WHAT ARE INVESTORS LOOKING FOR? 

Lead Discussant: 

A.Balasubramaniam, Head, Funding Facilitation, Malaysia Digital Economy Corporation  (MDEC) 

Speakers: 

Herston Powers, Managing Partner, 1982 Ventures 

Ng Yi Chung, Partner, AC Verntures 

Zac Liew, Co-founder & Chief Executive Officer, Curlec 

Ian Ow, Founder, Ablr 

• On the question of what VCs are looking for in fintech companies: 

Herston Powers of 1982 Ventures began by confirming that 2021 was indeed a  banner year (investment recorded an all-time high of US $3.5 billion), and that the  fintech industry in Asia was highly regarded as a preferred destination for  investment funds. He pointed out that when the West makes their first investments  in Asia, they are backing fintech companies first. For his organization, they are  biased toward founders that execute fast (ideas, he said, are a dime a dozen) and  only after that do they pay attention to other baseline characteristics like integrity,  trust, etc.  

Ng Yi Chung of AC Ventures added to this, agreeing that the last one or two years has  seen a huge inflow of capital coming in many forms, e.g. limited partners, new funds, etc. and due to a number of factors including demographics and infrastructure. The  fintech industry was among the top three recipients of these funds, mainly due to  the scalability of fintech and the very high levels of maturity and ability in the  founder eco-system. He added that new banking technology is currently attracting  the most attention, e.g. recuring payments, embedded finance, alternative tech  lending, etc.

• To the question of how to attract capital into their companies: 

Ian Ow of Ablr replied that startups must : 

(a) Find the right investor. 

(b) Establish clear value propositions and value markets. 

(c) Ensure product market fit. 

Zack Liew of Curlec emphasized: 

(a) The ability to articulate your vision. 

(b) How the startup will execute that vision.  

(c) Reasons why your team will be the ones to do it. 

• To the question of how they would differentiate their businesses from the  competition: 

Ian Ow of Ablr would enable more flexibility, employ AI, keep customer relations  strong, e.g. not levying late fees on customers and deliver on his value proposition,  that is, for the customer, the ability to access and purchase that which improves  your quality of life and, for the merchant, to reach out to more customers. 

Zac Liew of Curlec would build value around payments, take a holistic approach and  provide best value for merchants. 

• On the question of how Malaysia can progress and what would help bring more  capital into Malaysian fintech: 

Herston Powers of 1982 Ventures said one should not get dragged into the  comparison game. Look instead into the wide open spaces and opportunities that  exist in Malaysia and recognize that investors generally do regard Malaysia as a  strong market. He also advised founders and startups to tell their story more  aggressively and show investors how their current story leads to an even bigger story  in the future. 

• To the question of which sectors and verticals are hotspots of investment in fintech: Herston Powers of 1982 Ventures said:

(a) Southeast Asia has gone past the first wave of wallets, P2P lenders, etc. and now  sees more sophisticated tech with more layers. 

(b) Open banking, embedded finance, Buy Now Pay Later (BNPL) will drive interest. 

Ng Yi Chung of AC Ventures said: 

(a) Just as towns begin to pop up only after the roads leading to them were built, so  fintech infrastructure behaves in similar fashion, e.g. open banking would not  exist if there had been no online banking. 

(b) BNPL, recurring payments, embedded finance, open banking are all nascent  areas which will be of great interest further down the road. 

• To the question of whether NFTs are a viable investment, Ng Yi Chung of AC Ventures began by first asking how one looks at investment. Depending on this  definition, things like NFT, wine, art can all be considered investments. While  personally, he does not consider NFTs as viable investments, he said basic principles  still remain when trying to discern value, that is: 

(a) Does the investor have enough information to make a decision? (b) Does this “investment” fit your investment profile? 

• In closing, these remarks were made: 

Ian Ow of Ablr said that the hardest thing he had ever experienced on his startup  journey was having to do everything and anything to survive, even if it meant having  to map the whole process manually. 

Zac Liew of Curlec said that in a corporate job, one has a safety net. In a startup, the  founder holds people’s lives in his hands and one does anything he can at the end of  the month to ensure you can feed the many mouths that depend on you. 

Herston Powers of 1982 Ventures said that the future of fintech is really bright. 

Ng Yi Chung of AC Ventures said that the startup arena in Malaysia is really under rated. Contrary to thinking that the market here is not big enough, the trick is to find  that special niche and you will find there are truly tons of opportunities here.

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