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The Fund Journey: An Emerging Manager’s Story from Kuala Lumpur to South-East Asia. Part II: Investment Period and the Birth of Fund II (Years 2-5)

Continued from Part I (years T-2 -1). Read part I here, and Part III here.

Through the lens of Aisha Rahman, Founding Partner, Meridian Ventures With insights from: Rizal Tan, Co-Founder & General Partner And: Priya Nair, CEO, DataSync (Portfolio Company)

The investment period is where fund strategy meets market reality. For Meridian Ventures, Years 2-5 would test every assumption in our thesis—and force us to make decisions that would determine whether Fund I would succeed or fail. More importantly, it would teach us that building a world-class fundraising team was the key to our survival.

Year 2: Building the Portfolio

January-March: Deployment Accelerates

Year 2 began with unfinished business—we were still seeking to fill out our Fund I portfolio while simultaneously supporting our initial five investments.

The portfolio construction challenge:

Fund I targeted 12-15 investments. With $10M and roughly 30% reserved for follow-ons ($3M), we had $7M for initial investments. Average initial check: $450K-$600K.

Our investment period was 3-4 years, but best practice suggested deploying most capital in years 1-2 to allow adequate time for value creation before exits.

Target deployment pace: 4-5 investments per year in Years 1-2, slowing in Years 3-4.

Q1 investments:

Investment #6: HealthTech MY (February, Year 2) — Digital health platform connecting patients with specialists. Strong team from the Malaysian healthcare system. Complex regulatory environment, but a genuine market need. $450K investment.

Investment #7: PropTech.asia (March, Year 2) — Commercial real estate analytics. Data-driven approach to property valuation across South-East Asian markets. Two experienced founders from the real estate industry. $400K investment.

April-June: First Portfolio Challenges Emerge

By summer, reality started diverging from our investment memos.

DataSync: The early warning signs

Our first investment wasn’t developing as expected. The founding team—brilliant data scientists from Grab—struggled with go-to-market execution. Six months post-investment, they had built an impressive product with almost no customers.

Our board seat gave us visibility, but limited control. We pushed for them to hire a commercial co-founder. They resisted, believing the product would sell itself.

The VC’s dilemma:

This is where active ownership gets complicated. We had conviction in the market and product, but growing concerns about execution. Do we push harder and risk damaging the GP-founder relationship? Do we stay hands-off and hope they figure it out? Do we write more about our concerns in LP reports, potentially signaling problems prematurely?

We chose a middle path: supportive but direct feedback in board meetings, connected them with commercial advisors from our network, and documented our concerns internally while maintaining constructive external positioning.

Rizal’s perspective:

“DataSync taught us something important in Year 1: the gap between investment memo and portfolio reality. On paper, they were perfect—ex-Grab team, clear market need, technical excellence. In practice, they had a fundamental gap in commercial DNA. As investors, we could coach around the edges, but we couldn’t fix the team composition problem without their buy-in. That’s the limit of VC influence at the seed stage.”

Hunting great deals, but not every deal is going to end well.

July-December: Closing Out Year 2

More investments:

Investment #8: AgriTech ASEAN (August, Year 2) — Precision agriculture software for South-East Asian farms. Strong domain expertise from agricultural extension backgrounds. $350K investment.

Investment #9: EduScale ID (October, Year 2) — EdTech platform for corporate training, Indonesia-focused. First-time founder, but she’d been a customer of this category for years and understood the pain points intimately. $400K investment.

Investment #10: FinFlow (November, Year 2) — Subscription billing platform for regional SaaS companies. Two-time founder (previous exit to a strategic acquirer). More expensive than our typical deals—we paid a premium for founder pedigree. $550K investment.

Year 2 Summary:

Metric Value

Investments made 10 total (5 in Year 0, 5 in Year 1)

Capital deployed $4.1M (59% of initial allocation)

Portfolio value (estimated) $4.5M (modest markups)

Net IRR ~10%

TVPI 1.10x

DPI 0.0x (no distributions)

LP feedback (first annual meeting):

Our first annual LP meeting happened in November, Year 2. The feedback was mixed.

Positives: LPs liked our pace of deployment, the quality of our deal sourcing, and our transparent reporting.

Concerns: Multiple LPs questioned why we’d invested in 10 companies before having meaningful traction data from our earliest investments. Were we deploying too fast? Should we have waited to see DataSync progress before committing more capital? This was fair criticism. We defended our approach—the market window for seed deals doesn’t wait, and batch deployment is normal—but we heard the underlying anxiety.

Year 3: The J-Curve Bites Hard

January-March: Portfolio Divergence Accelerates

Year 3 revealed the brutal reality of seed-stage investing: outcomes diverge fast.

The winners emerging:

PayMalaysia signed a partnership with a major Malaysian bank, gaining access to 25,000 SME customers. Their MRR jumped from $15K to $45K in a single quarter.

CloudSEA landed their first enterprise customer and began generating real revenue. The founding team proved they could sell, not just build.

FinFlow—our expensive bet on the serial founder—launched and acquired 80 paying customers within three months. Unit economics looked strong.

The troubled middle:

LogiTech Asia was progressing but slowly. Their pilot customers liked the product but were reluctant to commit to scaled rollouts. The solo founder was burning out, handling everything herself.

SecureKL hit regulatory complexity we’d underestimated. Malaysian cybersecurity compliance required certifications that would take 12-18 months to obtain.

AgriTech ASEAN was pre-revenue and burning cash on R&D. The founders were making technical progress but had no commercial traction whatsoever.

The failures materializing:

DataSync continued its slow death march. By March, Year 3, they had signed only two customers—both small, low-ACV deals that didn’t validate the business model. Cash was running low.

The write-down conversation:

For the first time, we had to discuss portfolio write-downs with our LPs.

Our policy was to mark investments at fair value quarterly, based on either subsequent financing rounds or internal assessment. DataSync hadn’t raised follow-on capital, and our internal assessment suggested the company was worth significantly less than we’d paid.

The decision: Mark DataSync down by 50%. Our $400K investment was now carried at $200K.

This single write-down dropped our fund TVPI from 1.12x to 1.05x.

Grace Choo’s perspective (LP advisor, though not yet an investor):

“I remember Aisha calling to tell me about the DataSync write-down. She was clearly uncomfortable—admitting their first investment was struggling felt like a personal failure. But I actually gained confidence from that call. They weren’t hiding problems. They weren’t massaging valuations to look better. They were being straight about challenges. That’s exactly what I want to see from GPs.”

April-September: The Capital Crisis and Critical Decision

DataSync reaches the breaking point:

By July, DataSync had 4 months of runway remaining. The founding team came to us with two options:

Option A: Bridge financing to buy time for one more pivot attempt. They wanted $150K from existing investors to extend runway by 8-10 months.

Option B: Shut down the company, preserve remaining capital for investor return, accept failure.

This was our first major follow-on decision. The Fund Journey Map shows this moment clearly—the choice between doubling down and writing off.

The analysis:

We ran the numbers cold. DataSync had burned $500K (our $400K plus other investor capital) with almost nothing to show for it. The founding team had proven they couldn’t find early product-market fit despite multiple pivots. The market for SMB analytics was getting more competitive, not less.

A $150K bridge would increase our exposure to $550K in a company we’d already written down 50%.

Our decision: Don’t participate in the bridge. Let the company find other sources of capital or shut down.

This was painful. We liked the founders personally. We’d championed them to our LPs. Walking away felt like failure.

But the alternative was worse: good money after bad into a company that had demonstrated it couldn’t execute.

The aftermath:

DataSync couldn’t raise the bridge from other sources. In September, Year 3, they shut down and returned approximately $40K to investors. Our $400K investment became a $32K return—a 92% loss.

Priya Nair (CEO, DataSync) perspective:

“Looking back, Meridian made the right call. At the time, I was furious—I thought they were abandoning us. But we’d had 18 months to prove the model and hadn’t done it. Throwing more money at the problem wouldn’t have changed the fundamental issue: we were great at building product and terrible at selling it. I learned more from that failure than from anything else in my career. Two years later, I started a new company with a commercial co-founder from day one. That company is now doing $2M ARR. DataSync’s failure was my most important education.”

The Hard Lesson: We Need to Get Better at Fundraising

By late Year 3, with DataSync written off and the J-curve biting hard, we had a sobering realization.

“If we’re going to survive as a firm,” Rizal said one evening in our Bangsar office, “we need to raise Fund II. And we can’t go through the same scramble we did for Fund I. That nearly broke us.”

He was right. Fund I fundraising had been 18 months of desperation, cold outreach, and near-misses. We’d raised $10M through sheer determination, but we’d burned out in the process. And $10M wasn’t enough to build a sustainable management company.

We needed a systematic approach to fundraising. We needed a real fundraising team.

Building a World-Class Fundraising Team: The Game Changer

Who’s on your capital formation team?

The canvas identifies eight distinct roles that drive successful LP fundraising. We didn’t have eight people—we never would for Fund II—but we deliberately covered each function:

Role Function Our Solution

LP Researcher

Leads all research on prospective LPs, fills top of funnel

Part-time analyst using ADB’s LP database and conference materials

LP Networks & Engagement

Builds deep relationships through events, conferences

Aisha – primary relationship builder through AVCJ, SuperReturn Asia

Deck, Model & Dataroom Builder

Builds and maintains all fundraising materials

Outsourced structure using Strategy Tools templates; Rizal maintained

AI & Automation

Builds automation engine to make LP process 10x faster

LP AI platform for persona practice + custom CRM workflows

GP Leadership

Overall leadership, joins and leads most LP meetings

Rizal – led all key meetings, responsible for overall LP performance

LP Closer

Takes LPs from hello to signature, strong sales focus

Split between Rizal and Aisha based on relationship warmth

LP Whisperer

Elder statesman with networks to top prospective LPs

Advisory board member from major family office + Jim, ex-ADB

LP Process & DD Guide

Guides LPs through entire process from data room to IC

Dedicated support from legal counsel + streamlined process docs

This systematic approach transformed our fundraising capability. Where Fund I had been desperate scrambling, Fund II would be organized execution.

From two GPs to a strong capital formation team and network

Key changes we implemented:

1. Continuous LP engagement: We didn’t wait until we “started fundraising.” We maintained quarterly touchpoints with all Fund I LPs and prospective Fund II LPs from Year 3 onward.

2. Data room always ready: Instead of scrambling to build materials when an LP showed interest, we kept a perpetually updated data room.

3. LP persona customization: Different pitch materials for different LP types, practiced extensively using the Strategy Tools LP AI platform.

4. CRM discipline: Every LP interaction logged, follow-ups scheduled, relationship health tracked.

5. Advisory leverage: Our advisory board member opened doors we could never have opened ourselves.

The IFC Partnership: Becoming Institutional-Ready

One relationship proved transformative during our Fund II preparation: our connection to Grace Choo , Regional Lead at IFC (International Finance Corporation).

Grace had seen hundreds of emerging managers across Asia. She’d watched funds succeed and fail, scale and collapse. When we approached her in Year 3, we weren’t asking for investment (we knew our fund was too small for IFC at that stage). We were asking for guidance.

“We got immense support from Grace to understand how to evolve from Fund I to Fund II, and becoming institutional-scale ready,” I later told other emerging managers at an AVCJ panel.

Her guidance covered several critical areas:

On portfolio reporting: Institutional LPs expected quarterly reports with specific metrics. IFC had templates we could adapt.

On ESG integration: DFIs increasingly required ESG frameworks. Build these now rather than retrofit later.

On governance: Have an Advisory Committee and LP reporting structure that would scale.

On fund size: IFC typically couldn’t invest in funds under $50M, but if we performed well in Fund II, Fund III might qualify.

“Think of Fund II as your audition tape for institutional capital,” Grace advised. “Every decision you make, every report you write, every portfolio company you support—assume that institutional LPs will scrutinize all of it when you come back for Fund III.”

Andrew Senduk: Venture Partner for GTM Excellence

As our portfolio grew, we recognized a gap in our capabilities: go-to-market (GTM) execution. Many of our founders were technical experts who struggled with sales, marketing, and commercial scaling.

In Year 3, we brought on Andrew Senduk as a Venture Partner specifically to address this gap.

Andrew had spent 15 years building and scaling businesses across Indonesia, Malaysia, and Singapore. He’d led GTM for two successful startups (one acquired, one IPO’d) and understood the unique challenges of selling across South-East Asia’s fragmented markets.

Andrew’s perspective on joining Meridian:

“What attracted me to Meridian was their recognition that early-stage investing isn’t just about picking winners—it’s about helping those winners actually win. Most seed-stage founders in South-East Asia are technical builders who’ve never sold enterprise software or scaled a consumer product across multiple countries. That’s where I could add genuine value.”

Andrew worked with six of our Fund I portfolio companies on their GTM strategies:

•            Sales process design for enterprise SaaS companies

•            Market entry strategies for regional expansion

•            Pricing and packaging optimization

•            Customer success frameworks

His involvement became a key part of our LP pitch for Fund II: we weren’t just providing capital, we were providing hands-on GTM expertise that could meaningfully accelerate our portfolio companies’ growth.

Year 4: Portfolio Maturation and Fund II Launch

Portfolio Performance at Year 4:

Company Total Investment Status Current Value Multiple

DataSync $400K Shut down $32K 0.08x

PayMalaysia $450K Series A prep $2.2M 4.9x

CloudSEA $600K Growing $1.5M 2.5x

SecureKL $400K Bridge raised $350K 0.87x

LogiTech Asia $500K Turnaround $550K 1.1x

HealthTech MY $450K Growing $650K 1.4x

PropTech.asia $400K Growing $500K 1.25x

AgriTech ASEAN $350K Struggling $200K 0.57x

EduScale ID $400K Growing $600K 1.5x

FinFlow $550K Pre-Series A $1.8M 3.3x

Year 4 Fund I Metrics:

• Total invested: $4.5M (65% of initial allocation)

• Current portfolio value: $8.4M

• TVPI: 1.55x

• DPI: 0.01x

• Net IRR: ~18%

Fund II Strategy evolution

It was a webinar in March that led to team to step back and reflect. “Our fund II is not just a replica of fund I. We need to think far more strategically”. On the webinar, the team was introduced to the Fund Strategy Canvas, developed by Strategy Tools. Carving out a full-day offsite, the team sat down to complete the Fund Strategy Canvas together.

