Jeffrey Paine: What the SE Asia Startup Ecosystem Will Look Like Post-Coronavirus

My name is Jonathan Gresham. I'm a co-founder of the Founder Institute, and we got a really interesting topic today, and that is what the future of the Southeast Asia startup scene is going to look like when we get into a post-coronavirus world. Or at least I know at the Founder Institute, we are literally referring to things as BC, before coronavirus, and PC, post-coronavirus, right? It has been that much of an impact, not just on our daily our lives, but when we come back and when people even aren't thinking about the virus that much anymore, however long that could take, and nobody really knows what that will be, the world that we're going to come back to is going to be very different, right? All the things that we're doing right now are going to change the world that we go back into. And today, what we're going to talk about is, you know, specifically how is that going to change what the Southeast Asian startup ecosystem looks like? And secondly, you know, and in two perspectives, okay? From the investor perspective and from the entrepreneur perspective. And luckily today we have one of the most prominent early-stage investors in all of Southeast Asia, and his name is Jeffrey Payne. So hey Jeffrey, you want to introduce yourself?

Hi, uh, thank you all for coming on and, uh, you know, and chatting. Uh, so my name is Jeffrey Payne, I run a fund called Golden Gate Ventures. We are based in Singapore. We've been investing in Southeast Asia since 2012, so we've been operating for a while. So we do mainly seed and Series A, Southeast Asia predominantly, still very much Singapore, Indonesia, and Vietnam. Uh, yeah, so we operate about 3 funds. AUM is $175 million US.

Um, yeah, and then the normal, the normal, uh, size rounds that you guys would typically do?

Um, so fund 3, anywhere from $300,000 US to $3 million US.

Okay, so pretty wide range in the, in the early stage. So Jeff actually, um, And this is, I'm dating myself a little bit here, but right now we're in almost, the Founder Institute's in almost 30 cities across Asia and Southeast Asia. And Jeff helped us, it was all the way back in 2010. Jeff, we worked with Jeff to first to launch our first chapter in Southeast Asia in Singapore. And that also was coming out of a recession, which we may be heading into right now. But anyway, so, We have a great audience today. It looks like I'm just looking in the chat really quick. We got people from Chile. Wow, it's got to be late there in Chile, but thanks for joining. Myanmar, Malaysia, Bolivia, Kuala Lumpur. So yeah, welcome everybody. And I'm going to— here's how this is going to work. Okay, we have a very kind of top-level agenda. All right, so we're going to discuss with Jeff, we're going to first look at the investor's point of view of what's going on right now in the Southeast Asian market, things that they're looking to invest in, how, you know, any of the terms might be changing, that kind of stuff. And then after that, we're then going to talk about the entrepreneur's point of view. So based on how the investors are thinking, what might entrepreneurs who want to raise funding and that are planning to raise funding in the near future, how might they you know, what strategies should they put into place and how might they be trying to best position themselves to raise that funding, okay? But no matter what we're talking about at any time, we want to hear your questions, okay? So right over here in the chat, we have a member of the Founder Institute team. She's in there, she's listening to your chat. At any time, throw your questions into that chat and she'll get them to me to ask to Jeff. And, you know, I was talking to some people today. Obviously, Founder Institute used to run a lot of in-person events and now they've all gone online, right? And one of the biggest things with online events is that, you know, it's all about the interactivity, right? So if we're not answering your questions in the chat, then, you know, you can just go to YouTube or whatever to watch, to watch a video about startup funding, right? So believe me, we're here to listen to your questions. So throw them in the chat. I'm going to get started with some of my questions to Jeff to get us going, but, Get your questions in the chat, we'll answer them. All right. So, Jeff, so a lot of things have changed. Yeah. And in a ridiculously fast period of time. So we're gonna start on the investor's point of view here. So right now, you know, in the short term, and let's look at short term maybe meaning, you know, the rest of this year and, going into next year, maybe not all of next year, but most of next year, what are the types of things your fund and what you're seeing other funds may be looking to invest in, and in that time, given what's happening in the world right now?

Sure. Maybe just to give you guys some color what's happening, you guys may not know what the investors are going through. So even VCs are also going through what startups are going through. So, so the first few things that we— I, I can say pretty much across, across the board is, uh, we are looking at our portfolios first. Yeah, yep. So generally, we will split the portfolios into 3 buckets. One would be a bucket where, um, they have potential, whether they're already cash flow positive reaching there. They are in an industry that is a little bit more resilient. They have probably more, more attention from investors. They have more money than they need, etc. So those guys are the ones that we will tend to spend a bit more time on and make— making sure that they are okay for the next 2 years. Then the second bucket are the guys that just needs a little bit of support to get to cash flow positive so that we don't have to spend that much time anymore. So these guys tend to be either global B2C companies or very B2B-centric SaaS-type companies. Right. And then the third bucket, which is the ones that we will not put any more money into those companies anymore. Right. So, so every single investor are doing that exercise right now. Some of them are done. Some of them are still doing it.

