Business

Last updated: 12 november, 2010 - 15:49 GMT

Singapore Start-ups

About this programme by Peter Day

It is 10 years since I went to see Lee Kuan Yew, the founder of Singapore. It was then 10 years after he had stood down as prime minister of the neat and tidy city state, but he retained enormous behind-the-scenes influence in a job called Senior Minister. (He is now called Minister Mentor; Singapore's prime minister is another Mr Lee, his son Lee Hsien Loong.)

I was there because something Mr Lee Senior Minister had said about failure had caught my attention, and that is what we talked about.

Some history, first: for 30 years under his guidance, the country had engineered a deliberate, government-inspired attempt to attempt to make Singapore a first world oasis in a third world region.

Israel provided the model, surrounded as it was by hostile Arab states, just as Singapore felt itself surrounded by hostility when the Malaysian Confederation fell apart in 1965.

"Like Israel, we had to leapfrog the rest of the region, and attract multinational companies," he told me.

For 30 years, Singapore played catch up, but by 2000 there was nowhere to take a lead from. So the Senior Minister issued a new call to the island nation of 5-million people.

"It's time for a new burst of creativity in business," he told me. "We need many new tries, many start-ups. Out of 10 maybe one will succeed, and eight will fail."

This was deliberately radical talk from a leader whose government had directed his country so closely for so long. The old ways would not work anymore, he said.

Special

Singaporeans would have to stick their necks out and start to embrace risk as a way of life, without a government safety net.

So it was that in 2002, a government commission recommended a push for entrepreneurism in Singapore and then they designated a minister with special responsibility for it. I suppose it is what many places do, but it does seem typical of the way this City State thinks.

So recently I went back, to collect some Singapore start-up stories for radio, television and the BBC website, from some Singapore entrepreneurs ... the risktakers.

I found the place putting even more faith in real estate than a decade previously; like Dubai, Singapore still seems to think that if we build it they will come.

Inside many of the new buildings there are acres of retailing. Shopping is still one of the main leisure activities of the city state, a national form of self expression.

To encourage business round the new technology that I found Lee Kuan Yew very keen on 10 years ago there are government-inspired clusters of activity again expressed in soaring brand new buildings. In glittering buildings the Biopolis centre groups research institutions alongside many striking international medical companies. They have been attracted to Singapore as an Asian base in the same way that banks were in the 1980s. Nearby is Fusionpolis, designed to do the same thing for physical sciences and communications.

Impressive buildings, with impressive researchers inside them. But is this really also creating a city of risk takers prepared to set up on their own, true individual entrepreneurs?

Next to these Knowledge Hubs is the Asian campus of the famous European Business School INSEAD. It is celebrating its 10th anniversary, so I asked Professor Patrick Turner from the entrepreneurship department there how he thought Singapore's quest for entrepreneurs was shaping up.

He said after the push started, company formation doubled year by year from 2003 to 2007; then the global financial crisis hit and things cooled down.

Cakes

He went on; "One of the problems has been trying to do a Silicon Valley USA thing with a Singapore kind of mentality, which is not the same."

"In other countries this sort of change would take a generation. But they're agile in Singapore so it make take half the time, meaning that we’re only half way through the process."

There are several Singapore startup stories in this programme, and more online. One striking story comes from Lyn Lee, proprietor of the highly specialist chain of shops called Awfully Chocolate. It has eight outlets in Singapore and more in Hong Kong, Taiwan, Jakarta and mainland China.

She's built a little empire out of her impressive cakes, but she is frustrated by the way clever Singaporeans look down their noses at service jobs.

The prime ambition of a bright local remains a job in the very well paid civil service, says Lyn Lee. Or a big multinational company. Another entrepreneur told me that he thinks the availability of official funds for start-ups encourages an industry of grant-getting, not risk-taking.

Singapore is one of those start-from-almost-nowhere countries that has gone up like a rocket. propelled by a (then) visionary belief that international banks and corporations needed an offshore beachhead in Asia.

Now the multinationals want to be onshore and up to their necks in China. Singapore has to find way of staying ahead of expectations. Its prosperous people will have to heed the Senior Minister's message of ten years ago, and start taking risks.

Previous updates - November

October

September

  • The media is going through a 'double-mangle' says Peter Day.

  • In San Diego, Peter Day investigates the company that produces WD40's secret formula.

  • Peter Day looks back on a year of the credit crunch with Simon Johnson, former chief economist for the IMF.

  • Peter Day finds out from the experts how to start a bank.

  • Peter Day looks at the great expectations in landlocked Bolivia and its part in the auto revolution.

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