NUS Entrepreneurship Centre GEM 2006 Singapore Findings

NUS Entrepreneurship Centre

Global Entrepreneurship Monitor Study
GEM 2006
Global Entrepreneurship Monitor Study
Highlights on Singapore
GEM 2005
FEBRUARY 2007
Highlights on Singapore

1


GEM 2006
Singapore Research Team

Prof. Wong Poh Kam
(PohKam@nus.edu.sg)
Ms. Lena Lee
Ms. Ho Yuen Ping

2


GEM Singapore 2006

Overview of
GEM Research Methodology

3


Overview of GEM Singapore 2006
An annual GEM cross-national assessment of the level of
entrepreneurial activity.
10 countries in 1999, 21 in 2000, 28 in 2001, 37 in 2002, 31 in 2003,
34 countries in 2004 and 2005, and 42 countries in 2006.
For Singapore, this is our seventh year of participation.
NUS Entrepreneurship Centre was invited to carry out the Singapore
Country Study since 2000.
Funded by National University of Singapore (NUS) and supported by
Action Community For Entrepreneurship (ACE).

4


GEM Conceptual Model

General National Major
Framework Conditions Established Firms
(Primary Economy)
• Openness (External Trade)
• Government (Extent, Role) National
• Financial Markets (Efficiency)
• Technology, R&D (Level, Intensity) Micro, Small Economic
• Infrastructure (Physical)
And Medium Firms Growth
• Management (Skills)
• Labour Markets (Flexible) (Secondary Economy) (GDP, Jobs)
• Institutions (Rule of Law)
Social,
Cultural
Entrepreneurial
Political
Opportunities
Context
Entrepreneurial
Framework Conditions
Entrepreneurs Business
• Financial Opportunity / Necessity Churning
• Government Policies
• Government Programmes
• Education and Training
• R&D Transfer
• Commercial, Legal Infrastructure
• Internal Market Openness
Entrepreneurial
• Access to Physical Infrastructure Capacity
• Cultural, Social Norms • Skills
• Motivation

5


GEM Research Methodology & Data Sources
GEM employs 3 approaches:
Adult Population Surveys
2000 adults or more were selected in each country for a
random sampling survey using a common survey instrument.
In Singapore, the survey was carried out in June 2006
(Sample size for Singapore: 4,011)
The results of the analysis are drawn from the responses of
the working age group (18 to 64 years old).
This year, a total of 106,495 individuals in 42 countries were
surveyed by GEM.
6


Country Experts Interviews
Up to 50 key informants were interviewed by the GEM national research
team in each country in 2006 (36 for Singapore).The key informants
include entrepreneurs, investors, government policy makers and venture
support professionals.
The informants were asked to assess the environment for entrepreneurship
in their country along NINE dimensions:
• Financial Support
• Research and Development Transfer
• Commercial and Professional Infrastructure
• Barriers to Entry
• Access to Physical Infrastructure
• Cultural and Social Norms
7



Collection of Secondary National Social-Economic Data for each
country
International benchmark Social-Economic data from World
Bank, World Competitiveness Report
National sources of data on venture capital investment, firm
formation, etc.

8


Key Indicators of Entrepreneurial Activities in GEM 2006

Total Entrepreneurial Activity (TEA) Rate (Early-Stage Entrepreneurship)
• Nascent Start-up vs. New (“Baby”) Businesses
• Opportunity vs. Necessity

Other Entrepreneurship Indicators
• High Employment Growth Potential TEA rate
• Early-Stage Businesses with New Technology
• Early-Stage Businesses with New Markets
• Early-Stage Businesses with Export Markets
• Entrepreneurial Intention Rate
• Prevalence of Business Discontinuation (Exit rate)

Financing for new business
• Prevalence of informal (business angel) investment
9


Key Indicators of Factors Affecting
Entrepreneurship in GEM 2006
Personal Attitudes towards Entrepreneurship
• Know someone who has started a business
• Perceive the skills to start a business
• Perceive good business opportunities
• Do not perceive fear of failure as a deterrent

Perception of Social & Cultural Values for Entrepreneurship
• Perception of entrepreneurship as a career
• Media publicity for entrepreneurship
• Preference for uniformity of living standards
• Perception of status of successful entrepreneurs

Assessment of National Environment for Entrepreneurial Activities
• Rating on 9 dimensions of national environment for entrepreneurship by
selected key informants
10


