Although Singapore is well known, it is often misunderstood – particularly by geographically challenged Americans. Many do not realize it is an independent city state and often incorrectly assume that it must be a province of China. Singapore boasts a highly productive and well educated populace, low taxes, very low corruption, and transparency. It is also placed at a geopolitically strategic point at the tip of Malaysia and in the center of global trade, particularly between China, India, and Indonesia.
Today we’ll discuss seven reasons why we love Singapore and why we think it will continue developing into a thriving Asian startup hub.
Singapore is an easy place to work
Business incorporation in Singapore is open to citizens and foreigners alike, usually takes no more than two days processing time, and costs under $800. I say under $800 because foreigners are required to use an incorporation service to register. Average price on these is around about $560, though I did see one as low as about $400. No special visas or actual residence in Singapore is required. There is a requirement that Singapore companies have local directors but incorporation services often offer services to get a nominal local director for you. Employment Passes and Entrepreneur Passes are also available and relatively painless if you want to run your company personally in Singapore. Incorporation itself does not require a visit to Singapore.
The only slight hitch to the incorporation process is the requirement for a Singaporean bank account. Neither Citibank nor HSBC require physical presence in Singapore to open an account, however their fees and minimum deposits are higher than local banks which do require physical presence in Singapore. So it is a matter of picking one’s poison.
No additional licenses are needed for most lines of business. However, licenses are generally easily obtained in the event that they are needed.
Taxation is low
Companies pay no tax on the first $80,000 of income (for the first three years only), 8.5% after that until $240,000, and then a flat 17% until $1.6 million.
Singaporeans are fluent in English
80% of Singapore is literate in English, and in my experience, nearly everyone can communicate in English verbally.
Singaporeans are highly educated
Singapore generally ranks in the top five globally in math and science education. “Singapore Math”, a simplified and effective method to teach math, is popular the world over. The National University of Singapore and Nanyang Technological Institute are both ranked in the top fifty globally.
Singapore is virtually street crime-free
In the event that you do live in Singapore to run your business, there is never any need to fear crime. Singapore’s crime rate is lower than any nation in North America or Europe and is at a 29-year low.
Singapore’s weather is predictable
Singapore is in a tropical rainforest biome which means rainy and hot, yet predictable. Wear the same thing every day! Singapore never experiences the typhoons that plague other East Asian nations. Tsunamis and earthquakes are also unheard of, owing to Singapore’s great distance from fault lines. Air quality is among the best of all large cities in East Asia.
Getting seed-capital for startups in Singapore
There are many seed money programs in Singapore for which new companies are eligible. The foremost among these is the SPRING Startup Enterprise Development Scheme (generally referred to as SPRING SEEDS). For this scheme, the company must have $40,000 in paid-up capital. It must also have a corporate or individual investor with $400,000 in paid-up capital. The Singapore government will match dollar-for-dollar investment up to $800,000, in return for shares in the company. More details are at www.spring.gov.sg.
Also, there is the more whimsically named Joyful Frog Digital Incubator (jfdi.asia). This is an investment boot camp-style accelerator that boasts a greater than 60% success rate raising an average of $520,000 per team. $25,000 is doled out initially to selected teams. Extensive mentorship is given over a 100 day period. The next accelerator program is starting in February. An application can be found at jfdi.asia/accelerator/.
Finally, there is BANSEA (Business Angel Network SouthEast Asia). This is an organization that introduces entrepreneurs to “angel groups”. Angel groups typically put up $100,000-$1,000,000. These groups do generally have high expectations, expecting to get back at least ten times their investment in eight years. More information can be found at bansea.org.