Venture capital may sound exotic to most SMEs. Most associate VC with successful startups like ride-hailing firm Grab or e-commerce giant Lazada, or with aggressive funds like the storied American VC firm Sequoia Capital.
But how does one become a venture capitalist? Spend years earning their stripes in a consulting firm or investment bank? Build vast wealth and dole it out to startups hoping to strike gold? Or perhaps carve out a track record of investing in successful startups? There has to be some other way that people can join the ranks of grizzled business veterans and high-powered ex-financiers and consultants that make up VC firms today.
While student-run venture funds such as Dorm Room Fund and Creator Fund in the US and UK have proven their success and play a pivotal role in helping student founders, such funds are in their infancy in Southeast Asia. One such fund looking to grow this trend is Protégé Ventures, based at Singapore Management University’s Institute of Innovation and Entrepreneurship (SMU-IIE).
Letting the Students Loose
Protégé Ventures trains students to be tech-savvy entrepreneurial leaders by equipping them with the necessary skills and mindset to conquer the world of venture capitalism and navigate disruptive economies. Students accepted into this vigorous VC training programme can expect to source and fund student-led startups in Singapore.
The formula is simple – bring in a team of university students keen on the startup and investment world, provide them with real capital, intensive mentoring from established venture capitalists, put the team to the test by having them source for potential student founders in the market, make their assessments and present their evaluations to their mentors and the investment committee. This relationship between aspiring student VCs, student founders, established VCs and the institute is symbiotic on all fronts as it allows for young talents to be groomed at the onset, student founders to take their innovations to the next level, and for VCs to seek out innovative ideas before they become the next big thing.
While still maintaining a hands-on approach as its mantra, the programme also includes a more structured 5-week curriculum with lessons on deal origination, deal structuring and analysis methods for its incoming cohort.
So far, the programme has grown by 176 percent, training a total of 78 students over the last 3 years and has invested in 5 student-led start-ups to date. 70 percent of Protégé Ventures students obtained internships and job placements in VC, private equity firms and cutting-edge startups such as Blackrock, Temasek, Wavemaker Partners, Grab, Shopback and Capitaland. To date, Protégé Ventures has funded five student-founded startups since 2017 with each investment being between S$25,000 to S$50,000.
Theodora Boo, student managing partner at Protégé Ventures and undergraduate at SMU said that her experience taught her to be more attuned to the fast-changing economic environment and the details of analysing a potential startup. She says, “The programme taught me the importance of managing uncertainty by acting quickly and flexibly, just like how startups need to be ahead of the curve to succeed.”
Investment for Impact
Aligned with SMU-IIE’s core values of nurturing changemakers to create meaningful impact, Protégé Ventures intends to groom the next generation of entrepreneurial leaders by investing in student founders.
The fund aims to invest in student-led startups, where at least one co-founder is a student who is currently studying or has graduated within the last 5 years. The startup should also be anchored in the economic life of youths, and/or involves deep-tech by student researchers looking to commercialise their inventions.
With the COVID-19 pandemic impacting lives and economies worldwide, the team at Protégé Ventures has also delved into startups that present validated products or services that harness the opportunities presented by the new normal.
One such investment is Joni.ai – an AI-enabled ed-tech startup that the team had secured earlier this year.
Other startups funded by Protégé Ventures include:
- TalentTribe: New-age HR tech that builds a community in addition to recruitment.
- Lumitics: A B2B platform that helps hotels and restaurants track and manage their food waste with IoT and data analytics. The company has since raised a second round of funding of S$750K in January of this year.
- Rooit: A gamified chat app for youth and campus communities to communicate and make friends.
As a venture fund led by students for students, times of disruption and crisis such as the COVID-19 pandemic only proved how important the peer-to-peer network and support is for student founders. Leveraging on the institute’s existing international partnerships with resources, Protégé Ventures not only provides funding, but also extends assistance such as consultancy to help student founders take their businesses to the next level or to sustain in the current climate.