Michael Lints, Venture Partner at Golden Gate Ventures
Before joining Golden Gate Ventures, Michael Lints founded his venture fund BestDutch focused on Dutch SME’s in 2007. Michael is also a former vice chairman of the Economic Development Board Rotterdam. He studied Financial Analysis for Business Valuation, and Private Equity and Venture Capital at Harvard Business School.
BeFast.TV is pleased and honoured to interview Michael and dig deeper into how his journey as a venture partner started, the philosophy behind Golden Gate Ventures, the startup ecosystem in Singapore and more.
The interview was transcribed from the video-audio records.
BeFast.TV: Hi Michael, thank you for taking your time to talk to us. Can you tell us a little bit about yourself?
Michael: Thanks for having me. I am Michael Lints. I am 48 years old. I am living in Singapore for over a year and a half now. I am a venture partner at Golden Gate Ventures. Golden Gate Ventures is a venture capital firm based in Singapore and a small office in the Silicon Valley (US). However, most of its activities are in Southeast Asia.
BeFast.TV: Why did you join Golden Gate Ventures?
Michael: I have been a techie all my life so I would say venture capital is a natural step in my career, in my life cycle. I am a former entrepreneur, with the first exit happened eight years ago and then I decided to invest and do more community work, as the part of the Economic Development Board in the Netherlands for about four years. But then at some point, the entrepreneurship started to itch again. So I decided to go Harvard. At Harvard, a good friend of mine told me about what’s happening in Singapore and what’s going on in venture capital space and that kind of intrigued me. So I decided to just get the plane, go to Singapore. I got introduced to Golden Gate Ventures, and we were talking about the whole ecosystem in Southeast Asia and what’s happening, and this was more than two and a half year ago. While we are talking and exploring opportunities, it just made sense for me to join the team, and that is what I did in 2013.
BeFast.TV: What did you friend tell you exactly what was going on in Singapore?
Michael: He said a few things. The first thing he told me was: it is really early and it’s just starting to buzz and be interesting in terms of companies that are coming up. He said to me how Golden Gate Ventures is really active in the scene and not just investing, but also helping these entrepreneurs go to the next stage, and doing all types of events, and completely being part of the ecosystem, trying to grow it to the next level. It’s more than just investing; it is almost like being a startup yourself. That is what made it fascinating.
BeFast.TV: You say that Golden Gate Venture has started as a startup itself?
Michael: If we look at how Golden Gate Ventures started: Vinnie Lauria exited his company, decided travel to the region, started to coming back to Singapore, whereas Jeffrey Paine who was already in Singapore, who has already a long track record in private equity venture capital. They put their minds together and decided to do something for this ecosystem. Essentially, it almost looked like a startup plus accelerator while they were helping startups, investing, especially mentoring them. It evolved into a fund. I definitely say that our first fund was a startup.
BeFast.TV: What’s role of Golden Gate’s office in San Francisco?
Michael: It is critical to have a network. I think the network of investors is very important. It is also important to know what is happening in the Silicon Valley. We can complain about it, we can like it, but the Silicon Valley is the center of startups, globally. Every single region is looking at what is happening in the valley. So it is helpful to have a startup network, the network that can help you with deal flow. For instance, we have invested in the company, which is a part of the Y-combinator in the US, and eventually it moved to Singapore. It’s important for deal flow and also for finding co-investors.
In some cases, companies from Singapore are moving to the US and expanding in the US market. So then it becomes very helpful when you have a good network of VCs and friends that are willing to help out.
BeFast.TV: What is the strategy of Golden Gate Venture? Is that you look for emerging, promising startups in Southeast Asia and bring them to Silicon Valley?
Michael: It is not the typical route, but some of the companies build a global product from day one. In some cases, Singapore and Southeast Asia is not the direct market for them. It would be more convenient for them to go to the US and enter the market there. Some companies are just becoming a global company, and then the next step would be to enter the US, and eventually go to Europe.
BeFast.TV: Michael, what kind of startups are you looking? Do you have the criteria or a particular focus, a specific industry?
Michael: In terms of industries, we are pretty agnostic. When you look at the companies we have been invested at this moment; there is a large part which is part of the e-commerce, e-commerce vertical, which could be marketplace or payment solution. Typically, we have had this discussion with lots of people saying e-commerce is saturated or Fintech is gigantic, and high patrolled forget about it in the next five years. I tend to have a bit of a difference vision in terms of where we should focus on.
Yes, e-commerce and Fintech are playing an important part mainly because e-commerce has not been saturated at all. The funny part is, look at the Black Friday in the US, so this is the first Black Friday where e-commerce suppressed bigger more than sales. It means that people now understand the advantage of buying goods at home, as opposed to going into the shops.
