Making the power dynamic work takes good communication, good planning and the proverbial top-down approach

This article was co-authored by Prasad Vanga (Founder & CEO, Anthill Ventures) and Ms Lim Seow Hui (Director, Startup Development Division, Enterprise Group).

Corporations today have to innovate to stay relevant. Understanding this, many global corporations run internal programs and initiatives. However, these tend to be incremental innovations, which are important but not game-changing.

To achieve more ambitious innovation goals, large organisations must have the right talent, an innovation-centric culture, and the necessary enablers and processes to fulfil these aspirations.

Startups, on the other hand, have the single-minded goal to solve specific problems through constant technological innovation. This razor-sharp focus, strong internal team alignment, and agile development allow startups to innovate with speed.

There is, therefore, a compelling reason for corporates to work with startups to co-innovate.

Consider the power dynamics between corporations and startups

On one hand, we have the corporation’s ability and vast resources to achieve scale, and on the other hand, we have the startup’s ability to create rapid and value-creating disruptions.

Also Read: Cryptocurrency platform Liquid.com closes the first part of Series C funding, seals unicorn status

While they usually view each other as David and Goliath, there exists a synergy between them and they should explore collaboration. A structured program could extract most of the innovation potential through this collaboration.

Start from the top

The proverbial top-down approach is extremely crucial to percolate the vision down from the corporate leadership to the rest of the organisation. Carefully-designed programs involving the leadership and relevant business units will help craft the vision better and achieve the desired outcomes. The corporate could work with partners that are able to facilitate the co-innovation process.

It begins with an independent innovation audit to identify gaps that need to be addressed. Those gaps must be aligned with the corporate vision and strategy, thereby maximizing strategic impact. The corporate must then embark on the process of clearly defining the problem statements and gaps.

Three phases of corporate-startup collaboration programs

The program for such corporate-startup collaboration typically has three phases: design, build and operate.

At the design phase, it’s important to plan for internal resources such as budget, staff, infrastructure, operating model, legal documentation, and governance mechanisms, as well as external resources such as mentors and other industry partners.

During the build phase, key staff members are inducted into the program who will build and detail the program aspects such as using case creation, startup sourcing process, and relevant marketing efforts.

During the operating phase, the designed plan is executed along with the startup cohort. Some programs conduct carefully-curated business interventions that are aligned with specific business gaps. Periodic audits and reviews are required to assess the cohort’s progress and administer necessary course corrections to the program.

Good communication is key

Communication – both internal and external – is key to the program success. For the corporate that is engaging the startup ecosystem for the first time, it is crucial for the leadership to pay attention to communication.

Positive reinforcement after every success during the program helps everyone to rally around the new process of collaborative innovation. Portraying the appropriate public image is also necessary to attract the right startups and partners.

As this article is not meant to be an exhaustive list of the ingredients for a successful corporate-startup collaboration, these three ingredients have been identified as most essential.

Singapore offers a good location for co-innovation

Singapore is the gateway to the rapidly developing Southeast Asia region, with a population of more than 600 million people that is relatively young. Furthermore, the startup ecosystem in Singapore is ranked highly, with more than 150 VCs and over 100 accelerators and incubators on this tiny island.

Also Read: He scored poor grades at school, landed first job through nepotism, and is now a successful entrepreneur

In addition, Singapore has more than 5000 MNCs that have set up an office here and a number of them are involved in co-innovation. Enterprise Singapore supports the ecosystem through its Startup SG initiatives.

In 2018, L’Oreal launched the L’Oréal Innovation Runway, a partner competition with SLINGSHOT, a global startup competition. As a SLINGSHOT judge, L’Oreal was exposed to the many startups that took part in the competition and was able to pick out interesting startups to work with. They also piloted a co-innovation programme to work with startups based in Singapore.

Home-grown ST Engineering launched an engineering-based incubator, Innosparks, that aims to address needs in mobility, energy, and healthcare. It provides startups with up to S$500,000 (US$369,000) in funding, co-working space and includes access to ST Engineering’s expertise and networks.

With an increasing number of exciting and innovative startups in the region, a track record of corporate innovation, and the availability of partners who understand how to run co-innovation in Singapore, companies can consider Singapore as a strong base for such collaboration.

