AddVentures to focus on Startups that support SCG businesses
Nearly a year since AddVentures Corporate Venture Capital fund under the Siam Cement Group was established, it is one of the most active venture capital funds in Thailand.
Dusit Chairat, fund manager, said the investment strategy of AddVentures is to focus on efficiency enhancing technology that helps add value and can be further developed to support SCG’s core businesses rather than solely generating income.
“Our goal for the next five years is to spend approximately US$100 million (3.2 billion baht) to invest in Series-A startups, with 1-5 million baht each. We expect to have five-seven deals a year,” Dusit said.
AddVentures, therefore, is looking for startups with innovative technology that can help strengthen all areas of SCG’s businesses including construction materials, cement, petrochemical and packaging businesses. If these businesses have good potential, SCG wants to make a long-term investment in these startups as well.
“For the startups that can be rising stars in innovation technology and have good growth potential, we may enter a joint venture deal with them,” Dusit said.
SCG primarily focuses its investments on three core businesses; first, enterprise technology such as e-commerce software, e-commerce enablement, predictive analytic, omni-channel, artificial intelligence, and blockchain; second, smart manufacturing, robotics and automation; and third, B2B marketplace platforms for construction products, chemicals, packaging and industrial supply logistics.
This year, SCG will emphasise investing in B2B marketplace, Internet of Things technology, supply chains, visibility traceability and developing tech talent.
The company is ready to make both direct and indirect investments through its “Fund of Funds”. In the past, SCG had joined hands with Wavemaker Partners from Singapore, who focuses on investing in international startups. Recently, SCG partnered with Vertex Venture Management, the business arm of Singapore-based Temasek, which specialises in Southeast Asia and Indian markets.
Regarding its investment strategy in startups, SCG’s policy is to hold less percentages of shares and not interfere with management.
The AddVentures fund has already made an investment in three companies, including GIZTIX, joining two other funds in providing US$1.65 million in working capital to the transportation/logistics company.
“We choose GIZTIX as it directly supports our logistics operations. At present, SCG is Thailand’s largest logistics service provider with more than 7,000 fleets in operation. The GIZTIX system can help reduce idling time drastically. Meanwhile, GIZTIX can increase the supply of trucks in the system and can use SCG’s vast networks to expand to other ASEAN countries, starting with Vietnam and Myanmar.
A second startup that SCG invested in is GetLinks tech talent recruitment. GetLinks helps SCG in finding talented new employees to support SCG’s businesses.
A third company the fund helped support, Baania an integrated online real estate marketplace, helps support SCG’s cement and construction businesses by using Baania’s data to analyse and design products that meet customers’ needs.
The company is prepared to partner with other exciting startups. Last year, SCG joined with Builk B2B marketplace construction business, HG Robotics and Ralali, Indonesia’s B2B e-commerce tool marketplace. If SCG decides to invest in Ralali, it will mark the first overseas startup that it funds.