Media exec Vincent Lee takes stake in promising start-up in highly unusual manner
Expect entrepreneurs to beat a path to his door for similar deals
FRESH from uncovering who the angel for maxman.tv was, or at least narrowing it down to one of two brothers, this week Digital News Asia (DNA) can do even better -- how about an angel investor who coughed up a cool RM2 million (US$653,000) for a start-up in the mobile payment space?
The start-up is Soft Space International Sdn Bhd, which DNA wrote about on Oct 5. Founded by Chang Chew Soon, who describes his team as “a bunch of software geeks passionate about payment and mobile development.” Soft Space is really going places, having signed a joint venture agreement with MOL AccessPortal Sdn Bhd.
The aggreement will see them forming a mobile payment acquiring company that will focus on small and medium businesses (SMBs), allowing them to accept credit and debit card payments using smartphones and other mobile devices.
Those who read the story will know that DNA described Datuk Vincent Lee (pic) as a major shareholder of Soft Space, via the holding company Feotus (sic) International, of which he is executive chairman.
Feotus comprises Naga DDB, DDB International, DDB PR, Beyond Events, Vizeum Media Services, Rapp Collins, Stropt & Sports Limited (HK), Tribal DDB, Whack Films, Model.com and MNC Wireless Berhad.
But here’s the kicker: Lee invested RM2 million into Soft Space with apparently no stake determined in return for his investment.
Lee is currently executive deputy chairman of Star Publications (M) Bhd and was also the president of the Association of Advertising Agents Malaysia (4As) from 2005 to 2011.
“It was based on trust,” says Chang. He says that Lee had wanted him to join advertising agency Naga DDB Malaysia in a sort of chief technology officer role.
But Chang told him his plans and then, “I asked Lee if he would be interested to invest in me. He asked how much I needed, and said yes to the RM2 million. That was it and I got the check two weeks later!”
It may sound like a fairy tale but as Dr V. Sivapalan, chief evangelist of Proficeo Sdn Bhd, comments, “This is a highly unusual situation, especially for a man with Lee’s experience, and can come back and cause issues later on, especially if the company becomes very successful.”
Sivapalan strongly advises entrepreneurs to determine the stake upfront, even if they have an investor who is willing to come in without their stake determined yet. “It is the proper thing to do and will ensure there are no arguments in future.”
DNA wanted to speak to Lee about why he took such a big bet on Chang and made his decision on the spot, but he declined.
That may be so but you can bet many more entrepreneurs are going to be beating a path to his door to make their pitch to him. He better have a sturdy door.
As for entrepreneurs dreaming of a similar deal with their angels, this is a million-in-one type situation. Er, make that two-million-in-one.
MOL and Soft Space form mobile payment JV ... for your aunty!