Fund Strategy Canvas: Meridian Ventures Fund II ($25M)

Fund Name: Meridian Ventures Fund II

General Partners: Aisha Rahman & Rizal Tan

Use the Fund Strategy Canvas for your one-page, visual strategy

THESIS, STRATEGY

Thesis & Size

Meridian Ventures Fund II is a $25M early-stage venture capital fund investing in B2B software and fintech companies across South-East Asia, with primary focus on Malaysia, Indonesia, Vietnam, and the Philippines.

Our thesis is built on three convictions:

First, South-East Asia’s digital economy is entering its enterprise phase. After a decade of consumer internet growth, the next wave of value creation will come from B2B infrastructure—payments, logistics software, enterprise SaaS, and vertical solutions that enable the region’s 70 million SMEs to digitize operations.

Second, the best founders in ASEAN are increasingly emerging from non-traditional backgrounds and geographies outside Singapore. Malaysia, Indonesia, and Vietnam are producing world-class technical talent with deep local market understanding. These founders are systematically overlooked by Singapore-centric VCs who rarely travel beyond Changi Airport.

Third, early-stage companies in emerging South-East Asian markets need more than capital. They need operational support—particularly in go-to-market execution, regional expansion strategy, and preparation for institutional follow-on rounds. GPs who combine capital with hands-on GTM expertise will generate superior returns.

Fund II targets $25M, representing a 2.5x step-up from our $10M Fund I. This size allows us to lead seed rounds of $500K-$1.5M while maintaining meaningful follow-on reserves for winners.

Strategy

Stage: Pre-seed to Seed, with selective Seed+ participation

Check size: $500K-$1.5M initial; up to $2M follow-on in winners

Geography: Malaysia (40%), Indonesia (35%), Vietnam/Philippines (25%)

Sectors: B2B software, fintech infrastructure, vertical SaaS, logistics tech

Target portfolio: 18-22 companies over 3-year deployment period

We invest at the earliest institutional stage—typically first or second money in after angels. Our sweet spot is technical founding teams with clear product vision but limited go-to-market experience. We help them build the commercial muscle to reach Series A.

Unfair Advantage

Our unfair advantage is the combination of three elements no other regional fund possesses:

Operator-investor team: Rizal spent 8 years building and scaling startups across Malaysia and Indonesia before becoming an investor. He’s lived the founder journey and speaks the language of operators, not just financiers.

Ground-level presence: We’re based in Kuala Lumpur, not Singapore. We travel to Jakarta, Ho Chi Minh City, and Manila monthly. We see deals 6-12 months before Singapore-based funds because we’re embedded in local founder communities.

GTM value-add through Andrew Senduk: Our Venture Partner has 15 years of enterprise sales and regional expansion experience. He works directly with portfolio companies on sales process, pricing strategy, and market entry—capabilities that differentiate us from capital-only investors.

TEAM & TRACK RECORD

General Partners

Aisha Rahman, Founding Partner

12 years in venture capital and corporate development. Former Principal at a mid-sized regional VC where she led 15+ investments across ASEAN. Board experience across fintech, SaaS, and logistics companies. MBA from INSEAD. Leads fund strategy, LP relations, and serves on 6 portfolio company boards.

Rizal Tan, Co-Founder & General Partner

8 years as operator, 4 years as investor. Former VP Business Development at a Series B payments company (acquired). Founded and sold a B2B marketplace in Malaysia. Leads deal sourcing, investment decisions, and portfolio company operational support. Deep networks across Malaysian and Indonesian founder communities.

Extended Team

Andrew Senduk, Venture Partner

15 years building and scaling businesses across Indonesia, Malaysia, and Singapore. Led GTM for two successful startups (one acquired, one IPO’d). Works with portfolio companies on sales process design, regional expansion, and commercial scaling. Not full-time but engaged across 6+ portfolio companies per fund.

Two Associates: Handle deal sourcing, due diligence support, and portfolio monitoring. One based in KL, one in Jakarta.

One Operations Manager: Fund administration, LP reporting, and back-office operations.

Track Record

Fund I Performance (as of Fund II launch):

Vintage: 2023

Size: $10M

Investments: 12 companies

TVPI: 1.55x

DPI: 0.02x (one small exit)

IRR: ~18%

Notable Fund I positions: PayMalaysia (4.9x paper, Series A prep), FinFlow (3.3x paper, growing rapidly), CloudSEA (2.5x paper, acquisition discussions). One complete write-off (DataSync), demonstrating follow-on discipline.

Prior Track Record (attributable deals from previous roles):

Aisha: 4 exits from prior fund, including 2 at 3x+ returns

Rizal: Personal angel portfolio of 8 investments, 2 exits at 5x+

LP MIX

Anchor LPs

Jelawang Capital ($4M commitment)

Regional thought leader in South-East Asian venture. Their rigorous due diligence and public commitment provides institutional validation. Jelawang serves on our Advisory Committee and actively supports our LP fundraising through introductions and co-hosted events.

Sarona Asset Management ($3M commitment)

Impact-focused fund-of-funds with emerging markets mandate. Their commitment signals ESG credibility and opens doors to other impact-oriented institutional LPs.

LP Mix Structure

LP Category    Target Allocation         Rationale

Fund-of-Funds (emerging manager programs) $7M (28%) Jelawang Capital, Sarona, Speedinvest, regional FoFs with SEA mandates

Regional Family Offices $6M (24%) Re-ups from Fund I plus new Singapore/Malaysian families

Fund I Re-ups (HNWIs, angels) $5M (20%) Strong re-up rate demonstrates LP satisfaction

Fund-of-fund $4M (16%) Dubai Future District Fund, SEA-MENA-oriented allocators

Strategic / Corporate $2M (8%) Corporate VCs seeking regional deal flow

GP Commitment$1M (4%), Increased from Fund I to demonstrate alignment

Target LP count: 18-22 LPs

Average commitment: $1.1-1.4M

Minimum commitment: $250K (to maintain fund I relationships)

LP Value Add

Our LP base isn’t just capital—it’s a strategic network:

Jelawang Capital: Portfolio company introductions, co-investment on larger rounds, thought leadership association

Sarona: ESG framework guidance, impact measurement support, introductions to impact-focused follow-on investors

Fund I HNWIs (exited founders): Direct mentorship to portfolio founders, customer introductions, hiring network access

Dubai Future District Fund: Middle East expansion pathway for portfolio companies, sovereign wealth fund network

Corporate LPs: Strategic partnership and M&A optionality for portfolio companies

LP ECONOMICS

Financial Terms

Term     Fund II                Structure

Management Fee

2.0% on committed capital during investment period

2.0% on invested capital thereafter

Carried Interest 20%

Preferred Return (Hurdle) 8%

GP Commitment 4% ($1M)

Waterfall European (whole-fund)

Fund Life10 years + two 1-year extensions

Investment Period 4 years

Distribution Policy

Distributions made as exits occur, subject to:

Return of LP capital contributions first

8% preferred return to LPs

80/20 split thereafter (LP/GP)

GP catch-up provision after hurdle achieved

Fee Offsets

100% of transaction fees, monitoring fees, and director fees received by GPs from portfolio companies are offset against management fees.

LEGAL SETUP

Fund Domicile: Labuan International Business and Financial Centre (IBFC), Malaysia

Fund Structure: Labuan Limited Partnership

Rationale for Labuan:

Tax-efficient structure for regional investments

Regulatory framework designed for investment funds

Lower setup and administration costs than Singapore VCC or Cayman

Acceptable to institutional LPs including DFIs

Geographic alignment with our KL base

Fund Administrator: Apex Fund Services (Singapore)

Legal Counsel:

Fund formation: Rajah & Tann (Singapore/Malaysia)

Portfolio investments: Local counsel in each jurisdiction

Auditor: Ernst & Young (Malaysia)

Tax Considerations:

Labuan entities benefit from 3% tax on net profits or flat RM20,000

No withholding tax on distributions to non-Malaysian LPs

Tax treaties in place with most LP jurisdictions

DEALFLOW

Primary Dealflow Channels

1. Founder Networks (40% of pipeline)

Rizal’s operator background generates direct founder referrals. Portfolio company founders introduce their peers. Our reputation for being “founder-friendly” creates inbound interest from founders who’ve heard about us through the ecosystem.

2. Ecosystem Partners (30% of pipeline)

Deep relationships with Cradle Fund (Malaysia), MDEC, 500 Startups (SEA), Antler, and regional accelerators. We’re the preferred follow-on investor for several accelerator programs because we move quickly and add operational value.

3. Angel/Syndicate Networks (20% of pipeline)

Co-invest relationships with AngelCentral Malaysia, Angel Investment Network Indonesia, and individual super-angels across the region. Angels bring us deals early; we bring them access to institutional rounds.

4. Proactive Sourcing (10% of pipeline)

Associates systematically track companies emerging from regional tech hubs, monitor funding announcements, and conduct outbound outreach to promising founders.

Dealflow Expansion Strategy

For Fund II, we’re expanding dealflow through:

Quarterly “Office Hours” in Jakarta, Ho Chi Minh City, and Manila

Content marketing (Aisha’s LinkedIn presence reaches 15,000+ regional followers)

Deeper accelerator relationships in Vietnam and Philippines (underserved in Fund I)

Investment Process

Stage                   Timeline                         Activities

Initial Screen                                                                                                         1 week

Partner review of deck/intro, quick pass/proceed decision First Meeting           1-2 weeks

60-minute founder meeting, both GPs attend, Deep Dive, Term sheet 1            1-3 weeks

Market analysis, reference calls, product review, Investment Committee           1 week

IC memo, partner discussion, decision, Term Sheet 2 & Close                        1-4 weeks

Final terms negotiation, legal documentation, funding                                       1-4 weeks

Total process: 2-14 weeks from first meeting to close

Decision authority: Both GPs must approve; no solo deals

PORTFOLIO & VALUE ADD

Portfolio Construction Parameter

Target Number of investments 18-22 companies

Initial check size $500K-$1.5M

Follow-on reserves 35% of fund ($8.75M)

Target ownership 8-15% at entry

Concentration limit

No single investment >12% of fund

Follow-on Strategy

We reserve 35% of the fund for follow-on investments in winners. Follow-on decisions are made based on:

Company performance against milestones

Ability to maintain meaningful ownership

Quality of incoming investors

Risk/reward at new valuation

We explicitly do NOT do pro-rata follow-ons across the portfolio. Capital is concentrated in top performers. Fund I experience: followed on in 3 of 12 companies; those 3 represent 60% of portfolio value.

Investment Decision Framework

All investments must meet threshold criteria:

Team: Technical depth + commercial potential (or willingness to add commercial talent)

Market: $500M+ addressable market in ASEAN

Timing: Clear catalyst for why now

Fit: B2B/fintech focus aligned with thesis

Valuation: Entry price supporting 10x+ return potential

Value Add: How We Support Portfolio Companies

Board Engagement

GPs take board seats on all lead investments. Active participation in strategy, hiring, and fundraising decisions. Monthly check-ins with all portfolio CEOs.

GTM Support (Andrew Senduk)

Hands-on work with portfolio companies on:

Sales process design and optimization

Pricing and packaging strategy

Enterprise sales playbook development

Regional expansion planning

Customer success frameworks

Andrew engages with 6-8 companies per fund on structured GTM programs.

Talent Network

Curated network of 200+ executives and operators across ASEAN. Direct introductions for key hires. Quarterly portfolio talent events connecting companies with candidates.

Follow-on Fundraising

Warm introductions to Series A investors (Sequoia SEA, Vertex, East Ventures, Openspace, etc.). Preparation support for institutional fundraising. Data room and pitch coaching.

Peer Network

Quarterly portfolio CEO dinners. Slack community for real-time peer support. Annual offsite bringing together all portfolio founders.

EXIT STRATEGY

Value Creation & Exit Strategy

Value Creation Focus Areas:

During Years 1-3 (building phase):

Product-market fit validation

Initial revenue traction ($100K-$500K ARR)

Team building beyond founders

Market positioning establishment

During Years 3-5 (scaling phase):

Revenue acceleration ($500K-$3M ARR)

Unit economics optimization

Geographic expansion within ASEAN

Series A/B fundraising

During Years 5-8 (exit preparation):

Path to profitability or clear growth trajectory

Strategic relationship cultivation

Board composition optimization for exit

Financial and legal housekeeping

Exit Pathways:

Exit Type            Expected % of Exits Typical Timeline

Strategic M&A (regional) 20%              Years 4-7

Strategic M&A (global)        5%             Years 5-8

Secondary sale                     10%           Years 4-6

IPO (rare at our stage)          5%            Years 7-10

Write-off                            60%              Years 2-8

Exit Preparation Process:

Starting Year 2, we work with portfolio companies to:

Identify potential strategic acquirers

Build relationships with corporate development teams

Prepare management for M&A processes

Clean up cap table and legal structure

Develop exit-ready financial reporting

Exit Experience

GP Exit Track Record:

Aisha Rahman:

4 exits at prior fund, including 2 M&A transactions she led

Managed LP distributions and exit accounting

Board member through 3 acquisition processes

Rizal Tan:

Founded and sold B2B marketplace to strategic acquirer

Personal angel portfolio: 2 exits (1 acquisition, 1 secondary)

Operator perspective on founder exit psychology

Fund I Exits (to date):

SecureKL: Acquired for $2M (1.38x return)—managed full M&A process

DataSync: Orderly wind-down with capital return—demonstrated discipline

AgriTech ASEAN: Wind-down in progress

FUND ECONOMICS

Fund Model Summary

Item     Amount

Fund Size $25,000,000

Management Fee (annual, investment period) $500,000

Management Fee (annual, post-investment period) $400,000 (on invested capital)

Total Management Fees (10-year life) $4,400,000

Available for Investment $20,600,000

Target Gross Multiple 3.0x

Target Net Multiple2.5x

Target Net IRR20%+

Management Company Economics

Annual management fee of $500K supports:

2 GP salaries (market-rate for regional VCs)

2 Associate salaries

1 Operations Manager salary

Office (KL headquarters + hot desks in SG, Jakarta)

Travel (significant—we’re on the ground across 4 countries)

Fund administration, legal, audit

LP relations and reporting

Cash Flow Reality:

Unlike Fund I (where we paid ourselves poverty wages), Fund II economics allow for sustainable GP compensation. This is critical for partnership stability and long-term firm building.

