Entrepreneurial scene in Singapore remains lively with TEA rates above 10% for the past three years

Most recent data: 2014

Amongst innovation-driven (most developed) economies, Singapore continues to show active participation in entrepreneurship in 2014, with a consistently high Total early-stage Entrepreneurial Activity (TEA) rate that comes just after the United States, Australia and Canada. It is the attitudes of Singapore respondents that seem to serve as the catalyst for encouraging entrepreneurship in the country. Particularly, in contrast to the popular belief that Asians are more risk averse, Singapore respondents possess only moderate fear of failure, accompanied with a high level of intent to start a business. 

Singapore is one of the leading innovation-driven economies and the top country in the Asian region when it comes to the utilization of the latest technology, with one of the largest number of customers based overseas amongst new businesses.

Local experts interviewed as part of the GEM National Expert Survey evaluate entrepreneurial financial support, government policies and its entrepreneurship programmes as the biggest enablers of entrepreneurship in Singapore. The country is ranked 1st in these conditions amongst similar innovation-driven economies. Financial and governmental support for entrepreneurship allows start-ups easy access to funding and grants. 

In addition, there are several entrepreneurship programmes, such as the Young Entrepreneurs Scheme (YES!), which provides students with entrepreneurial education at secondary and post-secondary levels, and the Incubator Development Programme (IDP) which provides support to incubators, which in turn help start-ups with mentorship to guide them, as well as providing funds to develop new products and services. 

On the other hand, the major constraints highlighted by the experts are the costs of commercial and professional infrastructure in Singapore. Because the cost of living is very high, it is often challenging for new businesses to afford high quality business premises or professional advice.

SPRING Singapore

SPRING Singapore is the government body responsible for enhancing entrepreneurship in the country. SPRING has implemented various schemes, such as the Business Angel Scheme (BAS) and the Startup Enterprise Development Scheme (SEEDS), that help start-ups to access funds from early-stage investors. Additionally, the government has initiated enterprise and innovation programmes to promote entrepreneurial spirit among the youth across different age groups in secondary and post-secondary institutions.

Trends Over Time

The rate of entrepreneurship in Singapore has increased considerably over the last 10 years. Whereas the TEA rate was 4.9% in 2006, it has ranged between 10% and 12% for the past three years. 

Challenges for the Future

The main challenge for Singapore is to boost its comparatively low levels of perceived entrepreneurial skills, knowledge, experience, and opportunities to start a business in the country. Improving these would push more individuals to eventually put their intent to start a business into action, and therefore close the gap between the respondent rates of start-up intentions and TEA in Singapore. 

It is also important for Singapore to focus its efforts on increasing participation in entrepreneurship across age groups, especially amongst adults aged between 45 to 64 years old, who have more experience and resources to do so. 

Lastly, there remain room for improvement in several of Singapore's Entrepreneurial Framework Conditions (EFCs), such as its commercial and professional infrastructure and cultural and social norms.