GEM Singapore 2006

Core GEM Indicators Findings

11


GEM 2006 Singapore – Nascent Start-Up Prevalence Rate
* Definition *
This variable attempts to measure the proportion of working age
adults (age between 18 to 64 years old) in a country who is
actively engaged in starting up a new business.
To meet the criteria for this variable, the respondent had to
fulfill each of the following criteria:
if they had done something – taken some action – to create a
new business in the past year.
they expected to share ownership of the new firm and
the firm had not paid salaries for more than 3 months
12


GEM 2006 Singapore – New Business Prevalence Rate
* Definition *
This variable attempts to measure the proportion of working age
adults (age between 18 to 64 years old) in a country who are
currently running a new business (as opposed to trying to start one).
To meet the criteria for this variable, the respondent had to fulfill
each of the following criteria:
they are currently managing a new business.
they personally owned all or part of the new business.
the firm was started in year 2003 or later (this meant that the
business was, at most, 42 months old in June 2006).
13


GEM 2006 Singapore – Total Entrepreneurial Activity (TEA)
Or Early-Stage Entrepreneurship
* Definition *
TEA is the sum of
(1) the propensity of individuals involving in the start-up
process (nascent entrepreneurs) (start-up prevalence rate)
and
(2) the propensity of individuals engaging as owner-
managers of firms less than 42 months old (new business
prevalence rate)
Those that qualified for both are counted only once.
14


GEM 2006 Singapore – Necessity / Opportunity TEA
* Definition *
There are two major motivations for individuals to participate
in entrepreneurial activities.
(1) “Opportunity Entrepreneurship” - those who voluntarily
seek to pursue a perceived business opportunity and
(2) “Necessity Entrepreneurship” - those who become
involved in starting up a new business as a last resort, when
other options for work or participation in the economy are
perceived as absent or are considered unsatisfactory.

15


GEM 2006 Singapore – Total Entrepreneurial Activity (TEA)
Or Early-Stage Entrepreneurship
Among the OECD countries falling in the same income band as
Singapore (including USA) that participated in both the GEM 2005 &
2006 surveys (16 countries), the overall TEA rate has decreased
slightly from 6.4% in 2005 to 5.9% in 2006.
Singapore ranked 16th among the 22 OECD countries with a TEA of
4.9% for 2006, lower than 7.2% in 2005 and 5.7% in 2004.
Among the subset of 21 OECD countries that participated in both
GEM 2005 & GEM 2006, Spore’s relative ranking is lower in 2006
(15th/21) than 2005 (7th/21).

16


GEM 2006 - TEA Prevalence Rate & Rank in OECD
C o u n tr y R a te R ank C o u n tr y R a te R ank

A U S T R A L IA 1 2 .0 1 DENM ARK 5 .3 13
IC E L A N D 1 1 .3 2 M E X IC O 5 .3 14

U N IT E D S T A T E S 1 0 .0 3 F IN L A N D 5 .0 15
NORW AY 9 .1 4 S IN G A P O R E 4 .9 16
GREECE 7 .9 5 FRAN CE 4 .4 17
C Z E C H R E P U B L IC 7 .9 6 GERM ANY 4 .2 18
IR E L A N D 7 .4 7 SW ED EN 3 .5 19
S P A IN 7 .3 8 IT A L Y 3 .5 20
CANADA 7 .1 9 JA P A N 2 .9 21
HUNGARY 6 .0 10 B E L G IU M 2 .7 22
U N IT E D K IN G D O M 5 .8 11
NETHERLANDS 5 .4 12 M ea n 6 .2

Singapore’s 95% confidence interval is 4.3 to 5.5, hence countries ranked
from France to Netherlands are ranked within the same band as Singapore

17


Entrepreneurial Activity Rates – 95% Confidence
Interval, persons per 100 Adults, 18-64 years old.
RATES 95% Confidence Interval

Overall TEA 2006 4.9 4.3 – 5.5
TEA Opportunity 4.2 3.5 – 4.9
TEA Necessity 0.7 0.5 – 0.9
Consistent with findings from previous years, the majority of early-
stage businesses (86%) in Singapore were opportunity-driven.

