Entrepreneurship Lessons From Startup Whisperer Jeffrey Paine

Entrepreneurship Lessons From Startup Whisperer Jeffrey Paine

My view is that entrepreneurs are 80% trained and 20% born with it. So not everyone can be a founder, especially in high-growth start-ups which are very stressful,” says the Singaporean co-founder of venture capital firm Golden Gate Ventures (GGV).

While this may run counter to those who claim that entrepreneurship is a skill that can be taught, Paine argues that certain personality traits – agreeableness and fluid intelligence, for example – are innate.

“Fluid intelligence is how people process information and come to a conclusion. Founders need to make decisions with little or no data within a certain time frame, so they need to acquire as much knowledge as possible and process it to determine the decisions they need to make,” says Paine, who also helped launch pre-seed start-up accelerator The Founder Institute in Asia.

“If you’re too nice, you can’t make decisions because you’ll listen to everyone. To be a good founder, you have to be disagreeable, but you also need humility.

Paine, a serial entrepreneur with a background in Silicon Valley before co-founding Southeast Asia-focused GGV in 2011, has always been interested in working with and mentoring entrepreneurs in the region. In fact, GGV was born out of a need to solve a problem he identified among start-ups needing funding from Bay Area investors, as SEA’s entrepreneurial scene was relatively unknown in the US. ‘era.

Around this time, Paine mentored start-ups with Vinnie Lauria, a Silicon Valley entrepreneur who was backpacking through Asia after selling his company. Seeing the potential in some of these fledgling companies, they launched Golden Gate Ventures so that Bay Area Angels could invest in regional start-ups.

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An investor of big names like Carousell, RedMart and Ninja Van

Jeffrey Paine, co-founder of Golden Gate Ventures
Golden Gate Ventures co-founder Jeffrey Paine wearing a rose gold Cartier Santos-Dumont watch with leather strap (Photo: Phyllicia Wang)

Since then, GGV, which focuses on the consumer-oriented Internet and mobile phone sectors, has launched four funds and invested in nearly 70 companies in SEA, Greater China and the United States, including in Carousel, Carro, Ninja Van and RedMart. Projects in agriculture and climate technologies are in the pipeline, with the company expecting to close one to two more deals later this year, Paine reveals.

The scene has changed dramatically since the creation of GGV. After a decade of rapid growth with the rise of several unicorn companies in the region, SEA is now firmly on the radar of global investors. In 10 years, the capital invested per year has multiplied by 50, from 130 million US dollars (185 million Singapore dollars) in 2010 to 7.7 billion US dollars in 2020, food, fintech and logistics attracting the most investment.

“Grab and Gojek have shone a spotlight on the region by raising funds around the world and selling Southeast Asia to investors. Thanks to them, people understood what was happening here,” observes Paine.

Additionally, he believes the region’s start-up ecosystem has benefited from the prevalence of low-cost airlines, which have increased regional travel, and the use of English. “Before 2014, when I went to Indonesia or Vietnam for a conference, there was always a translator. Now you don’t need it. Using English helps unify the region a little more,” he says.

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Spearheading the growth of the “Startup Golden Triangle”

Jeffrey Paine, co-founder of Golden Gate Ventures
Photo: Phyllicia Wang

These days, the golden triangle of startups from Vietnam, Singapore and Indonesia are not only considered the gems of the region, but are also poised to influence the next wave of growth.

Continuing to spearhead the growth of the ecosystem, Golden Gate Ventures announced in May the opening of two new outposts in Ho Chi Minh City and Hanoi, complementing its other offices in Singapore and in Indonesia. Its goal is to attract investment to the Vietnamese market, foster the exchange and growth of new ideas and innovations, and help Vietnamese start-ups establish regional businesses.

In Paine’s view, these three flagship countries each have their strengths and advantages that position them for future growth and cross-border synergy. “With capital and talent from Singapore, and more sophisticated founders based here, you will have regional experts since their headquarters and product teams are here. Singaporean teams also tend to be more ambitious and see the big picture,” he says.

Indonesia’s strength lies in the size of its market and its return potential. “In many industries, if you’re #1 in the country, you’ll be able to generate returns for venture capital over multiple rounds. IPOs have shown that there are returns for different types of private investors.

On the other hand, Vietnam’s youth and technical talent make it an attractive destination for investors and entrepreneurs. According to Paine, “Besides its population density and adoption of mobile technology, it is the No. 1 in terms of technical talent in Southeast Asia. Teams are able to do very complex things like Web3 and crypto because they consider it second nature.

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What future for 2.0 start-ups?

Jeffrey Paine, co-founder of Golden Gate Ventures
(Photo: Phyllicia Wang)

Peering into his crystal ball, Paine thinks it will become more difficult to start a business over the next decade as the SEA startup ecosystem matures. “The rate of new consumer start-ups with unique ideas is declining as distribution to consumers is controlled by a few monopolies. Founders need to think about what kind of companies are worth starting and what suits their personality. »

According to the GGV Southeast Asia 2.0 Startup Ecosystem Report, the next generation of entrepreneurs will likely spawn social commerce start-ups and medtech and fintech-only unicorns. There will also be an increase in B2B SaaS (business-to-business) start-ups.

“To do well, you need to have an insight that others don’t, like an inflection point when something changes in your country, region, or the world. Then build something to become the first company to embrace change,” he says.

To prepare for this changing landscape and higher investor expectations in the future, GGV’s new portfolio growth strategy, called Founder First, aims to equip founders not only with financial capital, but also with human capital and social that the company has acquired over the years. .

“We have to consider the founders as human beings. They’re not money-making machines, they’re humans. They have to be very self-aware because being a founder can be extremely lonely – and it got worse during Covid-19,” he observes.

Because of this, he often asks budding entrepreneurs how many hours they sleep and how they regulate their stress when he meets them. Noting that a significant number have to deal with anxiety, burnout and impostor syndrome at one time or another, he observes that those who are in it for the long term, “need to know how to manage their stress and recognize the first signs of trouble”.

We must consider the founders as human beings. They are not money-making machines.

Spread the truth

Paine notes, however, that most start-ups don’t need venture capital funds. “Not every company needs to become a unicorn and most investors forget about these groups of companies. But even though these companies, such as software companies, may not be able to absorb so much capital because they don’t need it, they deserve to be there.

Paine says he won’t hesitate to speak up in such situations. “If such companies meet our investment criteria and we can help them think bigger, we will probably invest in them. On the other hand, we will also tell them the truth. If we see that their business is going to be small, please don’t collect money from us.

However, his interactions with such entrepreneurs do not necessarily end there. “We are happy to mentor them to help them get where they want to go. If we can help someone, we will try; if we can give honest feedback, we will because that’s how GGV has been from the start.

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