So it's sort of a triage, right? It's, it's, it's triage on what, you know, and this is a great perspective, right? A lot of the entrepreneurs I talk to, they don't realize like, hey, you know, VCs are running a business too, right? Um, so, so yeah, keep going.

So from, from doing that exercise, then, you know, then, then it limits our time to look at new deals. Now new deals have also gone down by probably 30-40%. But most, I would say 75% of the investors are doing more internal housekeeping and very, very little new investments. So just to be aware. So if you are fundraising, you just have to be aware. And then on the fund side, obviously we still need to make sure that, you know, our investors are happy with what we are doing and they are supportive. And when we do capital calls, the investors are still investing in our funds. That's actually the main focus, is to make sure that we have all the support and we can continue to go so that the 2 of the 3 buckets that needs money, they will get the money. Right, right. Um, so, so that's, that's what we're focused on. So if, if VCs are not responding to you, or they are taking a bit of time, or they are getting the juniors to talk to you, that's because the, the senior guys are busy doing all this stuff. So just, just be aware. Okay.

Um, because in normal, in normal times, that could be seen as a, as a kind of a no, right? So do you think there's just a little bit more patience in these times when talking with VCs?

Yes. So they have to finish the housekeeping. They have to know how much left in the war chest to look at new deals. And then they will try to figure out—

I think I finally fixed it. Okay. Sorry.

So then they'll try to figure out what what to invest in. So, um, so it— because it's a new— it's a new time, they are looking at things differently. Sectors are all different now, so their investment thesis will be kind of rehashed again. So they, they will kind of rethink and relook at companies all over again, right? So that's why things will be a bit slow. Yeah.

So you said something there too, right, where in, in a lot of the companies you were focusing on, so cash flow positive, number one, Right. First bucket, second bucket, B2B, and then there's this third bucket. Right. So the obvious question then is, okay, so B2C was, and now I know the answer to this, but I, you know, do you want to talk about why, why those are going to be kind of the riskier investments right now that a VC is going to be looking at?

Oh, yeah. So, so if it's, if it's looking at new deals, for example, we have to factor in what's happening this year, right? So we have to assume 2020 is gone, right? Like there's nothing going on, there's no customer, you know, customer engagement, nothing going on. So the scrutiny of what people are investing in a little bit more tight, right? So if you are supposed to make money, and you are not going to make money, then they may not invest in this sector this year. They might push it to next year. If it's a long-term play, like a deep tech play, climate tech play, and you are going to release product 3 years later, then that's a different story. So those funds that like deep tech, that have a 10-year fund, 12-year fund, they understand that it takes a long time. Then it's fine. So I think it all depends on the sector. So I can tell you what will be fine. I would say anything in healthcare, education, jobs creation and jobs training, blue-collar jobs, kind of, kind of segment, supply chain infrastructure. Some portions of fintech is still, is still going to be okay. Yeah, agriculture, food tech, that, that is okay depending on what it is. So if it's food science, then that qualifies deep tech, that will take a bit of time. If it's more like agriculture marketing, agriculture data, that will be a bit more resilient now. So farm, you know, farm, farm to consumers, right, those kind of things. And then climate tech is a little bit more long-term. But generally, it doesn't— the deep tech companies actually doesn't exist very much in Southeast Asia. I think, you know, Singapore has quite a bit of them, and then there's a few sprinkled around the region.

Right. Okay. That makes a lot of sense. And it's changing. I mean, it seems like a lot of the consumer stuff is is going to sort of take a little bit of a backseat, which makes sense because we have no idea what consumers are going to want in the next month, let alone the next 6 months, the next 12 months, right? Is that sort of your thinking? Yeah, right.

I mean, even though you may argue like media entertainment will go up, but how do you make money? That's a separate issue. Yeah, consumption will go up. Yeah, but monetization is a question mark. Right.

So yeah, what it seems to me is it's a much larger focus on just things that people will actually exchange money for. And in a lot of cases that just happens to be B2B stuff and, you know, or it's some of those longer-term stuff where those investors are much more strategic. So let's see, Minha has asked a couple questions here, like, will there be a preference on particular domains or business models? Will, so will VCs want startups to focus more on revenue or customer acquisition? Now, I know, I think on the consumer side, that's pretty obvious, but that it's going to be revenue, right? We're not living in this hypergrowth world anymore. Even before, I would argue even before coronavirus showed up, right? A lot of this hypergrowth was going out of vogue for a while. But for a B2B company or somebody that has some sort of revenue, right? Right now? Are you, you know, are VCs looking to push them to, to really get more revenue out of each customer, or are they pushing them, you know, to, to acquire more customers with the same kind of, you know, unit economics they're looking at now?