This is comparable with the 82% average for all GEM OECD
countries.
18

P e rc e n t a g e o f a d u lt p p o p u la t io n b e t w e e n 1 8 - 6 4 y e a rs

0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
B e lg iu m
Japan
S w eden
Ita ly
U . A ra b E m ira te s
G e rm a n y
F ra n c e
S lo v e n ia
S in g a p o re
R u s s ia
F in la n d
M e x ic o

S o u th A fric a
D e n m a rk
N e th e rla n d s
UK
H u n g a ry
T u rk e y
L a tv ia
Canada
S p a in
Ire la n d
C z e c h R e p u b lic
G re e c e
GEM 2006 - TEA Prevalence Rate & Rank

C ro a tia
N o rw a y
C h ile
USA
A rg e n tin a
In d ia
M a la y s ia
Ic e la n d
B ra z il
A u s tra lia
U ru g u a y
T h a ila n d
C h in a
In d o n e s ia
J a m a ic a
P h ilip p in e s
C o lo m b ia
P e ru
19

TEA (Early-Stage Entrepreneurial Activity) Rate and
GDP per capita, 2006
25%
Early-stage Entrepreurial Activity (TEA rate) 2006
TEA rate United Arab Emirates
CO Fitted 3rd order polynomial - Arab Emirates and Peru excluded
JA PH

20% ID
P e rc e n ta g e o f p o p u la tio n b e tw e e n 1 8 -6 4 y e a rs

CN
TH
15%

UY
BR MY AU IS
IN AR US
10%
HR NO
CL
LV CZ GR ES CA IE
UK
TR SA HU FI DK
SG NL
5% MX RU SI FR DE
IT SE
FR UA
JP BE

0%
0 10,000 20,000 30,000 40,000 50,000
GDP per Capita 2006, in Power Purchasing Parities (PPP)

20


TEA (Early-Stage Entrepreneurial Activity) Rate
and GDP per capita, 2005

30%

Early-stage Entrepreurial Activity 2005 Fitted Polynomial Trend (3rd order)

25%
Percentage of population between 18-64 years

VE

20%
TH

NZ
15% JM

CN
CL US
10% BR IS
AU
CA
IE
AR NO
GR SG
MX HR LV ES SW
5% F
DK
ZA B
SI N
SE
HU JP

0%
0 5,000 10,000 15,000 20,000 25,000 30,000 35,000 40,000 45,000
GDP per Capita 2005, in Power Purchasing Parities (PPP)

21


TEA Rate (Early-Stage
Entrepreneurship) and GDP per capita

• There is a U-shaped relationship between TEA & GDP per capita
across countries, with lower income countries and the very high income
countries showing higher TEA rates. For the bulk of relatively
advanced economies falling in the income range of about US$25,000-
US$40,000 per capita PPP, the TEA rates generally fall within the range
of 3-8%
• In 2006, along with Singapore, countries such as UK, Germany,
France, Canada, Italy, Sweden, and Belgium reported a fall in its TEA
rates in 2006 compared to 2005. In addition the USA also experienced
a drop in TEA from 12.4% to 10%.
• For countries that experienced an increase in its TEA rates such as
Denmark and Netherlands, the rates are by and large around the 5%
level.
• On the other hand, the TEA rates for Australia & Iceland have been
exceptionally high at around 10-12%, while Japan’s TEA rates have
been consistently low around 2-3% level.
• Singapore’s TEA rates of 5-7% over the years are within the expected
range for countries in the per capita income range of US$25,000-
US$40,000.
22


TEA (Early-Stage Entrepreneurial Activity) Rate and
GDP per capita among nations in $25,000 to $38,000
income bracket, 2005 vs 2006

14.0%
2005 2006
12.0% AU

AU IS
10.0% IS
CA
8.0%
SG CA
ES
UK UK
6.0% ES FI NL FI DK
IT FR DE FR DK
4.0% SG SE NL
BE
DE
IT SE
JP BE
2.0% JP

0.0%
25,000 27,000 29,000 31,000 33,000 35,000 37,000

23


TEA Rate (Early-Stage
Entrepreneurship) and GDP Growth

• The link between GDP growth and TEA rate is complex,
but there is some evidence that across OECD countries
falling in the same income band as Singapore
(US$28,000-US$40,000)*, higher GDP per capita
income growth is associated with a drop in TEA rates
(Pearson correlation = -.746)
• Likewise, for Singapore over 2000-06, there is a slight
negative correlation between GDP growth and TEA rate
(-.451)
• There also appears to be some correlation between
unemployment rate (+) and wage increase rate (-) and
TEA rate
* Excluding Australia and Iceland

24


Pearson Correlations between TEA
(Early-Stage Entrepreneurship) and OECD Average
Annual GDP per capita PPP growth

OECD Average GDP per capita PPP OECD Average
Growth TEA
2000 4.43 4.04

2001 1.35 6.43

2002 1.45 5.12

2003 1.42 5.15

2004 2.96 4.89

2005 2.39 5.26

2006 3.12 4.76

25


Pearson Correlations between TEA (Early-Stage
Entrepreneurship) and Macro-Economic Factors

