IN RECENT years, the annual listing of start ups to watch in Singapore have focused on their ability to pull in investors’ cash.
According to a local top 20 start-up list for 2015, the top three companies in terms of funding attracted were Fastacash, Carousell and Paktor while in 2016, they were Mesitis-Canopy, Vanitee and Coassets.
One common theme across these companies and all the other top-ranked start-ups is that they leverage on technological developments like Internet platforms, mobile solutions and social media networks to create a new business.
For instance, Fastacash provides a global Internet platform allowing users to transfer value such as money along with content through social networks and messaging platforms. Carousell allows users to create free listings on its online platform to sell things. Mesitis, a wealth management fintech startup, offers Canopy, an automated aggregation and porfolio visualization platform. Vanitee is an online community marketplace for quality beauty services from sought-after independent and emerging artists.
While leveraging on technology can get a business started, it is not a guarantee of success. In fact, none of the companies on the top-20 lists of 2015 and 2016 are household names as yet.
It is still early days for all of them, but the founders of these start-ups certainly have the tools and the infrastructure to get their businesses up and running. To be successful, these companies invariably have to think about forging strategic partnerships that are relevant to their business.
Forming Business Partnerships
For instance, Uber and Airbnb have had enormous success because they leverage on the sharing economy where owners rent out something that they are not using like a car or an apartment. In essence, Uber and Airbnb forge partnerships with owners of cars and apartments, respectively.
The local start-ups may find growing their businesses challenging if they are not able to find a way of partnering with others to grow their business. These partnerships can be in terms of building a wider customer base or sharing technology capabilities towards a common outcome.
They could follow the lead of Fastacash, which won the Singapore Open category of the inaugural MAS Fintech Awards in 2016. In February last year, Fastacash announced a strategic cooperation agreement with Hungary-based mobile wallet provider Cellum to help expand its global reach. Cellum helps Fastacash to reach out to customers in markets like Japan, Thailand, Austria, Bulgaria and Hungary.
The lesson to be learnt from Fastacash is that start-ups cannot only depend on their own technology to grow their businesses.
Among the best types of strategic partnerships are those that can open up a company to a new base of customers that they would have not reached otherwise.
Who To Sell To?
When a start-up is formed, one of the earliest thoughts founders or principals have is typically “Who are our customers?”
An equally important question should be “Who can we partner with to expand our customer base?” That has to be given credence right from the offset.
For Singapore-based start-ups, this is crucial as the local market is small. To grow, portability of businesses across borders is important. Technology naturally helps in this task. So, if you want to identify a Singapore start-up that will become a household name in the next few years, you have to ask yourself, can it find partners that will grow its global reach. If it can, then that start-up will be one to watch.
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