Oh, okay. So I think for this year, um, it's about managing your net burn. It's about not spending money that doesn't have very clear ROI. It's about protecting your revenue, you know, not, not, not having customers turn away. So if you can increase revenue with the appropriate ROI, then you should do it. If, if this year sales cycles probably takes 9 months, 10 months, right, then you just need to make sure that your current revenue doesn't disappear. And then it all depends on your net burn. So if there are, there may be 3 types of scenarios, it's like, do you have 3 months runway, 1 year runway, or 3 year runway? So if you have 3 year runway, you can still have a bigger plan, but your spend needs to be careful. You just need to ride out the next 18 months. You need to probably heads down on product and do the necessary cuts, but still understand what the customers are looking for. You may not be selling right away, but you are more heads down on product development. If you have 1 year kind of a runway, then it's about survival. You just need to make sure that your money lasts you longer, you need to make money faster, you need to cut the cost faster. And then if you have 3 months runway, then it's a matter of survival, meaning you may need to pivot to something else and come back to what you originally did. Or you may need something new so that you can raise a little bit more buffer, a little bit more bridging rounds with your current set of investors. So the guys with 3, 4, 5 months, it depends. It really depends on what you do, who you are, where you're from, where you're based, who your current set of investors are. These are challenging times for you, for sure.

Yeah, for a lot of us. And so let's see here, a couple more questions. You know, if VC you think is not— now, there's a lot of companies that VC is never appropriate for, right? So just throwing that out there, even in boom times. Um, you know, have you seen any, any of the companies having, um, at least right now, uh, any success in, in any of these alternative models, whether it's debt, uh, fundraising, you know, revenue-based financing, Crowdfunding, I would imagine— I don't know, I don't know this for a fact— I would imagine that's not a great route right now. I mean, and any, any thoughts on those, those types of things, especially if it's something like a consumer play?

Um, I think alternative forms of financing— venture debt is probably, probably the, the top, the top of mind, especially if you have raised some money before. You are generating some kind of a revenue, then venture debt will be there. Everything else is, yeah, focus on revenue, focus on cost. Right.

Yeah. Okay. And Mark was mentioning, you know, most Asian stock markets are down about 20%. Like, are the valuation metrics, you know, the metrics that you guys are looking at as investors, I mean, are those, how much of those fundamentally changed? And in the last couple of weeks?

I think valuation, depending on who you talk to, valuation metrics have changed slightly before the WeWork issue. Actually, it was quite a while back. Yeah, um, people are, uh, aware of certain things that have, have been kind of not very aligned. So for example, um VC and high-growth startup valuations are not justified or explained properly to the private equity guys or the public equity guys. They don't understand why things are valued that way. And generally, historically, these two sides of asset management do not talk to each other. Right. It's very confusing. They don't really know what each other is doing. And then all of a sudden, you know, these guys are investing in, you know, the, you know, like Series F or G or H, right, pre-IPO rounds of a VC-backed company. And then they don't understand why is it so expensive, etc.

Super risky companies.

Yeah, correct, correct. So I think Slightly around the WeWork time, everyone's trying to figure out, you know, is every deal I'm doing the right, you know, is it the right deal in the first place so that it generates return? And then is it at the right price? Yeah, so, so it has been changing. It has been. I think now obviously it's a little bit more, you know, uh, yeah, a little bit more scrutinized now. But yes, it has changed since the WeWork time.

Yeah, that's interesting. I mean, we've seen that here as well in the States, right? It was sort of the end of the hypergrowth model, right? And I think a lot of people were sort of trending in that direction as well. Um, so before, uh, so we're gonna, we're gonna transition soon. We're getting a lot of good questions here, which is awesome. And I'm seeing most of the questions are coming in on the entrepreneur front, which isn't surprising, right? Like, how can we, how can we move forward and those types of things. So I'm gonna kind of wrap up the first part of agenda here, which is the investor's point of view, which is to say things are changing a lot. There are companies in your portfolio, obviously, that you guys are— I mean, and it's interesting to see the investor's point of view, everybody. The investors, they are also working really hard to save the companies in their portfolio, right? The ones that are that have the ability to be saved, right? Some of them are maybe beyond saving and some of them not. But, you know, forward-looking, like, what are some of the fields? I know, Jeff, you know, personally, that you're interested in space tech, quantum computing, and some things like that. I mean, what are some of the things that you're personally excited about? Like, if you get a pitch from somebody, you know, this is something that just kind of scratches your back, so to speak, before we get on to the entrepreneur stuff and how they can sort of adapt to the current environment?

