Miguel Encarnacion, Managing Partner of Unifier Ventures
Unifier Ventures, a VC fund leading the way in cross-regional connections between Europe and Southeast Asia (SEA), recently secured EUR 6.25 million (US$6.7 million) to make the first close of its first fund.
Unifier Ventures strategically targets three key markets: Europe, SEA, and the US, while its distinct value proposition centres on bridging the gap between Europe and SEA by facilitating the exchange of ideas, talent, and capital. After a year of operating in stealth mode, it has already invested in seven companies.
In an interview, its Managing Partner, Miguel Encarnacion, provides insights into the firm’s vision, strategies, and pivotal role in shaping the future of cross-regional collaboration and innovation.
Edited excerpts:
How does Unifier Ventures determine the allocation of funds across Europe, SEA, and the US? Can you elaborate on the criteria and considerations in selecting companies for investment in these regions?
As a German-domiciled fund, we have hard-coded a 70 per cent allocation for Europe. The remaining 30 per cent can be invested in the US or SEA. We have different strategies across the three geographies we cover.
- In Europe, we look for cross-cultural, cross-functional founding teams that can build a global product and company culture to be in a position to scale internationally much earlier than homogeneous founding teams.
- In SEA, we look for repeat founders with a track record of entrepreneurial success, if not yet startup success.
- In the US, we look for underrepresented founders with unique insights into large, unaddressed markets.
Of course, finding all those characteristics in one team from any market would be amazing!
Why did Unifier Ventures choose to operate in stealth for the past 12 months? What advantages did this approach offer in the competitive VC landscape?
Many funds need to be announced immediately as part of their fundraising efforts. As a micro fund with an anchor investor in place and the first close amount secured, we just decided to jump right in and start investing before we work on all our brand materials. So, honestly, it was a matter of bandwidth as a small team.
How did Unifier Ventures establish partnerships with family offices behind prominent entities like the Bank of Makati and Seaoil Philippines? Can you shed light on the LP selection process and how these partnerships contribute to the firm’s strategic goals?
I used to manage the family office behind Seaoil Philippines, and it is now our anchor investor. During the five years of managing the family office, I built strong relationships with other family offices in the Philippines and a few more across the region.
Ultimately, we look for family offices with a digitalisation mandate across their core businesses so they can be the pilot customers for the startups we invest in, especially European startups looking to enter SEA.
What challenges and opportunities does Unifier Ventures foresee in bridging the gap between Europe and SEA in terms of capital flow and the transfer of ideas and talent?
The startup ecosystem in SEA is still relatively young, with very few exited founders having funnelled money and expertise back into the ecosystem. This is in stark contrast to the US and, to an extent, Europe, which already has a pool of exited founders setting up VC funds and venture builders to support the next wave of founders.
We also lack senior and middle management employees from startups that have gone through hyper-scale going on to join younger startups and build their own companies. That’s why it’s important for SEA founders to be plugged into other startup hubs globally to find strategic investors and experienced scale-up talent from other markets.
We focus on bridging Europe and SEA because we believe the scaling playbook is similar for these two regions, with smaller neighbouring countries having different languages, cultural nuances, and regulations.
From day one, the mindset for founders in the EU and SEA must be to ‘win locally but think globally’, which might not be necessary for founders building in mega markets like the US, China, and India. That is both a challenge and an opportunity for founders willing to navigate the complexity.
How does Unifier Ventures perceive the startup ecosystem in Europe compared to Southeast Asia? Are there specific industries or sectors within these regions that the fund finds particularly promising
Being a young startup ecosystem, many proven winners are still coming from e-commerce, fintech, and logistics tech. This is the usual starting point since people want to buy online, need to pay for these items and expect to have them delivered.
We see an opportunity to support these scale-ups with workplace technology solutions suitable for young, tech-savvy populations. We like the sector because it has broad applications across industries and allows us to recommend these solutions to our entire network, including the corporations behind our LPs and portfolio companies. Europe is particularly strong in building B2B software products.
Despite the initial focus on workplace technology with four of the first eight portfolio companies in that sector, we view ourselves as a generalist fund and already have portfolio companies in adtech, Web3, ESG, and healthtech. We’re driven more by the geographic relevance to SEA, whether the founders know it themselves or not. So, there is also a lot of interest in proptech and logistics tech because of the archipelagos and smart cities being built across our home region.
What are Unifier Ventures’s expansion plans in Southeast Asia to strengthen its connections between Europe and the region further?
As a micro fund with a small team, a big part of our strategy is to be involved with the right networks. For the past six years, we have been very involved with AsiaBerlin, which organises an annual tech conference boasting one of the largest attendances of Asian startups and investors in mainland Europe.
In 2024, one of our new projects is to help with the relaunch of Skytrain, a member-driven association of emerging fund managers across Europe. We are organising a delegation trip together with these two groups to come to SEA in Q3.
How does Unifier Ventures measure the success of its investments beyond financial returns? Can you provide examples of how the fund has contributed to the growth and success of portfolio companies in SEA?
One of our key success metrics is to build customer relationships between our portfolio companies and the operating companies of our LPs. A strategic investment is usually an intermediate step to facilitate this.
For our portfolio company Otis, we helped them raise 5x more capital than our initial investment amount directly from other family offices in the Philippines. This ultimately led to them securing a contract from a large insurance company affiliated with one of the families.
We also like to support with hires, especially for our European portfolio. For our German portfolio company Blockbrain, we helped them build a small team of Web3 researchers in the Philippines.
For startups looking to attract investment from Unifier Ventures, what advice would you offer in terms of aligning with the fund’s mission and demonstrating value in the Southeast Asian market?
In SEA, we look for founders with previous insights and track records across multiple countries. We want to support startups with clear use cases across the region and not just solve country-specific problems. That allows us to leverage our network of regional family offices and even bring in potential co-investors from Europe.
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