WHEN Inderjit Singh started his first company in Singapore about a decade ago, he recalled facing a multitude of obstacles, including a dearth of willing investors and a general disbelief that he would be able to achieve his dream of creating a homegrown multinational firm.

'With all my excitement, I created a business plan, looked around for investors and I could not find a single investor,' he said. 'Fortunately for me, I had some Taiwanese friends who were trying to hire me to run their start-up in Taiwan a couple of years earlier, so I went to them.

'And all I needed was some ground work and presentations, and I managed to raise US$138 million at one go.'

Not only were potential investors here uninterested, it was an uphill task obtaining credit from banks in Singapore as well.

'Banks were conservative and refused to lend us money,' added Mr Singh. 'The way I managed to raise money was to put my house on mortgage and that's how I funded my (other) start-up.'

Today, the serial entrepreneur and CEO of Infinit Solutions is having the last laugh. After starting his first company United Test and Assembly Center (Utac), he had subsequently moved on to set up three other firms and is widely regarded as a champion of local enterprise.

As he recounted the changes that have happened on the local entrepreneurship scene, he told BT that mindset change was one of the most critical components that paved the way to a more conducive environment for entrepreneurs here.

'In the past, if you were not a multinational, you were a local company, you'd face tremendous problems, even if you were a Member of Parliament trying to start a company,' said Mr Singh, who is a former MP. 'In fact, most of the government agencies were not receptive, not very helpful at that time. But this was the 1997-98 period. Today, I think that has mainly changed.'

Government recognition

As the country went through a period of recession in the late 1990s, government leaders started to recognise that it had to deviate from an economic strategy that was overly reliant on inward investments by multinational corporations.

It started to encourage entrepreneurship and the development of small and medium enterprises (SMEs). In 2000, the government-led Pro-enterprise Panel (PEP) was set up to look at ways of making the island more business-friendly, including a review of existing policies that that may hinder businesses.

serial entrepreneur and CEO of Infinit Solutions

As deputy chairman of ACE, Mr Singh saw the progress being made in the past five years, especially in the area of financing support for start-ups, one of his pet subjects due to his past experiences.

'In the past, every time we have a dialogue session, even if it's about something else, the first question that comes up is always about financing being a big problem,' he said. 'These days, when I do these dialogue sessions, interestingly, financing (issues) no longer comes up.'

Some of the new financing schemes that have emerged include the Micro Loan Programme, the SME Access Loan, the Loan Insurance Scheme, and the Innovation Commercialisation Scheme. The SME Access Loan Scheme, for instance, is a loan securitisation programme launched in partnership with DBS Bank to help companies raise funds from the capital markets. Since its introduction in April last year, it has already lent more than $100 million to over 400 SMEs.

Most recently, new trading platform OTC Capital was launched to provide an additional avenue for the shares of small companies to be traded on an over-the-counter basis. On the websites of the Economic Development Board, IE Singapore and Spring Singapore, too, are lists of financing programmes that cater for a variety of businesses and start-ups at different stages of their life cycles.

These days, banks are also paying more attention to smaller firms, especially the SMEs. Apart from the three local banks - DBS, United Overseas Bank (UOB) and OCBC Bank - Citibank, HSBC and Standard Chartered have also channelled resources towards selling to the SME segment.

'I think we've managed to plug many gaps, but I don't think we are perfect,' said Mr Singh. 'So we'll continue to improve. But I think, largely, right now the financing environment has become quite conducive.'

Also, with the government becoming more open to review policies and tweaking rules to encourage entrepreneurship, it is becoming easier to start a company in Singapore, said Mr Singh. This was reflected in the Global Entrepreneurship Monitor (GEM) 2005 survey, which found that the proportion of the adult population involved in starting a new business here has gone up from 2.1 per cent in 2000 to 7.2 per cent last year. Singapore was also ranked first among 34 countries in the three areas of government policy support, low regulation and taxation burden, and government programme effectiveness.

