Source: Digital News Asia
- One founder trait that stands out is humility, ‘you will learn, adapt & evolve’
Helping multiple entrepreneurs in solving multiple problems at the same time
Digital News Asia (DNA) continues its series that profiles 50 influencers who are helping shape Malaysia’s Digital Economy, from Digerati50 2020-2021 (Vol 4), a special biennial print publication released in July 2020. The digital version can be downloaded from the sidebar link. For information on customised reprints email firstname.lastname@example.org
When asked why he is interested in the startup space, and why he has entered it from the investment side, Victor Chua presents a non-sugar-coated answer.
“Just like a lot of people, I loved rags to riches stories. It is one of those things that motivate you when you’re working till 3am as an employee in the office and you don’t get time to spend with your friends and family. Because of such motivation, you can immediately feel the energy and possibilities if you talk to genuine entrepreneurs,” he says.
“It is like some sort of drug, except this is good because this is what humanity needs in order to find solutions for problems that we face.”
Victor is currently in position to be part of those rags to riches stories. In 2017 he co-founded Vynn Capital, a Southeast Asian-focused early stage venture capital firm that he built with IE Singapore’s Darren Victor (no relation).
The VC firm differs itself in a few ways. They focus on certain industries – travel, property, fast-moving consumer goods (FMCG), and female economics. On top of that, they place focus on how to create synergy among their portfolio companies, with the hope to build bridges between their limited partners (LP) and the companies they invest in.
Vynn Capital made headlines in February of 2018, when it announced a targeted US$40 million (RM168.2 million) maiden fund for Southeast Asia. In 2019, they came close to achieving that thanks to an undisclosed sum from Malaysia Venture Capital Management Bhd (Mavcap) as one of their anchor LPs. Later that year, Vynn Capital announced a strategic partnership with Japanese advisory and consulting firm OPTI to bridge Japanese investments into Southeast Asia’s startup ecosystem.
In April 2020, they announced a collaboration with insurance brokerage firm, BIB Insurance Brokers, to introduce innovation into the insurance and financial sectors. By then, Vynn Capital had already invested in startups that include Carsome, Dropee, Travelio, Pomona and Epost Express.
Victor has long been entranced with the VC and startup space. His first job was an investment analyst with international consulting firm Willis Towers Watson, which exposed him to all kinds of investment assets, forming a solid foundation. This was also when he ran his own edutech startup, despite limited knowledge on fundraising and exists.
This experience taught him that digital and technology is the way forward. “It allows people like me who had insufficient resources to also tap into client base from down south while I work behind my home desk,” he says. When he got exposed to private equity and VC, he met former Mavcap CEO Jamaludin Bujang, eventually joining Mavcap.
Victor would eventually be vice president of investments at Gobi Partners, which he describes as a “good journey” with lots of learning and experience, as well as realising the value a VC can create and subsequently pushing him to create Vynn Capital.
“Professionally, I believe that there is still a lot of alpha in early stage investing whilst a lot of VCs have moved on to later stage investment. The market in Southeast Asia is growing which means, now more than ever, there is more need for VCs and we can play an important role in unlocking opportunities when they are still stones and not gems yet.”
He launched Vynn Capital on the belief that the market is mature enough to have a differentiated strategy that commands a contrarian view to the traditional VC mode of “spray and pray”.
Personally, Victor has also wanted to build something from scratch, believing that venture capitalists should also be bold entrepreneurs who take calculated risks – justified by potential upsides they can foresee, of course.
“People often overlook the fact that VCs are also entrepreneurs if they are running their own fund and to me if you are running your own fund, you are walking your talk,” he quips.
Victor doesn’t just think of himself as merely an investor or shareholder, though. “We work with our entrepreneurs at personal level to go beyond just an investor-investee relationship. VCs are also business people. When we invest into a company, we work with the team to grow the business,” he says, an aspect he finds exciting.
“As an entrepreneur, you are solving a problem at a time. But as an investor, I am helping multiple entrepreneurs in solving multiple problems at the same time. At the end of the day, we are the Robin to all our Batmen.”
Victor believes that Malaysia still has the capacity to become the window for investors and businesses beyond SEA to access the region, and has opted to stay despite more attractive VC opportunities in Indonesia.
They have been talking to several international organisations to create the corridor of knowledge – something for large institutions to learn about Malaysia and the region and eventually enter by working with local startups and investors. Regarding this, Victor adds that they will be launching a few things at Vynn Capital soon.
Additionally, Vynn Capital is also working with the Malaysia Venture Capital & Private Equity Association (MVCA) to create more awareness and knowledge for people to learn about VC as an asset class.
For Victor, one entrepreneur trait that stands out for him as an investor is humility. “If you are humble, you will learn, adapt and evolve as well as attract the right kind of partnerships,” he says.
“For me, we are encouraging our companies from different countries to jumble up their views. We want each of them to actually be an influence to another, so that they can expand their view and perspectives and grow as entrepreneurs.”
When asked about what entrepreneurs should do to give themselves the best chance to raise funds, Victor says: “The first thing to do is not raise funds.
“If you focus on raising funds, you end up not being able to run your business. Always think of raising funds as a tool to expand your business rather than raising fund for the sake of having a higher valuation.”
Victor believes that, at this point of time, entrepreneur should think strategically when they’re seeking partners and support. “Think of how your solution and product can be of a strategic interest to the counterparty. Be creative with how you position your business.”
He cites Travelio, one of their portfolio company, as example. The startup started off as a travel tech company, who eventually started working with property developers and became a proptech business. Now they are also in grocery delivery.
How has Covid-19 changed the VC space? Victor also believes that there will be a rebound in three to six months following the pandemic, where we may see more transactions happening.
“Prior to Covid-19, there were still a lot of dry powder in the market and there were a lot of corporations making their plans to expand into SEA. We were also advising several Japanese and American companies in their approach to SEA,” he says. Covid-19 has delayed their plans, but Victor feels that they will find their way back into the ecosystem.
“Of course, there might be new innovations and methodologies, but I believe if your business or if a VC fund’s strategy is crisis-proof enough, there will still be a lot of opportunities.”