Startup Management: Tips for Prioritizing and Scaling (Live Blog)

Kee Lock Chua is the group president and CEO of Singapore-based Vertex Venture Holdings. Backed by Temasek, it’s one of the nation’s powerhouse VC firms with interests in China, Taiwan, South Korea, India, and the US. Oh, and in Singapore. Indeed, Vertex Venture is the oldest VC group in all Asia.

#13:59: Kee Lock has nurtured two billion-dollar companies, so our guest interviewer, Darius Cheung, asks how to build a billion-dollar business. Kee Lock says there are invisible barriers to entry and difficulties, but there are opportunities all across the world to do that. In terms of success factors, he says that it’s all down to the entrepreneur and the staff. Then, the ability to change enough to adapt to shifting markets and technologies. “Ultimately, it’s all about the team”.

#14:05: Regulations are often the biggest barriers, he says. Telcos are an example of where regulations and high prices – previously $1 per minute for SG-US phonecalls – inspire innovations. That’s part of the story behind Kee’s MediaRing business.

#14:08: But he admits to mistakes with MediaRing, like when it ditched PC-to-PC calling. That perhaps caused MediaRing to lose out to Skype. He and his team listened to analysts, Kee says, rather than listeners.

#14:12: However, it’s not really about money – the startup is about a bond among the team, “about building something great” and keeping the right startup culture.

#14:13: What are his favorite portfolio startups? Kee first points out that the VC task his hard – he has to be a sort of fortune-teller. Even after two or three years, he can’t be sure how the startup is performing and new challenges always emerge. So, no names named.

#14:14: Is there a series A crunch in Asia, as hype seems to suggest. He says that NRF does a great job to give funding and often gives around $1 million, which takes them up to the next level. But, for the next levels, you’re talking ten-million-plus levels, taking you to needing $50 million or more in funding for major expansion and capital-heavy work. He concedes that late-stage funding is tougher to find, as well as medium-stage startups. He calls that “the valley of death” where the company is operating well but has no money to scale. That’s sad, he says.

#14:20: Vertex has put three rounds of funding into Reebonz, the luxury flash sales site. At first he called it “a stupid company” but then saw the virtue in it, and at first Reebonz addressed Singapore and Malaysia well. That’s when the first input came.

#14:24: Reebonz is also a good example of keeping ahead of the competition, Kee says. It’s a bit like martial art Tai Qi. It seems easy to copy, but it’s very hard to master.

#14:27: There are still more startup opportunities in social and other areas. Though Vertex tends not to invest in that area.

#14:29: Which leads Kee back to the hardest part of the job: seeing trends. That requires a mix of objective and subjective – data and feelings about the market and where it’s heading. Look for opportunities in growth areas. Like Vertex looking into mobile components and smartphone usage grows.

#14:31: Vertex invests in six, seven, or eight startups per year. Typically mostly in China. Hopefully, he says, in Indonesia soon – but not yet.

#14:32: Vertex does co-invest, he says, in response to an audience question. In terms of startups themselves, he looks for those in the business for the long-haul.

#14:33: “A good entrepreneur needs to be arrogant – but also listen.” That’s hard to do. The arrogance is mainly confidence, he says, which is needed in the industry.

#14:39: What drives you, Darius asks? Kee Lock says that it’s possible to create great companies if you’re passionate. He points out that Singapore Airlines didn’t exist 35 minutes ago. It’s the same in sport: whoever wants to win will stand out from those who don’t want to lose. But those striving to win will succeed in the end. “We need more want-to-win companies”.