Carried Interest Distribution

Assuming 3.0x gross return ($75M exit proceeds) on $25M fund:

Distribution     Amount

Return of LP Capital  $25,000,000

8% Preferred Return to LPs $8,000,000

Remaining Proceeds $42,000,000

LP Share (80%)$33,600,000

GP Carried Interest (20%)$8,400,000

Total LP Returns: $66.6M on $25M invested (2.66x net)

GP Economics: $8.4M carried interest + ~$4.4M management fees over fund life

Working Capital

Fund II includes a modest working capital facility to bridge timing gaps between capital calls and expenses. This prevents the personal financial stress that characterized Fund I operations.

Structuring a series A with four co-investors, what are the return profile on this deal?

SUMMARY: WHY FUND II WILL SUCCEED

Meridian Ventures Fund II is positioned to deliver top-quartile returns because:

Proven Team: GPs with complementary skills, demonstrated partnership stability through Fund I challenges, and relevant operating experience.

Differentiated Strategy: Ground-level presence in underserved markets, combined with genuine GTM value-add through Andrew Senduk.

Strong Fund I Foundation: 1.55x TVPI with clear winners emerging, disciplined write-off decisions, and institutional-quality reporting already in place.

Right-Sized Fund: $25M is large enough to lead meaningful rounds but small enough to generate strong returns from regional exit valuations.

Institutional LP Base: Anchor commitments from Jelawang and Sarona provide validation and strategic value beyond capital.

Clear Path to Fund III: Fund II performance sets up institutional fundraise at $50M+, accessing DFI capital and achieving sustainable firm economics.

Fund II isn’t just an investment vehicle—it’s the foundation for building a permanent institution in South-East Asian venture capital.

Fund II Fundraising Begins

By mid-Year 3, we formally launched Fund II fundraising with a $25M target—2.5x our Fund I size.

The LP composition evolved significantly from Fund I:

LP Type Commitment

Jelawang Capital (anchor) $4M

Sarona Asset Management $3M

Dubai Future District Fund $2.5M

Speedinvest Emerging Manager Program $2M

Regional Fund-of-Funds (2) $5M

Fund I Re-ups (Family Offices, HNWIs) $6M

New HNWIs and Angels $2.5M

TOTAL $25M

Jelawang Capital: A Thought Leader Partnership

Among our Fund II LPs, Jelawang Capital stood out not just for their commitment size but for their role in the ecosystem.

Jelawang had established themselves as thought leaders in South-East Asian venture, publishing research on emerging manager performance, hosting convenings for GPs and LPs, and advocating for ecosystem development across the region.

Their due diligence process was rigorous—more intensive than any other LP we’d encountered. But that rigor came with genuine partnership. Once they committed, they became active supporters of our firm, making introductions to other LPs, providing feedback on our portfolio strategy, and including us in their thought leadership events.

“Having Jelawang as an anchor LP gave us credibility that we couldn’t have purchased at any price,” Rizal later reflected. “When other LPs saw that Jelawang had done deep due diligence and committed, it reduced their perceived risk in backing us.”

Fund II closed in 14 months—4 months faster than Fund I. The difference was our systematic fundraising approach. We had LP coverage across every major category. We had materials ready. We had a process. We weren’t scrambling; we were executing.

Fund II announced at SuperReturn Asia

Year 5: Fund II Deployment and Fund I Value Creation

Fund II First Investments:

With $25M to deploy, Fund II allowed us to write larger checks ($500K-$1.5M) and target slightly later-stage opportunities (seed+ to Series A).

Fund II investments (Year 5):

•            Investment #1-3: Three seed rounds averaging $800K

•            Investment #4-5: Two Series A participations averaging $1.2M

•            Total deployed Year 5: $5.2M (21% of fund)

Fund I Portfolio Events:

PayMalaysia closes Series A (October, Year 5): $5M round led by Jungle Ventures, a top-tier regional VC. Our follow-on: $200K to partially maintain position. PayMalaysia was now valued at $18M; our position worth approximately $3.5M on $650K invested (5.4x).

SecureKL acquired (November, Year 5): In a surprise development, SecureKL was acquired by a regional cybersecurity company for $2M. Our $400K investment returned $550K—a modest positive outcome (1.38x) after years of struggle. First actual exit and DPI generation!

AgriTech ASEAN shuts down (December, Year 5): After 3+ years with no commercial traction, AgriTech’s board and founders decided to wind down the company. Our $350K investment returned approximately $50K from remaining cash. Second complete write-off.

Year 5 Fund I Metrics:

• Total invested: $5.2M (75% of initial allocation)

• Current portfolio value: $11.5M

• Distributions (DPI): $600K (SecureKL exit + DataSync wind-down + AgriTech wind-down)

• TVPI: 2.15x

• DPI: 0.12x

• Net IRR: ~26%

Key Takeaways from Part II

For fund managers in their investment period:

1. The J-curve is real and painful. Years 2-5 will feel like failure even when you’re building a successful portfolio. Communicate this to your LPs early and often.

2. Portfolio mortality is normal. Expect 30-80% of seed investments to fail completely. The key is limiting exposure to losers while maximizing exposure to winners.

3. Follow-on decisions define returns. Our Fund I returns were driven by concentrated follow-on in PayMalaysia and FinFlow. Spray-and-pray follow-on destroys returns.

4. First exit matters more than its size. SecureKL’s 1.38x return was modest, but generating actual DPI established our credibility for Fund II.

5. Build your fundraising team before Fund II. Use the GP Fundraising Team canvas to systematically cover all eight roles, even with a small team.

6. Fund II timing is strategic. Starting Fund II in Year 3-5, before Fund I exits, is standard practice. LPs understand the cycle.

Grace Choo’s final perspective on Part II:

“By Year 5, I’d moved from cautious optimism to genuine confidence in Meridian. They’d made hard decisions, communicated transparently, and generated reasonable paper returns. More importantly, they’d maintained partnership stability through challenging years. Fund II felt like a natural evolution, not a leap of faith. I told them we’d be interested in exploring a Fund III commitment if they could reach $50M.”

Read part III: Value Creation, Fund III, and Institutional Arrival (Years 6-7).

If you have not already read it, check out part I, the early years.

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The Fund Journey: LP Outcome Canvas: EPF Investment in Meridian Ventures Fund III (Part IV)

From Fund I to Fund III Aisha and Rizal navigate nearly a decode on the fund journey. For Fund III, they run into the LP Outcome Canvas at one of Malaysia’s leading pension funds. (case based, fictional fund)

Read the full story, The Fund Journey: An Emerging Manager’s Story from Kuala Lumpur to South-East Asia, Part I (years T-2 -1), Part II (years 2-5) and Part III (years 6-7).

Fund: Meridian Ventures Fund III Fund Strategy: Early-stage B2B software, AI and fintech across South-East Asia (Malaysia, Indonesia, Vietnam, Philippines) Recommendation: Invest Date: October 5th

Commitment: $5,000,000 In % of total fund size: 10% Our role with the fund: Limited Partner with Advisory Committee seat

MV Fund III Pitch deck It’s strong.

Investment Context

Employees Pension Fund (EPF/KWSP) is evaluating a $5M commitment to Meridian Ventures Fund III as part of our emerging manager allocation within the alternative investments portfolio. This represents our first commitment to Meridian, though we have tracked the firm since Fund II.

Why Meridian Fund III:

  • Malaysian-based GP aligns with our mandate to support domestic asset managers
  • Strong Fund I performance (2.8x TVPI, 0.6x DPI at Year 5)
  • IFC co-investment provides institutional validation
  • Proven team stability through challenging early years
  • Clear thesis in B2B/fintech aligned with Malaysia’s digital economy priorities

Our Due Diligence Findings:

  • GP team demonstrates resilience and discipline (DataSync write-off handled well)
  • Differentiated GTM value-add through Venture Partner
  • Conservative fund sizing relative to opportunity
  • Strong LP re-up rates from Fund I/II (>80%)
  • Institutional-grade reporting and governance already in place

Analyzing Fund III with the LP Outcome Canvas

Outcome analysis for LPs, something most GPs are ill-prepared to discuss on the spot. Unless they’ve trained for it.

Outcome Models

1. Terrible

Scenario Description: Multiple portfolio failures due to regional economic downturn or systemic startup ecosystem collapse. Fund deploys capital but majority of companies fail to reach Series A. No meaningful exits. GP team potentially breaks up under pressure.

What would cause this:

  • Severe regional recession impacting startup funding environment
  • Key GP departure (key person event)
  • Systematic misjudgment in investment selection
  • Follow-on funding market collapse preventing portfolio companies from scaling

Metric Value

Years to 1x DPI Never

Years to Full Distribution 12+ (wind-down)

Fund Multiple 0.4x

Our Net TVPI0.4x

Our Net DPI 0.3x

Probability 5%

Our outcome: $5M invested → ~$1.5M returned over 12 years. Significant loss but limited to committed capital.

2. Disappointing

Scenario Description: Fund performs below expectations. Some exits occur but at modest valuations. Winners don’t scale as hoped. J-curve extends longer than projected. Returns below hurdle rate, no carried interest paid.

What would cause this:

  • Mediocre portfolio company performance across the board
  • Regional exit market remains challenging (limited strategic acquirer appetite)
  • Fund I outperformance was partially luck, not fully repeatable
  • Competition from larger funds compresses Meridian’s deal access

Metric Value

Years to 1x DPI Year 9

Years to Full Distribution 12

Fund Multiple 1.5x

Our Net TVPI 1.5x

Our Net DPI 1.4x

Probability 15%

Our outcome: $5M invested → ~$7M returned over 12 years. Positive but below our target returns for venture allocation. Opportunity cost versus other alternatives.

3. Performing

Scenario Description: Fund delivers solid, median-quartile returns. Portfolio construction works as planned with expected winner/loser distribution. 2-3 strong exits, several modest outcomes, typical write-off rate. GPs execute their strategy competently.

What would cause this:

  • Normal portfolio distribution: 20% winners, 50% modest outcomes, 30% failures
  • Regional exit environment functions adequately
  • Fund I success was real but Fund III faces more competition at larger size
  • Team executes well but without breakout positions

Metric Value

Years to 1x DPI Year 7

Years to Full Distribution 11

Fund Multiple 2.2x

Our Net TVPI 2.2x

Our Net DPI 2.0x

Probability 35%

Our outcome: $5M invested → ~$10M returned over 11 years. Meets our baseline expectations for emerging manager venture allocation. Acceptable risk-adjusted return.

4. Overperforming

Scenario Description: Fund outperforms expectations with strong portfolio company development. Multiple successful Series A/B raises, 3-4 meaningful exits including at least one at 10x+. DPI generation ahead of schedule. Clear Fund IV momentum.

What would cause this:

  • GTM value-add genuinely accelerates portfolio company growth
  • 1-2 portfolio companies achieve regional leadership positions
  • Favorable exit environment with active strategic acquirers
  • Strong follow-on investor interest validates portfolio quality
  • Team cohesion and capability continues to strengthen

Metric Value

Years to 1x DPI Year 5

Years to Full Distribution 10

Fund Multiple 3.0x

Our Net TVPI 3.0x

Our Net DPI 2.8x

Probability 30%

Our outcome: $5M invested → ~$14M returned over 10 years. Strong performance justifying emerging manager risk. Would support increased allocation to Fund IV.

5. Market Leader

Scenario Description: Fund establishes Meridian as the definitive early-stage firm in ASEAN ex-Singapore. Multiple breakout portfolio companies. At least one potential unicorn. Strong DPI from strategic acquisitions by global tech companies. Fund III becomes a reference point for regional emerging manager success.

What would cause this:

  • 1-2 portfolio companies scale to $100M+ valuations
  • Major strategic exits (Google, Microsoft, Grab, Sea acquiring portfolio companies)
  • Meridian brand becomes synonymous with quality SEA early-stage deals
  • Fund I fully distributed at 3.5x+, validating long-term track record
  • Strong global LP interest in Fund IV at $100M+

Metric Value

Years to 1x DPI Year 4

Years to Full Distribution 9

Fund Multiple 4.0x

Our Net TVPI 4.0x

Our Net DPI 3.8x

Probability 12%

Our outcome: $5M invested → ~$19M returned over 9 years. Exceptional returns. Strong relationship for preferred access to future funds. Case study for our emerging manager program.

6. Outlier

Scenario Description: Extraordinary outcome driven by a generational company in the portfolio. One investment becomes a regional or global category leader with $1B+ outcome. Fund returns driven primarily by single massive winner, similar to early Sequoia or a]16z funds with breakout companies.

What would cause this:

  • Portfolio company becomes the “Grab” or “Sea” of its category
  • IPO or $500M+ acquisition of lead position
  • Timing alignment with massive market expansion (e.g., regional fintech infrastructure buildout)
  • Everything goes right for one extraordinary founder

Metric Value

Years to 1x DPI Year 3

Years to Full Distribution 8

Fund Multiple 6.0x+

Our Net TVPI 6.0x+

Our Net DPI 5.5x+

Probability 3%

Our outcome: $5M invested → ~$27.5M+ returned over 8 years. Transformational return. Would significantly impact our alternatives portfolio performance. Extremely rare but possible given early-stage venture dynamics.