There is a funny story: one of the women got interviewed at Walmart, and the guy asked her “what are you doing here?” and she said “ it is quiet here, and I have a parking space now, but in fact, I use this physical shop purely for orientation. I look for stuff I like, try to get a feeling about it, and then I go home, open an Internet browser, and I start buying it online”. It is a fact that now we are shifting the way we are buying our goods.
Same with the Fintech. The reason why I’ve been focusing on this industry is that the banking industry is a multi-trillion dollar business. Fintech globally is the three billion dollars’ business, so it is a slight percentage. We have a long way to go in terms of what else can be done. That’s why we are still interested in e-commerce and focusing on Fintech. Those two are However, verticals we are looking at.
We are also looking at smart logistics, and IoT, which will become more and more important. Being a father, I see how toys will be way more connected than we can ever imagine, so IoT vertical is going to be very important and interesting.
So again, we are pretty agnostic in terms of verticals or industries. Some of the things we will not touch are like biotech, cleantech, that way out of our business, as long as it is mobile and as long as it has a B2C component, we are interested in looking at them and potentially investing them.
BeFast.TV: At what stage of development startup is supposed to be in order to apply for your funding program?
Michael: I say, anyone who is in between seed and series A. Typically, we will write a cheque between 500,000 USD and five million, anywhere in between. So that is a typical seed or series A in Southeast Asia at least. In the Silicon Valley, it is a total different bargain.
BeFast.TV: Please share your successful stories of investment?
Michael: Yes, of course. The question is always how do you measure success. Is it a success when you have a gigantic exit, and you do not have to work for the rest of your life? Or is it a success that you have never got a company before and within two years you have over 10 million users of your app?
Success can be very different in terms of the measurements. The way I see it – I think Singapore has a lot of new entrepreneurs that have proven to be very smart and to me, already very successful. An obvious example is the founding team of RedMart: Roger and Vikram. I think they have done a fantastic job on pulling e-commerce on the map, not only in Singapore but actually in the entire region. Again, they have done an amazing job. The company is employing over 600 people; that’s pretty badass within such a short period of time.
BeFast.TV: What about other countries in Southeast Asia – any examples of a good investment you have done recently?
Michael: We’ve done two investments in Vietnam recently. We are looking at doing a few sealed deals in Indonesia at this moment. So we are very interested in the local talent. No doubts Singapore is a vibrant ecosystem which helps companies get funding relatively easier than Indonesia or Vietnam due to the access to capital is way more difficult than in Singapore. Of course we will see more success stories in Singapore because of the presence of obvious factors and components.
However, the good thing about those countries is that we see those young founders are willing to fight much harder to get their first cheques that what gets me excited. When you talk to these guys, they are so confident; they know what they are building and they know where they want to go to in terms of strategy. Moreover, they are really eager and hungry to get you on board as a VC and then you start building a future. That is in Indonesia, Vietnam, the Philippines.
BeFast.TV: How do these founders approach you? Write you an email?
Michael: That is what they do, luckily, and we go out and find them as well. In some cases, for some of them, it is a big step to write an email to a VC or to an investor to ask for money. So we go to local events and try to help the local ecosystem. For example, Tech in Asia in Jakarta, that is where we go to and look for local talent. We also go to Vietnam and Thailand and other countries.
BeFast.TV: General question about the Global Startup Ecosystem: do you think that there is a startup bubble now and if so how is it different from the one that was 15 years ago?
Michael: I was in the midst of starting my first company during the first bubble, so I have been there and had seen it all. I have seen many people crashed during that time. However, I believe that there is a big difference between now and then, and whether we are in the bubble at all now. Yes, the prices have become very expensive at this moment, some valuations you do not even understand – companies do not generate any revenue, but still get a one-billion valuation. It is kind of sad.
But there is a big difference: nowadays, luckily, most of these companies are making money, and a decent amount of money as well. Back in the days in 2000, I remember a few guys were building a company but they were having a company on paper. So they had an idea and that idea generated money from the investors.
As well as, there is a big difference between investors back then and now: before you had retail investors, people put their savings or pension plan and go and invest in technology. Nowadays, you have professional and educated investors like venture capital firms or private equity companies or hedge firms to invest in these companies. Yes, prices are overrated, but there is a big difference now and then in terms of the companies, the technology, the fact that we all have a mobile phone that we use on a daily basis.
Let’s say, when you leave your house, you forget your wallet and your phone, what do you go back for? People go back for their phone. They would say “just leave the wallet out; I will just need my phone.” That is the big difference of how we use technology at the moment. But again, there has to be a correction on the market, and I guess it would happen sometime soon.