Jeffery: Welcome to the Supporters Fund Ask An Angel. I’m your host, Jeffery Potvin, and let’s welcome our guest today from Singapore, Tobias. Did I say that right? I was going to make sure I didn’t want to mess that up but you sound like a German. pleasure having you and thank you very much for joining us today.
Tobias: Absolutely Jeffery. Thanks so much for having me in the first place and excited about the questions.
Jeffery: you’re going to be awesome, you’re going to ask me. well there’s lots of good ones, I hope. but we’re going to dive into it so we can learn lots about you and what you guys are up to today. So, Tobias, maybe I know you’re in Singapore today which is a fantastic, nice little country. I love it there. Let’s dive into it. if you could give us a little bit more about your background, where you come from, where you’re at today, where you’re going and then one thing about you that nobody would know.
Tobias: Yeah, the good question. I like the second one you started with that with a bit of a background and then we dive into the secret question. So, I’m originally not from Singapore. I’m from Germany. actually it’s a tiny place close to Munich. actually it’s an hour drive in the south close to Austria. It’s called Berchtesgaden. It’s quite a mouthful. So, I grew up there obviously, went to school in Germany, did a law degree in Germany as well, and then went into the investment banking side of things across Europe. I was a little bit in consulting across Europe as well but mostly in Austria and Germany, basically now in the recovery service. We brought businesses back to profitability and then I moved to Dubai. I was in the Tech Space of an SME company we worked with in Iran and Iraq. a bunch of emerging markets in the space helped them with all the full penetration and gave people access to two games, musiC and all this stuff. Then I moved to chinA, lived there for about two years, learned fluent Chinese and also worked with a startup there. So, I joined super early. We raced with a capital and then went through SOSV which is a bigger US accelerator, but they have a bunch of different offices and then I actually ended up joining the US as we used to work with the investment team for a bit. We looked at IndiA, Korea , MusiC Tech, Southeast Asia predominantly. just because IndonesiA, Philippines and Vietnam are obviously very booming markets. And, then, went back to school in Singapore. I did a postgraduate degree there as well at NUS and in ChinA, and then joined blockchain farmers fund as sort of the third guy there together with Al-Mansour. And, for two years, we’ve been building this VC. I’ve invested in about 55 plus companies now across the last two and a half years. I had a crypto unicorn in a gaming space called Splinterlands, a bunch of other really good successes in those two years and in February. this year we actually decided, okay, let’s raise a proper fund. And, so now we’re raising a 75 million fund view. but 45 million committed now, and I’m going to have the first capital column in about two weeks. And, then starting deploying the money into interesting blockchain and merging tech startups basically from mid November and going to do 200 investments over the next three and a half years, and hopefully find some other interesting companies. I’m pretty sure I will find some interesting companies. And, then the next question you ask is like something nobody knows. it’s actually interesting which connects you back to where it actually started off and came from which is Obamacare. So, every 10 years, we have what we call a passion play, alright. So, it’s something where everybody I mean that’s almost a whole village comes together every 10 years and plays a theater act. It takes five hours. We played a hundred times and you’re not allowed to cut your hair for almost two years because it needs to be realistic. And, so you have to picture me probably here like this and a white angel costume walking around, walking across the stages and talking to the people, what god has been told in the past. So, that’s something very specifiC from our hometown. It happens every 10 years. it’s actually happening 2020 as well, and in the US, 2022. actually because of COVID-19, I got shifted for two years. I’m not going to be participating this time but I have done it a couple of times in the past. And, if you go on YouTube, you’re probably going to find me.
Tobias: That’s awesome. Well now I have to ask another question about this. So, who coordinates this and how big is the city and how many people are participating in this?
Jeffery: no, cut your hair for two years. Yeah, it’s quite big honestly. So, we’ve done this for 400 years. Wow, so every 10 years. except I think World War I or World War II or something, that was about a gap. This has been happening every 10 years. And, there’s one person in the city called the Christian. he’s like organizing it, putting it all together, recruiting their people and it’s a huge thing. I mean we are four thousand people, four and a half thousand people in this village. And, I think probably like three and a half thousand people actually. So, every time we act as five thousand people watching it. We acted a hundred times. So, it’s half a million people just coming to this tiny village over the course of I think like three months or so, like it’s happening five or six days a week. And, it takes like six hours, right?! a two-hour break in between. so, it’s a whole day thing and people come from all over the world, like it’s gotten quite a bit of attention. so, we have a lot of Asian tourists, a lot from the US. So, basically, from everywhere and it’s like honestly. It’s the biggest thing, every 10 years for this little village. you can imagine. nothing else is happening there, except a bunch of tourists. but it’s a nice, cute little town.
Jeffery: Wow, that’s incredible and I think just being part of that atmosphere and having to coordinate and put all this together. sounds pretty cool. probably not the best profession to go into if you’re a hairdresser or working in a salon, you might lose some dollars for a couple years, but I guess there’s always ways to trim that hair and keep yourself looking polished. but that’s pretty cool.
Tobias: I think that’s a lot of people that come together, so real Camino based. I grew up in a small town of 6000 people.
Jeffery: So when you say a village, I’m thinking like 150 people but 4000 people in a village sounds like a pretty big small town. but either way, maybe I’ll say, I came from a village too. And, then I can share my story of a small town growing up. I love how people correlate the two differences.
Tobias: I lived in ChinA, lived in Shanghai with 25 million people. that is they don’t even know what four thousand looks like. they don’t agree with the city or a village. That’s one person. That’s two cars on the subway track. So, yeah that’s my neighborhood.
