ADDVENTURES, an investment arm of the Siam Cement Group (SCG), aims to be the leading corporate venture capital (CVC) firm in Southeast Asia region.
Joshua Pas, digital transformation director at SCG, said that AddVentures wants to be lead VC in three verticals: industrial, enterprise, and business-to-business (B2B). These will be its key areas of future investment.
"We focus on both strategic return and financial return, but we do not try to maximise financial return," said Pas.
Pas added that venture capital is a long-term game that cannot depend on the quick win. It does not focus on majority share and board seats, but rather focuses on working with start-ups and other investors.
AddVentures is also eyeing in-bound start-ups from the US, Israel, and China with potential to fit the SEA markets. However, for the first year it will focus on ASEAN and Thailand first.
Its investment strategy is to access the technology frontier and break into the core innovation regions - Silicon Valley, Tel Aviv, and China. And it will build its business portfolio in its home market of Thailand and ASEAN countries.
"We have four stages for working, starting from identifying a strategic fit and commercial deals, then investing and scaling. But not all will follow this progression; it depends on what stage they are at," said Pas.
Applying the concept of "You Innovate, We Scale", AddVentures sets three key criteria to consider which start-ups it will invest in - proof of concept, customer reach and traction, and readiness for scaling up.
Breaking down AddVentures' three key verticals of investment, the industrial category includes "smart" manufacturing, robotics, automation, and energy efficiency technologies. The enterprise category includes e-commerce enablement, omni-channel, SaaS (software as a service), AI (artificial intelligence), AR (augmented reality), VR (virtual reality), blockchain (a ledger technology that records bit-currency transactions), and predictive analytics. For B2B investment, the company will look at marketplace platforms, including construction products, chemicals, packaging, industrial supply, and logistics.
Dusit Chairat, corporate venture capital fund manager at Digital Transformation Office for SCG, said that start-ups that want to grow and achieve scale need resources, industry expertise, and market access that CVCs like AddVentures can provide.
"SCG, our parent company, as a regional firm, having regional operation in ASEAN countries, can help our CVC arm to scale start-ups by providing all they need," said Dusit.
AddVentures was launched last month with total funds of US$85 million (Bt2.89 billion) expected for three to five years, said Dusit.
One-third of the money will be invested in venture capital focused on Silicon Valley, Israel, and China. The remaining two-thirds will be put in direct investment in start-ups in Thailand and Southeast Asia, as well as start-ups from the three key markets that are ready to expand to SEA.
Over the next five years, AddVentures aims to invest in 25 to 35 start-ups and in four to five venture capital opportunities. This year, it will concentrate on Thailand and SEA, and aims to have two venture capital investments and three to five direct investments in start-ups, mostly in Thailand.
Its investment range is between post-seed and series A.