Krungsri Finnovate, a corporate venture capital arm under Bank of Ayudhya, has joined forces with Pawoot Pongvitayapanu, founder of e-commerce solution provider Tarad.com, to set up a 1-billion-baht trust fund to invest in early-stage startups.
In 2022, Thailand saw 61 investment deals worth US$312 million in local startups. Since the start of this year, three investment deals have been reported with a total of $10 million in funding.
"By the second quarter, the new trust fund will operate with 1 billion baht for fundraising," said Mr Pawoot, who is also an angel investor. Mr Pawoot has invested in more than 30 startups over the past decade.
The fund is open for two investor categories: institutional investors with an investment of 100 million baht each, and ultra-high-net-worth individuals through Krungsri Asset Management.
"We have also held discussions with some public agencies about investing," said Mr Pawoot.
The fund focuses on startups in the pre-Series A funding round with an investment range of 5-65 million baht per deal.
"I see dozens of startups and innovative firms that have the potential for us to invest," said Mr Pawoot.
The investment areas include marketing tech, e-commerce, healthtech, biotech, big data, and artificial intelligence.
"We are quite open but startups that we want to invest in need to have the potential to gain traction, particularly in terms of customers and ready products or even having gained revenue or profits. They need funding to scale," said Mr Pawoot.
Krungsri aims to work with the invested startups to help them expand their businesses overseas, as it has branches in multiple countries.
"Thailand has various good startups but they still lack capital, particularly for small startups," Mr Pawoot said.
He said the fund's investment decisions will rest with an investment committee.
According to Mr Pawoot, the fund's uniqueness includes its own startup accelerator and its plan to establish overseas offices to support startups' business expansion.
The fund will also consider investing in startups in other Asean countries in the future.
Sam Tanskul, managing director of Krungsri Finnovate, said that without investments in pre-Series A startups, Thailand may lack new startups in this stage over the next 3-5 years.
There is a shortage of investment funds for small deals or accelerators, he noted.
"This new fund will have an incubator that can strengthen startup capability," said Mr Sam.
The fund is open for any technology field, including tech that supports bank customers.
"Early-stage startups carry a high risk for investors, but we select those which have already gained traction to minimise risks," said Mr Sam.
"We chose to co-invest with Mr Pawoot because of his experience as an angel investor."