I think right now it's more— it is still very much healthcare, education, especially in Southeast Asia. So we need to bring that up. So because of this situation right now, I think the public and the private sector are now closer to the government. So you understand how a little bit more about how well they are run, or how well they are not run. So a lot of things are becoming more glaring, right? The healthcare system, infrastructure, education, how the job market is structured. So all these quite fundamental things are something that I want to see, the bottom of the pyramid, like what services and products where the bottom of the pyramid can consume so that they can better themselves, right? So agritech is a good area to look at, you know, blue-collar job creation, how to train them and how to place them and educate them, etc. And then help the healthcare system. So all these fundamental things is something I want to look at more. And of course, the supply chain infrastructure. So, you know, we need We need to move goods around. We cannot just stay at home all the time. Things have to be moved around, including humans as well. So all these are sort of very basic essential sectors that needs to be upgraded. Then on the deep tech side, I'm always looking at the climate tech side of things. The truth is there are not many entrepreneurs that do that here. But, you know, I would love to see more. So it could be, you know, foreign entrepreneurs from somewhere else setting up shop in Jakarta or in Vietnam or in Singapore. It doesn't matter as long as they're doing something for the climate. That's kind of nice.

Yeah. And I think, I mean, you've seen all these social media posts. Where was it? It was in that city of India where they can finally see the Himalayas there. And I think all this, and that's where I've been having these conversations with founders every day. They're like, what? Okay, so if you're Zoom, you're gonna make a million dollars. It's like, no, like what's going on right now is that I'm going to fundamentally change the way people are looking at the world in a lot of different ways, right? Climate, I think is one of them, right? You can look at any type of collaboration. Yeah, you can say Zoom, but any type of collaboration. I know e-gaming is going to absolutely explode if it wasn't already, right? There's a lot of other markets that are just gonna be corollaries of that. I mean, the number of people, family members and stuff that have been connecting over Zoom that maybe haven't even talked in 2 years, right? Now it's like, oh, let's get on a Zoom, right? Like this is, there's all of these things that are coming. So yes, there's a lot of devastation in the economy and there's a lot of jobs are being lost, but things are just sort of getting reshuffled around in this new economy. So let's jump into some of this stuff. And I know I did see just very quick, there are a lot of questions about edtech, right? Because I know edtech in Southeast Asia has been traditionally, I don't know, the last 10 years or so, right, has been sort of a real big area of focus. And I've seen it pop up a couple of times here. So before we get into the entrepreneur's point of view, just the investor's point of view on edtech, do you see— it's always been an interesting market, I think, recently for Southeast Asia. Do you see any kind of changes based on what's going on now on particular areas of edtech or?

No, no, I think it's— there are actually— they are not like— there's a lot more edtech companies that I think a lot of them are doing fairly well, especially those that has their proprietary content and they rely less on, let's say, live, like online live tutoring. So if they have their own content, and you can do it at home without any supervision of teachers, those companies will do fairly well. So I think education will, yeah, I think the behavior is gonna change. So the adoption, even after this is over, the adoption will go up. So I think it's a good time to be in that space.

Right. Agreed. I mean, a lot of the places, even here in the US, almost— I know like all my local schools, middle school, high schools, they're all going to online learning. This is forcing a lot of people that were always uncomfortable with doing things online. Well, now they don't have a choice. Okay, so in the entrepreneur's point of view, right? So now we're shifting here. Get in your questions. I see a lot of questions here. I'm gonna pepper them in. So let me, I'll start with a question from Joe real quick. So how long, you know, from the entrepreneur's point of view, right? How long do you see coronavirus affecting the economy? And now let's keep this specific 'cause Joe, I don't know where you're from, but, you know, at least for your, you know, your very specific domain. Southeast Asia, you know, what are, what are your thoughts on that, Joe?

Um, so there's two, two, there's two thoughts, but we are still working on it. So we are doing some data modeling in-house to try to figure out, um, which countries will bounce back first, meaning they will kind of reopen, uh, business as, uh, business as usual. But You guys have to remember every Southeast Asian country is different. Some are more insular, some are more export-oriented, some are manufacturers, and then some are more services-oriented. So I think, yeah, we are still running the numbers, but I would say next March is a good time. Some countries will open up much earlier. My feeling is Vietnam will open probably first, but it doesn't mean their economy will bounce back right away because they are very manufacturing export heavy. For example, Apple and Samsung and LG manufactures a lot from there. If global demand goes down, then there's an issue there. So I think, yeah, I would say 6 to 12 months is probably the time, but every country will bounce back differently. And it also depends a lot on how the US bounce back. So if US bounce back quicker, then the global recession can kind of ease up a little bit. But if not, then yeah, the recession will keep going.