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About Lim Seow Hui:
Armed with Bachelor in Electrical Engineering from NUS and a stint in the Human Resources industry, Ms. Lim Seow Hui joined SPRING Singapore’s Industry Development Group in 2008 where she managed key SME accounts in the Electronics & Printing Industries. In 2011, she went on to head a team in the Planning Unit where she represented Singapore at international fora on SME-related policies development such as ASEAN and APEC SME Workgroups. Seow Hui is now the Director of Enterprise Singapore’s Startup Division where she works closely with partners from the startup ecosystem to further strengthen the community.

About Prasad Vanga:
Prasad Vanga is the founder & CEO of Anthill Ventures, a speed scaling platform for early growth stage startups. Within four years, Anthill has built a startup portfolio of 30 companies across India, US and SE Asia that has grown by 3X in portfolio value. In his current role, Prasad leads the strategy, fund management and venture building at Anthill. Prasad has over 18 years of experience in helping senior executives from large organizations like Symantec, Nike, Nestle, Novartis, Wachovia, HSBC, and YES Bank to drive business transformations. His expertise is to help senior leaders discover the core competence of their organizations and design a change management framework that allows them to leverage their culture to drive large transformations. Prasad also has the experience of an Entrepreneur who built a $25M company within 3 years and as an Investor, he has backed several successful companies like Medplus, Zenoti, and Tynker which provided exits of >12X.

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The venture capital arm of Thailand’s Siam Commercial Bank participates in Pagaya’s Series C funding

Thailand-based Digital Ventures, the VC arm of Siam Commercial Bank, has returned to join the US$25-million Series C funding of Israel-based AI-powered asset management firm Pagaya, as reported by Deal Street Asia.

This round was led by US-based venture fund Oak HC/FT and besides Digital Ventures, participating in the round were seed investor Viola Ventures, Israeli insurance firm Clal Insurance Ltd, New York-based GF Investments, and former American Express chairman and CEO Harvey Golub, all has participated in Pagaya’s Series B round in August 2018 raising US$14 million.

Pagaya said it plans to use the funding to develop its technology and pursue new asset classes such as real estate and other fixed-income assets including auto loans, mortgages, and corporate credit.

Using machine learning and big data, Pagaya manages institutional money focussing on fixed income and alternative credit like pension funds, insurance companies, and banks.

The company claims to manage US$450 million for banks, insurance firms, pension funds, asset managers, and sovereign wealth funds.

Also Read: Cryptocurrency platform Liquid.com closes the first part of Series C funding, seals unicorn status

A US$100 million actively managed asset-backed securities (ABS) was announced by the company in February. It will use AI to select and purchase individual loans for the ABS, instead of the traditional ABS mechanics of securitising a pool of previously assembled assets.
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Fintech is set to be a vibrant part of the global financial system, shaping and innovating the world of finance

Contributed by Benjamin Wong, co-founder and CEO of TranSwap

My Fintech idea came to me in 1997, about 20 years ago.

Back then, I had adequate knowledge on the US currency and wanted to hedge it with an FX forward contract but it was exorbitantly costly. Fortunately, I found a friend overseas with US cash, looking to buy Singapore money. We agreed to swap our currencies at an agreed mid-market rate and that’s how the idea of cross-border FX swapping model came to me.

However, the internet, technologies and regulations were not suitable for fintech innovation back then and I dropped the idea.

Fast forward 20 years later, I finally took the plunge to establish TranSwap, a cross-border payments platform for businesses.

What has changed since then?

Major regulators in respective countries are now beginning to allow fintech companies to operate in the regulated space by providing a fintech-friendly environment and the relevant licenses to operate.

In the United Kingdom, the Bank of England has extended direct access to real-time gross settlement systems (RTGS) accounts to non-bank service providers, giving them direct access to key payment systems.

In Europe, the Bank of Lithuania has given non-financial institutions access to Single Euro Payments Area (SEPA) through their own infrastructure, enabling non-financial institutions to innovate and serve their customers directly, avoiding the need to rely on brokering services of many traditional commercial banks.

Closer to home, Hong Kong is poised to issue the city’s first virtual banking licence by the end of 2019, and Singapore is exploring opening up its real-time, round-the-clock payments system, known as FAST, to Fintech firms to broaden access to various payment players.

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Even in Japan, their regulator has announced that it will allow non-bank companies to handle money remittances of over 1 million yen (about US$9,000), lifting a limit that has previously prevented start-ups from providing faster and cheaper services in an area dominated by the banking sector.

