Melisa Irene’s first brush with the venture capital (VC) industry in Indonesia happened in 2015 when she joined East Ventures as an intern.
“It was simple. I didn’t want to be doing nothing while writing my thesis,” she told DealStreetAsia in a candid chat, reminiscing her initial months.
Today, four years on, Irene has climbed her way up at East Ventures, becoming its first female partner and one of the youngest to be promoted to the role in the entire region at the age of 25.
Irene says she knew very little about the VC industry when she first started out. In the words of East Ventures managing partner Willson Cuaca, she is “an antithesis of how a VC partner arrives at the job.”
“I just thought it would be cool to have the chance to think to the future and get insights on new innovations, like Uber at the time, before they become widely available in the market,” she said.
Irene’s lack of knowledge on the VC business back then, however, is understandable. After all, her entry into the industry happened at a time when there were only a handful of local investors in the country, the landscape being dominated by Japanese players such as CyberAgent Ventures, Gree Ventures and IMJ Investment Partners.
“Sometimes I thought to myself, ‘Am I not as savvy as an investment banker that came into this industry?’ The answer is ‘not necessarily’ because this industry has just started, so the people that can capture the essence of the industry are not people that are smarter or have more experience, but those that can immerse themselves into the industry faster,” she said.
It helped that she chose East Ventures, one of Indonesia’s first homegrown venture capital firms and among its most prolific. Today, the VC firm has two unicorns in its portfolio and 70 per cent of startups it has backed have gone on to raise Series A funding.
On the job: Being a better reader
In her attempt to understand the industry quickly, Irene said that in her early days she would “say yes to everything” from looking at taxes, going for meetings to sourcing deals. In less than a year, she was promoted to the position of an associate, followed by another promotion as principal three years later, before being appointed a partner in early 2019.
Four years into the profession, Irene believes there are certain qualities that hold venture capitalists in good stead as they gear up to carve their path in the industry.
Among them is a strong desire to learn and the obsession for speed. However, the most important of all traits is empathy, which she defines simply as “thinking from the perspective of the founder.”
This particular quality seems to be something East Ventures is known for, especially embodied by its iconic managing partner Cuaca, who is widely known for the intuitive nature of his investment decisions and his knack for “reading people.”
Cuaca, who has led East Ventures since its inception in 2009, claims to have held only one meeting with a slew of companies wherein he took the investment decision in the first 15 minutes.
His reputation is enhanced by anecdotal stories such as his decision to offer a term sheet to the founder of HR platform Talenta (exited to rival Sleekr last year) after a brief airport encounter, or his decision to put money in m-Pos startup Moka (reportedly acquired by Gojek) without having met the founders in person.
Over the years, Irene has had similar stories of her own. Earlier this year, she sealed a deal with Malaysian company Allsome Fulfillment within a day after talking to its founder Ng Yi Ying over the phone.
“As soon as I managed to get internal buy-in [Cuaca’s approval], I booked a flight to meet the team in Kuala Lumpur in the afternoon, worked together with my team in the night and signed off the deal the day after,” she said.
In such conversations with founders, Irene said she looks out for certain characteristics she calls ‘East Ventures fundamentals,’ which include integrity, self-awareness and paradoxical nature.
“I look for founders who show strong comprehension and appreciation about human beings and their relationship. How well do they know themselves, their co-founders, and their team? How is the density of their internal organization relationship?” she said.
“For me, great entrepreneurs show strong ability to display awareness: to self, core circle, and the surrounding ecosystem,” she adds.
Another trait Irene values is a multidimensional thought process.
“All in all, I always chat with my team, look at the guy and ask yourself, is this the person you feel you can personally and professionally grow with?”
This ability to sense people, Irene said, is something she has developed partly through Cuaca’s help and guidance. However, she believes that a big chunk of the ability to understand a person’s character is a natural gift. Not everyone, she said, is a reader.
“I figured that people who reflect a lot about their experiences are better readers. Later, you would understand the things that potentially lead to a person having a certain character. With time, your mind will start to become trained at this,” she said.
At the seed stage, venture capitalists typically clinch a lot of investments on the basis of speculation rather than taking the actual fundamentals into account.
In East Ventures’s conviction in its assessment of founders, the firm does not see the need to spend too much time to assist founders it has invested in – a notion that would be deemed almost blasphemous to many of its peers that eulogize a hands-on approach with regard to portfolio companies.
“We are certainly hands-off,” Irene said, “If we have to be operationally hands-on, then by default the person [founder] is not capable. And if he is not capable, they shouldn’t be getting funding in the first place.”
What East Ventures does offer, however, is its network of entrepreneurs. As an investor in different sectors ranging from finance and logistics to beauty and F&B, the firm has built an entire ecosystem of tech solutions. It is this strategy that has helped many of its portfolio companies witness accelerated growth.
“With or without East Ventures, these companies are set to become successful. What we do is shorten the time for them to grow,” Irene said.
Having more of such great companies around, especially within the East Ventures ecosystem, is a source of inspiration for Irene. She said that from her first day at East Ventures, it is the firm’s value system, personified by its portfolio of founders, that had always motivated her to continually grow.
“I recall the time when EV and IDN Media shared our office at EV Hive (now rebranded as CoHive). I learnt about William Utomo, who is just one year older than myself. His dedication made me feel that I only contributed so little. I’d meet founders who are 2-3 years younger than myself and I was inspired by them,” she said.
According to Irene, with a much better-developed ecosystem, not only within East Ventures but in Indonesia as a whole, the stage is set for more companies to follow the lead of the likes of Tokopedia and Traveloka to grow their business and hit the $1-billion valuation mark faster than those before it.
“I think the two (unicorns) we have is just the tip of the iceberg because when they grow, they inspire many people. Also, when you start a company after the infrastructure is made better, you are more likely to succeed faster, so I think there’s going to be even more unicorns,” she said.
Indonesia, sure, is at a cusp of explosive growth. According to a recent report jointly launched by Google, Temasek and Bain & Co, the internet economy in the country has grown at over 40 per cent year-on-year. Going forward, it has the potential to become the pacesetter in Southeast Asia with its growing middle-class, coupled with rising ‘netizen’ population in the backdrop of strong domestic consumption.