Jeffery: That’s a pretty village. Now, I can see that. I can see that. So, I’m from a village too. so I’m going with it. That’s pretty amazing. That’s pretty cool. So, we’ll take a step back though and dive a little bit more into what I think is pretty prevalent to any VC or anybody that’s investing in early stage companies and that’s you worked in a startup and you’ve been through the ringer of what it takes to be in a startup. Are there any real lessons that stood out for you when you were working in a startup? what it felt like, what it was like for a founding team to build up their product, raise funds? any couple points maybe. three or four points that really stood out about what it takes to be a startup.
Tobias: Yeah, I mean. So, I work with two startups actually. So, one in Cambodia and one in China. And, first of all, it’s a very different environment to be in. The startup was more in the Tech Space and the other one I worked with was in the Fintech Space. So, I think a couple of interesting points to mention here is obviously, first of all, when you start really early on, you’re going to end up doing everything right. you need to be completely okay with it. That’s also the people you want to recruit for right. if you hire a guy in a BD role at the beginning and that’s sort of what he’s focused on, I think it’s going to be challenging because he’s going to end up doing recruiting. he’s going to end up doing reporting. he’s going to end up doing finance. he’s going to have doing anything because there are three people in that startup and you need to be flexible and agile enough to take on literally every task which comes across your joB, your board, or your desk essentially. So, from a hiring perspective, that’s interesting. The second thing is that we have made a couple of mistakes before hiring people with the wrong vision. there’s a couple of people who are not really hundred percent aligned with what the end goal is. And, then you see that pretty fast in terms of compensation. they care more about the cash benefit rather than a stock option. all these things which then should already be eye-opening to some extent. So, recruiting the first people in terms of skill set but also in terms of vision is one of the biggest things which I’ve learned. And, a second thing is probably in these emerging markets, quite interesting is from a geopolitical perspective. So, doing business is of course not easy in the first place. but doing it in a country like Cambodia for example, where everything is even from an infrastructure government perspective, much more emerging, and somewhere else brings additional challenges. And, these are challenges you probably would never imagine. If you do business in the US probably, or even in Germany where I come from, it’s still difficult to have a startup because of operational challenges and execution perspectives. but like corruption and things like other issues, you probably know that they’re existing but are not very present. you become a very different scale in these markets and they have a different additional hindrance to growth, an additional challenge to growth. And, that was actually the first time I really realized that. And, I had no idea before what perspective and scale to take on. So, these are a couple of interesting things which I think are especially relevant in these markets. I mean China is getting better, but Cambodia is still already staging. And, there’s still a bit of a wild rest in a sense of what you can do and can do and you see that quite extensive in terms of regulations, in terms of laws which have been made up, and also in terms of how the whole system works. it’s not as straightforward as a process. it’s more like who you don’t know and how to get to those people and then you can do a lot of links as well. Those are three great points, and two of them I’m going to hit on because I think that they’re really relevant to the conversation on what learnings that you’ve brought into the environment which I think are huge.
Jeffery: the many hats, you’re right, small team. you’re going to wear a lot of different hats to build your company and you’re going to shift and grow as your business grows. So, you’re going to bring new people in. you’re going to slowly try to focus as you grow your business and commercialize. So, those things will happen. one of the things when you talked about the vision and having people that were part of the same vision, how to build the business and the same part of the same strategy. maybe share a little bit more about how you were able to determine when people aren’t on the same page, when people aren’t really understanding where you’re trying to go and what measures you can take to either align people on that vision or move them out of the business because they’re only going to be bringing the business down. what are the red flags that you see around that I think this is highly important for startups because I would imagine that a lot of them are just building and sometimes they’re not paying attention to all the different resources on the team and not really maybe getting the feedback of negativity or going in a different direction or people’s personalities getting in the way. What things stand out or red flags do you notice that startups can utilize to help them better see this and then pivot and change as they need?
