Growing in the face of adversity

2020 will go down in history as a year that shook the world. The global health and economic crisis that the world continues to battle, together with numerous other social and geopolitical upheavals, makes this year one of the most eventful and challenging ones for individuals and companies.

As much as we all hope that life will return to pre-Covid days, we also know that life will be different henceforth. The optimist in me likes to see our present circumstances as a glass half-full. Sometimes the things that we cannot change ends up changing ourselves for the better.

What inspires me are the stories of Singapore entrepreneurs and business owners, who have made lemonade when life gave them lemons. Even though many companies are facing an uphill struggle during this trying period, we have also seen some remarkable examples of resilience and innovation. Many, if not all, of the past and present finalists of the EY Entrepreneur Of The Year (EY EOY) awards are inspirational examples for us to learn from.

FINDING OPPORTUNITIES AMID A CRISIS

Since the start of the pandemic, we have seen companies which have survived and thrived. There are companies which have, for lack of a better word, benefitted - and will likely continue to benefit - from the pandemic. These include firms in the healthcare, medical and bio-tech sectors, as well as those whose products and solutions support the post-Covid world of e-commerce, online payments and "stay home" phenomenon.

There are also companies which are suffering a dip in sales, but holding fast to their business models without making any changes, in the hope of a rebound when demand returns. The question remains how long these firms can hold out.

A NEWSLETTER FOR YOU

Friday, 8.30 am

SGSME

Get updates on Singapore's SME community, along with profiles, news and tips.

Sign Up

Sign Up

Finally, there are companies which have taken the opportunity to innovate, digitise and even shift their business models in order to thrive post-pandemic. These companies recognise the need for change and see the current environment as an opportunity to transform. Ambitious entrepreneurs make bold decisions to bring Singaporean brands overseas, daring to transcend borders even amid the current climate.

Many Singapore-listed companies have forged ahead with their expansion plans, focusing on long-term growth opportunities overseas.

Integrated food solutions provider Neo Group, for example, is reaping the benefits of its early adoption of technology and strategic acquisitions, and have ambitious plans to grow its regional presence. Incidentally, founder, chairman and CEO of Neo Group Neo Kah Kiat himself was one of the category winners at EY's EOY awards in 2015.

Food Empire, another company that has built strong international brands over the years, has shown resilience in its diversified operations.

Similarly, food and beverage operator Koufu Group is not letting the pandemic deter its diversification plans to invest in new areas of growth.

Meanwhile, MindChamps Preschool, with its strengths in education, intellectual property and franchise management, continues to expand its footprint locally and overseas.

A common thread among our successful entrepreneurs is that they have set their sights on becoming global champions in international markets. Willingness to take calculated risks and making changes to business operations and risk management strategies is critical as businesses find themselves operating in an entirely new landscape.

Regardless of industry, what is clear is that businesses need to commit to a more agile way of thinking and working in order to weather storms - and thrive.

ACCESS TO CAPITAL IN GOOD AND BAD TIMES

A common roadblock for businesses is capital constraints. Hence, access to a diversified pool of capital is key for companies to maintain financial strength through the current crisis. Listed firms have the benefit of being able to tap on both debt and equity capital markets to raise funds when they need to.

It is encouraging to see Singapore's homegrown company Nanofilm Technologies - whose founder, Shi Xu, was also a past overall EOY awards country winner in 2017 - to be the first tech unicorn to successfully list on SGX. The company raised over S$500 million at the end of October 2020 and saw its valuation grow from S$1.7 billion at the point of the initial public offering (IPO) to over S$2 billion in less than a week.

As all listed companies can testify, the IPO is just the beginning of a new journey. For SGX, what is more important is to ensure our listing platform can continually support issuers in their fundraising needs post-listing, in both good and bad times.

Over the last five years, companies on SGX have raised four times more funds through a secondary market listing than at IPO.

In the first nine months of 2020, SGX-listed companies raised US$8.6 billion in secondary funds via rights issues, placements and more recently recapitalisation in the face of the pandemic.

To support our local enterprises through this period, a coordinated response from the Singapore ecosystem is needed.

At SGX, we have been working with government agencies on multiple fronts to support issuers, including enabling the acceleration of fundraising efforts.

We continue to actively engage market participants and collaborate with partners across the global financial ecosystem to find ways to help enterprises navigate and achieve their long-term ambitions, even in the face of adversity.

While no economy around the world is immune from the effects of the pandemic, Singapore continues to offer one of the most favourable operating environments in Asia.

I am sure many business owners would agree that there is no better place to do business than in Singapore, which continues to invest time and resources in nurturing homegrown companies.

Waiting for the world to return to pre-pandemic days is futile.

Companies should carefully consider how they can turn the challenges that Covid-19 has presented into transformational opportunities. These challenges should not be seen as insurmountable hurdles, but rather as catalysts to even greater success.

READ MORE: Secretlab CEO Ian Ang is Singapore's EY Entrepreneur of the Year 2020