Inside Singapore’s Startup Laboratory

As an investor-turned-civil servant, Edwin Low is building a lab in the Singapore Government to grow the next generation of tech companies.

After all, the country has realized that it needs a thriving technology community to help it adapt for the future. Its Smart Nation strategy is heavily reliant on cutting-edge technologies such as robotics and artificial intelligence.

“The suppliers of the innovation and technology need to be built along the way to achieve the Smart Nation vision,” he says. “We need to grow a new wing for the economy, [and] startups present the fastest and most viable way”. Low’s Accreditation@IDA project grooms local startups and helps them avoid lengthy public sector procurement cycles. It puts them on a fast track because, the easier they can win contracts from government agencies, the quicker they can scale up and provide greater value in the country at large.

GovInsider caught up with Low to find out how the program works, and what it means for government agencies.

How it works

The team has to be careful when accrediting startups. It needs to ensure it’s assisting only viable companies that will deliver for the government and scale up in the economy at large. Its key criteria are “why somebody would buy from you and whether it changes the dynamics for the user”, Low says.

Startups don’t need to have it all figured out, but must show potential - whether the product could disrupt its market, can be scaled up, and has the right management in place. The accreditation team then digs into the nuts and bolts of the company, thoroughly testing the product for bugs. It checks the company’s financials and business model are healthy, and that it has the right internal processes in place to deliver services.

Participating companies must be registered in Singapore, have an annual revenue of less than S$10 million, and own a product that focuses on software. Some of the accredited startups are in data analytics, cyber security, sensors, and robotics, but the program is agnostic to the kind of technology, Low says.

Each accreditation is valid for one and a half years, after which the company will need to be evaluated again. What sets this program apart is that it is not an exam for startups, Low says: “That is something we deliberately veer away from. “[If the startup is not ready], we do not throw them out of the program, but we provide feedback on how they can move into the next stage,” he says. “The philosophy is we will not accredit if they are not at the right standard. We try to keep that bar high because it means something to the user.”

What this does for the government

The accreditation program reduces the risk of agencies losing out when commissioning from startups. This is a key problem in most of the world, where countries are reluctant to take on little companies in case they fail and tend to favor multinationals by setting high capital bars.

“By working with the startups to strengthen their product, processes, team, and financials, we are lowering the risk [for buyers],” Low says. [blockquote]“By working with the startups to strengthen their product, processes, team, and financials, we are lowering the risk”[/blockquote] The program gives startups opportunities to find and fix problems before they face their customers.

A team of specialists works with each startup to test the product and iron out the kinks.

“A startup could find out they have 10,000 bugs that they never knew existed. They then have the opportunity to fix it in a lab environment, and therefore, the product ends up more robust”, he says. IDA has worked with agencies to shorten the government procurement cycle, with accredited startups getting a priority spot in the queue.

“It is not a mandatory buy”, Low says, but accredited companies will need to be considered first. It is then up to the agency to judge whether the product meets their requirements.

This allows agencies to run projects in a more agile manner. “The typical way government procures is acquiring one main contractor who will do everything else for me. But there are other ways where maybe government should build a bit and buy a bit,” Low says.

Governments can break the project down into smaller contracts and work directly with the product owners.

A startup lab

While Low is helping startups grow, his unit also acts like a startup by running its experiments and risks. “We had to pioneer different things within the government.

We didn’t design this in a vacuum and assume it is a great idea. We had to do a lot of testing and ask: ‘Does this make sense for the startups?’,” he says. [blockquote]“We had to pioneer different things within the government. We didn’t design this in a vacuum and assume it is a great idea.”[/blockquote] Even when the program was launched in July 2014, “we weren’t sure how the startups or companies in the industry would receive it. We weren’t sure whether agencies would buy it,” Low says.

The key has been to be “constantly aware”, he says. “The same thing we are trying to tell the CEOs of startups, we apply to ourselves too: Be aware of the real problems, be aware of the stakeholders within the ecosystem, be aware of your unique values and what you are trying to deliver.”

Although Low has moved sectors, his goal has remained constant - finding and supporting startups that will create next-generation technology. As this former investor might note - nothing ventured, nothing gained.