Expertise, value propositions, and scalability are my mental model for investing – Mun Hon Ng, Novum Equity Partners

Mun Hon Ng, managing director of Malaysian private equity (PE) firm Novum Equity Partners, emphasises the importance of domain expert founders, value propositions, and scalability in determining the right startups to invest in

Novum typically invests up to $5 million and checks for top-line growth and investment spend from previous funding or revenue. The firm is founded on experience in both business operations and private equity investments. Its partners have managed a global portfolio value of above RM600 million (US$136 million).

In an interview with AsiaTechDaily, Mun warns against investing in the business rather than the people and advises entrepreneurs to be realistic in their funding requests.

“There is a reason that funding is raised in stages,” he said.

For those looking to meet investors like Novum Equity Partners, Mun emphasises trust, industry knowledge, and achievable plans as the top three factors he considers. He also shares three life lessons he wants his children to know: lifelong learning, valuing people over business, and delaying gratification.

AsiaTechDaily talks to Mun Hon Ng about his background and expertise, his investment model, and other lessons for startups. Edited excerpts below:

What background and domain expertise do you have? And when did you first think about starting a fund?

I spent the first seven years of my career in corporate finance and advisory, helping entrepreneurs in either raising capital (through IPO) or growth through M&A. Subsequently, I spent 13 years in direct investments (4+ years in the largest VC in Malaysia and served 8+ years as VP, Strategic Investment for the National Innovation Agency of Malaysia).

I have invested in multiple sectors with a focus on growth and tech/tech-enabled companies globally. I have always wanted to start a fund; hence I joined the industry in 2008. The idea was to learn as much as possible in fund management, especially in VC and Growth. I will say my domain expertise is in venture and growth investments.

What types of companies/sectors do you look to invest in and what’s your mental model for investing?

We are sector agnostic, but we have a bias towards tech or tech-enabled companies. Mental model – Domain expert founders, value propositions, how is the business better than its competitors, and scalability.

What is your typical investment range and how many startups do you invest in per year in general?

Up to US$5 million. We invest globally.

What would be the KPI that you usually check about the startups’ growth? It may be diverse in each industry like LTV, CAC, MoM, etc. but it will be helpful to understand more about your additional investment factors.

Top line growth and investment spend from previous funding/ revenue.

Can you share any investing mistakes that you made if there are any and the lessons we can learn from them?

Investing in the business rather than the people.

What mistakes do you see founders make when raising money?

Asking for too much at too high a valuation. There is a reason that funding is raised in stages.

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?

The top 3 things I want to know are:

1. Can I trust this person?

2. Has he/ she got the skills/ knowledge in the industry.

3. Is the plan achievable?

What are the top three life lessons that you want your (future) sons and daughters to know?

Lifelong learning, people over business, and delay gratification.