$1b fund set up to help innovators go global

The fund will source companies that have strong intellectual property internationally and groom them for regional expansion.
The fund will source companies that have strong intellectual property internationally and groom them for regional expansion. PHOTO: ST FILE

Intellectual Property Office and private equity firm join hands to drive initiative

A billion-dollar fund has been launched to groom high-growth companies to take on the world while using Singapore as a regional base. The initiative was one of several announced by the Intellectual Property Office of Singapore (Ipos) yesterday, as part of efforts to drive innovation and help more companies turn their intellectual property (IP) into assets.

These moves come after the Committee on the Future Economy recommended in its report in February that Singapore tap IP as a key driver of economic growth.

Ms Indranee Rajah, Senior Minister of State for Law and Finance, told a briefing yesterday that IP has not been sufficiently recognised by businesses.

"I don't think many fully appreciate what it can do for them and so Ipos' mission and task is to help our businesses realise this, unlock their potential, commercialise their IP and move ahead," she said.

One key initiative towards this goal is the $1 billion Makara Innovation Fund, a partnership between Ipos and homegrown private equity firm Makara Capital.

The fund will source companies that have strong intellectual property internationally and groom them for regional expansion.

It will invest $30 million to $150 million each in 10 to 15 young companies that have high growth potential and own globally competitive technologies.

"We've always been an economy that understands the value of connectivity, but connectivity now is not just through goods, cargo and money, but through ideas and innovation," said Ipos chief executive Daren Tang.

Through the fund, he added, local innovators will get a chance to connect with innovation centres around the world, while foreign innovators can use Singapore as a springboard from which to grow across the region.

The investment funds come from strategic investors from Makara's pool of clients, who were selected based on "what value add they can bring besides money", said Makara managing director Ali Ijaz Ahmad.

While Makara brings to the table its expertise in making commercially driven investments, the Ipos subsidiary, IP Value Lab, will provide its expertise in areas such as auditing, analysing and managing IP and identifying acquisition targets.

Makara spent two years setting up the fund, which has a targeted internal rate of return of 12 to 15 per cent over eight years. It has already met several promising companies that could receive investments in the coming months, Mr Ahmad said.

Mr Kuldeep Singh, founder of Singapore-based medical technology start-up Biofourmis, welcomed the news, saying firms like his are rich in IP but find it very hard to attract financing.

"Expanding into a new region or country also requires a detailed understanding of the market, habits, culture and governance, and here, our Government can play a big role in helping to collate market-related information, as well as helping companies get access to the right clients," he added.

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A version of this article appeared in the print edition of The Straits Times on April 27, 2017, with the headline '$1b fund set up to help innovators go global'. Print Edition | Subscribe