Singapore OVERALL TEA TEA
TEA OPPORTUNITY NECESSITY
GDP growth -0.451 0.117 -0.781*

Unemployment Rate 0.238 -0.340 0.289

Wage Increase -0.645 -0.142 -0.759*

* Significant at the 5% level

26


TEA Rates: Summary Findings
The 32% overall decrease in Singapore’s TEA from 7.2% in
2005 to 4.9% in 2006 appears to be across all demographic
groups, although somewhat higher among males, the young and
educated:
– A decrease in New Business Prevalence Rate from 3.7% in 2005 to
2.5% in 2006, and a decreased in Start-up Prevalence Rate from 3.9% in
2005 to 2.7% in 2006. (Note: 0.3% are involved in both new and
nascent businesses)
– A decrease in Opportunity TEA from 6.1% in 2005 to 4.2% in 2006,
and a decrease in Necessity TEA from 1.2% in 2005 to 0.7% in 2006.
– A decrease in Prevalence of Male TEA from 9.6% in 2005 to 6.0% in
2006, and a decrease in Female TEA 5% in 2005 to 3.6% in 2006.
– A decrease in TEA among individuals in all age-groups, particularly
those in the 18-24 years group, which experienced a 52% fall, and those
in the 55-64 years group, which experienced a 45 % fall.
– A 49% decrease in TEA among individuals with Secondary and
Polytechnic education respectively, a 54% decrease among individuals
with JC education, and a 38% decrease among university graduates
27


Summary of Level of Entrepreneurial
Activity in Singapore (2000 – 2006)
2000 2001 2002 2003 2004 2005 2006
TEA 4.2 6.6 5.9 5.0 5.7 7.2 4.9
Opportunity TEA - 5.1 4.9 3.9 5.0 6.1 4.2
Necessity TEA - 1.2 0.9 1.0 0.6 1.2 0.7
Male TEA 5.8 9.7 9.3 6.5 8.2 9.6 6.0
Female TEA 2.7 3.6 2.7 3.5 3.4 5.0 3.6
Nascent 2.3 4.2 4.0 3.0 3.0 3.9 2.7
New Business 1.9 2.4 2.0 2.3 2.8 3.7 2.5
Polytechnic 2.9 4.0 4.2 6.4 8.6 11.9 6.1
University 4.0 9.7 4.1 9.6 10.0 11.5 7.1
Source: GEM Master Dataset 2000 - 2006

28


GEM 2006 Singapore –Business Angel Prevalence Rate
* Definition *
To meet this criterion for operating as an informal investor
(business angel), individuals had to fulfill the following criterion:
they had in the past three years personally provided funds for a
new business started by someone else
public traded shares or mutual funds excluded
Among the 22 OECD countries, Singapore is ranked 8th in 2006
compared to 9th/24 in 2005.

Singapore’s informal investment prevalence rate is 3.0% for
2006, slightly lower than 3.5% in 2005 but higher than 2.7% in
2004. (Note: 95% confidence interval for 2006 is 2.2 to 3.8)

29


GEM 2006 – Business Angel Prevalence Rate & Rank in OECD
8
7
6

5
4
3
2

1
0
Australia

Iceland
United Kingdom
Netherlands

Denmark
Japan

Finland
Spain

France
Singapore
Greece
Canada
Belgium
Hungary

Czech Republic

United States
Mexico

Sweden

Average
Germany
Ireland
Italy

Singapore’s 95% confidence interval is 2.2 to 3.8, hence countries ranked Norway
from Denmark to Canada are ranked within the same band as Singapore

30


GEM 2006 – Informal Investor Relationship
to Investee
%
CLOSE FAMILY 35.3
OTHER RELATIVE 17.7
WORK COLLEAGUE 6.8
FRIEND or NEIGHBOR 34.6
STRANGER 5.6
Total 100
Compared to 2005, there is a significant increase in the proportion of family
and relative investment
31


GEM Singapore 2006

Other Indicators of
Entrepreneurial Activities in 2006

* Key Findings for Singapore *

32


GEM 2006 –High Employment Growth Potential TEA
Definition: High Employment Growth Potential (Aspiration) entrepreneurial
activity rate is defined as new start-ups that indicated they intend to employ at
least 20 people in 5 years. Prior literature has shown that a small proportion of
new businesses eventually contribute the bulk of job and value creation in most
countries; this indicator seeks to focus on such high growth potential ventures.
Comparatively, a larger proportion of Singapore's entrepreneurial activity i.e.
18% or close to 1 in 5 new start-ups exhibits growth aspiration compared to the
average for all OECD countries i.e. 10% or about 1 in 10 new start-ups.
High employment growth potential TEA rate varies from 0.04% for Japan to
2.2% for Iceland.
Singapore’s high employment growth potential TEA rate is 0.9% (vs 1.5% in
2005) (close to 1 in 5 new start-ups), ranking 6th out of the 22 OECD
countries, better than its overall TEA ranking (16th out of 22 countries). (Note:
95% confidence interval for 2006 is 0.7 – 1.1)
33


