iSpring Capital is a pan Malaysia – Singapore business accelerator focusing on the new economy. We bring an innovative and fresh concept to emerging technopreneurs, providing both financial and intellectual capital.
iSpring Venture Management is the fund manager for Mavcap Technology Sdn Bhd, which was incorporated by MAVCAP as a venture capital investment holding company. Mavcap Technology has a charter life expiring at the end of 2010. MAVCAP is the sole investor and has committed to invest up to RM25 million.
Our objective is to achieve medium to long term capital gain through investing in promising technology companies at various stages with growth potential primarily in Malaysia but also elsewhere. We define technology broadly as companies involved in Electronics, ICT, Internet, Semiconductor, Telecom and Networking and Medical and Health. In particular, our area of focus is in Wireless and eCommerce.
Our investment size will range from RM500,000 to RM3.7 million though we have the ability to invest larger amounts together with other investors.
Our Investment Criteria
Our objective is to achieve above average capital appreciation over the period of our investment. We generally look for 3 qualities in our prospective portfolio companies.
Management Team: We will only invest if we share the management team’s business philosophy, values and goals. We look for track record and ability to execute but most of all, we place a premium on integrity, professionalism and commitment.
Business Model: We like clever ideas or technology but will only invest in viable business models that can generate superior and sustainable returns. In our experience, companies that can achieve this will have some or all of the following: product/service differentiation, compelling customer value proposition, large market opportunity with potential for greater than average profitability, sustainable competitive advantage and barriers to entry and/or exit.
Potential Returns/Exit: As we derive our returns from the eventual divestment of shares in the companies we invest in, we will need to be convinced of the potential for exit opportunities such as an initial public offering (“IPO”) or trade sale.
Our Investment Process
Upon receiving your business plan, we will determine if the investment opportunity potentially meets our investment criteria. If we like your proposal, we will arrange to meet with the management team and listen to your presentation. If we decide to proceed further, we will commence initial due diligence. This process may take anything from 4 to 8 weeks depending on how quickly we get the information we require or need to get comfortable. During this period, we spend time understanding the business and also getting to know management. Equally as important, it is also an opportunity for management to get know us.
If our due diligence is positive and we decide to proceed, we will give you a Term Sheet setting out the terms of our investment. Once you have accepted this, we will commence with detailed due diligence which will normally include a financial, legal and sometimes a technology audit. Simultaneously, we will commence with the preparation of legal documentation. This process will take about 4 to 5 weeks at the end of which, if the results of our due diligence are satisfactory, we will complete our investment.
A typical venture capital investment process will take about 3 –4 months, possibly longer but unlikely to be shorter. It therefore involves a lot of time, effort and expense from all parties and at any stage, for a variety of reasons, the venture capital firm may decide not proceed further. We therefore spend time early in the process making sure you clearly understand our process, role and expectations as an investor and potential ‘deal breakers’.