AppShack Asia announces US$4mil venture fund
By Lum Ka Kay March 24, 2016
- Has already invested US$380K in four Malaysian tech startups
- Intends to produce its own reality show: AppShack Live Pitching
KUALA Lumpur-based Apps Shack Sdn Bhd (AppShack Asia) has officially launched its AppShack ‘pitching platform,’ and announced that it has set up an RM15-million (US$3.77-million) venture fund.
The fund is being financed by the founders of AppShack Asia, according to cofounder and chief business development officer Andrew Tan.
The founding team also includes chairman D.K. Tan, chief executive officer Jin Tan, and chief technology officer Nitin Gupta.
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The company will also provide add-on services like mentorship, and design and development services to help startups commercialise their products or scale their business.
“AppShack is a unique platform which bridges the gap between up-and-coming tech startups and potential investors,” Andrew told a press conference after the official launch in Kuala Lumpur on March 23.
“Combining technology and business know-how, our platform enables startups to develop their innovative ideas, by offering mentorship and guidance, technical expertise, assistance in business structure, legal advice and funding,” he added.
He said that AppShack Asia will take a stake, but was coy on the exact amount of equity.
“We want to be more than just providing funds to the startups and helping technopreneurs to commercialise their ideas,” Andrew said.
“We want to grow hand-in-hand with these companies, where they can leverage on our network and marketing skills to build their business,” he added.
Andrew said (pic above) AppShack Asia has not set a specific investment amount, but that it would be capped at RM2 million in any single company. [RM1 = US$0.25]
However, he then added that the RM2-million cap “is still negotiable.”
When probed further, he gave several answers before confirming that the investment amount is capped at US$500,000 (RM2 million).
Since its inception in June 2015, AppShack Asia has invested a total of US$380,000 (RM1.5 million) in four tech startups between December last year and March this year, but the company declined to give a breakdown.
The four startups are F&B platform discount aggregator Alakad; cloud accounting software provider Biztory; radio-frequency identification (RFID) and near field communication (NFC) event solutions provider Minitank; and sports events organiser Sport Play.
Andrew said the equity stake held by AppShack Asia in the four companies ranged from 10% to 70%.
Meanwhile, according to CEO Jin Tan (pic above), as part of its marketing strategy, AppShack Asia is also producing its own reality show on YouTube – AppShack Live Pitching – featuring startups pitching to judges to obtain funding.
“The startups will be judged by all four founders of AppShack. These startups will be judged on the feasibility of their business ideas.
“Once they’re selected, we will fund, mentor and coach them to help grow their business,” he added.
Producing a 13-episode reality show is extremely expensive, but Andrew was confident that “the viral effect” would be there.
“Those startups that don’t manage to raise funds via the reality show will still have the opportunity to receive valuable feedback from us,” he said.
“Plus, all the startups featured in the show will have gained a certain level of fame. The show will provide great exposure for them,” he argued, adding that the idea for the show stemmed from US reality show Shark Tank.
In Shark Tank, budding entrepreneurs present their ideas to a panel of potential investors called ‘sharks.’
Interestingly enough, e-government and Internet services provider MY E.G. Services Bhd (MyEG) also produced a startup reality show on local television, Make The Pitch, for three seasons from 2011 to 2013.
Andrew said that each AppShack Live Pitching 40-minute episode will feature four startups pitching, and that three episodes have been filmed.
“We are still in talks with several media organisations to air the show on TV,” he added.
At the event, AppShack Asia said the first episode had been uploaded but a check by Digital News Asia on its YouTube channel found only highlights.
Meanwhile, Andrew said AppShack Asia is looking to launch a special purpose acquisition company (SPAC) in Singapore to raise funds, although he didn’t give specifics.
SPACs are shell companies with no prior operating history, seeking an IPO (initial public offering) to raise funds for the purpose of using these proceeds to acquire operating businesses.
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