Govt reiterates backing for crowdfunding

Singapore

THE government on Monday reiterated its support for crowdfunding as a dynamic financing tool for startups, as well as for the continued growth of innovation and the startup ecosystem here.

Low Yen Ling, Parliamentary Secretary for the Ministry of Trade and Industry, said: "Crowdfunding is (an) emerging financing modality that is increasingly used by startups all over the world. The crowdfunding landscape in Singapore is growing rapidly... entrepreneurs have taken advantage of crowdfunding to get their projects off the ground."

In the last three years, crowdfunding sites have burgeoned in Singapore, among them Crowdo, MoolahSense and CoAssets, said Ms Low; these have reportedly raised a total of tens of millions of dollars for local ventures.

Bamboobee, for instance, in 2013 raised via Kickstarter some US$64,000 - 60 per cent more than its target of US$40,000 - to design and build bikes from non-processed bamboo. Today, the startup has sold over 1,300 bicycles globally, said Ms Low.

"Startups add vibrancy to the business environment, create jobs and contribute to innovation by bringing in new ideas," she added. "Although we have made a good start, we need to... keep up the momentum to support the continued growth of our startup ecosystem."

The number of active startups grew from 24,000 in 2005 to 55,000 in 2014, while total early-stage entrepreneurial activity (the percentage of working-age population who are about to start or those who have recently founded a new business) grew from 4.9 in 2006 to 11 per cent in 2014, she said.

Ms Low was speaking as guest-of-honour at Monday's CrowdFunding Asia Singapore Summit 2015, the second annual summit organised by local crowdfunding firm Phoenixict.

Equity and debt-based crowdfunding will take center stage this year, Phoenixict CEO Kwek HongSin told BT. Both crowdfunding types have been spotlighted recently, what with a proposed equity crowdfunding framework by the Monetary Authority of Singapore released in February, and a call for clearer regulations by the debt-based crowdfunding sector in August.

Said Ms Kwek: "Crowdfunding is a very strong alternative, though never a replacement, to traditional financial products. It serves the underserved markets ... raises ambitions, and empowers individuals, companies, the community, and even the government to better serve its citizens."

According to MyPrivateBanking, the global crowdfunding market would be worth as much as US$1 trillion by 2025.