Kickstart Ventures Geeks on a Beach 2014 Building Innovation Ecosystem
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The Philippine startup space is developing atop an economic boom. Kickstart Ventures is an investor doing seed to Series A investment. Beyond funding, community development is a key role: while the "Silicon + landform" formula doesn't apply, an emerging market must figure its own formula for growth. Here are some lessons from Area 55, a developing innovation ecosystem in the Makati-Fort Bonifacio cities.
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Kickstart Ventures Geeks on a Beach 2014 Building Innovation Ecosystem
- 1. Building our Innovation Ecosystem: Lessons from Area 55 @Padme001
- 2. What We Do: Early-stage Investments Fund digital startups in the Philippines Seed to Series “A”. Equity or convertible notes. Train / Mentor Diverse and active mentor pool Market access Ayala Corporation affiliates SingTel: 501 million subscribers in Asia
- 3. What we’ve done: portfolio management $2,400,000 funds made available. 18 portfolio companies. 49 founders. 337 jobs. 576,334 users. 40 new third-party investors. $8,511,363 subsequent funding raised. As of end-July 2014
- 5. …helping create an innovation ecosystem. Community networking & thought leadership Startup Weekend Manila / Cebu / Davao Kickstart Startup Mixer #raidthefridge #Area55 #Area55 Conversations Corporate relationships Kickstart Deal Day Investor development #Manila Angels
- 6. What have we learnt along the way? Plenty. For starters – It is harder than we thought. It takes longer to get many things done. It takes diverse teams to make stuff happen. And there are things that we can do to make work better for everyone.
- 7. Decide quickly and clearly.
- 9. Embrace diversity. Open doors. Listen.
- 10. Scale. Succeed. Take responsibility.
- 11. Observe and measure honestly.
- 12. Break rules and dream.
- 13. Trust and be trusted.
- 14. If you call yourself an investor, invest.
- 15. The images are obviously not ours. But if you want to learn more about what we do, or our awesome startups, please contact us for more information. www.kickstart.ph kickstartPH angel.co/kickstart-ventures
Editor's Notes
- Good afternoon. I’m Minette Navarrete from Kickstart Ventures. It’s good to have had the regional and national overviews. Now I want to take that closer to home and talk about building our community. Or at least a Kickstart perspective about building our community, which we in the Makati – Fort Bonifacio area have started to call Area 55.
- Most of you know Kickstart as investors: we provide funding for early-stage digital startups, in exchange for minority positions in their companies. Portfolio companies have access to an excellent mentor pool from all over the world so founders can get guidance based on market experience, not theory. We love our friends in the academe and consulting trade, but frankly, our bias is for mentors who have walked the walk so they can credibly talk the talk. One of the most helpful things we do is open doors to corporations so startups can do business with established companies. This week, the Ayala Group held its Innovation Summit – and a bunch of startup founders met, pitched to, and had lunch with the CEO’s, COO’s, CFO’s, and business unit heads of the conglomerate, about 200 suits in all. A pretty good collection of suits, by the way: Ayala Corporation’s group companies have a market cap of over USD22Billion (about twice that of Singapore Air), and they account for over 20% of the country’s stock exchange. Every founder came away with one or two good leads – so we’ll see where that takes us.
- Our portfolio results over the last 2 years – well, you can read the stats. > We’ve invested close to $2 million in 18 startups. A third of our portfolio companies have gotten subsequent funding, raising more than 4 times our aggregate invested amount, from 40 third-party investors, including great names like Omidyar Networks, Y Combinator, 500 Startups and IMJ Investment Partners. A couple more are closing in the coming weeks. It’s a promising start, but frankly what we all wait for is getting the significant exit, or exits, that demonstrate that the Philippines is a legit innovation ecosystem.
- Who joined us at Raid the Fridge last night? You should know that aside from beer, our fridge back at home base holds a couple of bottles of champagne, waiting for that first liquidity event.
- To get to that champagne cork-popping moment, we put in the groundwork together with the rest of the community. As an investor, we try to do our share of heavy lifting. We use 40% of our time in structured coaching, another 10% mentoring on-demand. We spend 2% of our budget on community events. Area 55 has welcomed policy makers like the US Secretary of Commerce and Philippine Senator Bam Aquino; and leaders from Amazon, Dropbox, Google, Twitter, and the National Competitiveness Council. We spend a good deal of our energies building bridges to corporations and investors. We are clear that we do what we do for a financial return: that way, corporations and co-investors have confidence that our portfolio companies are good business bets and not charity cases. Google “Area 55” and you’ll see a reference to “The Philippine Economy’s Secret Weapon” by Singapore’s Tech In Asia. We spend nothing on advertising.
- There isn’t a playbook that tells us what to do in the context that we’ve got. We are figuring things out as we go along. We act from an articulated set of values and principles, and trust that these will help us navigate unfamiliar territory and overcome all the obstacles. A lot like the Force, really. Some lessons we’ve learnt…
- First, my favourite quote, from my favourite character. There will always be information that is known, and unknown, and unknowable. Deal with it, and make a call. Over-analysing, negotiating too hard, or flip-flopping over decisions can kill innovation, whether you are a startup or an investor.
- Yoda’s a probably every mentor’s favourite mantra. Act with conviction, and a mindset of abundance: do the experiments, test the market, go all in. Don’t skimp on the wrong things.
- Embrace diversity. People who think and act different are essential for successful execution, unless you are a cheerleading squad or a synchronised swimming team. It makes for a richer community life. I am constantly amazed by how widely different our guests are when we hold Raid the Fridge in Area 55; and the conversations we have there are certainly quite interesting.
- Don’t buy the hype about the coolness of your startup life. It is fun, but hardly frivolous. It takes hard work, discipline, and maturity. If there’s one question that we frequently hear from potential co-investors, it is whether a founder or co-investor can run the whole course. Our innovation ecosystem is coming into its own; we all have to contribute to its maturation.
- Rational decision-making. Data-driven debates. We should know what our personal biases are, so we can assess data with clear eyes.
- Do the hard things. Not because it’s inspirational fluff, but because the hard things have the prospect of yielding greater returns.
- It’s important for our community to have an ethical backbone. If you’re a startup, don’t lie. Most investors will have developed a fairly sensitive bullshit detector, and you don’t do yourself any favours by misrepresenting stuff. If you’re an investor, do not propose predatory terms. Do not take 30, or 40, or 50% of an early stage startup: it makes them uninvestible, or at least unappealing to other investors. Do not demand 10% of the company for “introductions and advice” without handing over some cash.
- And finally, a word to investors: write the cheques. Err on the side of generosity. Risk capital is a necessary part of the innovation ecosystem. It’s not sufficient, but it’s necessary. So as Dave Overton said at the beginning of this conference: let’s invest in this country. Let’s help startups succeed. We’ll be open to the Jedi mind tricks, but please open your chequebook to the startups that deserve it.
- Thanks and have a great conference.