Talent investor Entrepreneur First leaves Singapore, consolidates globally

ENTREPRENEUR First (EF), which builds deep tech startups from scratch by matching aspiring entrepreneurs with each other, is pulling out after six years in Singapore as it looks to consolidate its global operations.

EF, whose investors include LinkedIn’s Reid Hoffman, plans to operate in startup ecosystems where it can run multiple programmes concurrently. It has decided Singapore does not have the supply of talent to support that.

In London, for instance, the company typically runs two cohorts each year but also recently added a programme designed for ventures focused on Web3, and another focused on climate tech.

Singapore supports two cohorts each year but is unlikely to be able to expand much more than that, said Bernadette Cho, partner and general manager at EF Singapore.

EF will cease its programme in the city-state after the current cohort, its 12th, graduates in April 2023. It will instead focus on its hubs in London, Berlin, Paris and Bangalore. The programmes in Toronto will also cease as EF opens a new hub for North America, to be announced later this year.

“That is the strategy and the overall direction in which the company wants to head and unfortunately, the size of the local talent pool in Singapore doesn’t position us to do that well,” Cho told The Business Times, adding that it was important for EF to continue its intake without “dropping the quality bar”.

Despite several efforts, Singapore still lags behind its global peers in deep tech talent and the commercialisation of academic research. Its startup ecosystem has expanded rapidly in the past decade, partly driven by the city-state’s positioning of itself as a gateway to the rest of the region. Still, funding and business solutions in South-east Asia have favoured more mature models in sectors including fintech and e-commerce.

Cho confirmed that the nascency of deep tech in South-east Asia was a factor in EF’s decision to leave. Nine employees at EF Singapore, including Cho, are affected by the programme’s closure. EF said it will continue to support its Singapore portfolio through its global team and funding network.

The portfolio of 80 startups is worth more than S$1.4 billion and includes space-tech company Transcelestial and Green Li-ion, which works on battery recycling technologies.

On a global scale, the value of EF startups has crossed US$10 billion since the company was founded in London in 2011 by Matt Clifford and Alice Bentinck, who were both in their 20s. Startups typically pitch to a global audience of investors at the end of their programmes.

EF similarly pulled out of Hong Kong in January 2020. Clifford told TechCrunch in October 2019 that while the quality of founders was high, the talent pool wasn’t large enough to support two cohorts per year in the long run.

“We’ve always said to our investors that we’ll deploy capital wherever we see the best long-term opportunities and, while Hong Kong might well have been viable for another cycle or two, we see more sustainable opportunities elsewhere,” he said then.

“I think it’s obviously been a very difficult outcome to have arrived at,” said Cho of EF Singapore’s closure. “But I remain really very grateful for the founders I’ve worked with and for the team that I’ve gotten to work with. I think we’ve achieved really exciting things in the last three years.”

She pointed to how the number of companies produced by EF Singapore that received seed funding doubled from 2020 to 2021. The average post-seed valuation multiple of the three most recent Singapore cohorts, compared with previous Singapore cohorts, has increased by over 50 per cent.

Singapore was EF’s first location outside its London homeground. Clifford and Bentinck told BT in a 2019 interview that they had been blown away by their visit to local universities, which showed a high quality of talent ripe for entrepreneurship.

“Entrepreneur First’s expansion to Singapore was a crucial milestone in our history – our first site outside London,” said Clifford in a statement on Tuesday (Nov 1).

“The EF Singapore team has worked tirelessly to find and serve the entrepreneurs in our community. We’ll be seeing the legacy of their work for years to come with the growth of the EF Singapore portfolio.”