Innobiz to link technology, capital

The project will hold a pitching day on Tuesday to let 15 tech businesses from the incubation centres of Software Park Thailand and Thailand Science Park to meet 25 local venture capital firms.

The two parks are under the NSTDA's Technology Management Centre.

Chaiyoot Chamnanlertkit, executive director of the SET's Industry Development Centre, said yesterday that the initiative aims to bring tech companies needing financing together with venture capital funds and private equity funds.

TMC director Chatchanat Thebtaranonth said the project would help local tech businesses, especially those in the first three stages of development - prototype, start-up and early-growth stage - that mostly face liquidity problems, to have more opportunities to access sources of capital from funds owned by the private sector, the government and individual investors.

"TMC bridges the gap between the capital demands of technology businesses and capital supply of investors," he said.

The 15 companies, out of 28 that applied for the project, have been screened and examined by the two parks and are seeking a total of Bt260 million. Most of them are local software houses and the rest are biotech businesses.

TMC has provided seed money of up to Bt5 million per research and development project or about 75 per cent of a total project's needs. But alone, the centre can encourage only tens of companies per year, so it hopes that the project will have a greater impact by promoting hundreds of tech firms per year.

TVCA executive Sopon Boonyaruthhapunth said venture capital funding is an important mechanism in helping nurture tech businesses here.

In the United States, even though last year total venture capital dropped 8 per cent from 2007, total venture capital spending was still US$28.3 billion (Bt1 trillion) and most of the capital was invested in tech businesses including green technology, biotechnology, life science, Internet and software businesses, he said.

"From that total venture capital value, seed money - money for helping start up businesses - was increased more than 50 per cent from 2007 to $1.5 billion and it was the highest spending during the eight years since 2000," he said.

For Thailand, venture capital funding still plays a minor role. Less than 1 per cent of the companies listed on the SET are software businesses supported by venture capital funds, he said.

"This is because the market capitalisation of the software business in Thailand is small and not attractive enough for venture capital companies. Thus venture capital companies for the software business are not many. This collaboration will help open up opportunities for both tech businesses and venture capital businesses to meet and make investment deals," he said.

As a venture capitalist, Sopon said the priority investment criteria are the executive team, business model and importantly, commitment.