From a New Years stay in quarantine, time for a reflective piece on Openspace in 2021 and beyond. As much as I love our all-team zoom calls and frenetic scheduling this year, its an enforced detention with a keenly anticipated freedom pending that gives you more time and enthusiasm for edit…
More than a two-man show.. Very excited to add Jessica to the Openspace Partnership group. She had a great 2021 with the fundraising and investment success of OSV+. She also romped it home in our 360-degree review process and wrote inisightful tomes for everyone else. Jess and I have worked together on deals since 2005 and I am deeply convinced on her broad capabilities. One thing she cant do though is drive too well. But was happy therefore to be her Chicago and Connecticut chauffeur this year on our toll-road packed US roadshow. Even more importantly, Jessica, Hian and myself are empowered by a very strong team, with a number of Southeast Asia VC veterans, no attrition since Covid and ready to further step up.
Regional is def worth it.. We now have five staffed offices across the region on back of a team of 32. But the one office people in the ecosystem didn’t quite buy into (at the time) was a Manila office. Now we have three going on four investments in the Philippines and perhaps one of our most exciting businesses, online streamer Kumu which was recently invested by General Atlantic. Watch for more from this market as interest increases and we have the team on the ground.
Strengthen the core and don’t distract. Our longest and dearest supporters warn us about style drift, warn us about a distorted mindset if you focus on banking the fees, warn us about losing focus. We bear this in mind constantly. But instead, we have in 2021 carefully added two new fund products to our platform with the goal of supplementing our core strengths of regional depth and technology knowhow. OSV+ adds to the capabilities at mid-stage and empowers our regional coverage leads. Ocular helps us to assess earlier stage crypto opportunities using a new mindset and embed two-way learnings in an area which is becoming closer to the core – in terms of entrepreneur focus and end-product development.
Northern Temperature has changed dramatically. Who would have thought China would move to overlay so many tech sectors with common prosperity ambitions in such a short timeline? And put at risk a liquidity and fundraising channel in the US markets that delivered so much over the years (and got a few roving tech bankers promoted back in the day..). We are seeing the impact in Southeast Asia but much remains to be sorted. Meanwhile, its great to see Singapore welcoming more entrepreneurs (including in fintech and crypto space) to our tropical shores as it embeds its advantages relative to other tech development hubs.
Simplification overpowers subtlety. Southeast Asian complexity needs to be embraced and managed in our view – and not plastered over. However, deal making at mid and late stage is seeing more remote-controlled capital put to work with less diligence and big picture themes. Time will tell but it’s a good place to be in being able to navigate complexity as this welcome capital arrives.
We are still talking about quarantine..
The Great companies will trade Grandly.. Too much focus in 2021 on the rise, fall and now scatter of SPAC deals, which I would say is a procedural distinction not a change in financial fundamentals. Good quality companies choosing SPACs will do ok (in the medium term) and sub-par companies doing regular listings or SPACs won’t. There will be some great success stories listed on public markets this year and we wish them to be recognized as such at listing but we also are prepared to wait for their success to show in the shareprices that emerge
GameFi Gains Ground. I’ve tried a few days ago shifting the quarantined kids from playing Roblox and Minecraft to playing Sandbox instead. “Wouldn’t you like to get paid for your builds?” Moderate success I would say as the interface and functionality was weak. But this can be solved, and I think a few games will break out in 2022 and appeal to more than just a narrow demographic, maybe even kids.
Gamblers Get Grounded.. Something might just blow-up. I have a few guesses if you catch me late at night. But there will be a reckoning for some people who are early in their track record building and more about going with the flow than doing the work and having a proper understanding of risk. Our business needs to embrace risk for sure and we will all have our moments of regret. But if your investment model moves to gambling, the house doesn’t lose too often in the long run.
Best wishes for a huge 2022 to all. Fingers crossed for less PCR & ART and more IRR & IPO. Thanks for reading this much longer piece than last year
Look forward to connecting with everyone in the New Year and maybe helping us build our highlights for next year.