Sitting through meetings. Doing intensive research. Staying ahead of the curve. It takes a lot to be a successful venture capitalist, and only a rare few manage to identify startups that will make it to the big leagues—or even define the standards of new industries. KrASIA’s writers have developed a new column, “Venture Voices”, where we will pose a single question to three VCs in Southeast Asia for each entry. For our first installment of this series, we ask: What are the key traits of a good venture capitalist?
Tiang Lim Foo, a partner of SeedPlus in Singapore who specializes in making seed-stage investments, had this to say:
I think to be a great seed VC, two things are essential. One is the ability to get really good at identifying talent, and the other being the ability to roll up your sleeves to work with the teams to build a company. The reality in the earliest stages is that there is little to no data that points to the viability of the product or the success of the business. Thus, it is important to have the right skill set and mentality for seed investing, as opposed to growth stage investing where financial acumen becomes more important and precise.
He told KrASIA that this is helpful for early-stage startups in a specific way:
As early stage founders start building out the product and get validation from customers and the market, it is crucial that they find VCs whom are entrepreneurial and are able to help make an impact operationally. The value creation during the early days is for the very long term, hence any support at the earliest stages will have an outsized impact in the long run.
Liu Genping, a partner at Vertex Ventures, named a few personal attributes that he thinks VCs need to have to be effective at what they do:
Integrity is the most important trait. As VCs, we manage investors’ money. And a good VC is always curious about new business, new technology, and new ideas. Learning is not only a job, but second nature of a good VC. A good VC needs to enjoy learning and make sense of the world around them. VCs deal with large amounts of information which is often vague, fast-changing, and full of conflicting views. The capability to make sense of the information and develop an independent view is certainly very important. VC is the profession closest to being an entrepreneur, which is full of challenges and up and downs. Success takes a very long time, and thus a good VC needs to be persistent, needs to be able to grow with their portfolio companies and help its founders achieve their vision.
Noting that there’s an important human element to this line of work, Liu also said:
VC is a people business. The capability of VCs to create and foster wide and deep relationships will go a long way.
Over in Jakarta, Willson Cuaca, managing partner of East Ventures, also pointed to the instinctual human connections that VCs need to make with startup founders:
To make a good VC, there are various things you need to have. First, you need to have empathy. Entrepreneurship is hard, you need to understand the hardship so that you could put yourself in founder’s shoes. Secondly, you have to be decisive. Fundraising is painful, don’t make it even more painful for the founder by not giving them a decision. We always have to make a fast decision about whether to go ahead or not. Third, you need to be in a supporting role. An investor plays a supporting role, and is not the main driver of the company. Always be available when a founder needs us, without asking too many or unnecessarily questions for the sake of checking boxes. We put the founder in the spotlight and support them from behind the stage. Lastly, you need to have a shoulder to cry on as you’ll get lots of midnight calls for different issues.
SeedPlus is a Singapore-based $18 million early-stage venture capital fund that typically invests between S$500,000 and S$1 million (US$368,000 to US$736,000) in product-focused early stage startups across Asia. The VC’s backers include Jungle Ventures, IFC, and Eight Roads Ventures, among others. Some of the startups in SeedPlus’s portfolio are Neuron Mobility, Travelstop, Homage, and EnageRocket. Tiang’s job is to see the buds among the weeds, looking to bet on the early-stage company that might just work.
Liu Genping joined Vertex Ventures in 2010 and is now a partner at the firm. Liu has diverse experiences of working with startups and multinational companies in various sectors, including internet, electronics (batteries), telecom, and investment banking. At Vertex, Liu is responsible for Series A/B investments in Southeast Asia. His current focus is on fintech, consumer internet and SaaS enabling small and medium-sized enterprises, among others. Liu’s latest portfolio includes investment in Singapore-based P2B lending platform, Validus Capital.
Willson Cuaca started East Ventures in 2009 as he saw Indonesia’s digital economy had a huge opportunity waiting to be explored. According to Cuaca, there were approximately 22 million internet users, but no one was working on or investing in big digital products back then. Cuaca and his partners at East Ventures saw it as a gap that they could fill. There were challenges along the way, but with persistence and faith, East Ventures has successfully proven itself to be one of the most respected VCs in Southeast Asia.
This article is part of “Venture Voices”, a series where the writers of KrASIA speak with venture capitalists based in Southeast Asia to get their takes on topics of interest.