Eric Ho, Vice President of Ventech China
Ventech China is a venture capital firm funding early-stage IT, life sciences, mobile technology, and e-commerce companies in Asia and South East Asia. Personal views expressed here.
Eric, who are you?
We are a VC group covering Europe, USA and China. Based on the expertise we gained previously, we believe that we are well positioned to enter SEA, as the region will likely follow some of the growth stories we’ve seen before. As such, we formally launched also a SEA initiative in 2018. Based in Hong Kong, I am responsible for Ventech’s SEA investments.
Why have you invested in South East Asia ?
Among others, we are of the view that the economy there will grow at an impressive pace. Against this background, we are keen to tap into the high value-added opportunities that will be, for instance, created around the emerging middle-class consumers.
How do you structure the deal ?
When we invest in a startup located elsewhere than in Singapore, we usually ask the founders to set up a holding company in Singapore and transfer their shares in the local startup to this holding company in which we invest. At the end of the day, together with the founders (and investors from seed rounds, as the case may be), we will be shareholders of the holding company which will own the shares of the local startup.
What is your main advice for an investor investing in SEA?
Apart from business related risks, it would be wise to understand the potential exposures of your capital/assets and how well the local laws are protecting them.
Could you explain the role of your lawyer(s) in this investment ?
Take, for example, we hire lawyers to (1) draft legally enforce able documents and agreements (2) advise legally acceptable corporate structure spanning holdco and local subsidiaries (3) negotiate with the legal counsels of business partners (4) introduce local law firms and other professional firms (5) introduce investment opportunities leveraging on his or her business networks.
Apart from possession of professional knowledge and local expertise, we are looking for lawyers with a strong work ethics and value highly those are responsive to our needs (one of the key elements is quick turnaround time). This is especially true when it comes to following up the matters post-investment.