Our Asian investment landscape: Tips for start-ups

The following article is a part of the media coverage series by Biotechin.Asia on InnovFest unBound.

NUS Enterprise and unBound Media jointly brought to us InnovFest unBound (read more here), which was held on the 17th and 18th May in Marina Bay Sands. There were numerous forums touching on a wide range of subjects from Healthcare to Investment to Media over the course of 2 days. The two of the most enlightening Panel Discussions were the Overview of the Asian Investment Landscape and the Fireside Chat about the investment journey.

The Overview of the Investment Landscape panel was moderated by Mr. Roland Yau Managing partner at CoCoon Ignite Ventures, an early stage fund that invests in entrepreneurs with a unique vision of the economy. He brought up many relevant issues to be discussed at the Panel, one key issue he brought up was about how the Asian market was very different from US or Europe. He went on to explain how in US/Europe, even if they are made up different states/countries, they still follow similar perspectives whereas the Asian market is made up of different countries with different cultures and their own perspectives. Thus, making it hard to figure out the Asian market trends as compared to trends in US or Europe.

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Mr. Peter Huynh from Qualgro

The panellists consisting of Mr. Masahiko Homma (Founder & General Partner of Incubate Fund) Mr. Peter Huynh (Partner of Qualgro), Ms. Melody He (Partner of SOSV) and Mr. Ian Goh (Founding Partner of 01 VC) agreed that the cultural barriers in Asia can be overcome with good communication between parties as well as deep understanding of one another’s culture and perspective.

When asked to describe a few trends in the Asian market Mr. Goh spoke about how more applications from Asian countries are being exported across Asia as well as into western markets like the US transcending cultural barriers as opposed to the vice versa. He also stated that the biggest markets in Asia currently are China, India and Indonesia emphasising mainly on China’s considerable growth to be an Internet powerhouse of today. He also advised new company’s trying to penetrate the huge Chinese market to:

“Be there, be on the ground and be quick”.

He explained that the Chinese have the tremendous ability to copy any product out there and it pays for newcomers to be hands-on and fast when entering the China market.

This valuable insight was closely followed by the Fireside Chat where countless tips were given to start-ups in their search for investors and their journey to scale up their company into different markets. This panel consisted of Mr. Suresh Shankar (CEO of Crayon Data) and Mr. Pierre Hennes (CEO of Extreme Ventures and Upstream Ventures) who were moderated y Mr. Sivi Sivanesan (Partner of Dentons Rodyk & Davidson).

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Mr. Pierre Hennes, Mr. Sivi Sivanesan, Mr. Suresh Shankar (Left-right)

Mr. Shankar, a 2nd-time entrepreneur with Crayon Data, emphasized the importance of chemistry or the relationship between start-ups and their investors. He talked about cultivating this chemistry through interacting with the investor and observing how they negotiate. Mr. Hennes also pitched in by saying that it is crucial for the start-ups to do their due diligence by looking into the background of the investors, like their past investments, to ensure that they are both on the same page.

The panel also talked about how investors varied across different cultures and that it benefits the start-ups to take into account these differences when pitching their company to the investors. They gave some examples of these differences, as shown below:

US/Australia/UK-

  • Legalistic
  • Results oriented

India/China-

  • Not legalistic
  • Focused on the big picture
  • Unpredictable as decision made by a single person, thus subject to their thought process

Japan-

  • Detail oriented
  • Process/journey of the start up
  • Importance of commitment as they follow through with their word

Mr. Shankar and Mr. Hennes advised start-ups to “be very careful who you are taking money from” as they could turn out to be micromanagers and ended off by stressing that there could be “only 1 captain for the ship”.

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