Summary Analysis

Probability-Weighted Expected Outcome

Scenario Probability Fund Multiple Weighted Multiple

Terrible 5% 0.4x 0.02x

Disappointing 15% 1.5x 0.23x

Performing 35% 2.2x 0.77x

Overperforming 30% 3.0x 0.90x

Market Leader 12% 4.0x 0.48x

Outlier 3% 6.0x 0.18x

Expected Value 100% — 2.58x

Probability-weighted expected return: 2.58x net multiple on our $5M commitment

Expected dollar return: ~$12.9M over 10-year average holding period

Risk Assessment

Downside Risk (Terrible + Disappointing scenarios): 20% probability of returns below 1.5x

Base Case (Performing): 35% probability of solid 2.2x returns meeting our venture allocation targets

Upside Potential (Overperforming + Market Leader + Outlier): 45% probability of 3.0x+ returns

Risk/Reward Assessment: Asymmetric return profile typical of venture capital. Limited downside (maximum loss = committed capital), significant upside potential. 45% probability of strong outperformance justifies the allocation.

Recommendation

INVEST $5,000,000 in Meridian Ventures Fund III

Rationale:

1. Expected returns justify risk: 2.58x probability-weighted return exceeds our 2.0x threshold for emerging manager venture allocations.

2. Downside is bounded: Even in terrible scenario, loss limited to committed capital. 80% probability of returning at least 1.5x.

3. Strategic alignment: Malaysian-domiciled GP supports our mandate. B2B/fintech thesis aligns with national digital economy priorities.

4. Institutional validation: IFC’s $8M commitment provides comfort on GP quality and governance standards.

5. Relationship value: Establishing relationship now provides access to Fund IV at larger scale if Fund III performs.

6. Portfolio fit: $5M commitment represents appropriate sizing for emerging manager allocation—meaningful enough to matter, small enough to absorb potential loss.

Conditions:

  • Advisory Committee seat to maintain visibility into fund operations
  • Quarterly reporting at institutional standards (already confirmed)
  • Co-investment rights on deals above $2M (standard LP terms)
  • MFN on any preferential terms granted to other LPs
Not every pension fund will announce the commitment on TikTok

LP Outcome Canvas by Strategy Tools. Get yours at www.strategytools.io

Read the full story, The Fund Journey: An Emerging Manager’s Story from Kuala Lumpur to South-East Asia, Part I (years T-2 -1), Part II (years 2-5) and Part III (years 6-7).

About the Author:

Christian Rangen is a strategy advisor and business school faculty. He works with ambitious ecosystem developers, innovation agencies, venture funds, national fund-of-funds and governments on building better VC firms and VC ecosystems. He runs GP Accelerators and GP Masterclasses globally.

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Fundraising in MENA 101 – Your first funding round

Startup founder. Looking to raise your first round of capital? Check out our field notes from a week in Dubai.

By: Chris Rangen, global advisor to VCs, FoF’s & ecosystem builders. Faculty, advisor, investor Sanjana Raheja, advisor to early-stage founders, accelerators, and innovation programs. Big thanks to Nitin Reen, Nuwa Capital for valuable input to this article.

We just completed a packed week of Masterclasses on scaling strategy and investor readiness in Dubai. For parts of the week, we worked with first-time founders at the very earliest of stages. Their #1 question: how to raise the first round of investor capital. So, here’s the long answer to the question; how to raise money as a MENA founder.

(note, this article cover idea- and pre-stage. For seed-stage and beyond, see Fundraising in MENA 201 – your funding journey – coming soon).

Backing founders, Chris, Scott, Sanjana, Alain

15 years of helping founders on startup fundraising

Over the past 15 years, we have worked with 1000’s and 1000’s of founders, mostly on growth strategy, fundraising and investor readiness. We have studied 100’s of highly successful founders and developed 1000’s of hours of slides, tools, simulations, digital courses, online workshops and in-person investor readiness programs delivered globally. Across different programs, roles, accelerators and 1:1 support, we have been on the inside of over 400 equity rounds, helping founders raise $100M’s from pre-seed to post-IPO.

Before you start

Before ever going out to raise any investor capital. Here are five questions you want to ask yourself.

Five questions before we start:

1.      Do you really want to raise capital from investors – or are there other ways to grow and fund your business?

2.      Are you a ‘backable case’? (ideally, venture backable case, with the possibility for 100X return – or higher?)

3.      Do you fully understand the expectations, business model and timeline of your investors?

4.      Can you generate investor liquidity and exit back to your investors on a reasonable timeline?

5.      Do you have the early traction and commercial proof-points to be fundable?

If you are not sure what each of these questions mean or not sure about how to answer them, you might want to discuss your startup growth plans with a mentor or co-founder before proceeding.

Assuming you’ve read, reflected and answered these five questions well, let’s go ahead.

What you need to raise capital for a pre-seed stage company in MENA

Ok, you don’t really need these seven items listed below. Fact is, some founders can raise the first check simply by a call or a WhatsApp. No slides. No memo. Just trust and relationship. But for most, these are the seven items that should be in place.

1.      Pitch deck

2.      Investor FAQ

3.      Financial model (if you have it)

4.      Liquidity budget (if you don’t have it, develop it)

5.      Long-term capital strategy (ok, most founder’s don’t it. They should)

6.      SAFE note

7.      Investor list (target 100 qualified, local investors, ideally from your personal network, local investors and local angels)

1.      Pitch deck

There are tons of great examples and template for what to put in a pitch deck. We recommend these slides in your standard, short pitch deck.  As you grow the company, you’ll hear us talking about your six decks. (read more about the six decks here) .

A bare minimum pitch deck – just keep it short.

If you have already developed your deck and just want some quick feedback on it, test out the SasStr AI pitch deck analyzer, a superb tool to sharpen any pitch deck.

VC Pitch Deck Analyzer from SaaStr.ai
2.      Investor FAQ

With the deck completed, you now want to dig more into the details. Developing a document with Investor FAQ, and making this available next to your deck is a great value-add for potential investors.

Think of the questions that Investors might have in their mind when you pitch to them. This includes:

a.      Is there a clear, urgent, and large enough problem here?

b.     Is this business model capable of producing venture-scale returns?

c.      Are your milestones set, investable and can they take you to the next stage?

d.     Is the risk/reward trade-off attractive enough to bet on today?

e.      Do you have the background & experience, and can your team actually pull this off?

For more, Download Strategy Tools’ Investor FAQ for pre-seed companies here.

3.      Financial model (if you have it)

At some point, you will need a financial model. For some, it might be too early, especially if you’re still validating your idea.

But if you have one (or can whip up a simple version), use it. It shows investors you’ve thought about the numbers behind your story.

We recommend keeping it simple at this stage. No need for complex spreadsheets yet.

Here is a pro tip: This works very well because investors love seeing you’ve stress-tested for surprises (e.g., “What if sales take 2x longer?”). You do not have to be precise; it’s about incorporating realism in your model.

4.      Liquidity budget

This is the “bridge” to your financial model. If you don’t have it, develop it.

What you do need, is a basic liquidity budget. This show clearly show how the money coming in now will be spent (use of proceeds), what other financing sources you are using, any revenue you might have and how long your financial runway will be.

You can easily build it in 15 mins. Here’s how:

– Calculate your Inflows: Raise amount + grants (e.g., Dubai Future Accelerators) + early revenue.

– Your outflows: Monthly burn (e.g., $10K: 50% dev, 30% go-to-market, 20% ops).

– Runway: Formula = (Total inflows – Burn) / Monthly burn. Target 12+ months. An investor putting in $50.000 today; how long will that money last?

5.      Long-term capital strategy (ok, most founder’s don’t it. They should)

Having a capital strategy “future-proofs” your fundraising to avoid dilution traps. This is the biggest point of pain for MENA founders that we saw in our masterclasses.

Build out a basic plan covering: – How much capital do you actually need, usually over a 5-10 year period – How are you going to finance this? (choice of instruments) – Over which timeframe will you be raising financing? – Which amounts, valuations and dilutions are you targeting for each round (ok, this last one is tricky, but the best founders got this mapped out already. You should too)

It sounds complicated, but it is the key to strategically fundraising your startup to success in the long term

In summary to the Financial Model, Liquidity budget, and long term capital strategy, focus on the 3 basics in Google Sheets or Excel:

a. Runway: How long will the money last? (Cash on hand ÷ Monthly burn = Months of runway.) Aim for 12-18 months post-raise.

b. Use of Proceeds: Break down spends (e.g., 40% product, 30% marketing, 20% team, 10% ops). Tie it to milestones like “Launch MVP in 6 months.”

c. Quick Projections: Rough revenue forecast (e.g., $0 now → $50K in Year 1 via 100 customers at $500/month) and costs. Test one key assumption, like customer acquisition cost.

One MENA-specific tweak: Please factor in local realities like currency fluctuations (e.g., AED/USD stability) or regional hiring costs. Start with a 6-month view to match fast pre-seed timelines.

I help work on this with early stage founders; reach out if you need support here!

Let’s move into the common (but heavily misunderstood) fundraising instruments that help you as a founder:

6.      SAFE note

Most founders use a SAFE note at this stage. You can also use a CN (convertible note), a KISS (Keep It Simple Security) or equity, but Carta data is clear. SAFE notes are used by 90% of all founders at this stage. Use a standard Y-combinator SAFE note template, and input your key information. Get the SAFE template here.

Just be aware, not all countries recognize the SAFE as legal investment instrument, so there is always that….

Test out Carta’s SAFE note calculator, to model out your note terms.

Want to know about how these instruments work? Check out our Scaling Up in MENA: The Most Common Investment Instruments.

7.      Investor list

Target 100 qualified, local investors, ideally from your personal network, local investors and local angels).

“Do you have any investors you can introduce me to?”, is probably the most common question I get from early-stage founders. Come on, that’s lazy.

Do your job, do your research and build your own lists. Map out your target investor personas. Study how active your investor prospects are. Find the ecosystem leaders that other angel investors follow. Map, study, map, study.

Building an investor list is surprisingly easy. Today, I expect any seed stage founder to be able to build out and maintain an investor CRM with 1.000 investor prospects, in some cases going to 5.000+ investor names. Difficult? Not at all. Takes some time? Yes, absolutely. But thanks to a plethora of options, from investor communities, online databases, matching tools and incredible AI tools, any founder can build a 1.000 name investor list in just minutes.

For pre-seed founders, start by engaging with personal network, high-net worth individuals and angel investors. Maybe explore local accelerators and grants, but keep it small, simple and fast. But, you do need to build that 100 name list.

What you will raise

The amount you raise will vary significantly based on many factors, including market, team, traction, general sentiment (AI is way up), etc, so take the numbers here and adjust for your own market and team.

You are likely to be raising in the range of $500.000 – $1M on a capped SAFE with discount. The amount and cap varies from market to market, sector to sector and generally based on the founders and their pricing power and negotiation position. Strong teams might see $500.000 5M capped SAFE with 20% discount. Less strong teams might see $100.000, capped at $1M post, with 30% discount and preference shares.

Less strong teams in smaller markets, might go as low as $50.000 – 100.000, but this is increasingly rare. if you are maturing into a VC round, you might even see $1M – $2M, at 4M – 8M post cap, a strong pre-seed deal in most markets.

Not sure what this all means? Do you research or get a mentor to guide you.

Understanding the instruments you will face

Pre-idea: $50.000 – 500.000, SAFE, capped at $500.000 – $4M post

Pre-seed: $100.000 – $2M, SAFE, capped at $500.000 – $8M post, with some markets at an average $12,5M post cap these days.

Seed: $300.000 – $5M, SAFE, capped at $1M – $15M post. Might also be a priced equity round. In some cases, could also be a CLA – convertible loan note

Seed+; $200.000 – $5M, SAFE, capped at $2M – $15M post. Might be a very strong seed round, with high level of interest. Could also be a bridge round, or even a short-term emergency financing round.

A: $5M – $25M, target $15M round size. Valuation $30M to $80M pre-money valuation

Across these rounds, you an reasonably expect a 20-25% dilution in the early stages, declining towards 15% – 25% as the company grows. If you have strong negotiation power, like Gamma, you can raise a $100M series B at 3% dilution, but this is the rare exception for the top 2% founders.

(Want to learn more about the six investment instruments you have and how to best use them? Join our 2026 Scale Up MENA! Masterclasses and Investor Readiness Programmes)

Going from notes to priced equity rounds

In many markets, the SAFE note has become the standard go-to-investment instrument. It’s well suited for that job. But, after a few rounds, you are likely going to switch from notes to a full equity round.

This is what we call a priced round, as the investors will – for the first time – set a price on your company. In doing so, SAFE notes are supposed to convert into equity. Some CN (Convertible loan notes) might get paid back or converted as well.

Around this time, we would also normally see a ESOP (Employee Stock Option Program) get established and a formal board of directors get set up. In our experience, we would ideally like to see the ESOP get set up far earlier, and be used as a key tool for attracting and keeping top talent from day one. However, many founders will only establish the ESOP here, leading into the first priced round.

Same on the board, we strongly encourage setting up boards already in year one, to start building the right board for long-term strategic support.

Read more about the seven startup boards.

Beware of stacking SAFEs

“Everyone said SAFE notes were supposed to be easy”, said one founder we worked with in Cairo. She had done four SAFE notes, across four different rounds. All early-stage.

If you know what you are doing, stacking SAFE notes is perfectly fine. Challenge is, most founders do not.

In her case, she held four different SAFE notes, with a total of 13 different investors, each note with different terms, caps, discounts. One of the notes did not specify pre- or post-money valuation. Another did not specify preference shares or common shares. One had MFN (most-favored nation). The others not. But, most of all, none of them clearly explained how to structure the SAFE notes going into conversion.

Our founder, she was equally confused and perplexed. Suddenly, she found, these easy-to-use SAFE notes were not so easy after all.

When stacking multiple SAFE notes on top of each other, just make sure you either really know what you are doing or you have a great lawyer-advisor at hand to guide you when the conversion day comes.

Understanding how dilution compounds

Ok, so you have now converted 1-4 rounds of SAFE notes, set up a 20% ESOP program and completed your first priced round. Congrats. Few founders actually make it this far. Just be aware of the equity math. Because, at this stage, you have likely sold off, or promised (ESOP) 40% – 60% of your company’s equity. More than one founder has turned ashen-white when realizing that the ‘easy SAFEs’, ‘small ESOP’ and ‘great funding round’, suddenly add up to a total of 55% of the company now switching hands.

Smart founders would abide by Nuwa Capital’s Nitin Reen’s advice, “stop at 3 concurrent notes”.

If you want to read more about the compounding dilution through the founder’s journey, check out our story on Leo Bank.

How to improve your negotiation position

–          Be profitable, don’t need the money

–          Show strong commercial traction, with a path to profitability

–          Have a great business in place

–          Have a great team in place

–          Have great advisors and early investors in place

–          Run a great fundraising process

How to run an accelerated fundraising process

Move fast. Raise capital. Get back to building.

Most pre-seed founders should be able to run a fast, accelerated fundraising process. We call this the accelerated fundraising journey. The point here is that this process is designed for speed, for getting the money in fast and quickly getting back to building the business.

Few founders design the process for speed, often ending getting dragged into lengthy processes, even years of fundraising, for even a small amount. Pro tip: optimize your pre-seed round for speed, fast closing and getting back to building.

Advanced early-stage founder?

If you are an advanced, early-stage founder, use these two canvases to guide your work.

Who are you targeting for the round?
Always think multiple term sheets, competitive syndicates. You need to put some competitive dynamics into this.

The most common mistakes we see

1.      Not being ready

2.      Not having an investment instrument (SAFE note ready)

3.      Asking for too much money vs. company maturity and pricing power

1.      Not being ready

Surprisingly, many founders go to market to raise capital – without having their most basic materials in order. Pitch deck lacking key information. No budget in place. No process in place and no timeline to close. The result? Long slogh, little progress. Time and energy wasted. Limited chance to close.

2. Not having an investment instrument (SAFE note ready)

We were running an investor readiness program in Cairo. Every founder, without exception, were pitching a great story, but their presentations ended abruptly. The “how to invest slide” was missing. There were no SAFEs ready. No timelines. No co-leads waiting in the wings. No other investor commitment and no momentum to close. Investors watching were all wondering the same, “How do I invest?”, unfortunately, so did the founders. Once we added that last slide:

HOW TO INVEST Raising  $100.000 on a $1,5M post SAFE. $50.000 already secured from five angels and one accelerator. Round closing in 3 weeks. Access our investor pack here and sign the SAFE note here.

Things started speeding up. Ask yourself. Have you built an investor pack that anyone can sign on today?

3.Asking for too much money vs. company maturity and pricing power

“We are raising $2,2M on a SAFE”, said one founder I met in Dubai this week. “But you don’t have any revenue or metrics to support that”, I replied. “That’s why we need the money”, came the response. Not an ideal response.

This might surprise some founders, but you really do want to show genuine momentum, traction and preferably early revenue, even at pre-seed stage. If you need $2,2M to get to first revenue, well, unlikely to happen. In that, raise a smaller amount, maybe $200.000 instead of $2,2M and build more capital efficiently.

Founders, go to work

Ok, that should be a pretty rich list for most founders. Our goal. help you raise smarter, faster and get back to scaling.

Good luck!

Want to read more?

The Story Of Scaling Leo Bank From Idea To Exit In The Middle East.

Founder: the six decks you need

Launching the First-time Fundraising Series

1. Deciding to raise

2. Running a competitive process

3. Building a compelling deck

Anatomy of a seed round

Can you run MedAssist’s Cap Table?

Antler: How to raise a pre-seed round

Carta: pre-seed funding

Y-combinator: a guide to seed fundraising

SAFE note templates (from Y combinator)

Ten Books That Will Save You From Costly Cap Table Mistakes: A Reading List for Founders, advisors & expert facilitators

This article is part of the Startup Series at Strategy Tools, helping founders, investors, and ecosystem builders across MENA navigate the journey from startup to scale-up. Read more about Scale Up MENA here. Thanks to Scott Newton and Rick Rasmussen for the collaboration in shaping a lot of this materials. Get the tools and learn more at www.strategytools.io

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Evolving Scale Up!

Over the past seven years we have delivered 300+ sessions with nearly 4.500 people through Scale Up! This month, we are rolling out the latest version, Scale Up MENA! and Scale Up Africa Rising! (launching in Q1 ’26). Here are the first observations from running the next generation of Scale Up!

It was one of the most intense, exhilarating and engaging Scale Up! sessions we’ve run in Norway (and we’ve run 60+ to date). The 30+ participants were highly capable. Angel investors, accelerator managers, ecosystem builders, founders, early-stage investors; all coming together to work on the ‘scaling up’ part of the ecosystem.

“Are you ready to scale?”, we asked, “do you have what it takes to scale from Bergen, Norway to the world?”, we challenges them. And they stepped up – big time, scaling five tech companies across energy, health, AI and seafood, ultimately ending up with a string of highly successful M&A exit transactions – and a string of zoo animals along the way.

Here are the top differences we observed in the new version of Scale Up! this week.

From financing to all round founder leadership and scaling development

The single biggest difference is the need for world class leadership and team collaboration. The moment the CEO steps back, the team steps down. The moment the Investor Relations Manager zoom out, the investor pipeline dries up in minutes. Leadership, more than ever, matters.

Got scale up leadership?

From equity to value

Previous generations of Scale Up! have largely been equity focused. Now, suddenly, ARR, revenue, revenue growth, margin expansion, building out the sales organization and revenue velocity matter. But beware of the famous year 10 hockey stick!

Look, year 10!

From investor landscape to commercial markets

With 35 markets to choose from, teams need to carefully select their beachhead and growth markets.

From linear to multi-level complexity

Five team members, each with a unique role, responsibility, KPIs, cards, boards and management dashboard.

is your workflow ready to scale?

Why it matters?

Globally, countries are competing on entreprenurship. But too often, the focus is on top-of-the-funnel, early-stage entreprenurship. Incubators filled, not IPO’s realized is often the metric of success. We developed Scale Up! to support more founders, innovation agencies, accelerators, ecosystems and countries in their efforts to scale, to scale up!

To date, nearly 4.500 people across 50 countries and 300+ programs have been through Scale Up! Globally, 50+ people are trained and certified to deliver Scale Up! programs. This month, we are training another 40 future facilitators.

This month, we are also rolling out Scale Up MENA! (from idea to exit in the Middle East) and getting ready to launch Scale Up Africa Rising! (from idea to exit in Africa). Next year, we are working on another two new outlines…..

Tomorrow, we’re off to Saudi Arabia and Dubai, where we will be running five Scale Up MENA! Masterclasses.

Read more and meet us in Dubai.

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Who attends a Scale Up Program?

Since start, we have delivered 250+ Scale Up Programs and Masterclasses, supporting 4.000+ founders, investors and ecosystem builders around the world.

This year alone, we’ll deliver 30 programs with nearly 600 participants. From impact founders in Southeast Asia, accelerators in South Africa, ecosystem builders in North America, tech founders in West Africa and top global ocean impact founders at Series A to name a few.

But who attends a Scale Up Program?

And what are their key benefits?

Here are the top 15 user groups we see.

1.    The young crowd

15-25 year old. Young. Excited. Engaged. In Canada, Michael and Stuart regularly run Scale Up! in high schools, proving that even 15- and 16-year old can manage growth strategy, customer discovery and cap tables. The young crowd is not a huge segment today, but we see a fantastic excitement with the participants as they learn entreprenurship, not in books, but by working and competing with their friends and peers.

Michael doing cap table math with High Schoolers. Canada, 2024

2. The students

19-25 year old. Young-ish. Thrilled to switch from classroom lecture to team-based competition. Absolutely love working with Scale Up! The students tend to be completely blank on anything to do with cap tables, equity math, but learn quickly.

In Austria, Germany and Italy, Enrico has been teaching Scale Up! for years in various business school programs. In Silicon Valley, Rick regularly use Scale Up! to teach entreprenurial finance. For faculty, using Scale Up! in the classroom is a superb way to make the teaching more engaging, more exciting and making learning stick.

ESCP Berlin, 2024

3.    The aspiring founders

20-30 year old. Have never started a company, but planning, hoping or aspire to. Are eager to learn the basics. Quickly realize that start, funding and scaling a new startup is a lot more ‘financing & math’ then they might have expected. They love the hands-on approach, the working visual format and the ability to discuss key terms and structures around the table as we work through the various Boom, Bust, Founder Tasks  and term sheets. In Hokkaido, Japan, Marcus ran the Scale Up Masterclass with a vast group of aspiring, Japanese founders, proving the format can transcend cultural barriers from West to East.

4.    First-time founders

We see a lot of these. First time founders may range from 18 – 45. Many are women starting their first company. Many have tried to learn and about fundraising, but typically had very mixed results to date.

Working with partners like EBRD, GIZ, Swiss EP(Entrepreneur), IFC, (formerly USAID) and Innovation Norway, we run a lot of programs supporting these first-time founders. In most cases, we prepare a pretty extensive pre-read package, giving participants time to read, reflect and complete a number of pre-session.

Cap tables, canvases and terms sheets. Swiss EP at work. Switzerland, 2022.

This year, first-time founder programs are taking our team to places like Estonia (Scott), Taipei (Suhail, Wan Fadzil), Oman (Mohammed) and Egypt (Chris),  to name a few places.

5.    Accelerator founders

Ok, now we are going somewhere. Accelerator founders is a big group, representing ca. 40% of all participants in a regular year. Most are early-stage, typically having raised 1-2 rounds of financing to date, most often through a SAFE or CLA instruments. In most cases, they are lacking the understanding of how SAFEs convert, how to structure the next round and how to shape a long-term capital strategy. Katapult Ocean (global), Savant (South Africa), Madica (West Africa), Net Zero Accelerator (Scotland) are some of the accelerators we have partnered with over recent years.

Within an accelerator, Scale Up! is usually delivered as an integrated part of the program, either in a 3-day format or longer 30-day, investment readiness format.

For founders, Scale Up! gives them a unique chance to experience many of the funding challenges they have ahead of them, and most truly appreciate the chance to build deeper skills in term sheets, cap table intricacies, investment instruments and generally strengthening their investment readiness.

Founder feedback, 2021.

6. Scaling founders

Having left  the messy seed-stages, the scaling founders are typically at Series A or Series B. They have significant experience with fundraising across stages, investor types and investment instruments. Most have had some ‘hard experiences’, or in several cases made every mistake in the book. Many quote, “oh, man, I wish we had had this two years ago…”.

Some people might believe that ‘at this stage, the founders should already know how to raise capital’. Nothing could be further from the truth. In fact, raising a pre-seed, seed, angel or accelerator round is usually based on future potential, with only limited strategy, DD and terms. Once you pass into ‘adulthood’ (how we explain the transition into Series A, things change. At Series A and B, the rounds tend to get more complex, legal advisors are often involved, term sheets tend to creep from 2-page SAFEs to 50-page equity contracts.

Navigating late-stage term sheets, Katapult Ocean, online, 2021

When we run Scale Up! with these founders, we don’t focus too much on the basics, but really dive into advanced term sheets, complex deal structures, investor outcomes and delivering on full and partial liquidity and exit  strategies. For most, we spend a half-day doing a complete IPO process, something most Series A founders have never experienced. “This has helped us completely rethink our Series A strategy”, said one UK founder recently. For Scaling founders, we often work with later-stage accelerators like Katapult Ocean, or with investment funds supporting their top portfolio companies.

In Dubai, our 2023 Masterclass with EO brought together 60+ highly experienced founders, many of them running large, successful companies; yet gaining massive benefits from the Scale Up Masterclass. Here, we mostly focused on the later stages of the journey, with outcomes, exits and holistic financing structures as our key focus points.

Structuring late-stage rounds, Dubai 2023

7. Accelerator staff

This is an interesting group. Globally, we have trained and certified accelerator staff in 15+ countries. It turns out, that most people working in an accelerator does not really understand what it takes to scale, how to read terms sheets, how to structure funding rounds and how to manage a cap table from pre-seed to exit. That’s ok, we cover all that in our Scale Up Masterclass for accelerator staff.

In places as diverse as Switzerland, Norway, East Africa and South Africa, we have trained accelerator staff to become active users or facilitators of Scale Up! Many of them go on to embed Scale Up! into their programs.

Connecting accelerators to investment bankers, Egypt 2024

8. Investment firms, VCs, Family offices, Fund-of-funds

On one hand, we might think that professional investors would not need Scale Up. By now, they surely know this, right? Well, not our experience at all.

Scale Up! run for this group throws complex funding structures, complicated scaling strategies and highly challenging exit scenarios on the participants. “How will you avoid massive dilution?”, “how can you best structure your Series A, to maximize non-dilutive financing?”, and “How do you scale revenue fast enough to get maximum payout on the 8X ARR exit transaction, where you realize net debt actually becomes a real thing due to your excessive debt financing on the Series C transaction”. The kit remains the same, but we run this very, very differently with professional investors.

The outcome? They love it. “We know the basic stuff, the early-stage content”, said one investor recently. “but the later-stages, that was entirely new to us”. “Wow, this is really challenging, but gives you a super appreciation for the role the founders have in real-life”, said an investment manager with a European family office. Having taken VCs, FoFs, national climate funds and Family offices through Scale Up!, there is no doubt that investment teams can become even better at their job with Scale Up!

2X Ignite GP Sprint, real life VC funds, taking on Scale Up!, scaling African tech startups into global markets, Cape Town, 2024

9. Ecosystem builders, innovation agencies, DFIs

We never expected the level of excitement, engagement and competitiveness from a bank, but our 2024 DNB (startup advisor) Masterclass was truly impressive. Six teams, 25 participants and absolutely top notch performance. Who knew that a group of bankers would be some of the most engaged, competitive and excited Scale Up! participants we had seen in years? In fact, we find that banks, innovation agencies, ministries, Development Finance institutions and other key ecosystem developers truly thrive on Scale Up! For many, it is the first time they really get hands on with the key concepts, challenges and complexities of scaling a startup. Many advice founders on a daily basis, but never having built a startup themselves, this is the next best thing.

Six teams, scaling into five IPOs, all led by Norwegian bankers. Oslo, 2024.

In Vietnam, we have worked with ThinkZone to build out the Vietnamese ecosystem.  In British Columbia, InnovateBC host ecosystem development Masterclasses and in the UAE, and in Norway, the national innovation agency has been long-term user of Scale Up!

Scale Up! Masterclass, InnovateBC & the wider BC ecosystem. Vancouver, 2025

10. Angel investors, angel networks

Many angel investors, it turns out, have capital to invest, but are either unsure of how to invest or how navigate the world of CLAs, SAFEs, pre-money, post-money, cap table, mark-ups and mark-downs. This is where Scale Up (Angel!) comes in. We have been running a dedicated Angel version for years, blending both the scale up founder perspective and the successful angel investor perspective into the same, engaging program.

In places like Cairo, East Africa and the Nordics, we have trained and upskilled 200+ angel investors using Scale Up

Would you take this SAFE note? Founders and angels negotiating terms in Cairo. Egypt 2023

For new and experienced angel investors alike, the Masterclass truly allows them to get hands on, deploy (simulation) capital into a portfolio of startups and watch their investment either flat line, go to zero or return a 100+X cash-on-cash in the best cases. More importantly, vs. more traditional classroom based educational angel programs, participants get to feel the competitive pressure, get to sense the panic when their investment takes an 80% down round and the joy at the 500M exit to Google, returning back their investment many, many times over.

Looking ahead there is a massive potential in rolling out more Scale Up Angel! Masterclasses to upskill angels and build better, more active angel syndicates around the world.

11. Innovation clusters

Leadership teams at Innovation clusters were our very first audience when Scale Up! was developed. We did not know it at the time, but it quickly turned out that most clusters were sorely in need of a better understanding of startups, scale ups and basic cap table math. Thanks to a wonderful collaboration with Innovation Norway and the Norwegian national cluster program, 100’s of cluster leaders have built their entreprenurial skills with Scale Up!

Functioning as key ecosystem builders, cluster staff, cluster members and cluster leaders all serve a vital role, in better understanding and supporting young companies. Scale Up! fits this bill perfectly.

Innovation cluster management teams, hard at work on Scale Up! Oslo, 2019

12. Corporate innovation, corporate venture capital

One of the best performing teams ever came out of the Accenture London Program in 2024. The Founder Intelligence team (FI, a part of Accenture) have day jobs to support corporate clients on startup engagement, design corporate accelerators and help big companies better work with startups and scale ups.

Naturally, they brought these skills to the Masterclass. The Terrawattz $4trillion IPO (Think, Nividia, just better), set a new record for what can be achieved in a Scale Up! Masterclass.

Terrawattz Board IPO deck
Showing strong momentum going into the listing

In the debrief, discussing how the team achieved this extreme outlier performance, the answer was “we fed all our data into ChatGPT, and that helped us…”.

Having run 20+ programs for CVC teams, corporate innovation teams and corporate disruptors like FI,  we  see a strong upside for more corporate teams to experience the ups and downs of the Founder’s Journey with Scale Up!

13. Business school faculty, educators

A group we love working with, but would love to see many more of, is the business school faculty. Scale Up! fits perfectly into a classroom program, having taught 1000+ students to date. Yet, getting faculty and educators to join and invest their time is always an uphill battle.

Honorable mentions include our Silicon Valley friend, Rick Rasmussen, who has been one of the most active Scale Up! educators anywhere in the world. Rick has shown an impressive flexibility in bringing Scale Up! into his many classrooms.

What we do see, however, is that many in the next group,  once certified, are easily stepping into classrooms, taking on roles as visiting faculty to teach entrepreneurship with Scale Up!

Exit paths, exit paths, Egypt 2023.

14. Mentors, advisors, consultants

Our final group is a broad one. These include consultants and advisors serving startups on their investment readiness and fundraising success. These consultants, mentors and advisors tend to already be highly active in their respective ecosystems. They are usually well versed in the challenges of building a scale up. They understand fundraising challenges, cap table math and love reading term sheets over coffee.

What Scale Up! does for them is provide a single package, a simulation kit, where they can apply their extensive knowledge in a whole new way. Expanding from ‘advisors’ to ‘facilitators’, they realize they can train, support and accelerate a vast cohort of founders, combining their existing expertise with the Scale Up! materials. These people tend to sign up for a Discovery session, complete the certification in record-time and join the Strategy Tools Master Trainer to learn from the source.

In Bahrain, we partnered with Falak Innovation and Tamkeen to deliver the first ever Scale Up Masterclass in the country. For many founders and participant, this was the first time they really got into what it means to build and scale a startup in MENA.  For Suhail Algosaibi as an active mentor and business angel, Scale Up! was just one more way of supporting young companies in the region.

Suhail, running one out of two groups in Bahrain. Bahrain, 2024.

15.   Anyone else?

If you are one of our global, certified Scale Up! experts, who did we miss? Any other group you would like to add? Leave your thoughts in the comments.

What is Scale Up!?

Scale Up! is a team-based, action-packed, ultra-competitive simulation to learn and master the founder’s journey from idea to successful exit. Working in teams, participants choose a case company, and then work through 6-10 years to scale the company into a global winner.

Scale Up! covers a wide range of teaching content, including:

  • Scaling mindset
  • Foundational equity
  • Customer discovery
  • Business models
  • Revenue growth (ARR)
  • Fundraising (SAFE, CLA, Equity) from pre-seed to Series F
  • Term sheets
  • Outcome analysis
  • Partial investor liquidity
  • Full exit transaction

Scale Up! is available in the following versions:

  • Scale Up Global! (global content)
  • Scale Up MENA! (100% MENA content)
  • Scale up! Angel (for angel investors)
  • with Scale Up Africa Rising! launching in Q1 2026

Learn more? Get certified?

Want to learn more about Scale Up, Scale Up MENA or Scale Up Angel? Check out our website.

Curious to dig into the full Strategy Sims universe and learn more about the methodology, get our latest report, Strategy Sims in Action, co-authored by a global community of Scale Up! experts.

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From 1.3 Million to 10 Unicorns: What Mauritius Can Learn from Estonia’s VC Ecosystem

Two island nations. Identical populations. Radically different venture outcomes.

Estonia and Mauritius each have approximately 1.3 million people. Yet Estonia has produced 10 unicorns valued at over $1 billion each, while Mauritius struggles to attract even $2 million in annual startup funding. What explains this 500x difference in venture capital success?

In advance of the upcoming Fund Manager Masterclass in Mauritius, we have analyzed both ecosystems through the lens of the VC Ecosystem Canvas, the answer lies not in any single factor, but in how eight critical components work together—or don’t. Here’s what the data reveals.

The VC Ecosystem Canvas. (Rangen, 2024, www.strategytools.io)

1. Talent, Culture & Dealflow: The Foundation

Estonia: A Self-Reinforcing Flywheel

Estonia has cracked the code on talent recycling. When Skype was acquired by eBay for $2.6 billion in 2005, it didn’t just create wealth—it created a generation of experienced entrepreneurs and angel investors. The “Skype Mafia” went on to found or fund companies like Wise, Bolt, and Pipedrive.

Today, Estonia’s tech workforce has grown nearly tenfold in the past decade. The country produces a steady stream of STEM graduates who view entrepreneurship as a viable career path. More importantly, 25% of Estonian startup founders are now foreign-born, attracted by the e-Residency program and Startup Visa—proving that talent acquisition transcends borders when the ecosystem is right.

The dealflow is robust: over 1,400 active startups generating hundreds of investment opportunities annually.

How to tap into more high-growth dealflow?

Mauritius: Potential Without Pipeline

Mauritius produces 1,200 STEM graduates annually and has an impressive 79% smartphone penetration rate. The infrastructure is there. But the entrepreneurial culture is still developing.

As one local founder told researchers: “It’s an unfortunate cycle because to expand outside the country, you need funding which is rare because investors think Mauritius is too small a market.”

The country currently has just over 100 tech startups—less than 10% of Estonia’s number. Without exits creating successful entrepreneur-investors, there’s no flywheel effect. The talent exists, but the culture of ambitious, globally-minded entrepreneurship is still nascent.

2. Early-Stage Financing: Angels Make or Break Ecosystems

Estonia: Active Angel Network

The Estonian Business Angels Network (EstBAN) has over 300 active members providing €20,000-€500,000 in seed funding. These angels don’t just write checks—they’re typically successful entrepreneurs themselves who provide mentorship, networks, and credibility.

The presence of experienced angels means Estonian startups can access pre-seed and seed capital relatively easily, allowing them to validate ideas before approaching institutional VCs.

Mauritius: The Missing Middle

Mauritius lacks a robust angel investor culture. The Mauritius Africa FinTech Hub provides some early-stage support, but the ecosystem doesn’t have the density of high-net-worth individuals with startup experience who can write €50,000-€200,000 checks.

This creates a critical gap: startups can’t get the initial capital needed to prove their concept and attract larger VC rounds. Without angels, the entire funnel breaks down.

Early-stage networks matter

3. Venture Capital & Growth Financing: Follow-On Matters

Estonia: €1 Billion Ready to Deploy

Estonian VC funds currently have approximately €1 billion in capital available for deployment. Major local players like Superangel, Tera Ventures, Change Ventures, and Karma Ventures are complemented by international giants like Sequoia, Accel, and Andreessen Horowitz.

Critically, Estonia attracts 8x more venture capital per capita than the EU average and leads globally with VC funding representing 1.17% of GDP—higher than Singapore, Israel, or the United States.

The ecosystem supports companies through multiple rounds: seed, Series A, Series B, and beyond. Bolt raised €628 million in 2022 alone. This depth of capital means Estonian startups don’t hit a funding cliff as they scale.

Mauritius: Gateway Capital, Not Growth Capital

Mauritius is projected to see $224.9 million in VC market volume for 2024, but here’s the catch: most funds domiciled in Mauritius invest elsewhere in Africa, not in Mauritian startups.

Launch Africa, the largest local VC with 146 investments, and Compass (owned by ENL Group) are the exceptions. But as one VC managing partner noted bluntly: “VC is a game of scale and for startups whose only focus is the Mauritius market, it’s going to be hard for a VC to write a cheque for a business whose market is only 1.7 million at best.”

The capital exists in Mauritius—it’s just flowing through the country, not into it.

4. Limited Partners: Who Funds the Funds?

Estonia: Government as Cornerstone LP

SmartCap, Estonia’s government-backed fund-of-funds, has been transformative. With approximately €176 million in net value, SmartCap invests in private VC funds that focus on Estonia, essentially providing cornerstone capital that de-risks funds for other LPs.

The government has also launched specialized funds: a €100 million Green Fund for cleantech and a €100 million Defence Fund for dual-use technologies, backed by EU NextGenerationEU funding.

This public-private model attracts institutional investors who might otherwise overlook such a small market.

Mauritius: Limited LP Base

Mauritius lacks a robust institutional LP base. Without a critical mass of pension funds, family offices, or corporate venture arms investing in local VC funds, fund managers struggle to raise capital at scale.

The government provides some support through schemes like the Mauritius Research and Innovation Council (offering $2.62 million in grants), but this is grants, not LP investment in funds. There’s no SmartCap equivalent creating a sustainable fund-of-funds ecosystem

Who are the LPs? and how do we get more institutional capital onboard?

5. Exits: Proof of Concept Matters

Estonia: Track Record of Wins

Estonia’s exit history is its secret weapon:

  • Skype → eBay ($2.6B, 2005)
  • Playtech → IPO (became unicorn 2012)
  • Wise → London Stock Exchange IPO (2021, now valued at $11B)
  • Bolt → Preparing for IPO (valued at €8.4B)
  • Multiple acquisitions of mid-sized companies

These exits validate the ecosystem, return capital to investors (who reinvest), and create experienced entrepreneurs who mentor the next generation.

Notably, 2024 was challenging: Estonia saw an all-time low in new startup formation, partly because founders are waiting for better exit conditions. This highlights that even mature ecosystems need continuous exits to stay healthy.

Mauritius: Exit Desert

Mauritius has virtually no meaningful tech exits. Without success stories, there’s no proof of concept for investors, no capital returned to the ecosystem, and no experienced entrepreneurs to recycle back into the system.

This is perhaps the biggest structural problem: investors need to believe exits are possible before they’ll invest at scale.

6. Service Providers: The Connective Tissue

Estonia: 150+ Support Organizations

Estonia has built a comprehensive support infrastructure: 150+ organizations including tech incubators, accelerators, legal firms specializing in VC deals, accounting firms that understand startup economics, and PR agencies focused on tech companies.

Organizations like Startup Estonia act as ecosystem orchestrators, connecting founders with resources. The density means startups can find specialized help at every stage.

Mauritius: Building Infrastructure

Mauritius has initiatives like the Mauritius Africa FinTech Hub, theTurbine accelerator, and the Mauritius Emerging Technologies Council. But the ecosystem lacks depth.

The country has strong corporate service providers (CSPs) for fund domiciliation—Mauritius ranks first in Africa for fund domiciliation according to a 2024 MasterCard Foundation study—but these serve offshore clients, not local startups.

There’s a mismatch: world-class infrastructure for hosting African-focused funds, but insufficient startup-focused service providers.

7. Community & Education: Building the Pipeline

Estonia: Entrepreneurship as National Identity

Estonia has embedded entrepreneurship into its education system and national culture. Universities offer specialized programs in entrepreneurship. The e-Residency program has attracted 100,000+ digital entrepreneurs, creating a global community connected to Estonia.

The startup community is tight-knit—with only 1.3 million people, everyone knows everyone. This density creates serendipitous connections and knowledge sharing. Community events, from the Estonian Startup Ecosystem Annual Fireside Chat to countless meetups, keep the ecosystem connected.

Mauritius: Emerging Community

Mauritius has launched initiatives like VIT Mauritius offering AI and machine learning degrees (55% of students from other African countries), and various fintech training programs.

The Digital Mauritius 2030 Strategic Plan commits to certifying 10,000 AI professionals by 2030, with $50 million invested in STEM education.

But community density is still developing. With only 100+ tech startups versus Estonia’s 1,400, there aren’t enough peers for the network effects that create spontaneous collaboration and knowledge transfer.

Having the right networks matter.

8. Government: Policy Creates Possibilities

Estonia: Digital Government as Competitive Advantage

Estonia’s government doesn’t just support startups—it operates like a startup itself. 99% of government services are online. You can start a company in 15 minutes. Tax filing takes minutes. E-signatures are legally binding and universal.

