SEA needs to collaborate more to grow startup ecosystem: Kejora Group

By Goh Thean Eu September 22, 2016

Collaborate to make policies more open, to encourage technology sharing
Sees investors maturing, now looking at fundamental aspects of company instead of merely market share

_{From left: Sophie Kamaruddin (moderator), Dzuleira Abu Bakar (CEO, Cradle Seed Ventures), Kuo-Yi Lim (Managing partner, Monk's Hill Ventures), Khailee Ng (Managing partner, 500 Startups) and Sebastian Togelang (Founder and managing director, Kejora Group).}

SOUTH-East Asian (SEA) governments need to further collaborate to enhance the region's startup and entrepreneurship ecosystems, so that regional startups can grow and develop at a healthy pace.

"There needs to be more collaboration among government agencies in SEA," said Sebastian Togelang, founding partner of Kejora Group, during the sidelines of the Private Equity Forum 2016 in Kuala Lumpur yesterday.

"Certain policies need to be re-looked at so that they can be more investor friendly. Today, it is not that straight-forward or easy, when an investor wants to put money into a startup in another country. So, having policies that are more open, and those that encourage technology sharing, will definitely help," he added.

However, SEA governments need to act fast though, as Togelang believes that it will be only a matter of time before large venture capital firms from the western countries start to buy up promising startups in the region in a big way.

Togelang was one of the panelists for the "Investing in Asean Technology and Innovation" panel. The other panelists included Cradle Seed Venture CEO Dzuleira Abu Bakar, Monk's Hill Ventures managing partner Lim Kuo-Yi and 500 Startups managing partner Khailee Ng.

During the discussion, the panelists agreed that the governments in SEA have played a crucial role in growing the ecosystem.

"The governments needed to do the un-sexy stuff in order to make things happen," said Lim.

Ng agreed, and added that government-link entities like Malaysia Venture Capital Management Bhd (Mavcap) have been very much under-appreciated by the general public.

"Mavcap has taken an aggressive path when the industry was un-sexy," said Ng.

SEA needs to collaborate more to grow startup ecosystem: Kejora Group

Meanwhile, Togelang (pic above) added that investor mindset has improved significantly over the past few years, as they are now more focused on the startups' fundamentals.

"I think it all started when there were some big investors who saw how the market evolved in Europe, China and Japan. So they thought that if they put a lot of money in the region, it will grow by itself. They were more concerned about growing the market share, becoming number one, and not so much about the revenue or cashflow

"But then, the unicorn crisis in the Silicon Valley came. It happened because a lot of companies were overvalued," explained Togelang.

Since then, investors have starting to pay more attention on startups' revenue traction, cash flow position, and others.

"This is a good thing, as it helps to build a more sustainable startup ecosystem," said Togelang.