Yeah, and at least my pessimistic view here in the US is that we're not going to bounce back that fast. But, um, but, uh, as far as— so if somebody is, you know, on kind of— they, they either have a full-time job or they're still in this idea stage, right? Um, do you think this is a good time for them to, to get moving, right? Looking at— and we'll kind of go step by step here, but at the very early, the idea stage, like, what are your— what are your thoughts there?

I think it depends on who you are. So if you have— I think generally it has been proven that this is the best time to start companies, primarily because there's good talent around you can hire. The cost of starting things, you know, it's not as high as before. And then very little competition. So I think it depends on what's your burning desire to start something, how much savings you have when you're starting out. Sometimes it is down to, you know, sometimes your personal financial situation, your family, family background.

Yeah, and Satya is asking—

Yeah, but if you're really not sure, Then yeah, whether you join FI, join an accelerator, or you do things on the side, right? Having something stable, having something, you know, having a stable job and doing something on the side, doing a side hustle, and only leaving your job once it takes off on the side, right? Because right now it takes less to start something. There are freelancers around, you can You know, start something on the side without, you know, breaching your employment contract. You know, you can get customers if you know what you're doing because there aren't any competition. Yeah, if it takes off, then you can say, okay, I can, you know, I can risk manage this and then I can quit my job.

Yeah, great. And that was a perfect segue. Satya was asking, is it a good idea to leave a stable job now for full-time entrepreneurship? Entrepreneurship. And I think, Jeff, what you're saying there is no, don't leave your stable job until, until you, you know, until you start doing it as a side project, and then you can understand whether or not you should, you should leave that stable job, right? Um, you don't have to do it full-time right off the bat, right?

But, but again, it depends on who you are, your obligations to your job, right? And what kind of, uh, yeah, what kind of, uh, contractual obligations you have, et cetera. But the general advice is, you know, stay at your job, do what you're supposed to be doing, and then explore things on the side. Okay.

And we got into this a little bit before, but, you know, in terms of if a founder was already raising funding for their business, okay, and we'll obviously use the early stage example. So we said before that, it's probably gonna take longer to hear back because each investor also, you know, they have a portfolio of companies that they are obligated, you know, they need to help them out. Are there any other tips or insights you can give to somebody that they were already sort of in the process having these conversations with a couple of investors and maybe they're angels, maybe they're actually, you know, institutional, But any other insights you might give them just so they can kind of see into what you're dealing with, they could act accordingly?

Assuming this is your first round or first institutional round, a few things to take note of. Number 1, your terms will change. 2, the decision process from investors will be longer. So these are the two things you just have to be aware, you know, like your term sheet will come back and it will change, right? Um, then you do have to work with your investor or lead investor as though they are your co-founders, like a co-founder CFO, right? So look at them as a CFO who's also a co-founder, and then explain every single line item on your projections and your budget sheet and everything. So your financials, you have to explain every single cell, right? As though you're talking to a co-founder. Just to make sure you're not overspending, you know how to use the money, your sales projections are as close to reality as you can. So, which means you need to spend more time to paint the picture to tell the story. But yeah, your, your, your knowledge of the market, knowledge of the customers, pricing, and finances is going to be more and more important, right?

And I think, yeah, I think part of that too is, is, uh, most investors have, have seen what happened during the last, you know, massive shift in the world, which was the housing crisis back in 2008, 2009, right? So I think that kind That kind of feedback is super important. And we've been telling a lot of our companies that as well, right? The investors are there, they're on your side, they want you to succeed. So being as candid with them as possible is pretty important because they have expertise that you probably don't have. So we're getting, all right, we're getting a ton of questions, Jeff, on very specific, industries, right? Yeah, I can sum up all the questions by basically saying, hey, I'm in this industry, I'm in this industry, right? So, uh, Sarath, online travel platforms, uh, Supriya, e-learning, um, you know, and I, I can go through, I can go through some of them, um, but, you know, I, I think what people— and yeah, I'm just going with the audience here— people want to know what what you think are going to be the trends that are going to be coming out of this, right, on the next side of what we're going through right now, and what are the places where there's going to be some momentum. So if you want to start with some of the high-level ones. So you already said, right, there's going to be, you know, obviously there's going to be healthcare, collaboration, supply chain logistics, right? What were some of the other ones we were discussing before?

