Fund to play bridge role in tech investment

TAWAN Boonyawat, CEO of Bangkok-based Moonshot Venture Capital Co, wants to serve as the bridge between corporate Thailand and technology startups to help drive the digital transformation process.

Tawan, a former venture capital (VC) executive in the telecom industry, said Moonshot VC was initially capitalised by eight investors in multiple industries who were keen to take advantage of digital and other technologies to transform their enterprises.

The fund is worth about Bt1 billion or US$30 million, contributed by EMC and other listed firms in construction, building materials and manufacturing sectors. These medium-sized enterprises prefer to share the risks involved with VC investments.

Unlike conglomerates or other large enterprises, these firms lack the huge resources that would enable them to tap the potential of promising startups on their own, without incurring significant risk to their balance sheets.

Startups in so-called “deep techs” such as artificial intelligence (AI), robotics, material science, and drone platforms are among the targets sought for investment by Moonshot both in Thailand and in foreign countries such as Israel.

“We don’t have unlimited funding so we’re very selective and target startups that can give synergy to other investors’ businesses, such as those in construction and building materials. Our investors also have a customer base that can support the sale of innovative products and services created by the startups,” said Tawan.

“Start-ups are supposed to solve the pain points of existing businesses and their customers as in the banking and telecom sectors. The same logic is true for the manufacturing sector, whose profit margins are thinner and thinner due to unrelenting competitive pressures”

“Our mission is to discover new tools and technologies that can respond to this challenge. For example, new material breakthroughs will benefit the construction and building material sectors as will logistic optimisation technology.

“Regarding Thai startups, BUILK is one of our favourites, especially for business to business e-commerce and software as a service (SAAS) for building materials and the construction sector.”

BUILK is now in the Series A funding stage, in which a startup gets its first round of financing from a venture capital firm and the company ownership is offered to outside investors in return.

“Startups involved in property after-sale services are also interesting, as are those in asset maintenance management using predictive analytics. In manufacturing, the IoT platform for factory and machinery management using sensors and other tools to prevent failures is also promising.”

He continued, “Blockchain and tokens for enterprises also have good potential to reform banking and logistic services, substituting the use of paperwork and documents.

“For start-ups, there are multiple challenges, including the ability to evaluate performance and pain-point solutions constantly and change quickly to survive the initial stage of business.” Moonshot VC also wants to bridge the strengths of startups and established enterprises. The startups are nimble and risk-taking, while the established enterprises need to overcome internal cultural barriers to be innovative. “There is a learning curve for both sides for the ventures to be successful,” explained Tawan.

“First of all, we want to find the right startups [to match with] enterprises. The startup’s innovations can help the existing business grow and boost profits, while startup can benefit from using the business network and back office of the enterprise. Then, it’s the transformation process and the learning curve. In this effort, mutual trust is key.”