Kollective Group, a capital advisory and investment firm headquartered in Singapore, is on the lookout for distressed tech deals amid the COVID-19 crisis.
According to Kollective’s founder and managing partner Ho Kheng Lian, the firm is willing to invest $10-20 million per deal which would involve a full buyout, and cover liabilities and working capital needed to turn the business around. Kollective is targeting firms across seed to Series D stages with $100,000-1 million in monthly revenue, with a tolerance of up to $1 million burn per month.
It is open to firms in B2C and B2B sectors, particularly in e-commerce, insurtech, and socially-led businesses in commerce, platforms, or media. Depending on deal terms, the management team of the target company may be kept in place while its inefficiencies are fixed.
“The second and third quarters were still pretty quiet on the distressed front, but we think it’s because of the government stimulus and investors keeping their portfolio companies supported. We expect to see an increase in deal flow from the fourth quarter onwards as this support begins to dry up. We’re on track to close another 1-2 deals by the end of this year,” shared Ho.
Kollective has a target timeline of 18-24 months to turn around the companies it acquires, which it will then keep in its portfolio or seek an exit later down the line. It counts on experienced tech founders and operators to advise on their deals.
Ho declined to share how much Kollective has set aside for its distressed portfolio, adding that the firm is completely funded by personal capital provided by herself and her team.
Founded in 2018, Kollective Group operates three divisions: Kollective Ventures (minority investments), Kollective Capital (buyouts) and Kollective Advisory Partners (fundraising and M&A advisory).
It has raised funds for top technology companies and venture capital funds globally including SpaceX, M17 Group, Coffee Meets Bagel, Vertex Ventures, Monks Hill Ventures and Mantis Ventures by the Chainsmokers.
Kollective is also a early shareholder in firms like Wish, Jenfi, Ender, ClearMD and Zenrooms. Its most recent deal was the acquisition of dating company Paktor Group from M17 Entertainment, marking its foray into full buyouts earlier this year.
Editor’s note: An earlier version of this story incorrectly stated that Kollective’s capital advisory arm has roped in Sandeep Uberoi as partner. He was only advising the firm.