🌉 Water Cooler Chat with Angela Toy, Director @ Golden Gate Ventures
Understanding the challenges of building a VC firm, redefining what it means to cultivate a career in VC in Singapore, and what it is like to work for Golden Gate
At Wrapped Up, we aim to keep you in-the-know on the most relevant conversations happening within the world of VC and startups. That’s why we’re excited to launch a new initiative as an extension of our regular Sunday programming…the Water Cooler Chat Series!
We will be interviewing VCs and entrepreneurs on a plethora of topics, ranging from post-pandemic trends to breaking into VC.
Scroll down and stay for a while, because we have a fantastic first edition for you. As always, feel free to like, share and hit reply - we love constructive criticism!
We are delighted to announce our first exclusive issue with Angela Toy, Director of Portfolio Strategy and Operations @ Golden Gate Ventures, a venture capital firm investing in early-stage internet and mobile startups across Southeast Asia. Back in 2019, GGV partnered with INSEAD to synthesize and share insights into the Southeast Asia exit landscape. The research yielded interesting developments and predictions unraveling in the SEA market within the next 5 years: more regional tech giants, higher valuations and greater anticipation of startup exits. Amid the aftermath of the pandemic, I was fortunate enough to chat with Angela to discuss the challenges and opportunities of working within VC in SEA.
Prior to GGV, Angela has had experience of working in areas of financial services including audit, regulatory compliance, sales and broking before venturing into the startup community with her own e-commerce business. Her startup journey led her to joining GGV in 2014, where she supports the firm with fund operations, portfolio management and deal executions. With her deep experience as an operator and director, we Zoomed in to discuss all things including:
Understanding GGV's rise to success
Building a VC ecosystem in Southeast Asia
Cultivating a non-linear career path in VC
I liked how you used your intuition and past experiences to make the leap into VC. Can you further talk about your thought process when you were making this decision? What was the biggest challenge for you when making this transition?
The challenges I see after working in VC at the beginning of my career vs. where I'm at today are two-fold.
It was fascinating to work for GGV near its inception, not because it was my first breakthrough into the world of VC but because GGV was essentially a startup itself. If you were to join Sequoia or any other established VC firm with a long track record, the way they do things is definitely different. The roles and needs of the firm are well-defined and the structure is already in place. We are still relatively young, yet growing within this burgeoning ecosystem. At this point, we are more mature in that we established a few funds already and have processes in place. Nevertheless, there's still a constant evolving need to change as the world changes. There's no need to look further than what we're seeing right now with COVID-19. In the near future, we're going to employ more people as we adapt and grow which will be an interesting shift. The landscape itself is definitely becoming more competitive as we speak since you have VCs from the US that are trying to break into the tech ecosystem in China or Southeast Asia in hopes of finding growth companies to invest in. In the meantime, seeing our firm take off and take root in the development of the SEA tech ecosystem has been rewarding, to say the least.
Personally, I know there's room for me to grow professionally as a manager. Coming from a non-investment background, I have to cultivate my own path and define what my progression in VC would look like. Once again, that's the challenge amongst VCs here in Southeast Asia; in the US, it's common that we have partner tracks for non-investment roles. Here, it hasn't been established yet.
You've been with Golden Gate Ventures for 7 years, working within operations, finance, and strategy. Tell me more about your experiences at GGV.
My role at GGV evolved as we grew larger. I was the second employee to be hired back in 2014; because of my audit background, I helped the firm navigate through regulatory compliance, laid down the structure on how to set up a fund, and deal with auditors, lawyers and accountants. It was interesting to be one of the few VCs in Singapore at the time since there was no set structure or guidelines on how to succeed in the industry, let alone understand what VC truly meant in Southeast Asia. Over time, we started to gain traction as we hit pivotal milestones within the firm. We established our first institutional fund, raised capital for our second fund and built out a portfolio of 30-40 companies. During this journey, we recognized that we needed to have more touchpoints with our portfolio companies since our portfolio was getting bigger in size. This is where I shifted my focus and allocated more of my time towards supporting these companies, the founders themselves and our partners. Our partners tend to collaborate mostly with 5 companies at a time, so I'm essentially supporting them in this capacity.
The main thing these companies need is fundraising support. In addition to being account managers, I would try to establish relationships with other funds, including co-investors and corporates, that would be interested in partnerships and future collaborations with our portfolio companies. For example, when a portfolio company says that it needs more help in sales development or operations within a certain country, we could then tap into our network and support them through these channels. At the end, it's all about making connections.
As of late, my role has expanded again where I'm taking a more active role in conversing with portfolio companies and helping them build out their strategies, especially in the midst of COVID-19.
Being that you were able to witness first-hand the burgeoning tech ecosystem in Southeast Asia earlier on, what was the most shocking revelation for you working in VC, something that you didn't expect or know going into your role, that might have contradicted your preconception of the industry?
When I initially joined, I didn't have a clear understanding of VC. As I mentioned, the definition of VC in Southeast Asia wasn't explicitly and implicitly written down. Therefore, one of the several unique challenges we faced that most developed VC ecosystems don't have trouble with is finding service providers that could address our needs (accountants, auditors, tax, valuation specialists, lawyers). To fill in these knowledge gaps, we had to tap into lawyers in the US, for example, for their guidance on some of the more standard types of terms you would see in a seed stage investment vs. terms in a PE deal. It was also a steep learning curve in terms of figuring out how to set up a network for SEA founders so that they have a level playing field to build up their business all the way to an IPO.
It's hard to talk about VC or any business without talking about COVID. The pandemic has obviously disrupted business as usual, forcing startups to pivot or change business models as consumers, or society as a whole, re-adjust to new norms. How has Golden Gate managed to adjust to these challenges and how has that impacted your role in the firm?
From a firm's perspective, we have always been more founder-focused. We constantly think about how we can serve founders as a platform instead of provide monetary value to their business. Beyond capital, founders need support and a network to succeed. We are one of the first VCs here in Singapore that saw the value in setting up a platform team and having in-house recruiters (portfolio managers, external CFOs, growth experts) help founders. Typically, founders would hire third-party services to handle different capabilities in their business, which was expensive. We aim to address a wide spectrum of their needs, whether it be from supporting their hiring initiatives to developing a business strategy tailored to their runway.
This year, deals and new investments have slowed down and we have done more portfolio support than before. I've been focusing on the impacts COVID-19 has had on our companies' bottom lines and the strategies of extending their funding runways until, at least, next year. We need to make sure we can help our companies get through this period where investors are not really deploying as much cash as before.
What is your advice to business students who aspire to break into venture capital?
My advice is to pursue internships and gain more experience in VC before diving head first. Content creation like building a newsletter definitely helps! People tend to forget that if you want to break into VC, developing a personal brand and marketing yourself strategically are really important. The more visible you are, the more people would want to hear from you. You should strive to be a subject matter expert in an industry you’re passionate about.
Also, many view the traditional route of breaking into VC as linear: you start your career at a more established firm, whether that be in investment banking or consulting, and pave your way into venture capital after building expertise. However, gaining operational experience at a startup can prove to be advantageous and is more often preferred.
At GGV, we believe that it is more valuable to hire a person that understands the pains and challenges of building a startup rather than a seasoned professional who spent years working in investment banking. When you hire people who spend so much time in the latter industry, it's not uncommon to see a gap in the way a banker and entrepreneur thinks and operates. Having a sense of empathy is crucial if you want to build and nurture meaningful relationships.
Hey there! We are Jeff, Dom and Vas, coming to you live from INSEAD. Thanks for reading Wrapped Up. We'd love to get your feedback - feel free to email us at firstname.lastname@example.org! It will help us to improve the newsletter and deliver the content you want right into your inbox. Thanks!