According to a recent report, leading Thai corporations and investors are marching to Silicon Valley through a US-based deep tech venture dedicated to start-ups to empower Thailand’s economy.
A second funding round worth THB1.62 billion (US$50 million) has already closed, faster than the expected date of the first quarter of 2019, and we are ready to invest in deep tech start-ups. The venture will expand to Israel after Silicon Valley, according to the managing partner of the deep tech venture.
The second fund is made up of various corporate ventures as well as individual business investors.
The managing partner of the deep tech venture stated that Israel has many interesting start-ups in agriculture, healthcare and cybersecurity, and all are expected to grow and play a more important role in the economy.
The second fund targets investment in four areas of deep tech start-ups in Silicon Valley – industry (construction, manufacturing, logistics), agriculture and food, energy and healthcare.
The partner stated that the deep tech venture has a stronger network and it can bring these technologies to its investors’ businesses and have these investors be customers of start-ups.
The company mainly invests in series A funding, worth over TBH32.6 million (US$1 million) per deal, and aims for returns within 7-10 years, mostly in capital gains at a rate of 3-5 times.
The managing partner also stated that the fund is planning to have offices in Singapore and Taiwan to help portfolio companies expand to Asia.
It will invest in a US-based start-up that innovates cold chain packaging for environmental savings and competitive prices.
The deep tech venture will add a Singapore office in November this year and plans to expand into high potential deep tech in Taiwan.
Over the next 4-5 years, the company expects to establish a third fund worth THB815 million (US$25 million), with larger funding size and dealings.
Interesting start-ups need to have breakthrough technologies, scalability and an eye for larger markets overseas, according to the deep tech venture’s managing partner.
The partner stated that half of the first fund, worth THB358 million (US$11 million), has already been invested in 14 companies one that is developing robots for commercial kitchens, and another which is developing an AI for construction scheduling platform that has already been adopted by Ananda Development.
The managing director of one of the investing companies, with a fund size of THB815 million (US$25 million), said the firm expects next year local and international start-ups that it invested in will help add new businesses to the company such as AI for customer insights, food and packaging.
Investing in overseas start-ups will foster local start-ups to work harder, looking to a larger market. The government may consider forming joint investments and offering more incentives to strengthen start-ups in Thailand, according to the managing director.
He added that the ventures he is in might spin off a new firm by collaborating with local and foreign start-ups to help technology capability here.
The investment director of another one of the investing ventures said that the company is exploring opportunities in new businesses and advanced technologies as well as investments in telecommunication infrastructure and digital services, including logistics in ASEAN. The venture has invested directly in an e-wallet developer and the Myanmar Information Highway.