Seeing through the founders in Southeast Asia

For all the puffing of chests and preening of feathers, the Southeast Asian tech landscape is still a heady mix of uncertainty and immense promise. Positive macros and healthy exits confirm exciting value creation; but that storied ~1000x (Google, Facebook, Alibaba) return remains the elusive white whale for VCs in this highly diverse, fragmented and largely untapped market.

The Southeast Asian tech landscape could be characterised by a constant tension between the drive to build stable, enduring businesses, and the drive to “win the future” with an outlier business that carries some earth-shattering, game-changing insight.

Some of us are looking to invest in/build that 1000x company, trying to figure out what that black swan might look like (ironic of course, as Taleb’s black swan by definition lies outside of all empirical postulation at our disposal). But is that where the real value creation is happening?

At my firm we have an unusual approach to debating investment decisions. We sit in a meeting room, and each is made to take a position regardless of their established inclination – Yes, No, or Bandwagon (free to chime in on Yes and No). The idea is that this forces us to fight our cognitive biases and come to as ‘objective’ a conclusion as possible. The reasoning behind it is simple: we often firmly believe things we barely grasp.

When I was asked to chime in as a young VC in Southeast Asia, instead of presenting my opinions as truths, I thought it might be an idea to lay out some thoughts and leave it to the reader to draw her own conclusion. The upshot was a series of essays on questions pertinent to the region’s tech ecosystem. The first one is published below.

On Traction and Changing the World

Mediocre V.C.s want to see that your company has traction. The top V.C.s want you to show them you can invent the future.
– Suhail Doshi, CEO of Mixpanel

A few months ago I met with a founder of a local startup with a “vision to really change things”. Halfway through his pitch, he pushed his laptop to one side and began gesticulating furiously with his arms. He had strong traction – but that was not important; I was to believe in his vision of things to come.

The whole thing reeked of caricatural posturing and I was barely able to keep my eyes from rolling. The New Yorker profile on Marc Andreessen featuring a16z founder Suhail Doshi came to mind. “This must be what he thinks an a16z founder talks like,” I thought to myself.

Southeast Asian founders are often drawing such analogical comparisons between Silicon Valley and Southeast Asia. The fact of the matter is that only the smallest handful of Southeast Asian founders have the talent and/or financial wherewithall to back up Valley-style bold ambition. Here’s why:

Culturally and financially, Southeast Asia is a whole different ball game. The crucial role US military support continues to play in the Valley cannot be underestimated either.

Below is a paragraph lifted from that New Yorker piece on Andreessen and a16z: