Category Archives: business

Venture capital improves corporate governance

COMPANIES receiving venture capital backing are generally better at corporate governance when they list on the stock exchange than those that have not gone down the venture capital path, according to a study by the Australian School of Business.

Based on 11 years of research by Associate Professor Jo-Ann Suchard in association with the Australian Private Equity and Venture Capital Association, the study examined corporate governance at companies that had gone through an initial public offering.

It finds that listed companies with VC-backed boards have more independent directors and a higher percentage of independent directors with industry experience than non-VC companies that have gone to an IPO.

“It is established in international markets that venture capitalists add value through various types of activities beyond just giving money,” Suchard says.

Her research shows VC-backed firms have more independent directors. “These were not just non-executives, but directors who didn’t have any prior or existing relationship with the company, so they weren’t lawyers or bankers or accountants who had a prior working relationship,” she says.

Suchard says VCs use their networks to bring in specialist independent directors to help run companies, and therefore provide better corporate governance, which should help protect shareholder interests and contribute to better performance over time.

Luceille Outhred, chief executive of South Australian technology innovation group Digislide Holdings, says having VC backing has definitely helped her company achieve stronger corporate governance.

“We’ve gone through seed capital raising and angel raising, and each time we’ve gone through a different stage, as a natural consequence of the business growing but also as a necessity for raising additional capital at a higher level, our policies and procedures have tightened up,” she says.

“We always had a goal of listing on the ASX or the New York Stock Exchange, or Nasdaq, so we have constantly been upgrading our policies and our procedures, both operational and governance.


“Digislide has received about $12 million in venture capital funding and we would be in a position to lodge with ASIC for an ASX-listed company if we choose to do so, because all our policies are at the highest level and the implementation is at the highest level.”

Dr Katherine Woodthorpe, chief executive of the Australian Private Equity and Venture Capital Association, says VC-backed companies are used to working with a board, whereas many other companies that list for the first time have not previously done so.

“A lot of companies think they don’t need a board in the earlier stages of being a company and so people are just not used to having a board,” Woodthorpe says.

“It is difficult, however, finding independent directors, particularly people who are interested in working with smaller technology companies, which are perceived as having higher risk.”

Ivan Kaye, director of BSI Australia, which provides venture capital funding through its Australian Distributed Incubator arm, says a condition of putting money into a company is that they move towards having the right structures in place.

“There are generally independent or non-executive board members put on by the VC.

“As a result of that, the shift from a private company to listing is smaller than with a company that hasn’t had VC backing.”

Mike Hershorn, director of Four Hats Capital, manager of the Nanyang Innovation Fund, says one of the first things to improve in the field of corporate governance is a company’s financial reporting.

“That’s really the first step, because if the board doesn’t have accurate financial reports it can’t work well to improve the company.”

VENTURE FORTH
* Companies with venture capital backing tend to have better corporate governance

* Independent directors have a stronger presence on the board

* The right governance structures are often a condition of VC funding

* Better governance brings better financial reporting

Source: The Australian, 28 Nov 2008

Coffee with 3 entrepreneurs at Geek Terminal

 

It is a beautiful Wednesday morning. Shen has invited Jeremy, Ridzuan and me for a coffee session at Geek Terminal. Each and every one of us chatted about anything under the sun. The most surprising thing we got to know from Jeremy is that Nokia had involved in many businesses in Finland. Nokia is a giant conglomerate someone like TATA in India. They used to sell car tires specifically designed for winter. (They had already sold their tires businesses. See link here)

 

So who are these entrepreneurs?

 

1. Shen, Founder/ Managing Director of Jorbb.com

 

Jorbb.com is Singapore’s newest site created expressly for non-executive jobs, for individuals seeking freelance, contract, part-time and casual employment. 

This innovative and uniquely interactive portal enables its users to not only post their resumes, but also photos, slideshows and video profiles.

 

Website: http://Jorbb.com

 


 

2. Jeremy, Managing Director of Metaversum Asia Pte Ltd (Singapore)

 

Metaversum develops and operates the 3D online world Twinity. This visionary project mashes up the real with the virtual world. Members of the Twinity community enrich and expand their lives by integrating their real life into the virtual world. Twinity is set to launch this summer and is currently in private beta. Founded in July 2006, Metaversum is financed by leading venture capital firms and has offices in Berlin and Kiev.

 

Company Website: http://www.metaversum.com/

Twinity website: http://www.twinity.com/en

 

 

 

3. Ridzuan Ashim, co-founder of Widgeous

Officially incorporated in early 2008 by 2 individuals, Widgeous is in the business of creating a web technology-based solution for solving the problem of having too many isolated channels of communication. Keeping to philosophy of keeping things simple, the company has built a platform which allows people to keep a centralised repository of their contact information. With that, others who wish the contact the individual can now do so simply by specifying the individual’s Widgeous ID. Widgeous then helps to decide the most efficient method for delivering the message.

The platform is also an open platform that allows application developers to build applications that fully utilize their cross-channel capabilities.

Website: http://widgeo.us/

 

 


 

 

 (From Left) Neo, Jeremy, Shen, Ridzuan 

Sponsored Review: Feel the air of entrepreneurialism!

Feel lost in the job market? Lack of motivation? I believe these are some emotional struggles among young Singaporean. However in the midst of poor market condition, there always exist an opportunity. Successful entrepreneurs usually emerge during bad weather. Why not get yourself de-stressed and feel the air of entrepreneurialism with Global Entrepreneurship Week 2008?

Global Entrepreneurship Week (The Week) lasts from 17 to 23 Nov 2008. It is a celebration of innovation, entrepreneurship and creativity. The Week will bring together millions of young people across the globe through online and local activities and encourage them to think innovatively and unleash their ideas.

This is not an “All Talk, No Action” event. M.Y. FBI Holiday Camp, targeted at children (age 10-12), will required participants to think of creative ideas to sell their craft on 22nd November as a closing for the camp. All profits will go to a charity benefiting children which will be selected by the participants themselves.

Besides business educations for the young children, Youths-4 Charity Flea market is targeted at youths from Secondary Schools and ITE with a focus on social entrepreneurship. Youths-4 Charity Flea market is a competition. Each team will be required to produce items/ crafts for sale on the flea market. To make the competition more realistic, rental and interest will be imposed.

The Global Entrepreneurship Week 2008 is organised by ACE and NUS Enterprise. The sponsored review is provided by BLOG2u (http://blog2u.sg). If you wish to find out more information of the event, please visit the official site: http://www.entrepreneurshipweeksg.org

Recycle your unwanted IT Products with HP Green Campaign

Guys, 

HP (Stock quote: HPQ) is organizing a recycling campaign this coming Saturday. If you have old and unwanted HP products, you can head down to HP Booth at Yu Hua Village to trade with a new ones under terms and conditions. This initiaitve is spearheaded by National Environment Agency.  

Date: 15 November, Saturday 

Venue: Blk 252, Yu Hua Village@ Jurong East Area (Main Site) 

Time: 11am – 7pm 

For details: Please visit the HP website here or NEA website here

 

Can we drive “armored-vehicle” on the road?!

 

If you are an entrepreneur or business developer, you are constantly fighting for sales otherwise you will lose out in this highly-competitive market. Time is everything! As a sales person or entrepreneur (especially those at the early stage of startup), you need to be highly efficient even on the move!

 

Meeting your clients is like engaging a fire fight. You need weapons and transportation for wars. Your products are your bullets and your car should be like your armor vehicle. Besides transportation capabilities, armor-vehicles have fighting and communication capabilities. Question here, “besides transportation, what else can our car do?”

 

I am sure all of us agree that car is a liability. Why? Simply because we do not see much of owning a car except for the ERP (for those who don’t understand, it is the acronym of Electronic Road Pricing), car loans, petrol charges and road taxes. We need to look at uses or applications of car beyond transportation.

 

I come across the term “Mobile Office”. One of the examples is to convert your vehicle into a mobile place. I believe this is the area that can be further explored. In fact Volkswagen (Stock Quotes: VOW.DE) has the concept of such car. Below are some of the photos of Volkswagen T6.  

 


 


 


 

The T6 model has won the “Best Lifestyle Interior” in the Interior Motives Award 2008. (Source: Car Body Design)

 

I am using this example only to prove my point that we need more applications on wheels. In fact, I believe that the design of the concept car can be further developed to suit the needs of the mass (especially entrepreneurs who might not have an office to work since office rental can be quite expensive).  Sounds hard? But it is not very hard for the technicians to change or modify your car parts. If you watch MTV channel, there is a TV program called “Pimp My Ride” that actually helps to “renovate” your car.

 

 

Enough of Wonderland! Let’s get back to reality. In Singapore, we have seen car loves spend ten thousands of dollars just on installing lighting and car audio system. I am sure there is a demand of office usages on cars. But, Can we have such car modification in Singapore? Bear in mind, you might be installing additional battery (approval from LTA – Land Transport Authority ) to power up your equipments such as communication devices which might transmit wireless signal (approval from IDA – Infocomm Development Authority).  Things are not going to be that simple. I believe there are more factors to consider.

 

I am very willing to hear more. Please drop your comments.

 

Giant Dog Spotted in Singapore

I can’t believe in my eyes! I haven’t seen such a big dog in my life. I was recommended by my sister to go shopping at U Petgamart, a warehouse-concept pet store.  When i walked into the store, this dalmatian look-alike was lying on the floor. When it stood up, its head is about my chest level! (guys, I am about 1.78m tall)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

This shot is not well-taken!


It is a Dog Life?! from Neodimension on Comiqs

 

 


It is a dog life! from Neodimension on Comiqs

 

 

 


It’s a Dog Life! from Neodimension on Comiqs

 

 

 

 

 

 

 

 

 

 

 

 

There are a lot of pet stuff over at U Petmamart. It is located at Pasir Ris Farmway 1. 

The Only Goat Farm in Singapore

 

The whole world knows the success of Singapore but little do they know that we have farms in such a small Lion City.

 

As part of my weekend activities, I spent one of my Sunday morning at Hay Dairies, the only goat farm in Singapore. It is located at very ulu place (a Malay word that used to describe remote place). It was not a very easy place to find if you intend to drive (for convenience, you can consider an express bus service from Kranji MRT station). Although it took us some time to drive to the place (we needed a map to navigate!), I take this opportunity to enjoy the nature scenery. It was enjoyment to look at the beautiful tropical trees and plantations.    

 

We reached there slightly later but still managed to see the milking in time. 

 


 

What a pity?! It would be great to see the uncle use his hands to do the milking.

 

Then the milk is channeled to this machine.

 

 

 

 

 

 

 

 

 

 

 

 

We enjoyed feeding the goats.

 

 

 This is what they had


 It didn’t have a strong taste like lamb perhaps it’s because I am not that particular. For those who think they can’t stand the smell, chocolate flavour might be a better choice for you. If you want to compare the nutrient level between goat milk and cow milk, you can visit this site. By the way, you can’t buy goat milk over the shelves. You have to buy directly from Hay Dairies.   

 

For more information of the goat farm tour, the contact details are as followed:

 No.3 Lim Chu Kang Agrotech Park Lane 4

Singapore 718859

Tel: (65) 6792 0931

Fax: (65) 6794 1580

 

Office Hours: 9am to 4pm (everyday)

Website: http://www.haydairies.com.sg/

Forbes – Cleantech investment hits record $1.6B in 3Q,

 

Look like investors prefer solar energy than others. 

“A record level of venture capital is pouring into cleantech despite a global economic downtown and credit crunch that’s hitting more established players in the industry.

U.S. venture capital investment in cleantech climbed to a record $1.6 billion in the third quarter of 2008, a 55-percent jump from the $979.3 million spent during the third quarter of 2007, according to an Ernst & Young report released Thursday.

The firm’s research, based on data from Dow Jones VentureSource, shows seven of the top 10 venture capital deals in the solar industry, which recently hit the governmental jackpot when President Bush approved an eight-year extension of investment tax credits.

Investors pumped $990 million into solar during the quarter, bringing the year’s running total to $1.7 billion with three months of data left to include.

John de Yonge, Ernst & Young’s Americas research director of cleantech and venture capital, said the cleantech industry is seeing a cohort of companies funded a few years ago that are now reaching the capital-intensive commercialization stage.

“We’re seeing these large follow-on rounds to solar companies to get them to that next stage,” de Yonge said.

One of the quarter’s top solar deals went to Santa Monica, Calif.-based SolarReserve Inc., which will use $140 million in second-round financing on utility-scale solar thermal power plants.

The alternative energy legislation, which was wrapped into the government’s $700 billion financial bailout package, also gave one-year extensions for wind, geothermal, biomass and other renewable energy projects.

Investments in energy efficiency totalled $186 million during the quarter, with GridPoint Inc. leading the way. The Arlington, Va.-based company raised $120 million in fourth-round financing for its smart grid platform, which helps such customers as Duke Energy and Xcel Energy (NYSE: XCJ) control load, store energy and integrate renewable energy sources.

Alternative fuels attracted $95 million in investment, with the largest injection of capital going to Sapphire Energy, a San Diego company producing fuel from algae and other microorganisms.

The majority of third-quarter venture capital funds – $905.9 million worth – went to later-stage deals, showing a continuing maturation of the industry.

But de Yonge said later-stage cleantech companies are receiving additional funds from a host of other players including private equity firms, strategic corporate investors, hedge funds and sovereign wealth funds.

“To me it’s an interesting indicator that clean tech companies are successfully reaching out to sources of capital beyond the venture capital community to help them to reach a commercialization stage,” de Yonge said.

The total $3.2 billion invested in cleantech so far in 2008 has already surpassed last year’s $2.7 billion.

Startups, like all companies, will have to figure out to stretch their dollars during the economic slowdown, de Yonge said.

But venture capitalists investing in cleantech commit their money based on more long-term drivers such as anticipated growth in consumer demand and attractive regulatory incentives, he said.

“Their horizon is much longer than public investors,” de Yonge said.

Cleantech subsectors include alternative fuels, energy storage, water, environment, industry-focused products, services and energy efficiency and energy and electricity generation, which includes solar, wind, hydrogen, geothermal and hydro power.

Source: Forbes – Cleantech investment hits record $1.6B in 3Q, 30 Dec 2008” 

Business Times – S’pore firm scores mobile wallet success abroad

 

WITH Singapore’s efforts to promote payments via mobile phones slow to get off the ground, a local firm is dialling overseas to exploit the market potential of this emerging technology.  

 

 

Following the success of earlier trials, Cassis International is working with a Malaysian operator on the commercial rollout of its mobile wallet initiative, according to company CEO Chua Thian Yee. This comes on the heels of a similar deployment for Korea’s SK Telecom (stock quote: SKM)in 2007.

The homegrown tech upstart, formed in 2002 by a group of executives from the smartcard industry, plays an integral role in realising the payment promise of near field communication (NFC), the technology that is being used to allow consumers to tap and pay for purchases with their handsets.

This is because Cassis provides the solutions needed to allow financial services players to securely distribute credit-card and other payment applications over the air to NFC-enabled mobile phones. By loading the relevant applications, the phone can be used to pay for everything from train rides to burgers and movie tickets.

Cassis was roped in for all the NFC trials that were sanctioned by Visa International(stock quote: V),  and is the only Asian firm on the payment provider’s international mobile payment platform consortium.

Helped by the two overseas projects, the firm is expected to maintain its revenue growth at 30 per cent in 2008, but its big break could come within the next year with more commercial rollouts around the world.

‘2009 will be a big year for us,’ Mr Chua told BizIT in an interview on Tuesday, without disclosing details of the deals in the pipeline.

To tackle its overseas projects, the company currently has a team of 70 staff across Malaysia, China, Korea, France, and its headquarters in Singapore.

While inter-operability and fragmentation issues dogged earlier attempts to promote mobile payments, Mr Chua is confident that the outcome will be different this time around with NFC.

Instead of loading credit-card applications into the chip of a plastic card, the data is instead sent over the cellular network to an NFC handset. There is no need to replace existing payment terminals, Mr Chua stressed.

‘NFC uses a standard that has already been established. It’s not about introducing new equipment but merely using another form factor (the mobile phone instead of a plastic credit card) to pay using the same transaction terminal,’ Mr Chua said.

While telcos in countries such as Japan and Korea have introduced mobile payments, local operators here are just starting to dip their toes into the fledgling technology.

Singapore Telecommunications and its partners Nets and United Overseas Bank are assessing the feasibility of a new coupon redemption feature with NFC-enabled handsets.

Rival StarHub, however, has chosen to join hands with Japanese operator NTT Docomo (stock quote: NTT) to test out the latter’s Osaifu-Keitai mobile wallet platform in Singapore.

Source Business Times 20 Oct 2008

 

 

Entrepreneurship in Meltdown

 

A follow-up of Ridzuan’s email – “Keep it going. Don’t lose heart!” It is pretty clear that the market is filled with pessimism especially of the poor performance in the US retail sector. The retail sales in US declined to 1.2% in the month of September. (Read article here). It is pretty obvious that export-driven Asia economies will be badly affected as the demand of US falls.

 

In Ridzuan’s email, I understand the anxiety faced by many startups in Singapore as funding activities will be greatly reduced due to the US subprime crisis. The market sentiment has been worsened when Singapore government has announced that Singapore has entered into a technical recession. A technical recession refers to 2 consecutive quarters of contraction. (Read article here)

 

For those who are involved in a high burn-rate technology early-stage startup, it is going to possess a really big problem in your venture as many PE/VC are reducing their positions instead of investing more on new ventures. In fact, big MNCs are taking the opportunities to look for “bargain” in the market. M&A will still remain strong despite the global meltdown but that only benefits private companies which have reached a certain scale (Read article here). For those startups that are still in the infant stage, better know how to control your spending. Only the Fittest Survive! If the company can pull through the bad weather, the market will definitely value it differently.  

 

This blog post is not meant to discourage passionate people who are starting up. In fact, I admired people like Ridzuan and Kelvin for taking the path of an entrepreneur. Bad time doesn’t always mean problems. It possesses opportunities too. As mentioned by Ridzuan and Bernard, it is the best time to hire talented people since the big players have already reduced or froze hiring. 

 

If you haven’t read Ridzuan’s email, you can access from here.