Edward Tay is the Chief Executive Officer, Board Member of Sistema Asia Capital, and a member of the Investment Committee.
Established in 1993, Sistema is the largest private investment corporation in Russia with assets in excess of USD 20 Billion. Its diversified investment portfolio comprises stakes from 15 sectors of the economy, including telecoms, internet technology, utilities, retail, pharmaceuticals, healthcare, railway transportation, agriculture, finance, and mass media. Sistema Asia Capital is a MAS regulated venture capital/private equity fund that invests in innovative APAC technology companies.
Edward previously held senior roles in British Telecom, IBM, Keppel Communications, and Hewlett Packard in divisions that include AI, data centers & analytics, cloud services, IoT, smart city, 5G, satellite communication & next-generation mobility networks.
He actively engages the regulators, investors, and business community in China on entrepreneurship and sustainability issues.
A graduate from the National University of Singapore in Mechanical Engineering, Edward serves as a Business Mentor at Singapore Management University and Adjunct Lecturer at Peking University for MBA Private Equity and Venture Capital.
He volunteers in public libraries, Singapore Red Cross, and Singapore Children Society.
In an exclusive interview with AsiaTechDaily, Edward says:
The world is always changing, and we must be willing to be innovative and remain adaptable to make the world a better place. As global warming continues to plague our earth, we must promote sustainable solutions to help save the world we live in. Most importantly, we must possess the tenacity always to do the right thing despite all the odds.
My advice to entrepreneurs is to seize any opportunities that come your way. COVID-19 has presented a wide range of pain points for entrepreneurs to solve. Do not be too demotivated during these times of uncertainty. Use this time to reflect inwards, evaluate what went well or wrong for your company, and, most importantly, innovate and pivot your business models to emerge stronger from times of crisis. During this period, plan long term in terms of your business strategy and look for opportunities to grow your business.
Read on to know more about Edward Tay and his journey.
What background and domain expertise do you have?
Edward Tay: Before Sistema Asia Capital, I held senior and leadership roles in British Telecom, IBM, Keppel Communications, and Hewlett Packard in divisions, including AI, data centers and analytics, cloud services, IoT, smart cities, 5G, satellite communications, and next-generation mobility networks.
Presently based in Singapore, I have been posted to Shenzhen, Shanghai, Beijing, and Hong Kong. I actively engage policymakers, investors, and the business community across Asia on entrepreneurship and sustainability issues and am invited to speak at Milan Expo 2015 and Singapore Sustainability Symposium 2019.
What kind of startups/ sectors have you invested in till now?
Edward Tay: We have invested in startups at various growth stages from a wide range of sectors such as telemedicine, health tech, cybersecurity, deep tech, and enterprise tech. Examples include Netmeds, Qwickcilver – both of which we have since exited and Rebel Foods.
What types of companies do you look to invest in? And What’s your mental model for investing?
Edward Tay: Sistema is early to a mid-stage investor, which focuses on value creation in traditional and new-age businesses that leverage technology. We have a specific investment style and targets – we typically go for the minority stake in companies compared to other traditional venture funds in the region, which usually aim to diversify their investments.
Traditionally, we focus on mature businesses that already have some form of market share. When looking for investments, we tend to go after companies with proven business models. The core of the business has to be healthy and sustainable, both financially and operationally. Additionally, we also look at these companies’ competitiveness and growth potential and evaluate their economic value before making our decisions.
Here at Sistema, we take a holistic approach to our investment decisions. Each of us in the leadership team brings on board-specific skill sets and expertise when looking at potential investment opportunities. With our respective expertise, we bring a unique perspective to the fund because we get involved in the company’s day-to-day operations. We take time out to understand the inner workings of the company before making an informed decision.
As for my investments, I look for three main criteria – social media savviness, adaptability of the business, and diversity within the workplace.
How do you handle this COVID-19 outbreak situation for your fund’s survival in the future?
Edward Tay: Despite the ongoing economic downturn, COVID-19 has surprisingly been a significant game-changer in opportunities for the venture capital landscape. The pandemic has boosted certain sectors such as e-commerce, health tech, and Medtech. Our fund is currently underway without much negative impact due to our focus on smart cities, deep tech, and enterprise tech – sectors whose growth has accelerated COVID-19. If anything, the pandemic has helped identify pain points in the various markets and provided opportunities for creative solutions.
