Why capital advisory is essential for value creation in VC
Published on May 8, 2023
In fast-moving emerging markets like Southeast Asia, having a value creation department is now a must-have for venture capital firms looking to help their portfolio companies succeed.
Startups in markets like Indonesia routinely face a range of challenges such as limited access to talent and a whole spectrum of regulatory and fundraising hurdles. The topic was front-and-center on a recent episode of the Indonesia Digital Deconstructed podcast by AC Ventures (ACV).
Host Leighton Cosseboom, ACV’s Principal of Comms was joined by his colleague Samira Shihab, Principal of Value Creation, along with Chandan Deep, VP of Strategy and Operations at B Capital, a global venture firm anchored by Boston Consulting Group and led by Eduardo Saverin along with other high-profile names.
With US$6.5 billion in assets under management across multiple funds, B Capital focuses on seed to late-stage growth investments, primarily in enterprise, fintech, and healthcare.
Meanwhile, ACV is Southeast Asia’s leading venture capital firm investing in early-stage startups focused on Indonesia. The firm empowers entrepreneurs with more than capital by coming with operational experience, industry knowledge, deep local networks, and resources. It is a generational partner to founders driving positive societal change and economic impact in the archipelago and beyond.
In the episode, the group unpacked how they help their portfolio companies grow. Samira’s focus is on working closely with founders to increase ROI, and her team focuses on key areas such as organization and people, business development, government relations, marketing and growth, recruitment and talent, corporate governance, and capital advisory.
Chandan’s role is similar. She helps founders drive growth and scale by focusing on things like operational improvements and strategic partnerships. Similar to Samira’s purview, B Capital’s operating team has three parts: operations, capital advisory, and talent.
Value creation, skills, and fundraising
One of the most significant challenges startups face today is fundraising. Samira’s team helps with financial due diligence and pitch deck creation, while Chandan’s team focuses on promoting co-investment opportunities and offering other kinds of expertise in fundraising.
“We offer capital advisory support to our portfolio founders, with a focus on continuously streamlining the fundraising process and leveraging our extensive network of potential downstream investors,” explained Samira. “ Fundraising is definitely a skill, and we support founders where they need it most. We aim to be a helping hand and transfer our expertise to make them as independent as possible. Capital advisory is challenging yet fulfilling, especially when we do get that term sheet.”
Samira went on to say that the level of fundraising support she and the firm’s AVP of Capital Advisory Maliekah Harjani will offer to startups usually depends on the company’s stage and the experience of its founders.
Sometimes, when it comes to pitching, startups lack confidence or communication skills, and they need coaching. Other times, they have incomplete data rooms or relatively messy numbers, and they need to implement certain frameworks. Later-stage startups may need help with networking and or simply being connected with the right investors. At the end of the day, Samira believes that fundraising is a sales game, and it’s essential to provide startups with all the necessary tools to get as many meetings as possible to increase the speed of funding conversion.
When asked to zoom in on a specific value creation case at B Capital, Chandan shared an example of how B Capital helped a portfolio company scale up by 800% in revenue over the last three years by defining its go-to-market strategy and setting up a customer success function.
Get the full episode for free on Spotify, Apple, and Google.
