“What is the difference between a great idea and a great founder? Which is better?” With these words, Arrif Ziaudeen, founder and CEO of Chope, starts the ball rolling and gets the discussion off to a rousing start.
Ziaudeen is moderating the second instalment of Great Minds At The Great Room, a series of talks jointly presented by The Peak and co-working space The Great Room. Titled “Investing in Formidable Founders”, this session brings together Ozi Amanat, founding partner of K2 Global, and Hian Goh, founding partner of Openspace Ventures and founder of the Asian Food Channel, to share their insights into how venture capitalists suss out the investment potential of a company, based solely on the founders.
“We bet on people,” says Amanat simply. “That’s our first philosophy. I’ve seen a lot of bad ideas become great companies because they had a great founder.”
Amanat and Goh talk about the qualities a great founder should possess. “It’s difficult because you have to quantify something that is not quantifiable,” admits Amanat, whose company – a bridge between a venture capital and private equity firm – has invested in some of the biggest names like Spotify, Airbnb, Uber and Alibaba. “Does the founder have an X factor? Do they see the world differently? Do they have scars? Can they pivot a company that needs pivoting? It’s a flip of the coin, really. But, with some people, you can actually see the life force within them, that can take over the room.”
Goh looks for emotional authenticity. That was the reason why his company, Openspace Ventures, which focuses on Series A and B funding, decided to invest in Love, Bonito, the Singapore fashion label started by Rachel Lim and Violet Tan. Spending time with Lim convinced Goh he was right to go with her. “She has this killer instinct,” he says, relating her uncanny ability to extract useful information for the business from anyone she meets. “And it’s related to the fact that she’s a people person to the tee.”
The other person Goh is impressed with is Nadiem Makarim of Go-Jek, the founder of the Indonesian start-up that started out in motorcycle ride-hailing but has since expanded his business into logistics and digital payments. It was valued at US$5 billion (S$6.9 billion) in February this year and plans to fill the vacuum left by Uber in Singapore. “He’s ridiculously smart and even unreasonable, but what makes him formidable is that as the business grew, he grew with the mandate.”
Ziaudeen projects a slide with a number of qualities listed in a chart; he had earlier got Goh and Amanat to rank them in order of importance for a founder. Both singled out “grit/ perseverance” and “gets sh*t done” as the two most important qualities out of a list that included “being visionary”, “being obsessed/expert in the field” and “commanding respect”. Ranked lowest by Amanat was “empathy with other humans”. “That almost got me divorced this morning,” he says ruefully. “But, honestly, venture capitalism is a brutal business. It’s not philanthropy, it’s not a social enterprise. We are out there with swords and knives and fists and we are fighting. People don’t see that, they see only the sex appeal, and the amount of money involved.”
Conversation swings round to personal stories of opportunities that they missed. For Amanat, it was Anthony Tan’s Grab Taxi. “I kick myself every day over that but you can’t catch them all.” For Goh, it was Quek Siu Rui’s Carousell. “I just couldn’t see it but I guess I’m still new to the game – and always changing my hypothesis as to what a good founder is.”
Ziaudeen wonders if the environment of Singapore isn’t really the most ideal for producing entrepreneurs, let alone formidable founders.
For Amanat, born and raised in New York but now based in Singapore, the issue is moot. He compares San Francisco with Singapore, noting that failure in the former often means losing everything, becoming a bankrupt and starting from scratch all over again, as opposed to Singapore where failure merely means pivoting to another company. “So there is a safety boundary in Singapore but I’m highly supportive of it, because it means this place
will probably be a hotbed for idea generation for the region.”
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Goh thinks it might be a case of needing more role models. “I used to tell Quek that he needed to sell his company for an obscene amount of money and live a very decadent lifestyle, get a Ferrari and an inappropriate girlfriend like a Taiwanese starlet,” he says, to amused chuckles. “Everyone would sit up and say ‘Hey, maybe I could do that!’ because no one’s seen that. We need a bad boy – maybe then the entrepreneurial juices would start flowing.
“The ecosystem needs heroes – when people see that you can be way more successful than the average doctor, lawyer and accountant by being an entrepreneur, then maybe more would step up.”