SET-listed InTouch Holdings is expanding its investment in venture capital funds overseas and embarking on a venture builder programme aimed at seeking startups involved in emerging technology as part of its business strategy this year.
The company said it plans to sign a US$10 million investment agreement with an Israeli venture capital fund by March, its first investment in foreign venture capital funds.
"From 2021 to 2025, we will expand our investment not only in local startups, but also overseas funds as well as ushering in a venture builder programme to build interesting startups," said Narongpon Boonsongpaisan, vice-president of venture capital and business development at InTouch, and head of InVent, the corporate venture capital arm of InTouch.
The goal is to expand the company's investment in 5G-related tech, such as edtech, robotics, insurtech, e-commerce, health tech, drones, ad tech, big data, smart buildings, agritech, machine learning, business-to-consumer payment, gaming, alternative lending and cybersecurity.
"There is still a limited number of Thai startups and 5G is new. We need to expand our business through co-investment with overseas funds, such as those in Israel, Japan, South Korea and China," said Mr Narongpon.
"We are focused on tech that supports or creates synergy with our core business at InTouch, Advanced Info Service [AIS] and Thaicom."
By 2025, InTouch aims to invest in three foreign funds, he said. Much of the investment could last about 10 years with an internal rate of return (IRR) of at least 10% expected.
Through the investment in foreign funds, InTouch wants to explore interesting startups faster, including those that could be brought to provide services in Thailand.
The investment in foreign venture capital funds would open the door for InTouch to vet 1,500-2,000 startups linked to the funds, rather than 200-300 startups at present, said Mr Narongpon.
Last month InTouch launched a venture builder programme for health tech, a sector that requires special support as it is hard to develop technology at an early stage.
Four health tech developers will be selected to join the programme.
InVent provides them with 150,000 baht per month until they provide services to the market.
In January, InTouch invested in Conicle, an all-in-one learning solution for organisations, expanding its investment into edtech.
Throughout this year, the company plans to invest in 5G-related startups in different sectors, such as edtech, health tech, fintech and other emerging technologies.
"We will continue to search for promising startups both in Thailand and internationally, including finding new potential business through joint venture, merger and acquisition," said Mr Narongpon.
Over the past nine years, InTouch has invested in 26 startups to the tune of 1.3 billion baht in total, a 26% increase from 2019. InTouch has exited seven startups with an average IRR of 29%.
In addition to Singapore, Indonesia and Vietnam, Thailand could become the next destination for overseas venture capitals to invest in Asean, he said. The local startup ecosystem has a limited number of startups and most of the effective ones are in the growth stage, or above Series B funding, which requires a large amount of money for investment, said Mr Narongpon.