SCG enters business start-up sphere

Yuttana Jiamtragan, vice president for corporate administration, said SCG’s corporate venture capital (CVC) arm, AddVentures, would enable the conglomerate to diversify and strengthen its innovation portfolio through investment in and collaboration with regional and global start-ups, allowing SCG to improve its competitiveness in the digital age.
The move was in response to the group’s realisation that rapidly changing technologies were significantly influencing changes in consumers’ needs and behaviour, creating both opportunities and challenges for entrepreneurs and corporates worldwide.
The engagement with start-ups will not only allow SCG to tap into business-model innovation and cutting-edge technologies, but will also provide opportunities for start-ups in SCG’s related verticals to scale in Southeast Asia, Yuttana said.
“We believe that the collaboration will benefit both parties. Start-ups can scale up by leveraging SCG’s assets and expertise in relevant industries, while SCG can grow sustainably with start-ups’ business-model innovation and technologies. Bringing entrepreneurial culture into the corporation will also help us learn to work in an even faster and more agile fashion in rapidly changing business environments.”
Backed by SCG’s strengths and resources, AddVentures aims to support and contribute to the Thailand and Asean start-up ecosystems. SCG’s management envisages that this effort will become part of the driving force for Thailand’s new new growth direction in line with “Thailand 4.0” initiatives.
Yuttana said SCG had appointed Joshua Pas, a technology and innovation veteran, as managing director of AddVentures.
Joshua said the company ran under the vision of “You Innovate, We Scale”. The message reflects the commitment to “add” value not only to the mother company, but also to the start-ups it collaborates with and invests in. Moreover, this new entity will be the venturing arm for SCG to explore new territories in terms of transformative digital technologies and innovation for the company.
“Local start-ups that we are considering now are in logistics and B2B e-commerce in SCG-related business,” he said. “Many of them are highly passionate about solving customers’ problems as they have direct experience and many of them are [in the] second generation of their family business.
“Local start-ups tend to understand customer behaviour and pain points very well. Many of them have very promising solutions that can address pain points in larger scale. If possible, we want to help them scale up.”
He said that this year, AddVentures expected to spend between Bt300 million and Bt500 million. However, over the next three to five years, its total outlay will be Bt2.5 billion to Bt3 billion.
Joshua said the company planned to collaborate with start-ups in various ways ranging from commercial deals, licensing, investing or even mergers and acquisitions.
“We would want to extend our resources, industry [expertise], and access to Asean markets to start-up in order to help them scale faster and more sustainably,” he said.
In the first three to five years, AddVentures plans to spend between US$1 million and $5 million (Bt34 million to Bt170 million) per deal on average. The geographical focus covers Thailand, other countries in Southeast Asia, China, Tel Aviv and Silicon Valley.
AddVentures aims to invest in start-ups in three verticals: enterprise, industrial, and B2B. Examples are start-ups related to logistics and supply chains, smart packaging technologies, chemical technologies, construction technologies, industrial and smart manufacturing, industrial and construction products, and B2B marketplaces.
“AddVentures is very open and would like to invite start-ups and others in the ecosystem to join hands with us. If you have the passion and team to solve customers’ problems and bring innovative solutions to customers in our focused areas, we can collaborate and grow together. That is our vision: ‘You Innovate, We Scale’,” Joshua said.