Uh, yeah, agriculture, agriculture, yeah, fintech jobs, yeah, yeah.

Um, and I think we also just touched upon, you know, even if you're looking at a consumer focus, it's It's just the— this whole thing is changing the way all of us interact with each other. I would venture to guess that a good majority of the people that are watching this right now, this might be the first webinar you've ever joined, right? Because again, these things are becoming normal. So I'm gonna go through a couple of the other industries that people are naming, and then maybe we could talk about what it might look like. So Sarath is asking, Do you think that online travel platforms— that's a challenging one— do you think that online travel platforms might bounce back normal soon after COVID-19 is gone, or will it take years to bounce back?

I think it depends. It depends. So my feeling is this: you guys have gone through the stay home thing or work from home thing, right? You actually realize a few things. You realize that we are born social animals. We cannot stay cooped up.

Yeah, that's true.

Even though you are extreme introverts like me, you still need to go out, right? So the reality is we will travel. So the moment this thing ends, there will be a percentage of people that will say, okay, 'Let me chill for 3 months just to see what's going to happen.' It's the same thing as if Apple released a product, you kind of like, 'Let's chill before I buy it and see what are the problems with those products.' But it will come back. The more people are confident that this thing is over or the vaccines are there, the rebound is gone. There's no second, third wave, then, then, yeah, then the travel industry will come back again. Okay, because right now I know for a fact, every one of you know, once this is over, which is the, the, the next city you will try to visit, right? For me, it's Japan, right? So you know right away where you're gonna go, right?

So Supriya was saying experts say e-learning, right? So we're getting to edtech here again. You know, is it— she, I guess she's— what her question is, will these directly be offered by schools? Which right now there's a big trend there, right? At least here in the US, I'm not sure, but what it's like over there, there's a big trend right now where all the schools are being forced to offer this, right? Because kids are home. So I guess right now, are there massive changes coming in edtech just based on kind of these forcing functions of this crisis? In your opinion?

Yeah, I think edtech is interesting, meaning some schools will adopt third-party, you know, platforms or services. Some schools with enough funding, depending on the government, whether it's private school or public system, they may develop their own content. But what, what is happening is the, the behavior will change the adoption of certain content will be adopted, whether it's in-house built or they use somebody else, which is probably going to be a startup. But you have to make sure that there's a few things that still doesn't change. Certain subjects for certain age groups, it cannot be completely online. No matter what you're going through right now, you still need some kind of a hybrid system. So you still need in-class discussions, you still need, you know, teacher interactions. Online only covers certain types of subjects, certain types of age groups. It cannot cover everything. So, so when you are in edtech or you're starting a company, you'll be very careful what you do and whether or not people rely on you completely, it's still a question mark even after this is over.

Right. So, Michelle, I hope I'm pronouncing that correctly. So, you know, you had mentioned blue-collar jobs before, right? Any kind of solutions that can help those? And Michelle's asking why those in particular, and what about white-collar?

Yeah, so if you look at emerging countries in Southeast Asia, I would say 80% are dominated by the blue collar. So for a country to prosper, they need this group needs to upskill themselves and needs to do more, do better, learn more, get better, and make more money so that the country can move ahead with certain industries. So right now, if you look at Indonesia, the fear is not what's happening. The fear is that the bottom of the pyramid goes into poverty. And they cannot work. That is actually the main fear. So the top 10%, what's happening actually, it's important, but that's actually, if a country were to drop or to really go into some serious issues, it's actually the bottom of the pyramid that are affected. So for any country to prosper, you need to fix and try to bring up the per capita income, bring up the education level, just like China did 20 years ago.

Right, that's good. That kind of— Sophia had a question here, which I think you also just answered, and it was very related. Will job reskilling or upskilling online services have a positive upward trend? I mean, so are you seeing— do you think the governments realize that, you know, that, that what you just said, and that they're supporting that? Have you seen that?

Yes, yes, I've seen this in Indonesia. So one of our portfolios are doing that, so to, to make sure the training programs are properly administered and tested and measured and everything, so that— and, and this comes from the government, right? So, um, so it's very hard for the private sector to, to enforce you know, like, you know, let's say a program for 200,000, you know, factory workers, for example. Right. So I think governments need to come in, and they may not have the resources to get this done. So maybe some startups can kind of help them out there, or a coalition of different private companies can help them out. So, yeah, I think it all depends on how the government works with the private sector.

Okay, um, Minhaz, and I'm just gonna— we got a lot of questions, Jeff, so, um, I'm just gonna, I'm just gonna pump through these. All right, uh, so Minhaz is asking, do you think there's going to be a lot of micro entrepreneurs born— I mean, a lot of people losing jobs right now, right? So do you think there's going to be a lot of micro entrepreneurs going out of these jobs, um, that, um, that could be taking advantage of some of this changed behavior that we're going to be seeing?