Evidently, the payments environment has evolved from a stricter space to a much friendlier one, and the tide is rolling in favour of fintech.

The Cross-Border Payments arena is currently a US$22 trillion market. 80 per cent of these payments are B2B related, with banks currently dominating 95 per cent of this market; banks are still the default option most people and companies for cross-border payments.

With fintech’s leaner operations and utilisation of technology to facilitate such cross-border transaction, companies like TranSwap are able to offer an enticing alternative that is more cost-effective, and quicker too.

As fintech continues to inspire more innovative solutions, it would prove to be challenging for banks to maintain the overwhelming majority in these transactions at current specifications.

With all these deviations from the once traditional and comfortable methods with financial institutions, the disposition has shifted massively from a business-centric view to a consumer-centric perspective with the focus centred squarely on customers’ needs.

Collaboration is key for growing the market

As famous Fintech evangelist Dan Cobley said, the future of innovation in finance will be driven by partnerships between fintechs, who bring innovation, and incumbents who bring distributions.

Essentially, while financial institutions are stable and strong, fintech firms are versatile and offer refreshing ideas.

Financial institutions have a great infrastructure that has been built over many years. This allows for a strong brand recognition with established trust among their consumers. Fintech companies, on the other hand, may not have such strong brand recognition at the start compared to financial institutions.

However, what fintech lacks in it makes up for in an innovation-oriented mindset, agility, consumer-centric perspective and flexible infrastructure created for digital. Financial institutions, on the other hand, are big ships, difficult to manoeuvre, and weighed down by heavy cost-structure and huge staff count that restricts their ability to quickly implement new processes.

But together, they can create new opportunities and fill new market gaps to expand the market.

For example, at TranSwap, we are working with certain local and international banks, not just as a usual banking customer, but partnering to develop innovative financial products and expanding our customer base together with them.

What lies ahead

In the next 10 years, we believe fintech will be a vibrant part of the global financial system. It will take on a major role in shaping the industry and leading the way for innovative financial solutions.

Also Read: Thai VC Digital Ventures invests in Israeli fintech startup Pagaya

Some Fintech companies will eventually become a virtual bank, while some will collaborate with financial institutions and many will thrive in their own area of niche service. It will not be a ‘winner takes all situation’ — the market is huge enough to accommodate those who continue to innovate with customer-centric products.

I look forward to the next 10 years!
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More about Benjamin Wong: 

Having worked in senior management roles in a range of industries, Benjamin is familiar with the issues of settling overseas payment and has now committed himself to help other businesses simplify their FX payments by establishing TranSwap, a cross-border payments platform targeted at businesses. TranSwap is also on the Networked Trade Platform—a Singapore Government initiative—as a Value-Added Service offering local importers and exporters seeking to make payments internationally a cost-effective and convenient solution.

TranSwap offers the most competitive rates through its proprietary online transaction portal and a wide network of FX partners to enable businesses to fulfil payments overseas at the lowest cost efficiently.

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A solution in search of a problem has put Singapore at number one on yet another list — overreacting to fake news

In the startup world, we are familiar with the idea of creating a solution in need of a problem. We are also familiar with the idea of our solution creating a brand new problem.

This week, the Singapore government seems to be enthusiastically passing a fake news law that creates more issues than solutions.

The new law gives immense powers to individual Ministers and has led to widespread concern within Singapore (no, it’s not just international folks projecting their ideals onto the city).

Ministers can individually flag “fake news”, where it will then be arbitrated in court — a ridiculously idealistic scenario with no basis in how media works. Furthermore, it gives expediated rights to request corrections or removals and makes it nearly impossible for media to fight back in a timely manner.

Finally, the law applies to all stories about Singapore, whether or not it originated in the city-state.

It is important to mention that Singapore does not have free speech protections and never has shown any intention of embracing dissent. This new law does not particularly change anything legally, but rather it speeds up the process — and creates a situation where the article comes down first, and then is adjudicated later.

The logic is the same as the procedure behind nuclear weapons: the Executive gets carte-blanche decision-making powers because the situation moves too fast for traditional government avenues. It’s fair enough. A lie travels halfway around the world before the truth has put on its trousers.

The problem comes in the grey areas. It tilts the legal power so heavily in one direction that the process is no longer a fight for truth but just plain ol’ censorship.

