Thailand based MTR Asset Manager Company Limited, has entered into the venture capital space. It plans to support small-and medium-sized entrepreneurs (SMEs) so that they can grow rapidly.
After signing the Memorandum of Understanding (MOU) of Venture Capital for SMES-OTOP project with the SME Bank today, the company’s chairman Chatu Mongol Sonakul said that many small-sized businesses in Thailand have good products but cannot access loans.
“We have lots of cash and we would like to manage our cash by investing in the companies which have good prospect rather than lending them money and generating the profit from the interest,” said Sonakul, who was a former Permanent Secretary of Finance Ministry and former Governor of the Bank of Thailand.
The venture capital has is not yet a popular sector in Thailand yet because most of the Thai SMEs are family business and they don’t want others to get involved in the management. This has been the main reason for the failure of the venture funds launched by the banks, in the past. “Today, the entrepreneurs understand that they need funds to compete in the mass market, to develop their products and they need a professional team to advise them in other aspects such as marketing or asset management, which are our core business,” he said, explaining the changing situation. .
Sonakul said he was interested in joining the startups in the initial stage of the business and help them to shape it from ground up. This might require for them to stay invested for a five to seven year period. After that, it may either continue the joint venture or sell its share to other investors who have the interest in that business.
He plans to hold around 10%-30% of each company’s share, depending on the company’s prospect and negotiation.
M.T.R. Asset Manager, established in May 2002, has a current portfolio of about 30 billion-40 billion baht ($923 million-$1.23 billion).