Tobias: yeah, I think you have to sort of break this down in maybe like two or three areas. Obviously, the first thing is probably like from a hiring perspective and then from an execution perspective. And, then probably like moving forward, the three errors in a cluster. So, let’s pick the first one from the hiring perspective. I think when you’re talking, especially at an early stage. when you’re hiring your second or third, fourth, fifth, sixth guy or was your girl. you want to make sure that when you talk to them, they know about the space. they give you ideas, and not just ask. I mean the thing for me, it’s important because if I hire the fourth, fifth guy. they’re not going to be executing what I tell them or what anyone else is going to tell them. I need someone who builds this company with me and brings their own ideas and has a similar, maybe even a slightly different vision. but then you align and pivot together and with all the conversations you’re going to have and with customer feedback and investor feedback, you get your way around. So, when you interview someone who is taking an important position early in our company, you essentially want to be challenged by that person. And, you don’t want to ask him where this company is essentially going and how he sees the market evolving. And, like he brings all these interesting components to a conversation. And, not just like yeah, if you tell me this, I’m going to do that. I mean that’s like the wrong mindset of someone who will take an important decision in an early stage company. And, then the second is also even from a compensation perspective, if someone really believes in what you’re doing and thinks this is going to be the next unicorn, they’re probably going to be more interested in actually getting part of the equity or getting part of the stock options or things like this because that’s what really ties their performance to the company’s performance. if someone is only interested in getting a cash component or making a short time thing, I think it already shows that the vision is probably a little bit different. because if you are going to be working with the next Facebook and the next Facebook is going to win and you don’t care about six, seven, eight thousand dollars cash, you want to have the shares obviously. And, that was what’s going to bring the whole value in. but that’s also what aligns the incentives again. now if you’re already in sort of working with founders and building with them, I think it’s super important that people are coachable, especially early where like the company probably going to look 100% different throughout the first years in terms of vision, in terms of how we build things, in terms of even business models. they change sometimes completely after you talk to first customers and get your insights and even talk to investors and get feedback. So, if someone is very much aligned in what they want to do, there’s no way of having flexibility in terms of conversations. or if someone’s not really coachable and thinks it might be good for an investment banking position where there is not really anything wrong, or in a sense. but since this is going to change so tremendously and has so tremendously impact on what you’re going to do. It is also challenging to work with these people. And, then the second part, which I think is pretty interesting, it’s another perspective of work ethics. It’s not a nine-to-five job. And, there will be ad hoC stuff and raising a startup is like raising a child in a way it needs constant attention and you need to constantly work together. you’re constantly going to have challenges which seem impossible to overcome, then you’re probably going to find a way to overcome. So, having someone with that sort of mindset that this is something he’s going to devote this time to and if you want to make it big is extremely important. if someone comes in, it’s like okay, I’m going to work hard 9-5, that’s probably also going to be a challenging early day. early on, I mean later yes. fair enough, there are going to be different positions. but this is all like where I see red flags. but again, it also depends on the startup founder itself. if you don’t want to be the next unicorn, if you just want to build an interesting sustainable business, then it’s again, it’s up for you to decide where your vision is. And, then surround yourself with people who are potentially better or even probably better than you because you’ll never be the smartest person in the room, not even the first smartest person in your startup. And, then align them with the vision you want to. just one is just going. you want to see the next unicorn and you have people with a similar vision. If you want to see this as the next small medium-sized business and just make a decent salary out of it and never sell it, then you need to have similar people with a similar vision. And, then that’s sort of what I mean with that choice first but if you chose some things, this could even be wrong. And, then figuring out, okay what to do with this person is sometimes hard to let the person go. but you should also not be intimidated by being challenged as a founder. So, someone who challenges you as a founder, also needs to be coachable and needs to sometimes take it in your pocket. If someone else has a better idea then so be it. No, not just because you’re the founder or the CEO that everything is going to be perfect. That’s also important to know. And, that’s the people I would like to have around me. when I do something, well there’s a lot. So, I’ll unpack some of them. but what I think is the key to your hiring process and to make sure that they’re aligning to your vision is that you’re hiring leaders. they’re hiring people that maybe they’re not 100% full leaders today. but they’re aspiring to become a leader. so, they’re going to push back against the founders. they’re going to push back and challenge all of the people in the business to ensure that it’s going in the direction, it’s growing, it’s building, it’s scaling, whatever. As you mentioned, whichever version you take of your business, if you want to be a unicorn or you want to just be a happy family office. So, I guess there’s different stages. but you’re really trying to find some strong leadership. And, I think to unpack the other piece of it was that not only are you finding leaders but you’re finding people that are self-directed that they can take the ball and run with it. So, it’s not you having to dictate what everybody needs to do because like you said at Persian person four or five, it’s getting out of the realm of you managing everybody micromanaging. So, you have to have leaders that are really tackling the market and pushing the business forward. And, you’re aligning to that vision now, not aligning to someone telling you what to do. Yeah, and then tying in the coachable aspect of it, which seems like the founder has to be more malleable as well, and drop the pride and look at their team as instruments that are going to help them scale and grow and they need to be able to take that input, feedback, coaching, anything that’s going to help them improve at the same time. So, not only are they being the leader and moving the business forward but they’re also being malleable to adjust to the personalities and everybody on the team. So, that strategy or the vision continues to keep aligning as they move forward. Yeah, I think that’s a really good summary and that’s another point. I wanted to bring it across there. And, especially the last point is, it’s really important because we have tried to work with a couple of founders before or even like seeing them on the call and things like this when everything the founder says is the thing, just because this person has been in the industry for like 10 years and figured out this problem, and built the business early on. And, that might all be true and it’s highly respected. I mean if you’ve done this. like you’re my full respect. It’s a very difficult journey,. but still sometimes you’re so concentrated and so tunneled in what you’re doing that any outside perspective is also super helpful because it can bring out this different light, this different perspective on what you need as a founder. because it’s so obvious for you, everything you do because that’s where you live it, that’s where you work it. but every other person who comes in with a different perspective is similar to our customer. look at it. If you think about it, they don’t have all this previous knowledge. They just want to have something easy and simple which works. And, then sometimes you get stuck and it’s obviously very simple to you but sometimes it’s not. And, then outside perspective. And, you should have the courage to accept if something is actually better or more interesting or good advice. no matter how good a vet or rich or whatever you are.
Jeffery: no, that’s a great point. And, I think a lot of founders need to take that step back at some point and realize that they’re building a business, they’re building a lot of personalities and there’s a lot of people that are hungry and interested and want to grow and support the founder. no matter if they’re the smartest person in the business or not the smartest, but they’re at least driven to make something successful, people want to get part of a vision. they want to be part of something that has to go somewhere. And, it’s tough to find people that just like to hang out and work and not go anywhere. So, I guess that’s a really big component to what you’re saying is that you really do have to have that strong vision so that everybody can align and you all have those same successes and you’re doing them as a team.
