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Sources of Funds



Financial Assistance should not be limited to just talking about money. According to the Agency for Science, Technology and Research (A*STAR), start-ups need "smart" money. Investors who bring in smart money are not only a source of capital, they also bring networks and expertise to your business. A*STAR has described the following ways to obtaining financial and management assistance for your business :

INVESTORS
According to A*STAR, there are various sources of smart money available:

Please note that the following information is an extract of the A*STAR's website on Technopreneurship. For further information, please refer to http://www.a-star.edu.sg

Business Angels
Business angels are high net-worth individuals, typically experienced businessmen or professionals, who invest in the seed stages of the start-ups' development.

Venture Capital
Venture capital refers to equity investments by institutional investors in growing, unlisted companies. It normally covers investments in the next stages of a company's life-cycle. Venture capitalists typically take a stake in start ups and support their investments by providing strategic, management and financial advice.

Singapore Venture Capital Association
The SVCA was formed in 1993 to serve as a voice for venture capital professionals, and to promote the growth and development of the venture capital industry in Singapore. It has set up a Business Angels Programme to match-make start-ups and Small & Medium Enterprises with business angels. Entrepreneurs and venture firms who are interested to know more about venture capital, the Association's activities, membership and the Business Angels Programme should contact SVCA at tel: 339 9090, Fax: 339 8247.

Websites
There are several websites which aim to match start-ups with potential investors, such as:

TAV Online - tavonline.com is an online network that provides a matching service to technopreneurs and investors.

Venture Capital On Demand - www.vcod.com is an independent internet-based business angel and financial advisory specializing in investing in and raising funds for young Asian entrepreneurs through its network of potential investors.

BANK LOANS

Banks traditionally require collateral in exchange for credit facilities. NSTB understands that this may pose a problem for technopreneurs whose assets are in intellectual property rather than tangible assets. The agency is therefore working with various banks to provide collateral-free loans.
Read here about Keppel TatLee TechFinancing Centre which is the first such bank in Singapore to offer credit facilities to including working capital, equipment and accounts receivable financing, and factoring.

Some useful banking sites for reference :

  1. Citibank, NA
  2. DBS Bank
  3. Keppel TatLee Bank
  4. OCBC Bank
  5. OUB Bank
  6. Standard Chartered Bank
  7. UOB Bank

TECHNOPRENEUR FUNDS

In recognition of the greater role, technopreneurs would be playing in the future economy of Singapore, the Government has made available a wide range of assistance schemes. The following information has been extracted from CNET Singapore website, under the category of E-business/E-Commerce. You may wish to read the article yourself :

In summary, the Government, spearheaded by the National Science and Technology Board (NSTB), has provided arguably the most comprehensive range of assistance schemes for technopreneurs :

  1. Innovator's Assistance Scheme

    2. Helps local technopreneurs (citizens and PR) with the initial costs of developing their ideas into commercially viable products - up to up to 70 percent of the costs or a maximum of S$20,000.

  2. Patent Application Fund (PAF)

    3. Help applicants defray the costs of patent applications and to encourage local individual or organisations to register their innovations and inventions to protect their intellectual property rights

  3. Technology Development Fund

    4. To provide seed funding to entrepreneurs and small high-technology startup companies in technology areas with high growth potential such as

    micro-electronics, information and multimedia technology, manufacturing and

    engineering, materials and environmental technology, and healthcare

  4. Technology Incubator Fund (TIP)

    5. This program brings successful and experienced groups of businessmen and technopreneurs, known as Incubator Management Companies (IMCs), to nurture and mentor high-tech startups and provide advice in business strategy for an incubation period of two years and to assist in the growth of the new companies.

  5. Technopreneur Investment Incentive Scheme

    6. Capital losses will be tax deductible under this new scheme which became effective from September this year.

    For technopreneurs with an IT bent

    If your ideas involve IT, another source of financial or technical support is the National Computer Board (NCB), now known as Infocomm Development Authority (IDA). Here are several schemes and programs to help technopreneurs jump-start their IT projects.

  6. Cluster Development Fund

To facilitate development of IT2000 projects and to nurture the new IT industry and to be used or co-invested in :

  1. developing pioneering IT services, products and business concepts
  2. developing sector-wide information infrastructure
  3. help Singapore IT professionals and users keep up with technological developments
  1. Local Enterprise Electronic Commerce Programme

    2. The LECP (EC) is designed to jumpstart the mass adoption of electronic commerce among Singapore enterprises by putting your company's need to the following IT Associations : Association of IT Consultants (Singapore), Microcomputer Trade Association (Singapore); and Singapore Federation of the Computer Industry. A grant of up to 50 percent of the e-commerce project cost, capped at S$20,000 for each qualified local enterprise, is also available.

  2. IT Co-Investment Fund (ITCF)

    3. To help members of the Singapore Federation of the Computer Industry (SFCI) in their investment in overseas IT companies to acquire new technologies and/ or gain access to overseas markets. The Fund will generally co-invest up to 50 percent of the investment. The equity stake by the Fund should not exceed 30 percent of the invested company

  3. Software Quality Improvement Programme (SQIP)

To encourage local companies to enhance and strengthen the Quality Assurance (QA) practices in the software industry and with the possibility of engaging external consultants to review, recommend, develop and implement a quality system that will meet international quality standards.
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