Singapore’s position as the world’s top startup ecosystem has slipped down from number 10 to number 12 in this year’s Global Startup Ecosystem Report, as published by Startup Genome.
The report contributes the move to the entrance of two Chinese cities — Beijing and Shanghai– into the top 10 list.
“Singapore’s performance number are solid and will probably continue to rise as their output and valuation rankings significantly exceed their exit ranking — which is a lagging indicator,” the report explained.
It cited “some concern” as Singapore’s early stage funding growth is “falling behind its peers” at 4.6 per cent (the global average is 5.0 per cent).
However, the city is credited for its strong government support and past global success such as Pie’s acquisition by Google and Grab raising US$750 million of funding. It also scored top position in talent, with Singapore startup founders being the youngest in the world at an average of 30.2.
As for Beijing and Shanghai, one of the leading factors that contributed to the success of these two cities in building startup ecosystems is strong government support, particularly in form of funding. Not only that venture capital firms are able to file for reimbursement if the startups they invested in fail, startups also receive rent subsidies for up to US$30,000.
Beijing debuted its entry to the top 20 list at number four, and the city was also crowned at the second largest concentrations of unicorns, as it has produced 24 unicorns until now.
It also indicated the second highest number of early stage funding per startup in the world, trailing only Shanghai, and had 11 per cent of global early stage investments and 10 per cent of global exits.
At number eight, the report dubbed Shanghai as having “no major weakness” as a world’s leading startup ecosystem.
Apart from the three cities, another Asian startup ecosystem that made it to the top 20 is Bangalore, which had fallen from number 15 to 20. Despite its fall, the report stated that Bangalore’s statistics are “still impressive.”
The city scored relatively low in the number of exits it has produced.
“This indicates either that Bangalore has a very bright future as these startups mature, or that there is trouble at the top of the market with acquisitions,” the report explained.
Bangalore also faced challenges in terms of access and quality.
“Engineers haven’t been hired very quickly, experience is average, and visa success is low –but the bang for the buck is still hard to beat as Bangalore’s engineers are some of the most cost-efficient in the world,” the report stated.
Topping the list is Silicon Valley, followed by New York City and London.
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