Start-ups can now apply to $285m fund announced in Fortitude Budget

Deputy Prime Minister Heng Swee Keat said $285 million would be allocated to help start-ups sustain innovation and entrepreneurship activities and gain access to credit, and bridge the financing gap they face amid the Covid-19 pandemic. PHOTO: ST FILE

SINGAPORE - Promising start-ups here can now apply for special funding earmarked for them in the Fortitude Budget, Singapore's fourth Budget this year.

Deputy Prime Minister Heng Swee Keat said in his speech on May 26 that $285 million would be allocated to help start-ups sustain innovation and entrepreneurship activities and gain access to credit, and bridge the financing gap they face amid the Covid-19 pandemic.

The Special Situation Fund for Start-ups (SSFS) will be administered by EDBI, the corporate investment arm of Economic Development Board, and Seeds Capital, the investment arm of Enterprise Singapore, said both organisations in a joint statement on Friday night (June 5).

Under the scheme, EDBI and Seeds Capital will invest in selected start-ups with private sector co-investors in a one-to-one ratio.

The scheme will end when the funds are fully committed or by Oct 31, 2021, whichever is earlier.

This is not the only scheme rolled out to help start-ups so far.

Earlier this year, some $300 million was set aside to help deep-tech start-ups under the Startup SG Equity scheme, in which the Government co-invests with qualified third-party investors in eligible start-ups. Artificial intelligence and alternative proteins are some examples of deep technologies.

The SSFS will support early to late-stage innovative start-ups, though EDBI will focus on late-stage start-ups with larger funding needs and a wider employment base, while Seeds Capital will focus on the early-stage start-ups.

Applications for the fund will be assessed on a case-by-case basis.

The start-ups should be incorporated as a private limited company with its headquarters and key value-added activities in Singapore.

EDBI and Seeds Capital are looking to start-ups from diverse sectors to apply.

The start-ups should possess strategic capabilities such as technology and innovation competencies or sustainable competitive advantages that can contribute to Singapore's national priorities, they added.

The firms should also have substantial innovative or intellectual property content developed or owned in-house and be able to demonstrate a commercially viable business model.

In addition, they should be able to show what they have to offer, and their potential to scale up their businesses in their target customer segment and across international markets.

Other key attributes required include a committed and capable management team with relevant experience and business acumen, as well as strong corporate governance.

EDBI president and chief executive officer Chu Swee Yeok noted that in the current difficult financing climate, even start-ups which were doing well before the Covid-19 pandemic could also have cash flow difficulties.

Many start-ups are facing financing challenges, as venture capital and private equity investors are taking a more cautious funding approach, she said.

"SSFS will allow Singapore to build on the momentum of our thriving start-up innovation ecosystem. We look forward to working with partner funds to support technology start-ups so that they can continue to execute their growth plans to build strategic capabilities in Singapore, continue with their innovation activities and expansion plans to capture new market opportunities," said Ms Chu.

Seeds Capital chairman Ted Tan said that while the SSFS was developed to support promising start-ups during these difficult times, it is important to ensure the funds are directed at viable start-ups.

"Involving private sector co-investors will double the deployable capital, and ensure that only start-ups with strong growth potential are supported. Collectively, the SSFS will enable these companies to continue their early product development and innovations to build a strong foundation for growth," said Mr Tan, who is also deputy chief executive officer of Enterprise Singapore.

Interested early-stage start-ups can apply for the funding via, while late-stage start-ups can apply via

Start-ups should provide information including a business plan, financial statements and cash flow projections, preliminary company information, manpower information and plans and, if available, details of current interest from potential co-investors.

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