Battle scars from coaching entrepreneurs
PUBLISHED ONJuly 15, 2014 3:00 AMByGrace Chng
Coachable entrepreneurs are worth their weight in gold, says Ms Koh Soo Boon, a venture capitalist of more than 25 years.
Many tech start-up entrepreneurs have doctorates or MBAs, and they think their inventions are good and they know best. This arrogance, if not corrected, will see their start-ups going down the drain, says the founder and managing partner of Singapore venture capital firm iGlobe Partners.
"I have many battle scars from these discussions with them throughout the years," she says, adding that entrepreneurs who heed their venture capitalists' advice are more likely to succeed.
In her earlier days with Temasek-linked venture capitalist firm Vertex Venture Management, she invested in home-grown Creative Technology, which went on to list on the US-stock exchange Nasdaq. In the mid-1990s, she invested in Lightspeed Technologies which provides desktop virtualisation services. Founder Jeffrey Goh recalls: "I met her for lunch and explained to her what we were doing.
She said, 'Very interesting, can package.' Those four words were magical. It led her to funding us. Due diligence was done in a few months, and we had our funding."
Ms Koh says: "You meet an entrepreneur and listen to his ideas. Within a short period, you have to decide to invest. What helps me decide is the founders themselves, their character and passion.
"If they just want to make money, they will skirt discussing the key issues. I want to see their commitment in what they're building. I want to be able to trust them."
Such win-win partnerships have led to successful public listings including US firm Telenav, which provides mobile location-based solutions, and Swiss company uBlox, which makes automatic telematics.
Ms Koh started her career in corporate banking but left to accompany her husband on a posting to San Francisco. After being a housewife for 18 months, she joined Singapore Technologies at its San Francisco office before moving to Vertex in the same city. The early days were tough because she had no contacts among start-ups or other venture capitalists.
So she set out to teach herself, setting up meetings and asking a lot of questions. "I had seven to eight meetings a day. Americans are generous, they will share with you, so I learnt a lot."
She left the company in 1999 and founded iGlobe. She remains excited, especially about the potential for value creation.
"Look at property development," she says. "The more you build, the more foreign workers are needed. When the project is completed, it makes one to two people very rich.
"In a start-up, you can make 200 to 2,000 people rich because they own equity and will share in the profits when there is an acquisition or public listing. That is why after so many years, I'm still excited about this industry."