Tobias: yeah, that’s the same thing for advisors, mentors, anything you bring on. they should all be aligned to that vision. So, everybody is sort of pulling on the same string essentially to get to that goal where you want to end up going and what you think is best for the business. but then obviously, getting advice and getting input along the way.
Jeffery: I love it. And, you mentioned this before, but getting coaching and getting advisors and help, I think that makes a big difference in any business project or anything that you’re going to do. it certainly helps you work your way through a lot of those issues. And, I think the one that I’m excited to talk about is the more exciting, I guess is the geopolitical side that you mentioned. And, we talked to a lot of investors around the world. then what I love about what you brought up is that there is this underlying elephant in the room which is that every country operates differently. And, you probably don’t learn a lot of these things until you’re in the thick of it. And, then like you said, you had to learn that there’s different things that can go on in government and some of it might be greasing the wheels of justice or whatever that might be. And, startups probably learn the hard way when they get in, how they have to operate, how they have to graB attention of officials or businesses. And, everybody has a different way of how they get compensated and how they operate and work inside of that business space. So, maybe you can open up this a little bit more around the types of things that you’ve seen. And, I wouldn’t say it’s just specifiC to Asia. I’m sure that there’s a lot of countries in the world where startups have to work through these types of measures. but what I’m interested in is that it’s not to call it out and say hey, this country, you got to pay off this guy in order to get this to work. it’s more of understanding what types of things can startups face and then what’s their way to work around them. And, I have a feeling that a lot of this goes back to the coaching and the advisors that come in, that they’re the ones that have been living through this. like the 30 years, as you mentioned. And, they’re going to bring enough experience to help you tackle some of these big problems.
Tobias: Yeah, I think it’s a very good start to what you mentioned. So, first of all, what can go wrong or what could end up being in a challenge. And, I’m talking more from the countries I have experience in as of now. but I’m pretty sure as you said, it’s probably everywhere. I could run some challenges like this, but as when you’re in a readily stable market, I would say like Singapore, you worry more about customer acquisition. when you get funding, like the standard problem a startup essentially faces, and you don’t really worry about like will I ever get a bank account or will I ever get a license or will I ever be invited to some certain events where I need to be part of, and the thing is, especially in emerging markets, if you are able to pull off an interesting business, the market is very small and it’s something very special. So, if you raise a big amount of funding, the whole country will know and you will just be on people’s radar, if you like it or not. because there are simply not as many of these breakouts as you might have in other countries. So, for example, we worked at our company and we raised the one of the, actually I think, was the biggest siege round in the whole country ever. So, if you do this, obviously people know you and everybody wants to know you. If they don’t know you, everybody wants to know you. Exactly, so it’s obviously on the one side. It’s a very good thing because hiring talent and getting media attention is very simple and also helps you, of course, pushing the name out cross-border. because in some countries, even though they’re emerging, the actual market you can capture is probably smaller or it’s developing currently. So, it’s always important, especially markets like Laos, Cambodia or even smaller markets in Africa or South America. like the strategy will always be capturing what you can in your market especially the bigger cities and then the outskirts or the provinces. you will probably not just reach, because the infrastructure looks very different. So, you have to go across borders to the next biggest cities. And, in Asia for example, it’s interesting because it’s very homogeneous. So, even in Cambodia and Phnom Penh, which is a little bit our early stage country in general, people go to Starbucks and spend five dollars on a coffee. Although the GDP per capita is always a very different story than somewhere else in the world, they all have thick talk. They even invest in cryptocurrency. So, it’s very simple and very similar. but when you move out of the phone pen place, or like out of the capital, then the whole landscape looks very different. So, that’s why you either focus on one market, and like to build something which everybody can use which is then more of an infrastructure perspective. or are you more of something sophisticated and layered on top and then obviously move out and capture similar markets. And, that’s the next problem. so once you get all this attention, relationships are typically in the countries I’ve been working in very important. So, if you are having a challenge with one relationship, even though it might be before you’ve never done anything in the business world, now you have the attention. So, now this person probably has a bit of power. So, that also determines who you speak to, who you get invited to and that is a big thing. So, building these long-term important relationships is becoming a very different level. And, it’s not just not like connecting with someone on LinkedIn, having a chat with them, that’s like, it goes way way deeper. It goes like supporting what they’re doing, like going to all their galas, like getting engaged with them. It’s literally building a long-term relationship. So, this whole networking has a very different meaning in that space. So, I’ve always been trying to do a lot of networking and things, but when I reach this country, I know, okay that’s a whole different level. And, if you’re not used to this as a founder, that’s going to tremendously put a barrier in front of everything. you’re going to because you have to approach it as the country does it. And, not you as a founder would do it. And, then it comes basically to your point. it’s how you understand that and how you reach this, typically not by yourself, reading a book about it. That’s probably not going to help you a lot. So, what you need is local people or even people who have been in the market for a very long time, who understand how business is being done there, and these people you want to get involved with. These people want to talk because even if you potentially have closed the door, they might be able to open it. but not yourself, if you up this relationship, or my language, like you’re out, this is done. So, you need someone else opening the door for you again. there’s no way of knocking against the door and saying I’m sorry, that was a bit rough. or I know, yeah, just dispute down the road. This door is closed from your own personal perspective. So, I think the biggest takeaway is, you have to expect the challenge literally everywhere even from things you would expect, that everything runs smoothly. Opening a bank account in the US is probably a straightforward process. no one is going to come and say, oh, you’re not going to open a bank account. it’s probably not going to happen. But these things can happen and it’s a very important decision where you go into the market because now we see a lot of companies coming over. And, oh, I want to build