“It’s really because we wanted to invest in Hmlet that we started Aurum, quite opposite of how it would normally work with starting a fund and then finding the investments”

Aurum Investments Director Michelle Yong

Singapore has just got a new corporate VC fund. Aurum Investments, a subsidiary of realty company Woh Hup and a sister concern of co-working space Collision8, has already made its debut with an investment in proptech startup Hmlet. While its key focus is proptech, the VC fund also eyes all kinds of technology-driven, human-centric startups in Asia.

e27 caught up with Aurum’s Director Michelle Yong to know more about the fund and its investment philosophy.

Here are the edited excerpts:

Aurum Investments made its debut with an investment in Hmlet in November before the official launch of the fund. Why so? Also, why did it take you a full month to announce the official launch since your first investment?

We wanted to share about the Hmlet investment with the tech and entrepreneur community first, without it being overshadowed by our own official launch announcement. As a family, we have always been very low key and under the radar, so we wanted the focus to be on Hmlet.

Following which, we recognised it would be important to announce the launch of the fund in order to attract the right startups and partners.

In fact, the launch of Aurum Investments is a strategic diversification of Woh Hup and the Aurum group of companies, which also includes Aurum Land, Collision8 and the upcoming health and wellness concept Core Collective.

You have been in the realty industry for long, and proptech market in Asia has seen tremendous growth over the past few years. Don’t you think Aurum came to the fore a little late?

Not at all – there is a right time and space for this fund. In fact, if not for our entry into the co-working scene with Collision8, we would unlikely have been able to launch this VC fund. Due to the success of Collision8, our traditional business leaders have become much more open to explore new horizons in terms of technology, partners and startups in a way that would never have been possible just 2 years ago.

So Collision8 has been a game changer for the Woh Hup and Aurum group, in shaping mindsets and shaping the future of the business.

In fact, it was through a Collision8 member that we were introduced to Hmlet, and it is really because we wanted to invest in Hmlet that we started the venture fund… Quite opposite of how it would normally work with starting a venture fund and then finding the investments!

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Looking to the future, we believe we are well-positioned to make an impact in the market — now that we have gained credibility and market knowledge of the technology scene.

In addition, with certain technological advances that have given regional and local startups a certain maturity in their approach to proptech, the industry is ripe for us to make a difference in a radically accelerated way.

Can you share the size of the fund? Although it is a corporate fund, do you seek partnership from external LPs?

It is a multi-million dollar fund in the double digit range. It is a fully corporate fund and we are not seeking external LPs, but we would welcome the opportunity to explore collaboration with other like-minded business leaders.

What is your investment philosophy? What is the average size of the cheque?

We are primarily looking for businesses that have strategic synergies with our existing businesses, so that we can add meaningful value beyond just funds. But it is also because we find it easier to understand our own industries and related sectors, and being new to this investment class, it is probably wiser to keep to somewhat familiar areas and leverage home-ground advantage. We have to believe in the founders and in the business model.

Michelle Yong in a interactive session with startups at Collision8

We will focus on seed stage or pre-Series A investments with cheque sizes of US$100,000 to US$1 million to begin with.

How do you pick startups for investments? What are the key things that you are looking for in your probable investees?

We are looking for startups that are tech-focused, human-centric, and highly scalable towards local and regional real estate opportunities. However, we are also not adverse to exploring non-real estate related startups.

I had a meeting last week with a healthtech startup, which is developing a remote fetal heart rate monitor for high risk pregnancies. This is a great example of a technology-driven, human-centric startup that we might consider. In fact, I could personally relate to the problem they were solving, having had high risk pregnancies myself.

With this fund, Aurum targets markets in Asia. Does it encompass all of Asia, including SEA, China, and India?

Yes. We have businesses across APAC, including India, the Philippines, Australia and even in the UK.

What kind of opportunities are you seeing in markets outside of Singapore?

Our business expansion strategy is lateral into peripheral business models as well as geographic within the same business model, and the expansion into other countries has been growing the core businesses thus far. We don’t plan to expand into a new country and a new business model at the same time as we are fairly conservative, but that could explain our longevity.

How many startups will you invest a year? Is there any more investment in the pipeline? Any startups outside of Singapore?

We hope to invest in two to three startups a year, and extremely open to exploring regional startups.

Who is the fund manager? Will you run it yourself? If so, who will take care of operations of Collision8?

Being a small fund we will not be hiring a full-time fund manager. Instead, three of the next-generation directors, Neil Yong, Derong Yong and myself will be mentoring the portfolio companies, managing the fund, and shortlisting startups, on top of running their respective businesses. To diversify our exposure and learn from seasoned funds, we will also be investing with some of the top VC funds in the region.

I will continue to lead Collision8, even though I have already handed over operations to our General Manager, Faith Bogue, and the Collision8 team is doing a stellar job growing the ecosystem, building connections and doubling the size of the space. The Collision8 team is also working on accelerator/innovation programmes to tie in with the launch of Aurum, as well as bringing other value-added services to the community.

Alongside this, I am also in the process of launching a new health and wellness concept, Core Collective, while also continuing to drive growth of residential property development firm, Aurum Land.

What are the synergies between Collision8 and Aurum Investments?

Collision8 is an innovation-led coworking community that attracts many of the most disruptive, driven founders to join us. With Aurum Investments, Collision8 members now have access to more funding opportunities through our trusted network of investors and corporate professionals.

On the flip side, all the startups that work with Aurum Investments will benefit greatly from being part of a wider community of the Aurum group of companies, encompassing not just co-working but also co-living and co-wellness (the new concept I spoke of, Core Collective).

For example, since the investment in Hmlet, their team has moved into Collision8 and benefitted from a conducive workspace (they used to work out of their apartment!), connections to VCs and other seasoned investors and mentors, access to open office hours with the extensive list of Collision8 preferred partners, as well as multiple referrals-turned-members. Collision8 and Hmlet are also finalising the details of the mutual preferential rates for coworking and co-living.

What are some trends that you are seeing in the proptech markets in Asia?

I can’t really put a value judgement on trends, but blockchain technologies sound extremely exciting. However, we have yet to see its realisation and application on a mass level here, whether it is a B2B or B2C approaches.

The adoption of these new technologies will need more time to break in. For us at Woh Hup and Aurum Land, the ones that have the greatest immediate application are in the project development verticals… making design and building processes more efficient to allow for project managers to reduce time and manpower and increase productivity. Especially with the rise of VR and AI technologies, it’s pretty exciting to see how more of these can be integrated into the construction cycle in a deeper way for us.

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Image Credit: Aurum Investments

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