medtech.
“We (referring to SGInnovate) don’t think so much about solving specific problems. Instead of finding a solution to medical records management using blockchain, we think about what the role of blockchain is in the future of healthcare,” he said.
“Though we are not sure where technology might lead us, part of our job is to bring together ideas forward, just to experiment in each of these domains,” he added.
As more people realise the potential applications of AI and blockchain, some worry that the hype around emerging technologies will lead these technologies to become solutions in search of a problem.
However, Mr Leonard saw the increased attention and discussion positively, as part of SGInnovate’s goal is to encourage thinking and experimenting.
“If we worry too much about hype or protecting against hype, or making sure that it is something more practical, we might miss something,” he commented.
To ensure that innovations are valuable solutions to real problems, SGInnovate looks to the venture capital community and investors to help decide what technology is worth investing into.
“What the team wants to focus on is getting ideas, as many as possible, out in the open and then the natural processes will decide what will survive and what will not,” he explained.
Innovation and breakthroughs would not be possible without some degree of risk-taking. As such, part of SGInnovate’s role in building a deep tech startup ecosystem in Singapore is to inspire and encourage more risk-taking among individuals and corporates.
Mr Leonard noted that more corporates are reaching out to SGInnovate to share their priorities and seek for innovative solutions. He cited the example of Rolls Royce and their work in aircraft engines, how the company is interested in using sensors to gather data and using data analytics to better understand the science behind the use of the engines. The company is also interested in new materials and ways to optimise the manufacturing processes.
“Like Rolls Royce, corporates now come to our space to both share their priorities, speak to start-ups, and learn about new ideas,” he said.
The role of SGInnovate is to ensure that the exchange goes both ways. It helps corporates in search for new ideas or solutions work with much smaller innovative companies or start-ups, and vice versa.
Mr Leonard said SGInnovate aims to be a platform and help both sides to find their conversation, sometimes with the help from partners like the Economic Development Board of Singapore (EDB) to engage large corporates.
Singapore Government has been proactively rolling out initiatives to make Singapore a hub for innovation. Mr Leonard likens the startup ecosystem in Singapore to a giant jigsaw puzzle.
“The whole picture requires a lot of parts and SGInnovate only represents one part. The part we try to represent is start-ups and entrepreneurs. We are not the only one representing this community but what differentiates us is that we focus all our time and effort to work with start-ups in deep tech only. When we work with industry partners and research, it is because we are trying to help start-ups. We only have one thing in mind and that is helping increase the start-up or entrepreneurial success,” he emphasised.
When people say it sounds risky to invest in this med tech company, my question for them would be, “why is it risky to invest in it, when we have already spent millions into research that made it possible to be something that changes people lives?”
In our interview in 2017, Mr Leonard said SGInnovate “really want(s) to build an outstanding global company and I (he) think Singapore is a great place from which to do that.” Following up on that, OpenGov asked Mr Leonard about Singapore’s progress and major development towards that objective during the past year.
He shared that the startup community has seen more investors to come forward and show interest in learning more about, or even invest in, start-ups in Singapore.
“More people are interested in being part of the community to build businesses. More corporates are also interested in working with start-ups. I don’t worry if we have achieved the objective, we are making good progress,” he said.
Within the Singapore startup ecosystem, SGInnovate also play an important role as a long-term investor. However, there could be concerns that SGInnovate is making risky investments with government funds through the Startup SG Equity Fund.
When asked if SGInnovate is worried about such perception, Mr Leonard pointed out the difference between “high risk” and “smart risk”.
“It is not our goal to make sure everyone to understand the processes might take time. We have the support of the Singapore Government to make longer term investment and take good risks. I would not say it is high risk. It is, what we call good risk or smart risk,” he said.
According to Mr Leonard, Singapore has built a lot of potential and capabilities, but until a company is formed and products developed that change people’s lives, this potential is not realised.
To him, the challenge lies in having people to think big and try, and that is where SGInnovate aspires to make a difference in.