a market, a startup in Indonesia because the market is big. fair enough that’s true. That’s also why a lot of people tried in China and completely failed and because the whole market is so different. So, you are another local with no local connections, with no partnerships in the market, with no legal standing, always having challenges, setting up entities, setting up bank accounts, getting licenses. Just because you’re not Cambodian or Indonesian, and there are some certain restrictions on how you can operate, it will be very challenging for doing business there. So, that’s why you want to surround yourself with local people who understand the system, who have good connections. And, then advisory boards, but also hires ground hires. you cannot build a business in Cambodia with only foreigners. it’s also not going to happen. There’s a bunch of these challenges which again come around hiring, come around from operations perspective. but also adjusting to it as fast as possible. And, not adjusting by reading a book, but actually getting real hands-on advice of how this would potentially go to play out. if you do XY sound, and yeah, it gives the whole pounding experience a whole other level, adds a bit of salt, a bit of pepper, makes it spicier. And, that also makes it more interesting. I mean as long as you can sustain and you build a long-term relationship, it solves the problem. you can also succeed in these markets. it’s just going to take a little bit more time probably and it’s going to be a little more challenging. I love that because when I started a company in the Philippines 15 years ago, there were a lot of interesting challenges. but it wouldn’t have started if I didn’t have Filipino partners. It wouldn’t have occurred if I didn’t understand the culture and took it for granted, because I was moving quickly, you’re not really paying attention to all the little elements that you just talked about. but how vitally important they are and what it really comes down to is the relationships that you build and how strong are those relationships. because when things get tough, they are stepping in to help you, they are helping direct you around those tough spots. because they’re locals, they understand how the government works. They understand how businesses are working on the ground. So, they can actually steer you through. And, a lot of them came from just setting up bank accounts or understanding how you could actually register a company as a foreigner in a foreign country. And, a lot of those stipulations came up and they don’t want to work with you. or the banks are saying, well we’re not sure we can do this because you’re a foreigner.
Jeffery: So it is quite fascinating the things that you learn. And, I think to your point, the biggest thing that comes out of all of this, is that when you are starting a company in another country, you figure out how to be a pretty damn good networker. And, go deep as you can on the relationships because those are the ones that are going to help you survive. And, then if you do that, I mean all these markets, they truly offer a tremendous potential of doing business there. So, it’s just a way of approaching it correctly. And, as you said, building these long lasting and deep ties to the culture, the business and the political side and then having the people to support you when some things get challenging. And, now that you’ve spent the last few years traveling around and building up in Asia and other countries as well, but specifically in AsiA, now you’ve launched into your own fund over the last two years. taking all these great learnings that you have and all these deep relationships that you’ve created, how much easier was it for you to kick off and build up this venture firm? because of all the types of relationships that you made that people wanted to support, ended up becoming a lot easier than just dropping in and saying hey, I’m creating a venture firm. Everybody lined up. Let’s get going. Did it work a lot easier for you in that fashion? because you understood the culture, you understood how to integrate easier. So, it was a little more acceptable for you to dive in here and start working with all these different broad companies and investors.
Tobias: I mean it definitely helped a lot. I mean all these experiences tied together, especially because I think it’s important to have that background of being an operator. but also being an investor, having to work in an investment firm, but then also being on the ground, seeing the struggles actually are and what the founders go through. First of all, it gives you a lot of credibility as an investor. or even let’s say a little bit more credibility, but also for yourself. When you’re doing the due diligence and you see certain problems arising, you get an idea of how easy or how difficult to solve them essentially. So, the blockchain farm was fun. Mansour set it up initially and they did a Fantastic job. Of course, I came in super early and then we built this together to an extent but they’re also in a similar space. They lived in various different countries similar to me. We actually met in China so that’s how the whole relationship started. And, they’ve been an operator and an investor before as well. So, it’s like you have a similar background, in a sense that everybody is oriented to reaching that vision of supporting these emerging tech companies across, also emerging markets. And, just really look for the deeper problem and not just like I’m finding random businesses. we always want to look, okay, what impact do you have towards a society or towards whatever industry you’re in? so I love their vision in the very beginning. So, that’s why I joined so early. And, that’s why I’m staying with them today and it’s a Fantastic journey. but it definitely helped. I mean we applied for the license in Singapore. It was still a long process. It took us five months or something to get the license. We got tremendous support in Singapore, from the government, because you’re doing something which is also not super straightforward. you’re still going to blockchain space. you still go into the emerging Tech Space. Whereas, something maybe a little bit more, not risky. but like it’s a little bit more emerging in a sense. So, I think the way that the team is split up, I think, makes us work together super well. So, we have someone who is very much on the growth set of things. Then you have someone who’s a super good networker and someone who is sort of fundraising and then we work quite hands on other companies and help them but we always had our learnings from the past and when we think, what is really important to us. And, it sort of helps us now a bit since we were working at a startup before. And, I was, literally every time I was working with a startup, advised a startup or even applied for a startup. At some point in time, the only question I have is, what problem are you solving? So why are you allowed to be in this market? That’s sort of the idea and that was our fun thesis. So, we want to solve problems with actual use. cases we’ve proven product microfit. everything else is then supportive. Obviously you want to have interesting founders and stuff like this, but that is helping me tremendously to make interesting decisions and go through these processes. And, being on call with founders and also setting up their own fund because that’s like your own venture as well in the sense of going through these processes, building the fund, getting documents out and all this stuff. So, I think it’s our background. second it’s the team and third is that we all sort of believe in the same vision and move this forward basically 24/7. and that really helped. And, the background definitely helped.