What has been fascinating about the roll-out of the law is the accompanying PR blitz. We regular folk here in Singapore have been inundated with articles explaining why this is necessary — usually quoting a politician with skin in the game. It almost feels as if the government knows this is a terrible law but is trying to convince itself, and thus the constituents, otherwise.

The scary part is that law is not government policy. It will be around a lot longer than the Ministers who pass it and while this crop of lawmakers may have benevolent intentions, it is written in such a manner that it can be easily abused by a rogue Minister or a new regime with less altruistic intentions.

As pointed out in a fantastic explainer written by Cherian George, the law provides an avenue for the government to leverage pedantic errors or differences in perception to request a full takedown.

The law provides an avenue — the courts — for a journalist to challenge the takedown request, but that is an unrealistic solution. Journalists have deliberately chosen a life of low-pay and a lot of media companies can’t afford the legal fees necessary to take a fake news case to the High Court.

If the journalist loses a case they could be fined S$20,000 (US$14,800) and face a year in jail.

It also puts responsibility on tech companies like Twitter and Facebook to clamp down on fake news with fines up to S$1 million (US$740,000).

The law is wilfully placing faith in companies that have failed miserably in markets that are much more important to their bottom line. If Facebook can’t figure out fake news in America, there is no chance it will do so in Singapore.

Alan Soon, of Splice Media, pointed out on Twitter, that the law transforms tech companies into agents of government policy. It is a valid point, but as someone who watches tech closely, the reality more likely to be like the television show “Veep” whereby failures in corporate policy are defined more by incompetence than malevolence.

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The problem nobody is talking about is self-censorship, a much more serious issue than fake news. Fundamentally, when, not if, this bill passes, it is unlikely to change much of what the public sees. What it will change is what the public does not see.

Self-censorship, more than fake news, is a real problem across the globe. It is a means for authoritarian entities (often corporate) to wilfully keep their people ignorant in an effort to achieve a goal (be it power, money or fame). Even in countries that support free speech, financial and political incentives often result in stories being killed.

Fake news, on the other hand, is a peculiarity of our times; just like penny presses in the 18th century,  Yellow Journalism in the late 19th century and the rise of partisan political news at the end of the 20th century.

The public should ask itself how many stories will never threaten this law because they were killed long before they even had a chance. In a corporate media structure like SPH or Mediacorp, that number is going to be higher than we’d care to admit.

Take, fore example, the debacle around 38 Oxley Road. How would that have been handled if some intrepid reporter had the scoop instead of a Singaporean princeling? Would Mediacorp or SPH really have published that story? Maybe I am cynical, but I seriously doubt it.

As said Tim Harford in his article,“Why there is no need to panic about Fake News”:

“It is all too easy to turn legitimate concerns about false information into a situation where the government decides what can be said and who can say it. We need to be careful that the cure is not worse than the disease”

Plus, Singapore does not have a fake news problem. This is exemplified by the necessity to cite foreign cases and one (ONE!) domestic case of an article that went mildly viral and had zero actual impact on society.

(If I am going to be a real jerk about it, 1,716 shares, 754 reactions and 157 comments does not qualify for the word “viral”).

Again, a solution in search for a problem. At this point, the government might as well use blockchain to create a smart contract and make sure the law is real.

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Finally, and it is crucial to point out, the term ‘fake news’ has been bastardised (thanks largely to Donald Trump) and most people do not fully understand what it means. A project from the University of Hong Kong is working to educate the masses on what fake news actually looks like, and readers will quickly realise there is a huge gap between perception and reality.

Companies like MSNBC or Fox News tilt in certain directions, and that is problematic, but they do not traffic in fake news. Fake news, by definition, is creating a fantasy story.

Fake news is claiming Hillary Clinton was operating a human trafficking organisation out of a Pizza Parlour. It is NOT suggesting this new law is an embarrassing slip up for a country that has grown into one of the most admired cities in the world but still is still dragged down by perceptions of having an overbearing, stifling, government culture.

This is not to say that fake news is not a problem, but of all the issues that plague our modernity, it is very low on the list.

The law being tabled is the definition of, “cutting off your nose to spite your face” and Singapore is providing a model for copycat authoritarian governments across the world.

Congratulations.

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Starting a small business is one thing, but sustaining it is a whole new ballgame

Let’s say you had a great idea to start your own business and you’ve successfully managed to do just that.

