Northstar alum ditches tech, chases Indonesia’s consumer brands

In a startup ecosystem still dominated by blitzscaling and billion-dollar dreams, Melvin Hade is doing the opposite.

The Jakarta-based investor launched Kayella Consumer Partners earlier this year. But instead of chasing tech unicorns or exponential valuations like he did during his stints at Global Founders Capital and Northstar Group, his firm targets “real, cash-flowing businesses” in Indonesia’s consumer and retail space.

Melvin Hade / Photo credit: Kayella Consumer Partners

“We’re not just capital providers,” Hade tells Tech in Asia. “We build, operate, and co-own businesses with our partners. It’s a quasi-investor, quasi-operator role.”

Kayella’s investments target dividend payouts from the get-go. So far, it is seeing early signs of promise: One portfolio company returned Kayella’s full investment within three weeks of launch, Hade says.

No billion-dollar delusions

Kayella currently backs five brands: quick commerce company Astro (where Hade was an early angel investor), wellness brand Anda Reserva, men’s grooming startup Cogan, and F&B players Bli Gung and Way of Evergreen.

Check sizes range from US$100,000 to US$2 million. Kayella plans to launch five more brands by year-end.

But unlike the tech-style consumer rollups that have come and gone, Kayella doesn’t expect these companies to become billion-dollar brands. Nor does it want them to.

“We prefer assets that generate consistent dividend payouts,” Hade explains. Over the lifetime of the brand, doing so could still more than 10x the firm’s investment.

The firm’s approach is a bet on the non-tech economy and a rejection of venture capital’s hypergrowth religion. 

See also: Patrick Walujo’s Northstar closes SEA early-stage tech fund at $140m

During his time at both Northstar and Global Founders, Hade led investments into companies like Fit Hub, Gently, and Maka Motors. But the tech narrative has shifted since then. 

Founders are getting tired of pressure to reinvest every dollar back into growth, and limited partners (LPs) want returns they could actually spend.

“Flourishing consumer and retail businesses usually have strong profitabilities and pay out dividends regularly and consistently,” Hade says. But he also noted that “the VC model typically refrains from allowing founders to distribute dividends” and prefers reinvesting profits instead.

A five-year horizon, no fixed exit