GEM 2006 – High Employment Growth
Potential TEA Rate & Rank
among OECD Countries
Country Rate Rank Country Rate Rank
Iceland 2.2 1 Germany 0.5 13
United States 1.4 2 Hungary 0.5 14
Ireland 1.3 3 Italy 0.5 15
Czech Republic 1.2 4 Sweden 0.5 16
Australia 1.0 5 Finland 0.4 17
Singapore 0.9 6 Spain 0.3 18
United Kingdom 0.7 7 France 0.3 19
Norway 0.7 8 Belgium 0.3 20
Canada 0.7 9 Mexico 0.1 21
Denmark 0.7 10 Japan 0.04 22
Greece 0.6 11
Netherlands 0.6 12 Mean 0.7

Singapore’s 95% confidence interval is 0.7 to 1.1, hence countries ranked from Denmark to Australia are within the same band as Singapore

34


GEM 2006 – Percentage of TEA
(Early-Stage Entrepreneurship) with Latest Technology
* Definition *

Proportion of start-ups and new businesses indicating that they
employed the latest technology (technology available since 1 year
ago).
11.7% of early-stage businesses in Singapore employed the latest
technology compared to the average of 11.2% for all 22 OECD
countries.
This ranks Singapore 8th out of 22 OECD countries, ahead of countries
such as Sweden, Germany and Iceland.

35

0
5
10
15
20
25
30
35
40
Spain

Germany

Hungary

Netherlands

Ireland

Denmark

United States
with Latest Technology

United Kingdom

Australia

Japan
GEM 2006 - Percentage of TEA
(Early-Stage Entrepreneurship)

Sweden

Canada

Iceland

Mexico

Singapore

Finland

France

Italy

Norway

Belgium

Greece

Czech Republic

Average
36


GEM 2006 - Percentage of TEA (Early-Stage
Entrepreneurship) with New Markets
* Definition *

Proportion of start-ups or new businesses that sold their products or
services to what they believed were entirely new markets.
18.2% of early-stage businesses in Singapore sold their products or
services to entirely new markets, compared to the average of 12.4% for
all 22 OECD countries.
This ranks Singapore 3rd out of 22 OECD countries.

37

0
5
10
15
20
25
30
Hungary
Japan
Czech Republic
France

Belgium
with New Markets

Australia

Finland
Germany

United Kingdom
United States
Greece
GEM 2006 – Percentage of TEA

Mexico

Netherlands
Iceland
Ireland
Canada

Norway
Sweden
Spain
Singapore
Italy

Denmark
Average
38


GEM 2006 – Percentage of TEA (Early-Stage Entrepreneurship)
with more than 75% Export Markets
* Definition *

Proportion of start-ups and new businesses with more than 75% of its
actual or intended customers living outside the country i.e. overseas
market.
21% of early-stage businesses in Singapore (about 1 in 5 start-ups) have
more than three-quarter of its customers living abroad compared to the
average of 8.1% (1 in 10 start-ups) for all 22 OECD countries.
This ranks Singapore 1st out of 22 OECD countries, reflecting
Singapore’s small domestic market, .

39

0
5
10
15
20
25
Italy

Japan

Germany

Mexico

Netherlands

United States

France

Finland

Spain

Czech Republic

Hungary

Ireland

Australia
GEM 2006 - Percentage of TEA

United Kingdom

Norway

Greece
with more than 75% Export Markets

Canada

Iceland

Denmark

Belgium

Sweden

Singapore

Average
40


GEM 2006 – Entrepreneurial Intention Rate
* Definition *
Proportion of Adult Population that have not engaged in any start-ups or
new businesses but expects to start a new business in the next three years
Includes any type of self employment
May be alone or with others
Singapore’s Entrepreneurial Intention rate is 11.8% in 2006, declined
from 17.0% in 2005 (Note: 95% confidence interval for 2006 is 7.9 –
15.7)
This ranked Singapore 8th out of the 22 OECD countries, falling slightly
from its 4th position out of 24 OECD countries in 2005.