The government offers:

  • E-Residency (allowing anyone globally to access Estonian business infrastructure)
  • Startup Visa (attracting foreign founders)
  • Tax incentives (reinvested corporate profits are untaxed)
  • Direct support through Startup Estonia and SmartCap

This isn’t about grants—it’s about removing friction and creating the world’s most efficient business environment.

Mauritius: Policies in Progress

Mauritius has made significant strides:

  • 8-year tax exemptions for innovation-driven startups (since 2017)
  • 5-year tax holiday for e-commerce and P2P lending
  • Regulatory Sandbox Licence for fintech/blockchain testing
  • National SME Incubator Scheme
  • Innovator Occupation Permit
  • Premium Visa for digital nomads

These are excellent policies. But implementation and ecosystem integration are still maturing. Mauritius is building the infrastructure Estonia built over 20 years—the question is whether it can accelerate the learning curve.

The Missing Link: Networks & Relationships

The VC Ecosystem Canvas shows all eight components connected by “Relationships, Networks & Connective Tissue.” This is where Estonia truly excels and Mauritius likely struggles.

Estonia’s ecosystem is densely interconnected. The Skype Mafia invested in Wise and Bolt founders. Successful entrepreneurs become angels and VCs. Founders who exit become mentors. Government officials have startup experience. Service providers are former operators.

Mauritius is building components in parallel, but they’re not yet tightly integrated. The financial services sector operates separately from the tech startup scene. International funds domiciled in Mauritius don’t invest locally. Government initiatives don’t always connect to on-the-ground founder needs.

Bring the network together.

Recommendations for Mauritius: Building on Strengths

Mauritius has unique advantages Estonia lacks: strategic location as Africa’s gateway, strong financial services infrastructure, political stability, and preferential access to Indian and African markets. Here’s how to leverage them:

1. Embrace the Africa Gateway Strategy

Stop competing with Estonia on their terms. Mauritius will never be “Africa’s Estonia”—but it can be “Africa’s Connector.”

Action: Incentivize all Mauritius-domiciled VC funds to invest at least 20% in Mauritian startups or African startups headquartered in Mauritius. This would be along the same lines we now see in places like Saudi and Ireland. Create tax incentives for this. Set up LP structures to back a wide number of funds, but having those funds allocated to local, regional startups.

2. Create a Government-Backed Angel Co-Investment Fund

The missing angel layer is killing the ecosystem at the source.

Action: Establish a $20 million government fund that co-invests 50/50 with private angels on tickets of $25,000-$200,000. This de-risks angel investment while building the angel community. Model it on Estonia’s SmartCap but focused on seed stage.

3. Launch “Mauritius Labs” – A Pan-African GP Accelerator

Build on your geographic advantage.

Action: Create a government-supported GP accelerator that brings 100 African Emerging Fund Mangers per year to Mauritius for 3-month programs. Provide work permits, working capital, warehousing, office space, and connections to Mauritius-domiciled LPs. GPs must maintain legal entities in Mauritius for 2 years. This creates dealflow, attracts talent, and positions Mauritius as Africa’s GP/LP hub. (pssss, don’t think this is possible, just look to Luxembourg’s ICFA. Don’t yet know what a GP accelerator is? Just look at some of our work here.)

ICFA, showing the path for Mauritius’s GP Accelerator

4. Mandate Ecosystem Participation for Fund Licensing

Use regulatory network to build connective tissue.

Action: Motivate all funds seeking Mauritius domiciliation to: (a) host quarterly office hours for local startups, (b) participate in local pitch events, (c) provide annual scholarships to Mauritian students. Turn the offshore financial sector into an engaged ecosystem participant.

5. Create “Exit Readiness” Infrastructure

Build confidence in exit possibilities.

Action: Establish partnerships with London Stock Exchange, NYSE, and major African exchanges for streamlined IPO processes for Mauritius-domiciled companies. Create a secondary market for startup shares to provide liquidity before full exits. Model this on Estonia’s cooperation with LSE that enabled Wise’s successful IPO.

6. Activate the Indian Ocean Diaspora

Estonia leveraged its global diaspora through e-Residency. Mauritius can do the same.

Action: Create an “Indian Ocean Innovation Network” connecting Mauritian diaspora in banking, tech, and business globally. Offer investment matching, board positions, and advisory roles. Many successful Mauritians abroad would invest in their home ecosystem if given structured opportunities.

7. Integrate Education with Ecosystem

VIT Mauritius is a start, but it needs tighter industry integration.

Action: Require all tech companies receiving government incentives to provide internships or mentorship. Create entrepreneurship tracks in all universities with real startup projects funded by the government. Make “one year working in a startup” a graduation requirement for business/CS students.

8. Focus Ruthlessly on Fintech & AI for Africa

Don’t try to compete in every sector—dominate two.

Action: Declare Mauritius “Africa’s Fintech & AI Capital.” Concentrate all resources (grants, accelerators, tax incentives, regulatory sandboxes) on these two verticals. Build critical mass through specialization before expanding. Estonia’s early focus on fintech (Wise, Bolt payments) created momentum that expanded to other sectors.

The Bottom Line

Estonia took 20 years to build its ecosystem, starting with Skype in 2003. Mauritius is essentially in year 5-7 of serious ecosystem building. The gap is real, but not insurmountable.

The key insight: Estonia didn’t succeed because of its size—it succeeded despite it. The same can be true for Mauritius, but only if it:

  1. Stops thinking domestically (force global mindset from day one)
  2. Leverages existing strengths (financial services, geographic position)
  3. Creates tight integration between all ecosystem components
  4. Focuses ruthlessly on 2-3 sectors rather than trying to do everything
  5. Builds for exits from the beginning
  6. Start with building the world’s leading GP accelerator – in Mauritius

The infrastructure is coming together. The government is supportive. The talent exists. What’s needed now is intentional ecosystem architecture—connecting the pieces, creating the flywheel, and proving that exits are possible.

Estonia has shown what’s possible with 1.3 million people. Mauritius has the same population, better weather, and a gateway to a continent of 1.3 billion people.

The question isn’t whether Mauritius can build a thriving VC ecosystem. The question is: how quickly can it learn from those who’ve already done it?

What do you think? Are there other lessons from successful small-nation ecosystems that Mauritius should consider? Share your thoughts in the comments.

#VentureCapital #Startups #Mauritius #Estonia #AfricaTech #Ecosystem #Innovation

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Scaling Up in MENA: The Most Common Investment Instruments (A Wiwo Bank Story)

Ever wondered how startups in MENA actually raise money? Let me walk you through the journey of Wiwo Bank – a fictive digital banking startup that went from napkin sketch to Series B in the region.

First, The Basics: Your Funding Toolkit

Before we dive into Wiwo’s story, let’s understand the three most common investment instruments you’ll encounter in MENA:

SAFE (Simple Agreement for Future Equity) Think of it as an IOU for shares. You get money now, investors get equity later (usually at your next priced round). Key term: valuation cap – the maximum company value at which the SAFE converts to equity. If the cap is $3M but your next round values you at $10M, early investors still convert at $3M (winning!). You can also expect to see discount rate (often 20% or more).

CLA (Convertible Loan Agreement) Similar to a SAFE, but it’s technically debt. It converts to equity later, but if things go south, investors have loan protections. Key terms: interest rate (usually 5-10%), discount rate (investors get shares cheaper than new investors), and maturity date (when the loan must convert or be repaid).

Equity The classic. Investors buy actual shares at an agreed company valuation. Key terms: valuation (what your company is worth), ownership % (how much you’re giving away), and liquidation preference (who gets paid first if you sell). Make sure to keep track of pre-money, post-money and all key terms.

Meet Wiwo Bank: From Living Room to Boardroom

The Beginning: Friends & Family ($50K)

Sarah, Khalid, and Noor quit their jobs at HSBC, Bain, and Microsoft to build Wiwo Bank – a digital banking platform to reinvent financial services in MENA. With $200K of their own savings and $50K from Sarah’s supportive brother on a SAFE, they built an MVP.

Structure: SAFE – brother got a stake in the company, no complicated terms. Conversion into equity in the future. No terms, no cap. No nothing on the SAFE. Just assume MFN.

Pre-Seed: The Kuwait Accelerator ($1M CLA)

Six months later, Wiwo’s MVP caught the eye of Brilliant Lab’s “Brilliant Start” program in Kuwait.

The deal: $1M as a Convertible Loan Agreement with a 10% interest rate and $3M cap. Minimum 10-month duration before conversion.

This CLA gave Wiwo runway to expand beyond Dubai while giving Brilliant Lab protection as a loan if things went sideways.

Seed Round: The Doha Angel ($300K SAFE)

With traction in Kuwait and Dubai, the team pitched in Doha. Al-Kuwari, an investor focused on healthcare and fintech, believed in their embedded finance vision.

The deal: $300K on a SAFE with a $3M valuation cap.

No valuation discussion, no equity calculation yet – just fast money to keep building. The cap meant Al-Kuwari would benefit hugely if Wiwo’s next round valued them higher.

Series A: The Accelerator Alumni Round ($250K + $600K)

By now, Wiwo had real revenue and was expanding to Jordan. Jordan’s Oasis500 came in with $250K at a $3M valuation (straight equity this time – real ownership).

Then VentureSouq knocked: $600K at $5M valuation post, but only if Wiwo joined a top-tier accelerator first. The team hustled into Plug & Play (no equity), and VentureSouq invested, taking 12%.

All those SAFEs and CLAs from earlier? They converted now. Brilliant Lab and Al-Kuwari’s instruments converted at their $3M caps, meaning they got more shares than if they’d invested at the $5M Series A valuation.

Series B: The Big Leagues ($25M)

Fast forward 18 months. Wiwo hit $50M ARR, became a serious Careem-for-banking story, and had a clear path to breakout growth. Mubadala’s $400M fintech fund came calling.

The deal: $25M at a $55M post-money valuation, but with grown-up terms: anti-dilution protection and 1.5X liquidation preference.

What does that mean? If Wiwo sells for $100M, Mubadala gets $37.5M first (1.5X their $25M), then everyone else splits the rest. It’s protection for late-stage investors betting big.

The Lessons

1. Structure matches stage: Friends write checks. Early investors want SAFE/CLA flexibility. Growth investors want equity with protections.

2. Caps matter: Wiwo’s early believers who bet on $3M caps made 8X more shares than if they’d waited for the $5M Series A.

3. Terms get serious: Notice how friends asked for nothing, but Mubadala wanted liquidation preferences? That’s the real-life at scale.

4. Geography shapes deals: MENA investors often require regional expansion commitments (Jordan for Oasis500, Kuwait for Brilliant Lab). It’s not just money – it’s market access.

Wiwo Bank isn’t real, but this journey is typical for MENA startups scaling from idea to growth stage. Whether you’re raising your first $50K or your first $50M, understanding these instruments isn’t optional – it’s essential.

Your turn:

If you have read this far, you are ready for the task. Try to structure the cap table based on the information given here to the best of your ability. It might not be as easy as you think. Assume the following:

  • Three founders
  • 100.000 shares at opening, equally split
  • Set up a 20% ESOP, pre-Series A
  • All valuations pre, unless otherwise specified.
  • Post your results in the comments

#MENA #Startups #VentureCapital #Fintech #Fundraising #ScaleUpMENA

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How does it work? The strategy sims method in action

Over the past six years, we have run approximately 500 Strategy Sims sessions with participants from around the world. From C-level executives in global organizations to executive education programs at top business schools, developing venture ecosystems in the Middle East, and backing startup founders with global ambitions, Strategy Sims have served as a powerful tool for learning, insight, and professional development.

But how does it work? What is the workflow that makes Strategy Sims work? And what can new leaders and faculty learn in applying the Strategy Sims method in action?

By: Chris Rangen

The Scale Up Angel Sim, a deeply immersive, engaging and competitive way to learn angel investing, @Tiye Angel Network, Cairo, Egypt, Oct 2023

What is Strategy Sims?

The Strategy Sims are designed to help organizations and individuals navigate complex strategic challenges, develop critical thinking, and simulate high-stakes decision-making. Strategy Sims are designed to build learning, mastery and company growth, using experiential learning. The structure is based on modern theories on adult learning, including the renowned Lego Serious Play method by Johan Roos and Bart Victor .

Rather than passively listening to lengthy lectures, we use a combination of pre-work, micro-lectures, team-based competitive experiential learning, in sum driving far deeper and effective learning and development. Feedback from participants emphasize three key points;

  • Engaging: people love the format of an experiential learning program (with a strong competitive streak)
  • Fast-paced learning: learning comes from every angle, with high-pace, micro-burst, and instant shift from ‘learning to doing’
  • Team: teamwork, and great teamwork is the key to a successful Strategy Sim session. Without it, any team will struggle. Hands-on leadership (people have formal leadership roles in the program) and strong team collaboration makes all the difference – just like in real life

“Intense”, “Exhilarating”, “Super insightful!”, “Weirdly realistic”, “Eye-opening”, “Hard, worth it”, “loved the experience – thank you!”, “Thank you for the craziest 3 days!”, said the 25+ participants we recently had at Fund Manager! Program for the Newton Venture Program.

Meet the nine Strategy Sims

The nine Strategy Sims cover a wide range of topics, industries, content and market conditions, allowing participants to experience real-world content at an accelerated pace. Most of the Strategy Sims are built around the concept of a team-based journey, taking a company from zero to exit (Scale Up!), or turning a company around from laggard to breakout leader (Transform!)

The nine Strategy Sims are:

Transform!: from laggard to breakout winner

For corporate users, leadership development, strategy, innovation, change management and executive education programs.

Scale Up! From idea to exit

For entrepreneurs, startups, scale ups, accelerators, incubators, VC Funds, and startup ecosystem development and entrepreneurship education.

Scale Up MENA! From idea to exit in the Middle East (launching 2025!)

For entrepreneurs, startups, scale ups, accelerators, incubators, VC funds and startup ecosystem development in the Middle East and North Africa, as well as entrepreneurship education.

