During difficult times, startups often see extreme results – either very bad or very positive. Economic downturns may turn profits for companies that provide debt relief solutions or digitalisation tools. However, for most companies, economic uncertainty is never a good thing.
But can Southeast Asia’s startups weather the storm. Some investors think so and remain bullish on the region. We spoke to Antler’s Jussi Salovaara, Managing Partner and Co-Founder, Asia about their expectations over the near future, as we go through uncertain economic times.
The venture company follows a simple ethos – to invest in exceptional people as founders. This can even mean backing the person even when there is no startup to invest in. Antler has also recently announced its commitment of US$100 million to early-stage startups in Southeast Asia by 2025.
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To date, Antler has invested in more than 450 companies in over 30 industries. These include the likes of Homebase, Cove and many others.
What are the characteristics that make a great founder in Southeast Asia?
The characteristics of great founders are the same in Southeast Asia as everywhere else – grit, drive, clarity of thought and awesome problem-solving skills among others. Given the complex nature of Southeast Asia as a region, the role of both grit and problem-solving skills are especially important.
Further, we are excited to see more and more founders coming from the successful startups of the region, which puts them in an ideal position to build for the region given their experience. We have, for example, invested in three of the first 50 employees of Go-Jek (all in different companies). These founders have firsthand seen hypergrowth at the early stage of Indonesia’s first decacorn, and have all the lessons learned to tap into when building their own companies.
What is the current investment climate at the moment, as we see an economic slowdown across the region?
The investment climate has of course, somewhat slowed down from last year’s peak, but in the early stages, the market is still quite active. Just to give an example, we have just signed two Series A rounds in the last month alone and also have term sheets on the table for two B rounds, so deployment still happens.
Many regional VCs have a significant amount of dry powder (=undeployed, committed capital) and will keep investing over the next months. The most important thing is that there are great founding teams that start building innovative companies. As long as that happens, the capital will be there. After all, many of the most impactful companies ever have been founded during a downturn.
Are there specific industries in the region that you think are under the radar at the moment?
Antler is a sector-agnostic investor and we believe there are opportunities in every industry. Some of the sectors we are right now excited about include logistics, commerce enablement, circular economy and travel. Further, fintech and web3 are exciting sectors that are here to stay and we will be backing companies in these sectors as well.
Which markets in Southeast Asia are showing the most potential for growth?
Antler has a presence in Singapore, Indonesia and Vietnam, and we firmly believe in those three markets. In fact, we will increase our investment volume in those markets this year.
Further, we are excited about the prospects of the Philippines, which has shown remarkable growth lately. When you combine this with a large domestic market and good English skills, you have great building blocks in place.
End of the day though, we at Antler believe that great talent can be found everywhere, which in turn means that great companies can be built pretty much anywhere. Both Malaysia and Thailand also have great companies in the ecosystem, and we can’t wait to see more of these companies grow into regional giants.
What’s next for Antler?
We will keep doing what we do best – help build lasting companies. Antler is right now present in 25 locations, and we will be further building our global presence as there are many ecosystems where we can further add value. Our global is a significant value add to our portfolio companies. On top of this, we will strengthen our platform to add more value to founders with operative topics, such as support with fundraising, hiring, getting the best possible perks from different vendors etc.