Success stories

What is needed now is perhaps more success stories to encourage the breeding of more entrepreneurs the likes of Ron Sim, Olivia Lum, Sim Wong Hoo, Kenny Yap and Vikas Goel. Mr Singh recalled that when he quit a high-paying job at Texas Instruments to start Utac, 'my mum fell off her chair and she thought I was crazy'.

At present, such social perception, rather than structural support, seems to be in the way of entrepreneurship growth. According to the same GEM survey, only 46.8 per cent of Singaporeans believe that starting a business is a good career choice. This is way below the 55.4 per cent average recorded in Organisation for Economic Cooperation and Development (OECD) countries, placing Singapore 18th out of the 24 countries studied.

That attitude may still exist for some time, but Mr Singh's sense is that it could be changing, going by the attendance at events organised by ACE. He also sees more schools integrating entrepreneurship into their education curriculum.

EDB chairman Teo Ming Kian agreed. 'Our three universities - NUS, NTU and SMU - all have entrepreneurship courses and business plan competitions for their students,' he said. 'For those with the aspiration to be entrepreneurs, such courses will prepare them well for the undertaking. Even at the secondary school level, there are activities like Bizworld that expose our young to the excitement of entrepreneurship.'

The fruits of such programmes are not going to be readily seen, said Mr Singh.

'Some of these things are not going to happen overnight, simply because the best-paying jobs are still the multinationals, government-type of jobs,' he said. 'And we need many more success stories to show people that, actually, entrepreneurship is something that's exciting to do and rewarding.

'I think, moving forward, we'll start to see a growing number of success stories. In the past, it took a long time for people to become successful. Now, it's faster because the environment has improved a lot. And as more of these (success stories) happen, I think we will see more people willing to (become entrepreneurs).'

In the longer term, Mr Singh hopes to see a one-stop agency for enterprises that are started here - much like the way EDB has been a one-stop agency for multinational firms investing in Singapore. 'I'm not saying it should be for Singaporeans,' he explained. 'Singapore-based companies can be started by Singaporeans or started by foreigners. EDB's approach of hand-holding, account management is highly successful.'

The call for such a one-stop agency is not new. Mr Singh, together with other MPs, had raised the proposal in Parliament last year. The government had then rejected the suggestion, arguing that with the large number of firms involved, their diversity and varied needs would be too much for a single agency to cope with. It preferred to have Spring Singapore play the role of a coordinator, mobilising the expertise of other specialised agencies whenever needed.

Vision

Although his wish of seeing a single, dedicated agency for small enterprises has yet to be fulfilled, Mr Singh is heartened by the progress made on the entrepreneurship scene so far. His vision is for Singapore to be like a Silicon Valley of sorts, where even failed entrepreneurs will have the chance to bounce back, and where the enterprise ecosystem can remain vibrant and weather all kinds of business cycles.

'I think we have now the makings of that, if we keep the momentum,' he said. 'I'm not saying we've already arrived. We must keep the momentum, not slow down, and continue to find new ways of making the environment more and more conducive, so that not only our own local entrepreneurs but also foreign entrepreneurs will come here and also use this as a base to (start their companies).'

EDB's Mr Teo shares a similar view that more needs to be done.

'We have come a long way since embarking on the drive to promote entrepreneurship,' he said. 'But we will have to do more to increase the entrepreneurial capability of Singapore. We need more people experienced in starting new firms, and who can react quickly to good opportunities for businesses. We need more people motivated to get involved in entrepreneurial endeavours. We need people with the confidence to think globally and the ambition to create enterprises of global scale.'

And the picture of Singapore becoming abuzz with entrepreneurial activity may not be as far-fetched as some may think. Mr Singh is confident that in five years' time, the island could reach that stage.

'A lot of changes have happened, but if our ecosystem remains strong and we can continue to attract (entrepreneurs to start new companies), I think, give us another five years at this kind of momentum, and you'll see the landscape completely changed. Then we'll see more successful local enterprises and many more of our local enterprises becoming successful overseas.'

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