Um, yeah, certainly. So if you have skills, yeah, you'll be— yeah. Okay.

Um, and then some of the other, uh, so a couple people have asked about fintech.

You'd mentioned— yeah, so you'll be freelancing, for example. Yeah, go ahead.

Go ahead. I think we had a delay there for a second. Sorry.

Okay. Yeah, so it will be, you know, you'll make money by selling your time, you make money by, you know, by even selling, you know, digital products, physical products. Yeah, so everyone will try to, try to have many side hustles for sure.

And one thing that I'll say there too is that The market is changing and that is a distinct advantage for micro entrepreneurs or smaller companies. Big companies are all reshuffling and they're dealing with layoffs and they're dealing with a lot of other big problems and they're not going to be able to move to the changing consumer preferences. So it's a pretty massive opportunity for entrepreneurs right now. So some of the other specific things, a couple of people brought up fintech because you had mentioned that, but I think what you had said was, oh, it's fintech, but specific types of fintech. I think is what you might have said. So what are the specific types of fintech that you think are going to be interesting and they're going to gain steam?

I'd say insurance, obviously. Insurance and then some level of lending, so like consumer lending, SME lending, that's going to come. But not everyone will get the loans, right? But there are certain segments of people that in the past have never even thought of lending money. But now they may want to diversify their risk a little bit. So even though these are people that did not lose their jobs, it could be, you know, some family members did. It could be salary cuts, right? But, but they, they, they need, they need something to tide them over for, you know, 1 or 2 years.

Okay. And there's a couple things here because you obviously, you expressed an interest in some of the, uh, the green technologies, climate technologies, things like that. So, uh, Jurgen was asking electricity generation in Southeast Asia, like enabling expensive grid connection of some of the islands. Do you see that that's something that could— I mean, I, you know, some of these are always going to be interesting, but what we want to focus on here is, okay, what's going on in the world right now? Are these going to pick up steam, you think?

Um, I think every— everything is at play, right? So the government is, uh, you know, if, if that's— if there's a loophole, they will try to either fill it themselves or they try to do like a PPP, like a public-private partnership, right? So, so for those who are more into kind of power products, right, there are still things going on in the area, um, because these are G2G or B2G kind of projects that, that is a 30-year life cycle. So, so it's okay. Um, so I think all segments of climate tech is all in play right now.

And do you think the governments are going to be more, um, you know, and maybe it's out of job creation or something like that where they're going to be a little bit more amenable to some of these ideas and there might be some more funding opportunities that are opening up?

Yes, yes. But again, every government functions differently, their budgets are allocated differently. Sure. So yeah, they will same as what we do, right? They will try to make sure that, yeah, the money goes to the right sectors first before it comes, right?

Okay. Um, Bhaskar was, was getting into a little bit more on the fintech side. I mean, do you, do you see any particular interest right now in payments, um, in fintech, or, um, Depends on where you're from, which country, and what kind of payment method that is.

Generally, traditional kind of payment volumes have dropped probably like 10-20%. Digital payments, mobile payments for certain things like gaming, probably went up 20%. So, so again, this is Payments is a long-term play, right? So this year and a half is just up and down. So some sectors will go up, some sectors go down. I think if you are in the payments game, you need to think long-term. You need to figure out which country you dominate, how you make money, how much of a take rate you can get, and then who are your competitors. And now is a good time to hire people. So payment companies tends to have very strong tech, technical talent. So now is a good time to hire if you have the resources to do that.

This is the best time to hire people that you typically couldn't afford. Literally.

Some of you with resources, this is a good time to go on the offense, right? Most people are going on a defense. Yeah. So go on offense, go and hire the right people, etc. Yeah.

It's times like these. A lot of amazing people have been laid off from companies and it had nothing to do with how amazing they were. It was just because they had to get cut and they're looking for opportunities and they're looking to the future. And that's why, you know, if you look at the last couple of economic downturns, the dot-com bust around 2000 and the housing bust around 2008, You know, that's usually where there was the seeds planted of the biggest companies that we use technology-wise right now. And it's because they took advantage of a lot of different advantages. And I think the biggest one is just the workforce, right? Because normally, if you want to find this amazing talent, you've got to offer them, you know, you're competing with the large tech companies. You've got to give them daycare on campus and all this kind of stuff. Now they want to do something cool, right? They want to work on something that they think is going to be part of the next wave. So Boone also asked here, and I'm going to wrap up soon. So any— yeah, we're going to wrap up in a couple of minutes here. Boone asked virtual reality, right? I think this one is kind of interesting of a test case. What are your thoughts on virtual reality as a result of what's going on right now?

