Starting up is hard to do: Startups can tap the government’s startup grants as long as they meet the eligibility criteria. Photo credit: Unsplash
At times, starting a business without the requisite funds is like looking for a job when you have no experience.
Not only is it a tall order, but how is one even possible without the other? Unfortunately, we don’t always get to choose how and where we get started with something.
More often than not, it’s make or break, do or die. So if you own a startup, is there such a thing as a startup loan?
The quick answer is no. There isn’t such a thing as a startup loan, especially if the startup is in the pre-revenue stage.
However, the good news is that government-backed project financing or business financing is available.
The definition of a startup is quite broad as it could refer to a young company that is anything between 6 months to 5 years old.
This article will cover two startup grants and the specific type of startups that can apply.
Startup SG Founder (SSGF) grant: Suitable for pre-revenue but high-innovation startups less than six months old that need help with developing an idea and bringing it to fruition.
Startup SG Tech grant: Singapore-based startups that have been registered for less than 5 years at time of grant application, with at least 30% local shareholdings, and a group annual sales turnover of not more than $100 million or group employment size of not more than 200 workers.
There are two tracks to this equity-free scheme – the Startup SG Founder “Train” track (a new track), and the Startup SG Founder “Start” track (enhanced from the existing SSGF scheme).
The “Train” track
Enterprise Singapore (ESG) has appointed Venture Builder and Accredited Mentor Partners (VB-AMPs) to offer venture-building programmes to Singaporeans, such as support for sourcing innovation, turning ideas into scalable businesses, and finding capital, etc.
Eligibility for the “Train” track
Applicants must:
Here are the categories of those who are eligible or ineligible for this track. Apply for a VB-AMP here .
The “Start” track
Entrepreneurs can approach any AMP appointed by ESG with their strong business ideas.
AMPs will identify and recommend applicants for funding support after evaluating the business concept, business model, strength of the management team, and potential market value.
If the application is successful, the AMP will offer advice, learning programmes and contacts. ESG will also disburse a capital grant of $50,000 to the startups – but the caveat is that the startups must raise S$10,000 as a co-match fund to the grant.
Eligibility for the “Start” track
Applicants choose an AMP and submit their pitch decks to it. The AMP will then assess the applicants.
Once an AMP has determined an applicant’s eligibility, it will provide a letter of recommendation to the applicant, which must then be attached in an online application form and submitted to ESG within 2 weeks from the receipt of the letter of recommendation. ESG will inform the applicant and AMP on the grant’s application status.
The grant is open to all SCs or PRs who meet these conditions at the time of application and throughout the grant period:
*All main applicants who are first-time founders are to hold non-zero equity.
**Students who have ongoing academic commitments are not considered full-time committed to the company.
Click here to submit your pitch deck to an AMP.
Check out the list of AMPs here and the list of VB-AMPs here. ESG may onboard more VBs in future.
If you have received a Letter of Recommendation from an AMP, you may submit an application to ESG here. Incomplete applications will not be entertained.
SSGF grant recipients can submit documents for the second tranche of disbursement here
Read more about the SG Startup Network or check out the frequently asked questions.
This is a competitive grant that aims to provide applicants with better cashflow. Applications received from 1st August 2017 will be awarded after the completion of each milestone, instead of by reimbursement.
The grant also has an equity component, where ESG will have the rights to exercise a share subscription.
It aims to encourage the development of proprietary tech solutions, and kickstart the growth of startups based on proprietary technology and a scalable business model.
Proprietary technology ideally involves intellectual property (IP) or intellectual assets (IA). It refers to a combination of processes, tools, or systems of interrelated connections that may have been derived from research institutes, institutes of higher learning or public health institutes.
Through the Startup SG Tech grant, companies may be eligible to receive early-stage funding for the commercialization of proprietary technology.
The grant also supports Proof-of-Concept (POC) and Proof-of-Value (POV) for the commercialization of innovative technologies. Startups may apply for either of them – depending on the stage of development the technology or concept is in.
Eligibility
Your solution must:
Startups must:
Your project must fall into one of the two categories below:
Proof-Of-Concept (POC) Project
Your solution is at the conceptualization stage, with its technical or scientific viability still unproven. You must be able to explain the innovative science or technology concept behind the solution.
Proof-Of-Value (POV) Project
You already have a technically or scientifically viable concept (POC available), and want to further develop a working prototype to validate the commercial value of an established concept.
Startups must inject an increase in paid-up capital of 10% and 20% of the grant for POC and POV respectively. This replaces prior restrictions on the supportable costs. The grant cap for POC will remain at $250,000 and POV at $500,000.
Your project should fall under one of these areas.
Points to note:
Application
There are three stages for Startup SG Tech:
Stage I
Interested startups should submit a summary of the proposed project.
Download this form, fill in the required fields and submit your completed form as an attachment. ESG will inform you of your project’s eligibility.
Stage 2
If accepted, ESG will ask you to submit an application comprising the Startup SG Tech Proposal Template full business proposal and cost breakdown.
Stage 3
Shortlisted applicants from Stage II (both POC and POV) will present their proposals to a final evaluation panel of industry experts. The decision of the evaluation panel is final.
Read the frequently asked questions here.
Startup SG is a handy site and resource for startups. It offers information on all the funding support and grants that are available to startups and founders, investors, as well as incubators and accelerators.
Read more about the various initiatives for startups here.
If your startup doesn’t qualify for any of these loans and grants, sign up on Lendingpot – and reach 45 of our partner lenders at once when you send in your loan application for free.
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Belinda loves thinking about random stuff, and collecting useless bits of facts and trivia. She often roots for the underdog, and believes the world needs more happy endings.
