What’s next after a VC invested in a fraudulent company’s product

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All things considered, I think I’m a pretty risk-averse person. But life, and especially its biggest decisions, tend to require little leaps of faith. Some work out, some don’t.

For Vickers Venture Partners and its founder and chairman, Finian Tan, a bet on trading company Envy Global Trading didn’t pay off. Ng Yu Zhi, the 33-year-old director of Envy, has been charged with two counts of cheating and two counts of fraudulent trading, and prosecutors expect to bring more charges.

In today’s premium article, we look at the impact this misstep has had on Vickers and a little of what goes on behind the scenes at the VC firm.

Today, we look at:

• Vickers Venture Partners’ troubles with Envy
• A new addition to the buy now, pay later arena
• Other newsy highlights such as the successful seed round of a Vietnamese investing startup, and a new addition to the team at East Ventures

PREMIUM SUMMARY

How much will its Envy stumble affect Vickers?

Vickers’ investment in trading company Envy didn’t go as well as it’d hoped. The investment firm’s chairman Finian Tan also got burned in backing the company on a personal level. With both the VC firm and its chairman caught up in the mix, might there have been a conflict of interest?

• Take a chance on me: Backing Envy was an opportunistic investment for Vickers, which is to say it was outside of its usual mandate. These types of investments typically allow VCs to experiment with other assets, business models, or industries.
• Remember – no conflict: Some VCs forbid employees from investing in portfolio companies. While others don’t have such rules, they have conflict management policies in place. Tan had also invested in Envy, he says there was no conflict of interest and within the guidelines of Vickers’s conflict policy. There would be a conflict if his investments were in company equity, but in this case, both “invested into the contracts and not the company so one investment does not affect the other.”
• Still on track: According to Tan, he expects several big upticks on the horizon, even if Vickers has to write off the Envy-related bets. The VC firm is slated to mint its sixth unicorn, which would make 2021 Vickers’ best year ever.

Read more: Will the Envy misstep tarnish what could be Vicker’s ‘best year’?

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