The Adolescent Ecosystem: Singapore Reaching Puberty


People can’t seem to agree on Singapore these days.

Barely one month after Compass released their Startup Ecosystem Ranking 2015 report qualifying Singapore as the 10th best startup ecosystem in the world, a new report by the folks over at SparkLabs Global Venture resoundingly dismissed that claim with some good, ol’ fashioned shade.

In an article on e27, Bernard Moon, managing director at SparkLabs, says:

“We know that from looking at a lot of Singaporean deals that 1) There is a lack of Series A investors, and 2) There is definitely a lack of historical exists. We would never put Singapore in our top 10, maybe even top 20.” (emphasis mine)

My response:


This dude’s trippin’. 

First, let’s ignore the egregious omission of Japan from his list of top global ecosystems. Second, let’s also ignore the tremendous amount of butthurt that I am totally and openly willing to admit I felt in light of Singapore’s efforts over the last fifteen years.

Cue 500 Startups’ Tim Chae, Kim Ngo, and Arnaud Bonzom:

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tl;dr: Tim noted that Singapore didn’t have a history of exits (which, to his credit, Bernard also points out in his chat with e27). Both Kim and Arnaud took issue with that, and as they both rightly claim, there have twelve notable Singapore exits in recent memory.

So who’s right?

Well, they both are.

Let’s get one thing straight: I’m a staunch proponent of the Singaporean startup ecosystem. I’ve worked in it for many years, and I like to think I’ve contributed to its growth in some small, meanginful way through Walkabout, SuperHappyDevHouse, OpenCoffee Club, and a life-shortening amount of coffee. I take a very positive approach to the ‘pay-it-forward’ mantra (and conversely, I am hyper-critical of those that don’t play by that rule). I am extremely loyal to Singapore and am an avid supporter of its growth and potential.

But Tim’s right: not all exits are created equal.

Reading article after article, you’ll note that companies are all “exiting.” And to the layman, it’s hard not to interpret these are unequivocal wins. But that isn’t necessarily true.

Many early-stage VC funds often refer to a rule of thumb when doing a gut-check on their portfolio: 50% to 60% of a given fund portfolio will die or exit for less than 1x return on investment, 30% to 40% will make 1-5x returns, and less than 10% will make 5x and above.

Bear that in mind next time you hear of a startup being acquired for an undisclosed amount of money.

And to be brutally honest, Singapore really hasn’t had a history of exceptional exits. Yes, we had Luxola. Yes, we had Nonstop Games. Yes, we had Viki. We’ve had exits, we’ve had good returns, we’ve had some home runs, but we’ve had far more exits with returns that probably weren’t exceptional, and certainly didn’t result in fund-making returns.

We’ve had real wins, but not enough to denote a trend.

A mature, sustainable ecosystem is not defined by those kind of exits. It is defined by the exits that make massive windfall returns for investors and entrepreneurs.

These exits communicate to existing and potential investors and entrepreneurs alike that yes, Singapore is growing; yes, you can develop a successful company here; and yes, if you do exceptionally well, you can see a life-altering financial return.

To borrow an American example, no one jumps out of their seats for a base hit, but they sure as hell do for a grand slam homerun. And if your home team only has a history of doing the former, it’s hard to see them winning the World Championship.

So no, there does not yet exist a history of critical wins, and our previous wins are certainly not enough to really put Singapore on the map (or, some may argue, to be listed on some arbitrary list of ‘top ecosystems’, whatever that means).


Let me be blunt, Singapore has done an incredible job at fostering its startup ecosystem. This is no exaggeration. The number of countries that have done what Singapore has is exactly one, Israel (it should be noted that Israel’s startup ecosystem predates Singapore’s by a good fifteen to twenty years).

Startups per capita has grown in orders of magnitude; entrepreneurs are smarter and more regionally- and globally-thinking; there are so many more funding options now compared to even three years ago that it’s genuinely incredible.

Granted a startup ecosystem is defined not only by new startup formation, but by exits, and in that respect, Singapore isn’t quite there yet.

But that doesn’t mean they aren’t coming.

There’s a tremendous difference between a lack of exits and a lack of potential exits.

You have dozens of companies now receiving investment from heavy-hitters in the VC space. You have dozens of companies that were started several years ago, but continue to thrive and secure investment round after round. These companies go from strength to strength, supported by smarter investors with larger checks. There is several billion dollars worth of acquisition potential across Southeast Asia, especially Indonesia and Singapore. Add to that the dozens of other startups soon reaching that maturity level, along with dozens of new funds focused exclusively on the region.

So how do we reconcile Singapore’s lack of exits with its potential massive exits? It’s clear that Singapore’s ecosystem isn’t in its infancy anymore, but it’s not yet mature enough to start achieving those mammoth exits.

Instead, Singapore is just hitting puberty. Its ecosystem is in its adolescence.

The reason why I am so critical of Bernard Moon — and indeed, other similar reports, even those more complimentary of Singapore like the Compass Ranking — is because they reflect a shallow understanding of what constitutes a startup ecosystem.

While many reports seem to ignore the importance exits play in defining and growing an ecosystem, other reports, like Bernard’s, totally discount potential exits, especially when considering the relative strength of these companies vis-a-vis previous iterations within a given ecosystem.

It’s not fair to compare Singapore’s adolescence with more mature adults. It’s like asking a junior college athlete why she can’t compete with professional footballers.

But to continue the metaphor, Singapore has shown itself to be a tremendously talented athlete, having achieved in fifteen years what no other country has done since the concept and vision of silicon valley entered the public consciousness.

An adolescent ecosystem is a far better descriptor for Singapore, one that is realistic about its success but nevertheless cognisant of its potential. More importantly, that descriptor can easily be applied to other tech ecosystems around the world, and can serve both as a bellwether of success and a reminder that not all ecosystems become “mature” overnight. It’s a process, a gradual process, that is perfectly reflected in the way these ecosystems grow from infancy to fully-grown mature ecosystems. I’m looking forward to seeing how Singapore grows up, as I am with respective ecosystems across Southeast Asia, Africa, and Latin America.

Then again, maybe I’m just being moody. Puberty can do that to a kid.