Startup Hub Singapore partners with Japan to attract Japanese entrepreneurs as both countries aim to develop unicorns

SINGAPORE — Singapore is boosting its status as a startup hub by attracting startups from different countries and regions and supporting their growth, rather than just providing funding. The governments of Japan and Singapore have begun working together to encourage Japanese startups to expand overseas.

Red Dot Drone PTE, Ltd., a company that develops software that controls automated drone flights, has been based at Block71, a startup support center at the National University of Singapore, since its founding in 2017. The company has about 10 employees, with Thai and Singaporean workers as well as Japanese, said co-founder Akira Hirakawa, 41.

Block71 brings together managers from around 30 companies that work on software development for customer management systems, among other things. The managers are of various nationalities, including Australian, Chinese and Malaysian.

“It’s stimulating because we can exchange information about customers and investors. I often get tips for my business from conversations with others,” Hirakawa said.

Many startups have found growth in Singapore. Grab, the developer of an app that offers both ride-hailing and food delivery services, is a typical example. Entrepreneurs from home and abroad are flocking to the country. According to the Singapore government, startups will have raised $11 billion (about ¥1.74 trillion) in the country in 2022, surpassing the estimated ¥800 billion raised in Japan.

Behind the startups’ success are the Singaporean government’s efforts to actively promote entrepreneurship. The government provides subsidies of up to 50,000 Singapore dollars, or about ¥5.9 million, to entrepreneurs and offers offices that can be rented at a low price. The government has also introduced visas for foreign entrepreneurs and offers tax breaks for investments in newly established startups.

In April, the Japanese and Singaporean governments agreed to set up a platform for the two countries to work together to support startups in order to accelerate the expansion of Japanese startups. By tapping into Singapore’s expertise, the platform will provide opportunities for entrepreneurs to meet investors and help them expand overseas through investment firms affiliated with the Singaporean government. The two governments aim to develop unicorn startups, or companies with an enterprise value of at least $1 billion, or about ¥160 billion.

Singapore’s Minister for Labour and Second Minister for Trade and Industry, Tan See Leng, has high hopes for attracting Japanese startups. He says: “Singapore and Japan are natural partners to collaborate in deep tech and open innovation.”