500 Startups has officially announced the launch of a US$10 million micro-fund in Thailand, to further nurture and develop early-stage startups in Thailand’s burgeoning tech ecosystem.
The aptly-named micro-fund ‘500 TukTuks’, a reference to the auto rickshaws popularly used in the country, will be co-managed by two highly-prolific investors in Thai tech scene — Founder of Ookbee Natavudh Pungcharoenpong and Founder of Disrupt University and Thailand’s ‘Godfather of startups’ Krating Poonpol, who recently joined 500 Startups as Venture Partner.
500 TukTuks will focus software technology and marketplaces. It has an eye on fin-tech as well. According to Poonpol, fin-tech is not present in the Thai startup scene currently, but the fund is looking to explore it.
The fund will offer selected startups US$50,000 to US$100,000 at first, and double the investments if the teams prove to be successful. Startups will also have access to the Silicon Valley accelerator’s global network of mentors and 2,000+ founders.
500 TukTuks intends to waste no time in getting started, and plans to invest in six to seven companies within the next two to three months. According to Pungcharoenpong, it is aiming to back a total of 50 to 60 companies in the next two and a half years.
Applicable startups can be either based locally, with a business model that is scalable to both regional and global markets, or have a business model similar to bigger and successful businesses in the global market, but not yet present in the Thai ecosystem.
It is also keen on the broader picture of harnessing innovation in Thailand, to further encourage interest in both investors and entrepreneurs.
“We’re willing to invest in very, very early-stage startups. […] For example, if the team has some startup people and they are working on a prototype, and the prototype is awesome, we’re willing to cut the cheque early,” Poonpol shared.
Pungcharoenpong also said that 500 TukTuks’ aim is to help develop and scale early-stage startups for higher value funding rounds.
“There are investors coming to the region who are looking at Series A or Series B. In a market like Thailand, there are not many companies that are ready to go into those stages,” he told e27.
Poonpol revealed that new investments will be announced in the coming months.
Rise of Thailand’s startup scene
Thailand holds immense potential; it’s the fourth most populous Southeast Asian country after Vietnam with 65 million people and over 40 million having access to the Internet via smartphones.
Its share of mobile web traffic in APAC comes in fourth at 39 per cent, higher than Malaysia’s 35 per cent. LINE reigns as the dominant social network platform with over 35 million users, surpassing even Facebook’s presence.
Pungcharoenpong said that Thai consumers are also competitive in comparison to countries like the Philippines and Indonesia with notable numbers in digital and e-spending.
With 500 Startups investing in more than eight Thai companies via 500 Durian and now injecting US$10 million into the scene, it’s clear that both foreign and local investors are starting to recognise Thailand’s potential.
This is a significant progress from two years ago. According to Poonpol, Thailand’s domestic startups have collectively raised US$25 million in the last two years alone, compared to almost nothing previously.
The earlier lack of investor interest set up a barrier for keen entrepreneurs, but Pungcharoenpong is confident that will change with the entry of 500 TukTuks.
Image Credit: Daily News