Entrepreneur

With Over 60 Investments In SEA, This Venture Builder Now Looks To M’sia For New Market Leaders

  • If you’re interested to find out more about Reapra and B80P, you can check out their website here
  • You can also meet the Reapra team in person and hear from them on September 19, 25:30pm in Common Ground Bukit Bintang, where they will be part of a special sharing session on “Pivot To Profit”. Find out more details here.

At 25, Shuhei Morofuji was looking to his future and he didn’t like what he saw there. The expected path, that many had tread before him, was to become an average salaryman in Japan.

But he wanted a more efficient way to reach his own definition of “success”. 

When he hit the age of 36, you could say he had found just that. In 11 years, he had founded and lost 1 business, set up a second business that became profitable in 12 months, and had a successful IPO in 5 years. 

Today, the company he started, SMS, has more than a USD1.5 billion market cap and, in its early days, was grown to its size and scale with minimal venture funding.

Shuhei stepped down from the position as the CEO in 2014, but remains the largest shareholder.

Looking for new opportunities, his attention settled on Southeast Asia, which he found was abundant with problems and opportunities to develop that could not necessarily be solved by simplified business models.

“There is just no single solution, and these problems need founders who are well-versed in managing the complexities of growth and sustainability,” as his team now recounts. 

“However, these founders may either be working on the wrong problems, or may need to grow themselves to help develop these promising, upcoming industries.”

Seeing this, Shuhei founded Reapra in January 2015.

Enter Reapra

Reapra is a venture builder and investment group based in Singapore with a strategic focus on developing sustainable businesses.

“We have invested in more than 60 companies, and have continued to hone the core of our methodology,” shared Takeo Matsuda, the Managing Director.

This methodology was inspired by Shuhei’s success with SMS, and also is continuously updated based on their experiences with each new investment they make.

“It will give founders the tools to create profitable, sustainable businesses that will be set up for the longer term and build a meaningful presence in their respective industries,” said Takeo.

Reapra believes that focusing on founder development allows their team to partner with the founders to build industry-scale businesses actively.

“The founders need the right tools to manage the difficult complexities they will face—this takes more than just simple, one-time, practical advice—and requires a massive effort to know how to learn and balancing it with the right actions to take the business forward.”

Another concept that Reapra takes very seriously is sustainability. We had to question it, as that’s a term that is thrown about too often nowadays.

Priscilla Han, the Head of Investment & JV in Reapra explained it thus, “When we talk about sustainability, we mean business sustainability. More importantly, we ask how can we make businesses self-sustainable, in survival and growth, with limited resources available.”

The advantages of being sustainable include:

  • You have more control over how you grow 
  • You’re less susceptible to whether there’s funding in the market and whether you’re lucky enough to be in a market with lots of funding
  • Sometimes, the more money you raise, the more you waste. When there’s a big cheque and founders know that there’s a buffer, they make decisions differently.

Riding The Changing Waves

Since 2015, Reapra has observed that founders have a lot of choices for investors and have been more selective about the partners they select.

“This has challenged us to really think about the support we give and what could be most relevant to the founders we partner with,” they said.

The Reapra team is clear that their philosophy is not for everyone, and they are aware that their approach doesn’t necessarily fit all types of industries.

Reapra’s Research team works to always actively identifying promising business fields that fits its philosophy and investment thesis. 

And it’s now looking to Malaysia.

Sending Out The Call

“There is high potential among founders and an eagerness to learn—Malaysia is rich in entrepreneur development programs from incubators and angel networks (i.e. MAGIC, MBAN) which has helped grow the pre-seed segment,” said Priscilla.

Reapra is calling for founders to join its B80 programme, where the team identifies and partners with promising entrepreneurs across Southeast Asia, providing mentorship and funding with long-term goals in mind.

Any founder who brings the following will make them sit up and pay attention:

  1. Mission-driven with a long term horizon 
  2. Profit-driven mindset 
  3. Willing to partner an active investor
  4. Hands-on founders 
  5. Desire to develop strong learning capabilities. 
  6. Capital-efficient business

“We especially like businesses that have high cash generation agility, a clear path to profitability, strong value proposition and niche focus,” said Priscilla.

To them, a big red flag would be oversimplified business models that need a significant amount of cash infusion to reach profitability.

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For entrepreneurs seeking investments, Priscilla had this final nugget to add, “As a founder, finding an investor that is aligned with their mission is important. The challenge is, a lot of founders don’t have a choice, when they’re faced with a short runway left.”  

“Founders should try their best not to fall in this position, so that they can select a suitable business partner or investor for the long term.” 

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