To sustain a dynamic and competitive market in the long run and to support Singapore’s ambition to become a leading financial and premier asset management hub, we need more fundamental changes. It is crucial that SGX develops the ability to attract and retain high-growth and innovative companies which are future-oriented, and the EQDP can help in this regard.
The new world
Consider the sectors which have become significant today in a world profoundly transformed by technological advancements — AI, robotics, autonomous transport and logistics, biotechnology, digital biology, financial technology, semiconductor chips, energy production and storage, etc. These are undoubtedly the sectors of the future, and innovative and successful companies in these fields are not only redefining human progress but are also amongst the most impactful and sought-after investments.
But why (save perhaps for a few precious examples) are such companies today conspicuously absent from SGX despite Singapore hosting a world-class innovation ecosystem? And why have prominent Singapore-based or founded technology companies such as Grab Holdings, Sea, Razer Inc and recently MiRxes, amongst others, chosen to list overseas?
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The usual reasons are low liquidity, low valuations, lack of peer group, preference for larger markets, but some market practitioners will cite a key reason which cannot be denied — a paucity of domain expertise in the SGX investor base, which must be recognised as a major factor preventing future-defining companies from choosing SGX as their primary listing venue. The world has entered an unprecedented technology investment cycle and SGX risks being left behind.
The sectors of tomorrow are inherently technology-based and knowledge-intensive. They require specialised knowledge to properly assess investment opportunities given huge complexities, rapid evolution and intricate industry nuances. A different level of investment acumen is needed to navigate and process detailed scientific, technological and regulatory information and to be able to make forecasts and predictions.
In selecting an IPO venue, companies carefully consider an exchange’s attributes, in particular in relation to price discovery and liquidity. The shareholders and boards of leading innovative companies will never risk crucial access to capital by listing where investors do not fully appreciate their value proposition or who only have a shallow understanding of their technological innovations. These companies will inevitably gravitate towards specialist IPO venues with deeper investor pools and domain knowledge.
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To turn the tables, bold steps are needed to create a new and durable capital market ecosystem — one that is set up with the requisite knowledge, expertise and experience to perform proper due diligence and to invest in these complex sectors. We need more specialist equity fund managers with deep domain expertise and specific mandates to invest in their areas of competence. This ecosystem can be built by initially drawing upon the available domain expertise in Singapore and supplemented with talent from abroad.
EQDP 2.0?
The EQDP, instead of focusing generally on SMEs, could begin to seed funds in a variety of specialised domains and which have proven execution capabilities. To assist in building out the ecosystem, these funds could commit to certain developmental outcomes such as hiring talent, elevating domain expertise, expanding local asset management capabilities and supporting local companies.
The initial batch of funds could even be cross-over funds — i.e. those that can invest across private and public equities, which would provide these funds the ability to participate in pre-IPO rounds as well as IPO placements and post-IPO transactions. This would give the IPO aspirants the confidence of a funding continuum as they move from private to public markets.
In this new world, domain specialists become the key contributors to efficient price discovery, and they can lead as effective cornerstone investors. Their presence will also encourage broader market participation and, importantly, signal credibility — making SGX a more compelling listing venue.
Singapore’s equities market is dominated by traditional sectors such as banking, property and real estate investment trusts, and change will take time. Inevitably, too, as with any reform, there will be teething issues, chicken-and-egg questions and even early failures along the way. But in the long run, such a knowledge-based ecosystem could be a truly transformative market force attracting future-orientated listings and change the market landscape in a meaningful way. If executed successfully, it would not be beyond the imagination that SGX could one day be the IPO venue of choice for certain hi-tech sectors.
In his 2026 New Year message, Prime Minister Lawrence Wong emphasised that to remain competitive and sustain Singapore’s progress, we cannot simply do more of the same and must “rethink, refresh and reset” our economic strategies. We need our equities market to do exactly that if we are to secure the city’s long-term position as a leading global financial hub.
Dr Foo Fatt Kah is a co-founder and managing director of Luminor Capital. He was formerly the Asia (ex-Japan) head of equities for a European investment bank and the Asian venture partner for a Singapore-based global biotech venture capital fund
