Kickstart Ventures’ Co-founder and President Minette Navarrete
Kickstart Ventures has lately been in the news for its US$200 million funds deployment plans in the Philippines. For the country’s startup scene, which is believed to be lagging behind other countries in the region despite a mature infrastructure, it’s an encouraging sign.
It established itself as one of the most active VC firms in the Philippines with a total of three funds deployed since its incorporation in 2012.
Kickstart was started with a US$2.4 million fund with the mandate to source innovation by nurturing early-stage (pre-Seed to Series A) startups to scale.
According to Co-founder and President Minette Navarrete, Kickstart’s grassroots approach allows it to fully integrate into the country’s startup ecosystem, build relationships across geographical and corporate borders, and invest in some of the most promising, innovative local startups.
Its success was followed by the creation of its second fund worth US$50 million in 2015. This fund provided Kickstart wth the ability to engage with and support early-growth stage (Series A to C) tech startups in the Philippines and beyond.
“In the early days, Kickstart focussed on startups, which have reached the early growth stages with the normally established product-market fit and with a focus on increasing traction and rapid scaling. As a corporate VC, we believe that Kickstart is best-positioned to support the needs of these early-growth stage startups by making available the scale, expertise, and experience of Globe Telecom and the Ayala Corporation,” said Navarette.
Also Read: Kickstart Ventures to manage Ayala’s US$150M Corporate VC fund in Philippines
“By facilitating these opportunities, Kickstart can co-create a more mature and enabling innovation ecosystem where innovators can thrive, and innovation is sustained, and tech startups and large enterprises are supportive of each other,” she continued.
The firm itself is a wholly-owned subsidiary of Globe Telecom, which counts Ayala Corporation and Singtel among its shareholders.
e27sat with Navarrete for an interview. She explained that while the VC firm operates independently, it collaborates closely with colleagues in Globe Telecom, Ayala, and Singtel to ensure that the deals made are strategically aligned, in addition to offering financial returns as investments.
Can you explain the reasons and expectations behind focusing on early to early-growth stage tech startups investment for the latest fund?
Minette Navarrete (MN): For our third fund in 2019, the US$195M Ayala ACTIVE Fund was announced and that Kickstart would manage it. The focus of the second fund will continue to be early to growth-stage startups, but broadens the investment scope to include early-growth stage tech startups in the various industries that the Ayala has interests in. They include property and construction, banking, utilities, manufacturing, education, healthcare, and of course, telco.
As a corporate VC that is future-forward in its vision, we ensure that we provide the startups we invest in with enough support to succeed. This means that beyond putting in capital, we also provide them with market access and connections as well as mentorship opportunities that can help them grow positively.
Can you share more details on the four different investment themes: A Frictionless Future, From Automation to Augmentation, Smarter Living, and A World of Plenty. How Kickstart plans to make it work on the larger goal of “leveraging on tech to transform lives and communities”?
MN: Nation building is at the forefront of Ayala’s list of responsibilities for their fund. In line with this, the Ayala Corporation decided to invest in the future through these four investment themes.
A Frictionless Future explores the integration of offline and online lives by merging digital and traditional channels that can improve equality and inclusivity in societies.
This is something we’ve seen with fintech companies such as GCash that are helping to fill gaps that build barriers for the general population who want to utilise e-commerce services but are unable to do so due to a lack of bank accounts or credit cards.
Also Read: Kickstart Ventures and Tencent jointly invest in Canadian media company Wattpad
Automation to Augmentation looks at the technologies that enhance human capital and improves our ways of working. These are innovations that can make work less dangerous, less repetitive, more productive, and more engaging and meaningful.
This includes innovations in data science and Big Data, leading us to make better decisions, applications of AI, and machine learning that complement and enhance human capabilities, and applications of augmented and virtual reality that offer new ways of presenting the information.
Smarter Livinglooks at improving the quality of life in the spaces that we interact and engage with, that we live in.