41


GEM 2006 – Prevalence of Entrepreneurial
Intention Rate & Rank among OECD countries
Country Rate Rank Country Rate Rank
Iceland 20.0 1 Hungary 9.6 13
Mexico 18.3 2 Canada 8.7 14
France 14.8 3 Denmark 8.2 15
Australia 14.8 4 United Kingdom 7.8 16
Greece 14.0 5 Belgium 7.3 17
United States 13.5 6 Finland 7.0 18
Czech Republic 12.8 7 Germany 6.7 19
Singapore 11.8 8 Spain 6.4 20
Sweden 11.2 9 Netherlands 5.6 21
Norway 10.4 10 Japan 2.4 22
Italy 10.2 11
Ireland 9.8 12 Mean 10.5
Singapore’s 95% confidence interval is 7.9 to 15.7, hence countries ranked from Denmark to France are within the same band as
Singapore

42


GEM 2006 – Prevalence of Businesses Discontinuance
(Exit Rate)
* Definition *
Proportion of Adult Population that has in the past 12 months shut down,
discontinued or quit :
A business that was owned and managed by the individual
Any form of self employment
Selling goods and services
Excludes those who sold off businesses
Singapore’s business discontinuance rate in 2006 is 2.2% (2.3% in
2005), ranking 10th among the 22 OECD countries.

43

0
1
2
3
4
5
6
7
8
Netherlands
Belgium
Hungary
Japan
Spain
Italy
Ireland

Denmark
Germany
Finland
United Kingdom
Sweden
Singapore
Canada
(Exit Rate)

United States
Greece
Norway
Iceland
France
Czech Republic
Australia
Mexico
Average
GEM 2006 – Prevalence of Businesses Discontinuance

44


GEM 2006

Personal Attitudes of Singaporeans
Toward Entrepreneurship

45


GEM 2006 – Attitudes and Perceptions of Singaporeans
towards Entrepreneurship
26.3% of adult population surveyed know someone who has started
business, lower than 31.3% in 2005 and the OECD average of 36.3%.
25.4% of those surveyed perceived to have the skills to start a business,
lower than 29% in 2005 and the OECD average of 41.1%.
15.7% of those surveyed between 18 – 64 years old perceived good
business opportunities, lower than 17.5% in 2005 and the OECD
average of 34.1%.
In terms of fear of failure, 65.6% do not perceive fear as a deterrent,
compared to the OECD average of 65.0%. This represents a slight
increase from 61.5% in 2005.

46


GEM 2006 – Attitudes and Perceptions of
Singaporeans Towards Entrepreneurship
Entrepreneurial Population Attitude Ratings
(Source: Adult Population Survey, Rating % of answering “Yes”)
SG SG ALL 22 GEM OECD COUNTRIES (2006)

High Low
2005 2006 Mean
Score (Ctry) Score (Ctry)

Know someone who started a business 31.3% 26.1% 36.3% 60.8% (IS) 26.1% (SG)
Have skills to start a business 29.0% 25.4% 41.1% 53.2% (CA) 15.7% (JP)
Perceive good start-up opportunities in next 6 months 17.5% 15.7% 34.1% 64.6% (DK) 9.2% (JP)
Fear of failure is not a deterrent 61.5% 65.6% 65.0% 79.0% (US) 42.2% (GR)

Source:
1) GEM 2006 Adult Population Survey
2) GEM 2006 Master Dataset

47


GEM 2006

Indicators of Social & Cultural
Values for Entrepreneurship

48


GEM 2006 – Starting Business is a Good Career Choice
*Definition*

Proportion of Adult Population that perceives starting
a business is a good career choice.
48.2% (vs 46.8% in 2005) of Singaporeans perceive
that starting a business is a good career choice,
compared to an average of 57.8% (55.4% in 2005) in
the OECD countries.
This ranked Singapore 19th out of 22 countries
(18th/24 in 2005).
49

0
20
40
60
80
100
Japan
Finland
Belgium
Singapore
Mexico

Sweden
United States
Denmark
United Kingdom
Hungary
Germany
Australia
Norway
Greece
France
Czech Republic
Iceland
Ireland
Choice in OECD Countries

Spain
Canada
Italy
Netherlands
Average
GEM 2006 – Starting Business is a Good Career

50


GEM 2006 - New Business Success is High Status
*Definition*
Proportion of Adult Population that perceives starting a new
business provides high level of status and respect.

54.1% (vs 57.8% in 2005) of Singaporeans believe that new
business success is accorded with high status in this country,
compared to an average of 65.2% (66.2% in 2005) in the
OECD countries.