Jeffery: I love it. And, you mentioned that being part of a startup really makes a big difference and it allows you to really engage with the startups better because you can relate easier knowing both of you have gone through the thick and thin of things. And, I like the line that you said which was what problem are you solving and why are you allowed to be in this space. And, I like that because it’s very direct and it proves a point that you can’t succeed without having a problem to solve. And, then you have to prove why you belong in this space because I think from any investor’s standpoint, if you can’t answer that question, then you’re not really investable. So, prove to me why, or prove to us or yourself why you actually should be selling in here because you’re so early, I’m not seeing the wins. show me and prove to me why this works. So, I love that line. that’s bang on. And, again of course, the team, the vision, all of those things really structure to help you support the vision of where you guys are going in this fund. Can you just quickly chat about a couple of things around the types of companies that you look to invest in and where do you see, as being maybe the next emerging markets or the next big innovation that you think is going to come over the next two to five years?
Tobias: yeah, absolutely. So, with the new fund, we’d be continuing something which we have already been doing which was proven to be working. So, we invest in early stage companies. it’s preced to pre-series a. So, typically we go in the most successful investments. we’ve done probably between a three and 10 million valuation. we focus on anything sub-20 millimeters super early. anything asset light. So, we don’t do anything hardware related, real location and industry agnostic. except like this hardcore biotech or med tech solution, we need a lot of domain expertise. we took a B step away from that and with a new fund we are going to raise on the process of finishing the raise of 75 million dollars. so we’re going to deploy this in about 200 companies over the next three and a half years. So, it’s early. it’s small checks. it’s 200k on a first or up to 200k on the first check size. And, then we want to work with the companies quite hands-on. like I mentioned typically, weekly calls with them and really help them solve their problems and then once we get to know the company, we know how their company is standing, then we can do larger checks from 500k to 5 million to really help them scale at further rounds down the road. And, we’re not any, I mean, although we focus a bit on blockchain, it’s not that we are a token fund. So, we always want to go on equity and that’s why again it’s so important for us. So, it’s the problem and the product market fit, because we are long-term investors, an eight year essentially fund life. And, that’s how we see it. you want to have someone who is similar, aligned, who is there for the long term, wants to build sustainable businesses and wants to have our capital and also support to help them scale. And, that’s been working quite well if you look at Splinterlands. one of the biggest successes when we back them probably like four million valuation, is currently now raising in the billions. one of the biggest blockchain games in the space now growing very fast and we had probably more than 100 calls with them over the last two years. and literally every week, and tremendous kudos to him in this space is working very hands-on with them to help them reach this stage. and like from every different angle, same as Mansour and me as well. and that’s the same approach we have with all of our companies. and especially from a market perspective, when you ask me where I see a lot of potential moving forward is of course I mean southeast Asia I think is big. I mean you mentioned the Philippines where you have also been active where a lot of our gamer communities from Splinterlands are also coming from, where you see you’re probably going to see a lot of growth moving forward. I mean GDP per capita is increasing. you have a very high mobile phone penetration. you have very low data costs which paired with a young and hungry generation is going to change. and also governments are quite favorable. If you especially look at the blockchain in crypto space, Thailand, IndonesiA, Singapore, even Malaysia and CambodiA, they launched Bakong which is a blockchain based payment switch. and that’s like I mean I was impressed that this was a priority of the government. but it obviously shows how forward-thinking they already are and that’s driven by just young people who are getting so much exposure to different markets and leapfrogging as this password says from mobile first. literally no one is using a credit card. they’ll pay with the phone. they never had a credit card in the first place, like it’s just so different from what priorities they have and how further they’re moving into space. and of course from a blockchain perspective, it’s a very similar thing with Plato. Earning gaming people in the Philippines are able to make two to three times their monthly income by just playing a video game which is game changing in this market. and especially also it solves core problems such as international remittance sending money from A to B is typically very expensive. and you have a bank account. the unbanked percentage in the Philippines, probably at 70, which makes it even more difficult to open bank accounts for business growth because you cannot really escape your working capital needs. if you cannot get a loan, and of course, from a personal perspective, if you want to send money from A to B, it’s about 50 cents in Indonesia which is the same price as a bowl of rice which is intense. if you think about it, it compares to western or Europe or US. I’ll be sending three to four euros, literally just sending her to the bank . that’s quite high and then you probably think about twice, if you actually want to do that. and then that’s why you see pay fast and all these companies have so much traction in this market because they really solve a problem which prevents people from doing something. That’s why all these emerging technologies are growing so fast. And that’s why I see any of these markets but also parts of Africa and the house of Latin America is so interesting from an investor perspective.
Jeffery: I love it. and that sounds pretty exciting. like that you guys are in the thick of things, making some great investments and of course, just living and learning how these startups are interacting with everybody. and China has been pretty advanced in the last few years on their ecosystem and their startups. and it’s obviously branching off into all of the other countries surrounding it. and that seems like Southeast Asia is just moving really fast. And that’s absolutely exciting. very exciting. very cool. Okay, well we’re going to jump in real quickly. We got one last question before we went into rapid fire questions. and that one last question was in the journey and everything you’ve done in the startup space. Is there one story that really stands out for you around a startup that maybe you thought was going to fail? just what it takes to really be a startup. and what it takes to be an entrepreneur, to live through the Epson flows, the roller coaster ride. Is there any story that really stood out that she or he really impressed you? and just blew your mind on what it took to be an entrepreneur.
