Fintech angel & accelerator with 30 years of experience in SME finance around the world. Currently, Yoshi has 8 portfolio fintech startups in London, New York, Paris, Dubai, and Tallinn, while playing a role as an accredited business angel at REDangels. He is stationed in Kuala Lumpur, Malaysia and is also an advisory board member at Fincog, Amsterdam-based fintech consulting firm, a partner at Network VC Syndicate Fund LLC registered in California, and an advisor to Sturgeon Capital, London-based PE boutique focused on frontier markets. He is ranked #30 among Thinkers360’s ‘Top 50 Global Thought Leaders and Influencers on FinTech’ (Nov 2019) and also ranked #26 on ‘Business Strategy’ (Dec 2020). He holds an Executive MBA from Aalto University, as well as certificates of Fintech programme at University of Oxford Said Business School and AI program at MIT Sloan School of Management.
This month Yoshi penned and authored an article exclusively for PBEC members on the increasing demand for Angel Investing network groups. One such global group is in the process of expanding & forming its latest chapter in the Pacific between LATAM and ASEAN players coming out of Santiago, Chile, that PBEC will proudly become associated with called “COREangels”
A Movement by Portuguese Business Angels to Reshape Angel Investing around the World and A New Challenge in Chile
As commonly known, ‘angel investments’ are made individually by business angels with a wealth of financial assets. But, there has been a worldwide trend of organizing business angels. The first organized cases date back to The Band of Angels (since 1994) in San Francisco, US. Then, during the dot-com bubble, EBAN (European Business Angels Network, Brussels) was launched in 1999. In this trend, the meaning of angel investing had changed from ‘investing hobby’ to ‘investing for excitement, greed, and quick money’. (Source: Rui Falcao, Co-Founder of REDangels and COREangels, Presentation on COREangels, Feb 2021)
Since the famous US global accelerator Y Combinator was founded in 2005, FNABA (Portugal, since 2006), Founder Institute (US, since 2009), FiBan (Finland, since 2010), SEEDRS (UK, since 2012), REDangels (Portugal, since 2014), and COREangels (Portugal, since 2019) were born. During this phase, the meaning of angel investing seemed to change to ‘investing for learning, a particular purpose, and/or career development’. (Source: same as above)
During such a phase of organizing business angels in late 2000s, angel investments were still made individually by business angels on their own. However, it’s worth noting that within REDangels and COREangels in Portugal, as a new attempt, all business angels belonging to the organization become shareholders in the company for the purpose of ‘group investing’, and all decisions on company strategies and investment deals are made by all the shareholders in a council system. Also, they are trying to reshape angel investments in a professional way, while the real meaning of angel investing is recognized as an investing process with the purpose of value creation for entrepreneurs launching innovative businesses. (For more information, please visit the websites of REDangels https://www.redangels.pt/en/ and COREangels https://www.coreangels.com)
The features of investing activities by both REDangels and COREangels include the following: i) all business angels become shareholders with voting rights in a group; ii) possibility of very high return and flexible ticket size (e.g., EUR20,000 at minimum per person); iii) deeper involvement with start-up teams; and iv) entrepreneurship ecosystem involvement (i.e., learning, connections, experience) for young generation who looks for an opportunity to learn about entrepreneurship and angel investing, to be connected with entrepreneurship networks, and to develop a career as a business angel.
Furthermore, COREangels are currently expanding its brand of business angels around the world. As of today, it has 4 groups in Spain, Brazil, and Portugal. In February – April 2021, the COREangels had implemented an intensive program to create new COREangels groups around the world. As a result, it is most likely that 7 COREangels groups will be established around the world in 2021. Among those 7 COREangels groups, ‘COREangels Pacific’ will be established in Santiago, Chile lead by George Cargill, Nils Galdo, and Yoshiyuki Oba, a PBEC Member.
Chile has the highest number of startups per million inhabitants in the Latin America and the Caribbean (LAC) region: 4.2 in Chile, compared to an average of 1.6 in LAC. Chile has 8% (78) of Tecnolatinas despite having only 3% of LAC’s population. This is caused by a sustained and systemic effort by the country to create an entrepreneurial innovation ecosystem. Another good sign is; the country has achieved significantly higher shares of VC flows in recent years. Ecosystem value is slightly below what would be expected (2% of LAC ecosystem value), but this means that the ecosystem is still catching up with the regional leaders. Three sectors represent 35% of Chilean ecosystem to date: Fintech (18%), Software as a Service (9%), and E-commerce (8%). (Source: Ignacio Pena, TECHNOLATINAS THE LAC STARTUP ECOSYSTEM COMES OF AGE 2021)
According to CB Insights, The State of Fintech Report: Investment and Sector Trends to Watch https://www.cbinsights.com/research/report/fintech-trends-q4-2020/, Fintech finished 2020 on a strong note, with Q4 of 2020 deals up 11%. In particular, Fintech is gaining momentum in Latam. From 2016 through 2020, funding to Latam-based fintech companies grew at a 64% CAGR. Around 40% of deals during this period went to alternative lending and payments companies.
Given such a situation where there is further room for the rise of startups in Chile and Latam, the outline of ‘COREangels Pacific’ is described as follows:
| Value added:
|
A cross-border angel investing platform in the “Ring of Fire” region including Latam and Asia (leveraged network mainly in Santiago, Lima, Bogota, Medellin, Singapore, Hong Kong, and Tokyo) |
| Investment vehicle: | SpA (company by shares) based in Santiago, Chile |
| Maximum number of shareholders & business angels (BAs): | 50 (Multinational members are welcome. 10 BAs already committed) |
| Average ticket for a BA: | US$100,000 (US$50,000 at minimum) |
| Target size of fund: | US$ 5 million |
| Number of startups invested: | Approximately 20 |
| Investment objective: | Long-term capital growth by putting “smart money” into startups in the field of key technologies to give social and economic impacts in Chile, Latam and Asia. |
| Fund term: | 10 years (investing in the first 5 years) |
| Plan to start investing operations: | Q2 of 2021 |
| Distribution model: | VRPA (amount receivable by Shareholder & BA at the time of distribution) = Vtd *Fi * Fa Vtd = Total amount to distribute, Fi (BA investment factor) = BA Investment / Total Investments, Fa (Seniority factor) = (Seniority BA – Average Seniority) + 1, Seniority BA = 0.01 * n.0 month of investments |
| Management fees: | 1.25% per year (plus, 20% carry) |
Currently, ‘COREangels Pacific’ is looking for founding members (i.e., shareholders & business angels) in Q2 of 2021. If you are interested in developing your career as a cross-border business angel and ‘group investing’ into emerging startups in Chile, Latam and Asia, please contact Yoshiyuki Oba for inquiries.
Yoshiyuki Oba
oba.yoshiyuki@gmail.com
Fintech angel & accelerator with 30 years of experience in SME finance around the world. Currently, Yoshi has 8 portfolio fintech startups in London, New York, Paris, Dubai, and Tallinn, while playing a role as an accredited business angel at REDangels. He is also an advisory board member at Fincog, Amsterdam-based fintech consulting firm, a partner at Network VC Syndicate Fund LLC registered in California, and an advisor to Sturgeon Capital, London-based PE boutique focused on frontier markets. He is ranked #30 among Thinkers360’s ‘Top 50 Global Thought Leaders and Influencers on FinTech’ (Nov 2019) and also ranked #26 on ‘Business Strategy’ (Dec 2020). He holds an Executive MBA from Aalto University, as well as certificates of Fintech programme at University of Oxford Said Business School and AI program at MIT Sloan School of Management.