This ranked Singapore 17th among the 22 countries (21st/24 in
2005).

51

0
20
40
60
80
100
Japan
Czech Republic
United States
Mexico
Belgium
Singapore

Spain
Sweden
Netherlands
Greece
Hungary
France
Norway
Italy
Canada
Australia
in OECD Countries

Iceland
United Kingdom
Denmark
Germany
Ireland
Finland
Average
GEM 2006 - New Business Success is High Status

52


GEM 2006 – Media Publicity for New Business
*Definition*
Proportion of Adult Population that perceives there is
sufficient media publicity for new businesses.

60% (vs 70.2% in 2005) of Singaporeans perceive
that there is sufficient media publicity for new
businesses, compared to an average of 55.3% (54.7%
in 2005) in the OECD countries.

This ranked Singapore 8th out of the 22 countries
(6th/24 in 2005).
53

0
20
40
60
80
100
Hungary
Denmark
Belgium
France
Greece
Spain

Italy
Germany
Mexico
Japan
United States
United Kingdom
Sweden
Netherlands
Singapore
Czech Republic
OECD Countries

Australia
Finland
Canada
Norway
Iceland
Ireland
Average
GEM 2006 – Media Publicity for New Business in

54


GEM 2006 – Uniform Living Standards
*Definition*
Proportion of Adult Population that prefers a uniform
living standard.

53% (vs 51.5% in 2005) of Singaporeans prefer a
uniform living standard, compared to an average of
63% (60.1% in 2005) in the OECD countries.

This ranked Singapore 19th out of 22 countries
(19th/24 in 2005).
55

0
20
40
60
80
100
Japan
Denmark
United States
Singapore
Mexico
Netherlands
France

Sweden
Iceland
Belgium
Spain
Greece
Czech Republic
Finland
Germany
Norway
Hungary
Australia
United Kingdom
Standards in OECD Countries

Canada
Italy
Ireland
GEM 2006 – Preference for Uniform Living

Average
56


GEM Singapore 2006

Assessment of National Environment for
Entrepreneurship

57


9 Dimensions of Entrepreneurial Environment
• Financial Support
• Research and Development Transfer
• Commercial and Professional Infrastructure
• Barriers to Entry
• Access to Physical Infrastructure
• Cultural and Social Norms

Each dimension is measured using several sub-indicators

58


Breakdown of Key Informants – 2000 - 2006

2000 2001 2002 2003 2004 2005 2006

Entrepreneurs 17 6 18 11 16 19 18

Policy Makers 12 9 4 8 4 3 0

Investors 6 5 7 6 9 8 0
Venture
Support 4 11 7 8 7 6 18

Total 39 31 36 33 36 36 36

Source: Singapore Expert surveys 2000-2006

59

Entrepreneurship Environment –Financial Support
(A) Financial Support
2
2000 2001 2002 2003 2004
2005 2006
1

0

-1

-2
A 01 A 02 A 03 A 04 A 05 A 06
A01 – In my country, there is enough equity funding available for new and growing firms.
A02 – In my country, there is enough debt equity for new and growing firms.
A03 – In my country, public subsidies have a major impact promoting firm creation and growth.
A04 – In my country, private individuals (other than founders) are an important source of financial support for new and growing firms.
A05 – In my country, venture capitalists are an important source of private support for new and growing firms.
A06 – In my country, initial public offerings (IPO) are an important source of equity for new and growing firms.

60


Entrepreneurship Environment – Dimension on
Cultural Norms
(I) Cultural and Social Norms
2002 2003 2004 2005 2006

2

1

0

-1

-2
I01- In my country, the national culture is I02 supportive of individual success achieved through own personal efforts.
I01 highly I03 I04 I05
I02- In my country, the national culture emphasises self-sufficiency, autonomy, and personal initiative.
I03- In my country, the national culture encourages entrepreneurial risk-taking.
I04- In my country, the national culture encourages creativity and innovativeness
I05- In my country, the national culture emphasises the responsibility that the individual (rather than the collective) has
in managing her own life.