Tobias: yeah and actually one story which I found really impressive. There’s a company called Click and it’s a payment company. now became a legit Fintech company with a bunch of different components of how they make money. but they launched in a very emerging market and went basically through every challenge I mentioned before. and I was impressed by the founders’ mindset. but not just one founder, like literally all of them. they didn’t get paid for a month but they believe that they were doing this correctly. and even the people, like after three to four months of not being paid a cent because they couldn’t. At this point in time, everybody was still pulling together, going to the office and working because everybody believed in what they’re actually doing, adding a tremendous value to the ecosystem. and it was always very challenging. you can imagine especially the burden of a founder, of a CEO who has to sleep with all of this every single day. It’s very difficult but in the end they pivot the business model and then move from A, B to C to A, B to B. They got traction. they got funding and they pulled through it. but no one essentially quit and that is exactly from a recruiting perspective. so important if you only have people who do not believe 100%. and what you’re doing is going to create tremendous value. they are not going to be there after not getting paid for one or two months. and that can happen faster than anybody thinks in a startup. and probably everybody reached that point closely or even had it when you needed to raise a bridge around all these things or not take a salary as a founder yourself. and that’s what I mean. That’s why I saw these points are just so important because if you reach such a stage which unfortunately can happen and happens to most of the startups out there, if you look from a pure statistical perspective, you need to have the people who pull through this and still be motivated and still believe in the bigger vision. and that’s exactly what they’re doing. and I have never seen anything like this before. I mean of course they are getting a month, not paid or they’re getting a pay cut or something like this. but getting up, paid for half a year, and literally coming back to office, like every single one. they’re coolest to the founders of building a community and feeling that keeping the division in the company that much. and like business friendships essentially. so people stick together even if something goes really wrong.
Jeffery: oh, that’s incredible. and you mentioned the pivot too. so it’s pretty cool that when you get yourself into a real challenge and a real pickle and you can’t pay and you can’t do something, but you really believe in the vision that eventually things are going to alter just enough to get you into the spot. but sometimes you gotta hit the bottom before you can start moving up so that’s a pretty amazing story and great to hear that they were able to work their way through it as a team and keep growing. so that’s pretty awesome. Yeah, they’re crushing it. I love it. crushing is good. we’re going to jump into rapid fire questions. we’re going to start off with business questions and then we’re going to get into the personal side. so you can pick one or the other. ready to roll?
Jeffery: Tobias, founder or co-founder?
Jeffery: unicorn or four-year 10x exit?
Jeffery: tech or cpg?
Jeffery: brand or tech brand ai or blockchain?
Tobias: I was a blockchain. guess that one. but just double check.
Jeffery: checking your convictions. First time founder or second, third time founder?
Tobias: myself though just in general. Oh, I rationally would say the second or third time founder. but I love investing in first-hand honors.
Jeffery: Okay, first money in or series a?
Tobias: first money in.
Jeffery: angel or VC?
Tobias: VC, but early.
Jeffery: okay. board seat or observer?
Jeffery: safe or convertible?
Tobias: no, safe.
Jeffery: lead or follow?
Jeffery: equity or interest payments?
Jeffery: favorite part of investing?
Tobias: working with the founders.
Jeffery: number of companies invested per year?
Jeffery: you’re on the super high threshold. It’s amazing. any preferred terms that you guys like?
Tobias: To be honest, we’re very founder friendly.
Jeffery: You don’t really have that many terms.
Tobias: coachability is something important for us. and we typically get some equity vested for our support.
Jeffery: okay. and then two things that really stand out for you when a startup approaches you that you like to see to get you into that investment mode?
Tobias: if someone immediately starts with what problem they’re solving and does not put the tech in the forefront, so not saying, oh I’m a blockchain company. like I don’t care. I want to see what problem you’re using if you use blockchain that’s great for us because it fits our thesis. but blockchain alone won’t cut it. and the second thing is unit economics. Even though you understand the value of what that means for your business, even though the numbers might not be correct, putting thought into this and actually building a story around numbers is very powerful for me.
Jeffery: I love it. Same. That’s two great points. Okay, we’re going to jump into the personal side. book or movie?
Jeffery: Superman or batman?
Jeffery: pizza pop or ice cream bar?
Jeffery: five minutes with Bezos or Oprah?
Tobias: oh that’s a tough one man. I want to speak to Oprah.
Jeffery: I like it. Arsenal or Manchester United?
Tobias: Manchester United.
Jeffery: Damn it. I only found two Arsenal fans in all of this. and the second one actually just chose it because it was the first one I said. I wasn’t a soccer fan. like bikes or rollerblades? big mac or chicken mcnuggets? trophy or money?
Jeffery: beer or wine?
Jeffery: alarm clock or mobile phone?
Tobias: Well, that’s fine. hotel or hostel?
Jeffery: Oslo. ah the second hostel picker. I love it. king or rich?
Tobias: I’m not a money person
Jeffery: Okay, concert or amusement park? I’m using parks, fortune cookies or birthday cake?
Tobias: fortune cookie.
Jeffery: Has life been boring without Trump?
Tobias: Sorry, say it again.
Jeffery: Has life been boring without Trump?