Well, congratulations but that’s just the beginning. There’s a lot of planning required before setting up a business.

However, once the business starts, it’s a completely different game altogether.

Growing a business takes both effort and planning. You need to make sure that everything is perfectly in line once you start off. As a small business owner, there will be hundreds of things on your mind, even after you’ve set everything up.

Here’s every step that you need to take just after starting your business.

1. Start off on the right foot

It is extremely important that you start off your business on a strong footing. While this won’t guarantee that your business will succeed, it will definitely reduce the chances of failure.

Make sure that you have a second stream of income flowing when your business starts. You will need money to sustain it until the business takes off. Having a continuous flow of money also reduces the need to borrow.

Conduct thorough market research to get a better understanding of your industry and your target audience. You must also pay attention to your legal and tax issues. Get them in order right from the get-go and you’ll have fewer headaches and responsibilities later.

You must also be ready with professional materials such as business cards, email addresses, and a business phone number.

2. Delegate work

It’s common to see entrepreneurs who think that they can do everything on their own. However, you need to learn how to delegate work to your employees and trust them with it. This will not only ensure that the work is done efficiently but it will also give you time for more important things.

Remember, employees are the very foundation of your small business. Make sure that you hire the right team for your business. While you should definitely take the skills of employees into account, it will also help if you get along well with them. This will ensure that the work environment remains both productive and fun.

You should also get support and advice from your friends, family, and mentors. This will help you broaden your vision. And don’t try to save money doing the jobs you aren’t qualified to do. For instance, if you need help with accounts, hire an accountant to do it. You may lose out on a lot of other things trying to do their job.

3. Build your web presence

No business can get ahead without having a web presence nowadays. Your web presence shouldn’t be limited to just having a website. You need to be proactive to ensure that people who search for relevant things in your industry find you.

For this, you should first build a website and get it listed on the search engines. Once that is done, you can start putting an effort into search engine optimisation. Using advanced SEO techniques, you can improve your search rankings and get more traffic.

Also Read: He scored poor grades at school, landed first job through nepotism, and is now a successful entrepreneur

Along with this, you should also establish your presence on social media. With over 2 billion monthly active users, Facebook is the largest social network in the world. You should take advantage of this tremendous audience on social media.

By establishing a social media presence, you can interact with your customers on a more personal level. You can even keep them up-to-date with the latest happenings in your business. Additionally, you should connect your website to your social media profiles. This can help you get traffic on your website as well.

4. Reduce your overhead

You should create a budget for your business so that you can keep track of your expenses. Then you’ll be able to find unnecessary expenses that may be burning your cash. You can then find a way to reduce those expenses and use that money to push your business further.

For instance, if you have an office space that isn’t being used much, you can use a co-working space. There’s also the option of working from remote locations virtually. This can help you save on office rent and probably offer more competitive prices for your products or services.

5. Connect with other businesses

You also need to start building contacts and connections with both your customers and other businesses. Make sure you visit your competitors and introduce yourself and your business. It’s a good idea to even refer customers to them when it makes sense to do so.

As they are more experienced in the industry than you, they can provide valuable insights and advice. While they may be your competitors, each business has its own specialisation and niche. You must give them credit for the things they do instead of fearing them. There are good chances that it will be reciprocated from their end too.

6. Create thoughtful content

To become an authority in your niche and industry, there is no better way than to create high-quality content. Thoughtfully crafted content can win the trust of your potential customers. When this does happen, they will be more likely to support your business and sometimes, even refer it to others.

Also Read: The world should wish the Singapore fake news law is Fake News

Good content can also get you some publicity. When the content is shared by people or gets featured in a publication, you’ll reach a wider audience. Becoming a respected voice in your industry can help your business succeed.

Content doesn’t necessarily have to be limited to blog posts and webpage content. You can create videos, infographics, case studies, webinars, and more. It’s also a good idea to write guest posts on blogs of other notable websites in your industry.

Final thoughts

Starting a small business is no easy task. You need to plan and execute everything with thorough perfection. By hiring a good team and building a strong presence both online and offline, you can help your business grow.

You need to judiciously use your capital and make the most out of your available funds too.

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Photo by Heidi Sandstrom. on Unsplash

e27 publishes relevant guest contributions from the community. Share your honest opinions and expert knowledge by submitting your content here.

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