Filipino startups are blooming, but still face key issues, says VC

This article is from an episode on Asia VC Cast hosted by Daniel Song. This is heavily revised from the original show transcript. For the full interview, go here.

Ambar Machfoedy is the managing partner at Rekanext, a Singapore-based early-stage venture capital fund focused on regionalizing startups across Southeast Asia. He’s also a professor of marketing at New York University’s Leonard N. Stern School of Business. Previously, he was a consultant at Accenture and Monitor Group (now Monitor Deloitte).

In this interview, Machfoedy walked me through Rekanext’s investment thesis as well as his outlook on investment interest from China and his observations on the Philippine startup scene.

Tell us about your background. How did you become part of Rekanext?

I have been in management consulting for 35 years now, and this experience brought me to many parts of the world. I only became a VC about two years ago, after I came back from spending 12 years in New York. So upon coming back to Asia, I figured that this was going to be a new chapter of my life, doing something I’ve never done before.

A good friend of mine, who has spent five to seven years as a VC, helped me to get started with investing. We decided that we would do something on our own, and that’s how Rekonext started.

Could you talk about the firm’s investment thesis?

We primarily seek investments in technology companies, with the sweet spot being startups in deep tech. We are also very interested in startups in traditional industries that use technology to differentiate themselves.

Ideally, we look at startups located in Southeast Asia, especially those that are in Indonesia, Singapore, the Philippines, and Vietnam. The whole idea of what we do is that we take these exciting startups, which we believe will be successful in their respective countries, and then bring them to other countries in the region.

You do roundtable discussions as part of the investment decision-making process. How does that work?

We’re very intrigued by how Chinese businesses have traditionally been able to grow successfully by leveraging relationships and networks or clan associations. Senior clan members and young businessmen sit around a table for a meal and have conversations, and it’s an opportunity for younger members to be mentored.

In the same way, our senior executives get together for our roundtable sessions. We invite startups that are keen to raise funds from us to talk to us. We see how they think their venture is viable and how they hope to grow it. Then, we decide whether it’s something we would like to invest in.

Our roundtable sessions are also for our portfolio companies. We do it at least once a month to understand the startup’s pain points and see how we can help them grow further.