Tobias: Yeah, definitely. less headlines. it’s certainly not as loud as it used to be, that’s for sure.
Jeffery: yeah. All – time favorite sports team?
Tobias: It has to be Munich, the German football like the Munich One.
Jeffery: Yeah, fantastic. That’s awesome. I follow them on twitter and watch their games too.
Tobias: You sure?
Jeffery: yeah. they’re pretty solid.
Tobias: oh! they’re a great team. They always seem to pull off great talent. So, yeah. great team.
Jeffery: favorite movie and character you would play in the movie?
Tobias: James Bond GoldenEye. and I want to be James Bond.
Jeffery: awesome. I like it. Which movie was it? Which version is James Bond?
Jeffery: oh, gold’s finger.
Tobias: I think you’d translate gold finger.
Jeffery: Okay, cool. Yeah, I like it. I want you to watch every single James Bond movie by the way.
Tobias: Actually I’m looking at a series. I might do that. I like that I’m going to go back and watch them all. It’s been a long time. good idea.
Jeffery: done. favorite book?
Tobias: favorite book? My favorite book is ‘God has a bunch of them’.
Jeffery: Is it a German book though?
Tobias: Okay, but translated. It’s something like asking why , even if you do something. you want to always understand where you’re coming from. and I like it because it ties back to literally all I’m doing. it’s like just asking what’s beyond that. Even if you hear something nice, headlines or something, it’s mostly not as good as people make it look like. then getting that critical eye I think is pretty cool.
Jeffery: I like it. Okay, the first brand that pops into your mind?
Jeffery: most famous person that pops into your mind?
Tobias: The most famous person pops into my mind? Honestly, I wanted to say my dad at the very beginning. but that’s a bit too cliché obviously. I thought immediately about Jeff Bezos just because I talked to him before and I read an article before about it.
Jeffery: okay, it’s good answer too. I think I might move that question around because a couple people have picked Bezos because I say his name. and I’m like, no that’s not the point. but it makes sense. it’s going to come up so I’m going to shift that one beforehand so that it makes you really think. because I am curious as to the great thing. It’s that a lot of people do pick Apple as their first brand that comes to mind. so maybe it’s just environmental but they do a fantastic job of getting in your face.
Tobias: Yeah, absolutely.
Jeffery: Okay, so the last question we have. What is your superpower?
Tobias: my superpower is genuine listening.
Jeffery: That’s a good power to have, more people could use the power of listening.
Jeffery: So brilliant. I love it. Well, Tobias I want to say thank you very much for all of your time today. I learned lots, took lots of notes. I always have to show this because I want people to believe that I actually do write but it was fantastic. I loved it there. There were a lot of great insights he shared, a lot of great things.
Tobias: amazing what you guys are doing with your new fund, tearing it up in southeast Asia which is amazing. and the way we like to end our show is we like to give you the last words. We want you to share anything that you like to the investor community or the startups. but again I thank you very much for all your time today. Fantastic. great to learn more about you and what you’re up to so thank you for joining us today.
Tobias: Definitely, I mean I had a very good time. I love the questions, especially the quick questions in the end. and yeah, it’s great. It’s good to be on the podcast today. so that the last couple of words I think for me is it’s it’s just what I want to say is essentially do something you’re passionate about. and it’s both from a founder perspective and from an investor perspective. and join a fund you’re interested in what they’re doing and not just do you want to join a VCU. and also as a founder do something. doing something with the mindset of making this to get money is probably not going to work and really think about. Why am I in this market? and what do I do better than any competitors, or if there’s no competitor is this really a market. and that comes again if you’re really passionate about what you’re doing. it’s in the open bottle. one side, it’s obviously very good. but on the other side it can also be a bit delusional so, getting this secondhand advice and figuring out these questions I just mentioned and the same thing is for a VC, every VC should give every startup attention even if you might not invest in them. It’s still good to give them feedback or a notice because I think everybody deserves that. I love it. Men, you’ve got bullet points after bullet points, so fantastic all great insights.
Jeffery: Again, Tobias, thank you very much for all your time today. It’s been a fantastic time. So thank you very much.
Tobias: Absolutely my pleasure. Thanks so much for having me, Jeffy.
Jeffery: Okay, that was a fantastic chat with Tobias in Singapore. Those guys are doing some amazing investments working with so many great companies. and I think he shared some really cool key pieces to helping startups, and not just in Singapore and southeast Asia but just in general when you’re going into a business. you talked about wearing many hats, you’re three people. you’re going to do a lot of different things, have a strong vision. so write that vision down. That’s your pitch, whatever that might be, have a vision. and then what you’re going to have to battle through some geopolitical issues while you’re building a company in different countries, figure out what those are but look for coaches, advisors and people that have done it before. they’re going to help you maneuver through this a lot quicker. and then I guess just the end part which was again supporting the passion, be passionate about what you’re doing. have the mindset. don’t always make it about money. make it about why you’re building this company, why you’re solving this problem, why people are going to want to come to you for that solution. one day, they’ll pay you in my mind. It was always work because I love what I do. I’m going to learn but figure out what drives you and it can’t always be about money to make sure there’s a market and you’re solving a problem but Tobias fantastic conversation. Again, thank you very much for all of that insight sharing. It was fantastic. So thank you very much for joining us today. If you enjoyed this conversation, please subscribe to our YouTube channel or follow us on Spotify, Apple podcast or Stitcher. You can also check us out at supportersfund.com or for startup events visit opn.ninja. Thank you and have a fantastic week.