This includes IoT applications for smart homes and smart communities. It includes city management, making the city better and safer, and property and construction tech, making building and construction faster, safer, and more efficient.
A World of Plenty looks to address the many gaps and inefficiencies in the world that contribute to inequality and scarcity.
This involves improvements in the discovery, collection, and distribution of utilities such as water and energy, and it also includes ensuring access to basic needs such as healthcare and education.
Can you tell us about Kickstart’s support for Singapore based/founded companies like igloohome and yup.gg?
MN: The four themes mentioned before will touch on some areas of interest that Kickstart has already invested in. Igloohome is a smart access startup that envisions “a world without keys”. It speaks to the theme of Smarter Living.
Yup.gg is an e-sports and gaming company that aims to better connect gaming content creators with brands and advertisers looking to engage with consumers in new and more authentic ways. It speaks to the theme of a Frictionless Future.
Singapore is still widely considered as a hub for businesses that aim to have a regional presence in Southeast Asia. It also serves as a launching pad for many ASEAN startups with global ambitions.
For startups founded in the Philippines, we offer guidance about how they may be able to future-proof their corporate structures, and this frequently includes setting up a Singapore entity while maintaining a local operating entity.
In the case of Lifetrack Medical Systems, this allowed them to more easily establish a presence in Singapore and eventually move their headquarters there to aid in the expansion of their international operations.
For startups that originate in Singapore or other markets outside of the Philippines, we’re able to provide them with the support to enter the Philippine market and to establish a presence here as needed.
With the rapidly growing internet and connected device penetration and a growing young consumer population, the Philippine market is proving to be attractive startups, such as igloohome in the smart home space and yup.gg in the eSports and gaming space.
Can you share about Kickstart’s future plan and ongoing innovation?
MN: Kickstart acts as the innovation scout of Globe Telecom. We search for tech startups whose innovations align with the strategic interests of the Globe while enriching the local startup ecosystem.
Through our work with Funds 1 and 2 with Globe over the past eight years, we’ve been given the opportunity to extend this mission on behalf of Ayala with the Ayala ACTIVE Fund.
Whereas with Globe, we focussed on digital tech startups, we now have the mandate to broaden our reach across all of the entire Ayala’s broad interests.
Also Read: Kickstart Ventures makes investment in cloud-based networking company Teridion
Kickstart will contribute to Ayala’s mission of innovation towards nation building by investing in the future we believe in. This future is defined by the Ayala ACTIVE Fund’s four investment themes.
Can you weigh in on what will Southeast Asia, especially the Philippines’s future become in tech investment?
MN: Collectively, Southeast Asia represents one of the fastest-growing economies in the world. Driven by rapidly increasing connected devices and Internet penetration, and a large emerging middle class, the region is abundant with opportunity for its startup ecosystems.
Despite being a region of geographically distributed and culturally unique markets, we’re starting to see more and more inter-country collaboration and investing over the past few years. With a total population of more than 650 million — twice that of the US — there is still a lot of potentials that can be unlocked.
We believe that the Philippines is a key market for any aspiring unicorn in Southeast Asia.
While Singapore remains the financial hub of the region, and Indonesia is the most populous market (250 million-plus people), the Philippines has the second largest population of the region (100 million-plus people) and can be an effective entry point into the region for new products and services.
While the Philippines startup ecosystem has not matured at the same rate as some of its ASEAN peers, there are reasons to believe that this will change soon. Government support is increasing with recent legislation enacted such as the Philippine Innovation Act and the Innovative Startup Act while the availability of private capital and support for tech startups has increased significantly with many Philippine conglomerates recently establishing CVC funds (for example, JGDev from JG Summit, UBX from UnionBank, and of course, Ayala ACTIVE Fund from Ayala Corporation). We’re optimistic that it’s an uphill climb from here onwards for the Philippines.
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Picture Credit: Kickstart Ventures
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