61


GEM 2006
Singapore’s Entrepreneurial Environment Scoreboard
Entrepreneurship Environment Ratings by Country Informants
(Source: Country Expert Survey; Scale 1 = Low to 5 = High)

SG 18 GEM OECD Countries (2006)*

High Low
ITEM 2005 2006 Mean Score (Ctry) Score (Ctry)
Availability of capital 3.1 3.5 2.9 3.9 (US) 2.3 (IE)
Government policy support 3.5 3.5 2.7 3.5 (SG) 2.0 (HU)

Low regulation and taxation burden 4.0 3.8 2.7 4.0 (IS) 1.5 (IT)

Government program effectiveness 3.4 3.4 3.0 3.5 (DE) 2.3 (HU)

Effectiveness of primary & secondary education & training 2.6 3.1 2.4 3.1 (SG) 1.8 (DE)

Effectiveness of university & mgmt. education & training 2.9 3.3 2.9 3.7 (US) 2.2 (DK)

R&D transfer effectiveness 3.0 3.2 2.7 3.2 (SG) 2.4 (NL)

Business service effectiveness 3.4 3.5 3.4 4.0 (US) 2.8 (MX)

Rapidity of change in markets 2.8 3.1 2.7 3.5 (IS) 1.9 (FI)

Market accessibility 3.0 3.3 3.0 3.4 (NL) 2.4 (MX)

Ease of access to physical infrastructure 4.7 4.6 4.0 4.7 (US) 2.8 (IT)

Cultural value placed on independence 3.0 3.5 2.9 4.5 (US) 2.3 (HU)
* Only 18 OECD countries (including Singapore) provided data on the entrepreneurship environment ratings by country informants.

62


GEM 2006 - Overall Assessment of Singapore’s Environment for
Entrepreneurship
• The expert informants’ ratings on all entrepreneurship environment
indicators in 2006 were above the averages of the 18 GEM OECD
countries
• Singapore was rated the highest on three attributes– “effectiveness of
primary & secondary education & training” (3.1), “government policy
support” (3.5), and “R&D transfer effectiveness” (3.2).
• Singapore is also near the top among the surveyed countries in terms of
“government programme effectiveness” (3.4), “market accessibility” (3.3),
and “ease of access to physical infrastructure” (4.6).
• Overall, in comparison with 2005, the ratings of Singapore’s environment
for entrepreneurship in 2006 appear to have generally improved on most
dimensions, and stayed more or less constant for a small number of
dimensions (“government policy support”, “government programme
effectiveness”, and “ease of access to physical infrastructure”, and
“regulation and taxation burden”).

63


GEM Singapore 2006

Conclusions

64


Conclusions

Entrepreneurial activity levels across the 16 participating member
countries of the (OECD) group falling in the same income band as
Singapore (including USA) have dropped from an average of 6.4% in
2005 to 5.9% in 2006.
Consistent with this observed decline trend in the OECD countries with
the same income bracket as Singapore, Singapore’s early-stage
entrepreneurial level, as measured by the Total Entrepreneurial Activity
(TEA) rate, also decreased from 7.2% in 2005 to 4.9% in 2006.
The data for the OECD countries show that the bulk of relatively
advanced countries in the US$25,000-US$40,000 per capita range
reported TEA rates in the 3% to 8% region, with the mean clustering
around 5%.
The fall in Singapore’s TEA rate in 2006 is likely to be partly due to
favourable GDP and employment growth. The majority of OECD countries
also experienced a decline in TEA rates between 2005 and 2006.

65


Conclusions
Compared to the average level of GEM OECD countries, Singapore fared
better in terms of start-ups that are technology-oriented, intended to
penetrate new markets and overseas market, and have higher employment
growth aspiration.
The assessment of Singapore’s environment for entrepreneurship showed
improvement across most environmental indicators, particularly the
availability of capital for start-ups and the effectiveness of education and
training programmes.
Compared to the other OECD countries participating in the GEM,
Singapore received higher ratings on all the indicators.
Unlike lower income countries or countries with unfavourable policy
environment, Singapore’s challenge may be one of coping with the paradox
of success, resulting in high perceived opportunity cost of starting up on
one’s own and a social norm less supportive of entrepreneurship.
A key policy focus should be on promoting high tech and innovative
startups that can internationalize, not just start-ups in general
66


The full Singapore report can be
downloaded from the NUS
Entrepreneurship Centre website:
www.nus.edu.sg/nec

To download Global Executive report,
GEM website:
www.gemconsortium.org.sg

67

NUS Entrepreneurship Centre GEM 2006 Singapore Findings

Recomendados

Recomendados

Mais conteúdo relacionado

Mais procurados

Mais procurados (18)

Semelhante a NUS Entrepreneurship Centre GEM 2006 Singapore Findings

Semelhante a NUS Entrepreneurship Centre GEM 2006 Singapore Findings (20)

Último

Último (20)

NUS Entrepreneurship Centre GEM 2006 Singapore Findings