SPRING today announced that another 21 companies have been awarded the TECS POC and POV grants. To recap, TECS stands for Technology Enterprise Commercialisation Scheme (TECS) – a S$75 million programme launched by SPRING in April 2008 “to provide technology start-ups and enterprising public-sector researchers” (i.e. A*STAR) with early-stage funding support to R&D projects either at the Proof-of-Concept (POC) or Proof-of-Value (POV) stages. The POC grant seeks to develop technology ideas early on from the conceptualisation stage by providing full funding of up to $250,000, while the POV grant provides 85% co-funding up to a maximum grant of $500,000 to further R&D and develop the POV or first working prototype – generous grants that possibly fills the widely-known market gap in Singapore’s early-stage financing.
SPRING TECS 2009 Brochure
Facts & Figures
To date, a total of 38 companies have been awarded the grant – 17 in the first grant call (although the press release for the first call only reported 16 winners) and 21 this (second) time round.
Apart from the identities of the winning companies (hooray for you guys!), the other most significant announcement by Phillip Yeo was the removal of the periodic nature of TECS’ grant calls. Instead, “entrepreneurs and start-ups can submit their proposals to SPRING at anytime.” According to Chairman of SPRING, Mr. Phillip Yeo, this tweak will allow the TECS scheme to be more responsive to the needs of our entrepreneurs and start-ups. For more details, check out the 1st call winners and here for the 2nd call winners.
The 2nd TECS grant call also represented the first time that the grant was made available to companies in the Infocomm space.
For you Americans, Infocomm = the approximate equivalent of TMT. I say approximate, because a closer look at the TECS brochure reveals that Interactive Digital Media has been excluded – probably because MDA has an equivalent for IDM-related projects. SPRING reported that more than half of the 220 proposals came from the Infocomm (ICT) sector. Other sectors (that had gone ahead in the 1st call) include Electronics, Photonics & Device Technologies, Chemicals, Advanced Materials & Micro / Nanotechnology, as well as Biomedical Sciences. Given the heavy representation of ICT among the applications (and I don’t think it was entirely due to pent-up demand), I only wonder why ICT was excluded in the first place.
Awarding grants to 21 out of 220 proposals translates into a rate of slightly under 10% – almost 10 times more generous than that of private-sector VCs. Anecdotal VC sources tell me it’s about 1%, or 1 deal invested for every 100 companies seen.
I don’t have figures for angel investors – the more relevant group since they invest in earlier stages than most VCs do – but I doubt they invest 1 out of every 10 business plans they see either. Still, with their diametrically opposed objectives (government- support innovation; VCs and angels – make money), the added generosity by the government is not surprising, and perhaps welcomed.
A total of S$14 million has been awarded to 38 projects (averaging S$368k per project/company) over a period of 14 months (averaging 2.71 projects per month)
With an estimated remainder of S$61 million in TECS’ kitty, going by awarded amounts so far, I am estimating we’ll see anywhere between 140 – 180 projects dished out until the budget is expended. With the lifting of periodic grant calls and acceptance of applications by SPRING all-year round (how I wish the Great Singapore Sale wasn’t restricted to just June as well), I fully expect the award rate to pick up over the rest of the year.
Transparent Selection Criteria
I extract from the TECS site/press release the following selection criteria for the TECS grant for reference by interested parties.
What are the criteria for selection?
As a guide, the proposals would be evaluated against the following criteria:
1. Strength Of The Scientific / Technical Idea
* Level Of Originality/ Inventiveness/ Novelty
* Technical Feasibility Of Project
2. Ability To Successfully Carry Out The Project
* Scientific / Technical Capabilities Of Development Team
* Business Competencies Of Management Team
* Conceptual Framework, Design And Methodology
* Access To Relevant Resources (Eg. Specialised Laboratories & Equipment)
3. Commercialization Potential
* Potential Manufacturability / Scalability
* Potential To Attract Further Funding & Market Demand
* Defensibility Of Intellectual Property
4. Economic Benefits To Singapore
A Viable Solution for Singapore’s Early-Stage Funding Gap?
What are your views about this grant scheme? Can this be a good alternative to early-stage funding? How can this programme be improved further to select more commercially viable projects? What sort of success criteria/KPIs should the programme be tracking?
Let me know your thoughts!