AddVentures, the corporate venture capital (CVC) arm of Thai conglomerate Siam Cement Group (SCG), is looking at later-stage investment bets to capture opportunities from the maturing and fast-growing digital ecosystem in SE Asia as well as China and India, a top executive said.
In line with the shift in its strategy, AddVentures will cut bigger cheque sizes and back tech startups raising later-stage funding rounds.
Speaking exclusively to DealStreetAsia, AddVentures managing director Prakit Worawattananon said, the firm is looking at investing from $5 million to $10 million per investment. The CVC unit has typically invested in the region of $1 million per deal backing post-seed to Series A and B rounds.
AddVentures invests from a corpus of $100 million. Worawattananon revealed, the firm still has enough budget to deploy capital to late-stage startups, either its existing portfolio firms or in new investments.
“Once we believe (in the startup business), we will put in a bigger amount of money, so that we can have some presence in the startups, board seats, and decision-making that will align with SCG’s mission,” Worawattananon said.
On the firm’s sub-$1-million bets, he added, “we’re more like an observer rather than someone who can really make any decision.”
Worawattananon was appointed as the new managing director in March this year as the firm seeks to grow its investments and tap further synergies with the parent group.
Since 2017, AddVentures has deployed capital into five venture capital funds and 16 startups in 8 markets including India, China, SE Asia, S Korea and the US. Its fund investments include China Renaissance, Vertex Ventures, SoftBank, Wavemaker Group and Silicon Valley Bank. Some of its direct investments include Indonesian aquaculture eFishery, Thai building material marketplace BUILK and Vietnam’s B2B trucking marketplace Logivan.
AddVentures is also expanding its sector focus to cover new and emerging areas such as AI-based supply chain financing and optimization, deeptech, and health tech. It has previously invested in B2B commerce, agriculture, building material marketplace, and logistics.
Synergy with SCG
AddVentures, as is the norm with CVC units, is focused on building a bridge between its startup portfolio and SCG’s various businesses – chemical, cement, building materials, and packaging – by leveraging the parent entity’s strength and network. SCG has over 300 subsidiary companies, $13 billion in market capitalization, and $4.3 billion asset value outside of Thailand, per information on its website.
For instance, it has helped Thai building material provider BUILK to foray into the Philippines and enabled Indonesian B2B marketplace Ralali, and aquaculture eFishery to enter Thailand by setting up joint venture companies with SCG group. Additionally, packaging and printing startup Printerous got a product knowledge transfer from SCG Group.
The integration with the parent company also presents an exit route for its portfolio firms.
“If an investment is aligned to any of SCG’s business units, we will exit and transfer our interest to another entity (Nexter Venture) in SCG. If we don’t see that potential in the medium-long term, we will exit fully,” he added.
AddVentures is targeting some exits to come by next year. He declined to share further details.
Riding on SCG’s geographic reach, AddVentures is also seeking to expand its presence in India and China, the two largest markets in the region. However, the firm will likely skip heavily-regulated sectors such as fintech in China but look at other areas such as logistics.