An entrepreneur recently approached me and asked me to “tell him the truth” about working with Asian investors. In the several years that I have served as an investor and VP for a Japanese corporate innovation center, I cannot count the number of times I have answered this question. In this article, I will share with you the current status of Asian investors in the startup sector, the key investors you should know, and add a word of caution about confusing geographic culture and corporate culture.
The truth is that the distinction between a venture capitalist (VC) and strategic investors from the East as compared to their Western counterparts is not as pronounced as one may think. There is a popular narrative about cultural differences and how it impacts investing. Take the Credit Suisse report How Culture Impacts Investment Behavior, which found that culture does have noticeable impact on individuals’ investing decisions. However, these differences relate to the individual and not to the institutional investor. In fact, the study shows that investment differences across cultures become less prominent as the amount of investable assets increases.