Additionally, Do you have advice for anyone looking to start a fund?
Edward Tay: Have integrity, be resilient, and persevere – these are some strong attributes necessary for budding venture capitalists to be successful, especially in Southeast Asia. You must also be willing to put in the work to build long-lasting relationships with fellow LPs, founders, investors, and other players in the ecosystem. Good, strong relationships will help you in the long run.
What mistakes do you see founders make when raising money?
Edward Tay: From my observation, there are two main mistakes that founders tend to make when raising funds. The first is not knowing when the right time to raise funds. Many founders seek to raise funds much later than when required, without realizing that the fundraising process is tedious and unpredictable. Throughout the fundraising process, many factors may arise and contribute to unforeseen delays. These include changes in headwinds in the economy, change of leadership, or even disruptive technologies that may affect the originally planned valuation.
Another mistake founders make is that they are not aware of key person risks within their organizations and fail to take proper risk management steps to identify and mitigate them.
What’s your advice to entrepreneurs who have a chance to meet investors like you? What are the top 3 questions that you always ask the founders?
Edward Tay: My advice to entrepreneurs is to seize any opportunities that come your way. COVID-19 has presented a wide range of pain points for entrepreneurs to solve. Do not be too demotivated during these times of uncertainty. Use this time to reflect inwards, evaluate what went well or wrong for your company, and, most importantly, innovate and pivot your business models to emerge stronger from times of crisis. During this period, plan long term in terms of your business strategy and look for opportunities to grow your business.
What’s your general thought about the term “Global,” and What are the important factors (criteria) for local startups to consider for international expansion?
Edward Tay: Startups should aim to have a longer runway if they choose to service the global market from the start. Due to funding scarcity, they may choose to launch their proof of concept or pilots in selected companies or industries or countries, but they must have the audacity and courage to take on the world.
Founders need to bring in many talents consisting of different genders, religions, languages, and customs. This allows them to understand local conditions better when they expand globally and leverage their talent base.
It is important for founders to think out of the box and always believe in taking the company forward by fostering a close team that is dedicated, positive thinking, and with integrity.
What kind of startup or tech industry will impact the world in the future like 2-3 years locally in your view?
Edward Tay: Personally, any organization or startup that aims to accelerate digitalization will have the upper hand in terms of growth. Sectors such as health tech and e-commerce will emerge stronger after this crisis. The pandemic has exposed the underserved, and these industries will have a positive impact on the world. Gone were the days of a super-app or mega platform. The pandemic has exposed various pain points for various audience groups, which allows entrepreneurs to diversify their solutions to these pain points.
What are the top-three books or movies (TV series) that changed your life and why?
Edward Tay: One of my favorite books to read is “The Story of My Experiments with Truth,” the autobiography of the late Mohandas K. Gandhi (Mahatma Gandhi). One quote has stuck with me throughout this time – “Let hundreds like me perish, but let the truth prevail.” Amidst ongoing disruptive technologies, climate issues such as global warming, and ongoing tensions between the world’s giants, Gandhi’s words have never been more relevant today.
Another one of my favorite books is the Chinese historical novel “Romance of the Three Kingdoms.” I relate strongly to the story of the three brothers, Liu Bei, Guan Yu, and Zhang Fei. Though not related by blood and with different temperaments, the three can put their differences aside and work together to build a cohesive team. I see many similarities between the characters in the novel and my fellow colleagues, where we can cultivate a strong kinship and bond that forms the firm’s philosophy.
How do you keep yourself motivated every day?
Edward Tay: I set time aside every morning for prayers and meditation. I also keep myself fit by running on alternate days. After this, I will read the news from the local English, Mandarin, and Bahasa newspapers to keep abreast of various news and trends before starting my day at work.
What are the top- three life lessons that you want your (future) sons and daughters to know?
Edward Tay: The world is always changing, and we must be willing to be innovative and remain adaptable to make the world a better place. As global warming continues to plague our earth, we must promote sustainable solutions to help save the world we live in. Most importantly, we must possess the tenacity always to do the right thing despite all the odds.
What would you like to be remembered for?
Edward Tay: For making a small difference in people’s lives, no matter how brief or insignificant our interaction may be.
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