THE Singapore Economic Development Board (EDB) has committed fresh funds of S$20 million over the next 2 years to expand its corporate venture programme, where it partners large companies to identify and spin off new businesses in high-growth areas.
The Corporate Venture Launchpad 2.0 builds on the "encouraging results" of the S$10 million pilot programme started last May by the statutory board's corporate venturing arm EDB New Ventures, said managing director Jacqueline Poh at Tuesday's (Jul 26) launch.
"Innovation is a key pillar of Singapore's economic proposition and many companies in Singapore have realised that corporate venture building is one important way to get momentum and pioneer new innovation," said Poh.
To date, 6 of the 13 companies in the pilot have spun off new ventures and committed at least S$50 million of follow-on seed investments for them, said EDB in a statement. The new ventures cover a wide range of areas, including sustainability, agritech, fintech, senior living and the metaverse.
Singapore is now home to close to 80 corporate ventures, almost double the number last January.
Compared to traditional start-ups, corporate ventures enable companies to tap their own resources and networks when coming up with new ideas, said panellists at the launch, all of whom were involved in the pilot.
"(With corporate ventures), there's a lot of discussion which goes into how to use your existing recipes to create something new... and also the expertise which is available within the company really comes in handy to begin with," said Vikash Dhanuka, chief executive officer of Sing Fuels.
This helps to "de-risk" the early stage venture process, said Michael Pareless, open innovation lead at Bayer Crop Science Asia-Pacific. "One of the advantages of this approach is that in addition to bringing that agility, urgency and independence to the company, we are also bringing market expertise and resources to give start-ups an advantage that most of them don't have".
Companies can also tap EDB's networks to gather feedback on their ideas from industry leaders, said Gaurav Julka, Electrolux Apac and MEA's head of appliance as a service. The team behind Electrolux's venture spoke to 25 to 30 industry leaders before coming up with their final pitch, he said.
Aside from doubling the pool of money available, the Corporate Venture Launchpad 2.0 will broaden the eligibility criteria to include a wider range of companies, from "large corporates building their first ventures to forward-thinking companies who are now building multiple ventures", said Poh.
"We are also keen to invite more regional businesses and scale-ups to venture build from Singapore," she added.
EDB will co-fund up to S$500,000 for each concept validation sprint. It will also provide advisory support, lend connections, and deploy its venture builders to be part of the sprint teams, where relevant.
An additional S$500,000 of co-funding will be made available for the "build and launch" phase so that companies with high potential ventures can accelerate set-up, the development of their Minimum Viable Product, and the hiring of founding teams.
Companies can use a self-help toolkit to better scope venture concepts, evaluate their organisational readiness for venture building and select the right studios to develop their concepts, said EDB.
"By doing these, we hope to work with companies on 20 to 30 projects over the next 2 years," said Poh.
EDB has also signed Memoranda of Understanding with 6 venture studios for the launchpad. The studios - BCG Digital Ventures; FutureLabs Ventures; Leap by McKinsey; Next by Bain & Company; Rainmaking and Wright Partners - help to validate new venture ideas and business plans.