I think horizontally it has always been too early, but I think probably after this there might be some interesting verticals that VR can kind of step into. So I think medical is one area, entertainment is the other area. So I think there's room to go. There's a lot of R&D still being done. A lot of companies are still not giving up. Many of them have, you know, gone, come and gone, but there will be some application that will make sense. Right.

Yeah. I think if at any time virtual reality is going to come into play, it should come fairly soon. And the, you know, just to wrap up on some of the healthcare stuff, Right. So we've been throwing— that's obviously a big field, you know, and I even know a lot of companies that we work with, you know, they work in quote unquote healthcare, right? But they're fairly broad. And we've been instructing a lot of them like, hey, you know, like, let's focus on some of the specific parts of healthcare that are going to be very relevant in the very near future. You know, where would you try to direct people within that healthcare field be relevant right now?

Uh, right now it's, uh, uh, medicine delivery number one, and then telemedicine number two. Yeah, so these are the two immediate, yeah, like immediate needs. Um, then everything else tends to be, you know, from healthcare insurance to employee kind of health, you know, employee healthcare program management to specific, for example, fertility health and all that, that, that, that will be later. That will probably be next year.

Okay. All right, cool. Well, um, thank you everybody for, for the questions. I mean, Jeff, do you have any— if, if there was— and I know just, just from the questions that I got today or tonight here, uh, in the morning or afternoon for, for basically everyone else on, on, uh, on this event. Yeah, you know, it's, it definitely seems like a lot of people here were interested in, in, you know, picking your brain as to what, what this post-corona reality is going to look like, right? And I know that's a, I know that's a very broad a very broad stroke that I'm giving there. But, you know, if an entrepreneur is, you know, maybe they're doing health tech, maybe they're doing virtual reality, whatever it is that they're doing, you know, how would you recommend just as a closing thought here, if they kind of try to look at their idea, maybe it's an existing business, maybe it's just an idea, how do they look at that to try to see, you know, okay, how do I move forward with this like, will this be relevant in this post-corona future? Do you have any thoughts there?

My feeling is there are ideas that will make money this year, and then there are ideas that will make money, you know, like 3 years later, right, where you need 2 years to kind of prepare yourself. So I think it It all depends on what you do and where you're from and the market that you're targeting. But generally, it is true. If you're thinking to start something, you have savings, you really want to do this now, now is the best time to start a company. But again, coming from an investor, everything needs to be aligned, right? Like your founding team, your idea, your market size, Everything needs to be aligned. So be very, very careful before you do it, meaning do a lot of research, making sure it's almost foolproof. It's almost no longer the team is great, they will figure it out kind of game anymore. So everything about you needs to be great. So your team, your market size, your margins, The way you execute, the way you go to market, everything has to be perfect. So do not rush to start companies, but you have to plan a lot better now. And then the last comment to everyone, I don't know if there's a way I can answer all the questions here, somewhere, I don't know. I would love to because, you know, If you have, if you kind of gave us your time to come listen to us, then write a question. I want the opportunity to answer that. So if there's a way to do that, let me know.

We could see, yeah, I know we can get the chat. Go ahead.

Right. Yeah. So maybe, yeah, you can, I think you have their emails, you can kind of like figure out how to do that. Two is if you are currently running a company, started one, or is in one, a few things. One is to make sure you reach out for help. So if you are kind of going through some downtimes, right, you need someone to talk to, please reach out for help, reach out for someone to talk to, go for walks, etc. Right now, probably a good time to do that, depending on where you're from. So don't be alone. Even though you're extreme introvert, you like to be alone, don't be alone. And yeah, do reach out.

All right, well, thank you, Jeff. That was great. I know, and I'm just looking at some of the comments here. People are thanking you for all the— for all the advice and all the insights you've given tonight. So we'll try to figure out what to do with the chat here because, yeah, there were a lot of questions and it was hard to keep up. But thank you, everybody, for joining. Also, thank you, Jeff, for sharing all of your insights. And everybody, you know, as Jeff said, this is— it's a challenging time for a lot of us, right? Yeah, take some time for yourself. Go for a walk. And, you know, we can all sort of try to figure out what the future is going to look like and act as best we can. Right?

Yeah, one thing that helps, sing karaoke. That helps.

Sing karaoke.

All right.

We'll try that. We'll try that out here. All right. Thank you, Jeff. Thanks, everyone, for joining. And yeah, have a good afternoon or evening wherever you are. Thanks everybody. Thank you.

Okay, just—

all right, bye.