Scale Up Angel! From Novice Investor to Super Angel

For angel investor networks, angel clubs, ecosystem development and education programs.

Scale Up X! Gender-based entrepreneurship

For female founders, female startup programs, gender-based entrepreneurship development

Supercluster!: Accelerating national transformation

For national transformation programs, innovation clusters, economic development, ecosystems and education programs.

Fund Manager!: From Thesis to DPI

For GP accelerators, venture capital training & education, fund manager development, VC funds, fund-of-funds, VC ecosystem development, LP training and education programs

Corporate Venture!: from innovation to value

For corporate venture teams, corporate strategy teams and education programs

VC Ecosystem: from emerging to outperforming (coming in 2026)

For VC ecosystem developers, international finance- and development organizations, government agencies, VC associations, national innovation agencies,  VC education programs

Scale Up! in action in the Middle East, @Tamkeen and Falak Innovation, Bahrain, April 2024

The Strategy Sims method

1. Client (Participants) Context

Understanding the participants’ context is crucial to delivering a relevant and engaging Strategy Sim. We begin by assessing what is top of mind for participants, the challenges they are facing, and the external factors influencing their industry.

For example, if a session is focused on strategic dynamics, we might ask: What are the implications of the current NATO rift and Europe’s sudden need to rearm? Should traditional European industrial companies expand into security and defense?

With defense spending on the rise, what should legacy companies do? Expanding Transform! to cover new strategy questions rapidly arising for (mostly) European firms in spring 2025.

If we are planning a Scale Up Masterclass, we might look at the current market for pre-seed, seed and venture-stage fundraising, we look at the latest deals and valuations and news in the market.

Meet over 500 real life investors, with terms sheet, SAFE notes and convertible structures from across the MENA region

By aligning the simulation with real-world contexts, we ensure that the experience is highly relevant and actionable.

2. Learning Goals

Each Strategy Sim is designed with specific learning goals in mind. These objectives vary based on the audience, program,  industry, and challenges they wish to address. Common learning goals include:

  • Understanding competitive strategy, leadership and transformation
  • Enhancing decision-making under uncertainty
  • Leadership during change and change management
  • Exploring business model innovation
  • Developing financial literacy and capital strategy
  • How to build a venture capital fund
  • How to raise startup financing?
  • How to improve national competitiveness
  • Mastering business angel investing
Transform! Puts participants into the shoes of a top management team, brought in to turn around a legacy company with declining sales, underperforming market cap and a culture strongly against change. Can the new management team successfully lead the  transformation, using the 10 Principles of Transformation?
The learning engine in Scale Up MENA!, our latest Strategy Sim, built entirely on MENA startup content. Startup teams need to master every key topic from equity setup, multi-stage financing, product development, market expansion, revenue growth (ARR) and exit negotiations, taking the company from early idea to a successful exit in just a few days.  March 2025
Detailed program for a 3-day Scale Up! Masterclass, for founders, accelerators and ecosystem builders, Sep 2024

3. Participant Outcomes

The success of a Strategy Sim is measured by the impact on participants. Key outcomes often include:

  • Improved strategic thinking and strategic leadership
  • Increased confidence in personal leadership during change management
  • Enhanced collaboration and robust teamwork
  • Greater confidence in making complex strategy decisions
  • Better equipped to raise one or multiple future fundraising rounds for founders
  • More confidence in building a venture capital firm
Upon completion of the Fund Manager Masterclass participants should be able to successfully understand and navigate the 10-15 year fund journey, January 2025

4. Selection of Strategy Sim

Choosing the right Strategy Sim depends on the participants,  learning goals and the client context. With nine unique simulations to date, it is easy for clients and executive educators to find and select just the right Strategy Sim.

Scale Up! Content deepdive, with an expanded focus on climate and cleantech. march 2022
Corporate Venture, a niche Strategy Sim, takes participants through the challenges of building a world-class corporate venture program. December 2024

5. Case Study

Each Strategy Sim is enriched with real-world case studies that provide practical insights into business strategies, industry shifts, and key decision points. These cases serve as a foundation for thinking, allowing participants to draw parallels between the simulation and real-life business challenges before stepping into Strategy Sim experience.

Fund Manager Case study, @Accenture, Frankfurt, March 2025
Want to dig deeper?

Read the full case study for Transform!, using the Mobility industry, at Duke University, April 2025.

6. Pre-Pack

Prior to the session, participants receive a pre-pack containing background materials, industry insights, and key frameworks to help them prepare. This ensures they enter the simulation with a solid understanding of the context and objectives. Some programs also run a 45. Minute webinar

For Transform, spring 2025, participants enjoy multiple classroom lectures, then receive:

Pre-session video, with an intro to corporate strategy & finance

  • Case study
  • Welcome brief from the Board chair
  • Team role descriptions
  • Management onboarding pack
  • Building the Transformational Company report
Management onboarding pack, BD team presenting how to create value by investing into Explore business models and doing CVC bolt-ons. Something for every new management team to reflect on, March 2025

For Fund Manager, spring 2025, participants receive:

  • Case study
  • Team role descriptions
  • Pre-session workbook, with core content intro and basic equity math for VC fund managers

Slidepack

  • Selected reading on ‘inside a VC fund’, and ‘how to set up a VC fund’
Pre-session workbook for Fund Manager, January 2024.
Want to dig deeper?

Read the BoD Chair Welcome Memo, Team roles and Management onboarding pack for Transform!, using the Mobility industry, at Duke University, April 2025.

7. Run the Strategy Sim

The core of the experience, the Strategy Sim itself, is an immersive, high-energy session where participants engage in competitive team work and dynamic decision-making. Depending on the chosen simulation, participants will:

  • Select team roles (you own your role during the program)
  • Formulate strategies (ambition, how to get there, how to win)
  • Compete against other teams (Collaborative, competitive, backstabbing?)
  • Respond to market shifts and external pressures (process information in real-time)
  • Manage resources and capital allocation (investments, divestment)
  • Negotiate deals and partnerships (alliances, take overs, hostile acquisitions?)
  • Build financial models, budgets and multiple presentations (average 4 presentations per program, up to 12 presentations in multi-day, complex programs)
  • Craft a plan to win (out compete the rest)
Classroom pitches at the Venture Asset Management Program, using Fund Manager, @IMD, Lausanne, Switzerland, September 2024.
Angels and founders collaborating on analyzing later stage investors, mapping them in the Investor Map, @Tiye Angels, Cairo, Egypt,  October 2023
Teamwork is key, four DNB Bankers going through the founder’s journey, here analyzing a term sheet from a Superinvestor, using Scale Up! @DNB, Oslo, Norway, October 2024.
Last minute merger negotiation between two teams, Transform @IE, Madrid. Inorganic growth through mergers, acquisitions and hostile take-overs are key to leapfrogging the competition. Leadership and dealmaking skills is vital here, May 2023

8. Select & celebrate the winner

Ultimately, every Strategy Sim session will end with a winner. In Scale Up! this is often the company that can achieve the best revenue, growth and exit transaction. In Transform! it is the first team to hit 50BN – or 100BN – market cap in public markets.

At IMD, for the Venture Asset Management Program, the winning fund, Circular Dragons achieved a 253X net DPI, but got stuck due to some highly questionable financial transactions, leaving room for BASA, fund III to secure the top spot, with a  188X net DPI, both massive outlier performances.

The fund Manager Masterclass – with 17 funds across 8 firms Fund Manager @IMD, September 2024

9. Debrief & Knowledge Transfer

Following the simulation, we conduct a structured debrief to help participants reflect on their decisions, analyse outcomes, and extract key lessons. This step ensures that insights gained during the session translate into practical applications.

For the different Strategy Sims, a variety of debrief tools and methods are used.

Updated debrief format, using the Transform! 12, February 2025
Want to dig deeper?

Read the full Transform! 12 Leadership Skills: assessment.

10. Bringing Back Into Real Life

The final step in the Strategy Sims method is ensuring that the learnings are integrated into real-world business contexts. Participants leave with new strategic action plans, new perspectives on their leadership and future development, and a framework for applying their hard-won insights to their own organizations.

For corporate leaders, new innovation strategy, new financial insights and a clear transformation roadmap are common ‘action points’. For founders, accelerators and ecosystems, clear action plans for scaling up, growth and successful fundraising. For emerging fund managers, a clear understanding for the path to Fund III, deeper appreciation for paths to liquidity and exits, and of course, how to accelerate LP fundraising, are all common take aways.

Fund Managers from across Africa in the Fund Manager, @2X Global, Johannesburg, March 2024

Conclusion

The Strategy Sims method is a proven approach to experiential learning, strategic decision-making, and business model innovation. Whether used by corporate leaders, startup founders, or venture capitalists, Strategy Sims provide a powerful way to navigate complexity, test strategies, and drive successful outcomes.

Currently used in executive education programs, MBA & Master programs, ecosystem development programs, VC development, startup- and acceleration programs, large-scale corporate transformation projects, national competitiveness projects; Strategy Sims can be a superb value add to your programs in classrooms and board rooms worldwide.

Do you want to explore how to bring Strategy Sims into your organization, classroom or practice?

Join 100’s of organizations around the world in accelerating learning, drive performance and achieve successful impact.

Become a globally certified Strategy Tools Master Trainer?

Read more or get in touch with us today.

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An Unexpected Adventure: Scaling Up in Hokkaido

Sometimes the best trips in life are the ones that come out of nowhere.

Take, for example, this adventure I stumbled into. It all started in the most random of ways — at a bar during Oslo Innovation Week, of all places. I had no idea that an innocent conversation with Miho Tanaka, a powerhouse of entrepreneurial energy, would eventually lead to a business trip halfway across the world. And not just any trip — this was a ticket to Hokkaido Innovation Week in Japan, one of the most exotic spots on the planet.

So, I packed my board game (because who doesn’t travel with a board game?), threw in some ski boots (gotta be ready for anything), and set course for the land of the rising sun.

When I arrived, not only was my bag nowhere to be found, but I realized something else: I was in a part of the world that felt lightyears away from the West. The cultural distance was vast, and Japan’s startup scene presented challenges that were very different from what I’m used to.

But hey, that’s why we travel, right?

Japan’s Startup Scene: The Land of Contradictions

Before diving back into my personal story, let’s take a minute to understand Japan. The country is a fascinating blend of old-world traditions and cutting-edge tech. It’s home to some of the world’s largest corporations and has made some of the most significant contributions to innovation over the past century. But when it comes to startups, things are a little… complicated.

Japan’s economy, while massive, is famously conservative. The risk-taking culture that fuels Silicon Valley isn’t exactly alive and well here. In fact, the Japanese are known for their strong preference for stability — which is the opposite of what you need if you’re trying to start something from scratch. The startup scene is still maturing, and a lot of venture capitalists are hesitant to back early-stage companies, preferring more established businesses instead.

There’s also the matter of Japan’s “no-risk” mentality. Many people, particularly those in the older generation, still view failure as something to be avoided at all costs. This can create a challenging environment for entrepreneurs who need to fail fast, pivot, and try again — all things that are often part of the startup journey.

That said, things may be slowly shifting. For the first time in decades, Japan is exiting its ultra-low interest rate era — a sign that the country’s long-stagnant economy might be turning a corner. With inflation creeping in, wages rising, and the central bank finally confident enough to raise rates, there’s hope that a more dynamic economic environment could emerge. While monetary policy alone won’t fix Japan’s conservative startup culture, it might loosen the grip of risk-aversion in capital markets — nudging both investors and institutions toward a more innovation-friendly mindset.

My Own Hokkaido Adventure

Now, back to my story. Without so much as a change of underwear (thanks to my missing luggage), I rushed to the next plane. After landing in New Chitose, I hopped on a train to Sapporo, the vibrant city known for its snow, skyscrapers, and startling cleanliness. Seriously, this place is pristine. And, oh yeah, it snows like 10 meters a year. You’ve got to love a place that can pull off that much snow without breaking a sweat.

The next day, we kicked off an excursion with a group of VIPs, and suddenly, I found myself next to someone at a red light who bizarrely spoke Norwegian. “Are we heading to the same bus?” I asked. Turns out, these were the founders of TuniSea, a startup that’s turning marine invertebrates into a delicacy (yes, really). And then there was Ruben Brands of Sea02, a startup tackling one of the most critical challenges of our time: ocean carbon capture. What absolute legends. 

Three hours later, we were all in the heart of backcountry skiing bonanza Niseko , exploring traditional Japanese dining spots, visiting local distilleries, soaking in Onsen hot springs, and experiencing the legendary “Ja-pow” (that’s Japanese powder snow, for the uninitiated). It was an unforgettable experience.

The Scale-up Simulation: Making Deals, Fast

But let’s be clear — we weren’t there just to have fun. There was serious business to be done. The big day arrived for running the “Scale-up!” simulation, where we threw a group of founders, investors, and ecosystem players into a high-speed, high-stakes board simulator designed to mimic startup fundraising.

At first, things were slow. The participants were still getting used to the idea of building deals, and we were all kind of tiptoeing around the board. But soon enough, the lightbulbs went on. It became clear that if you want to survive in the startup world, you need to make deals — and you need to make them fast. The simulation started ramping up quickly as founders learned that speed was the name of the game. 
Now, I think this is an extremely interesting observation because having worked with over 200 founding teams over the years, I see this mistake over and over again; founders are not working quickly enough with the process of fundraising. Instead, they drag their feet up until they are running low on cash which is the worst time to be asking anyone for money. Also, once they finally do finish the raise they kick back and focus on more “important” issues up until they’re too low on cash again, and the whole circle starts again.
Another observation: once participants realized they could combine investor cards, they suddenly became much more creative in dealmaking. And that’s the beauty of Scale-up! You can simulate a process that would otherwise take you 3-4 years to wrap your head around. 

In any case. what was truly fascinating was how, regardless of cultural background or experience level, the participants began to recognize the value of a good deal and a sound capital strategy. The competition became fierce as everyone rushed toward startup greatness and world domination. It’s almost as if the mindset of speed and deal-making transcended borders and ecosystems — everyone was on the same page, working toward the same goal.

Closing Thoughts: Breaking Through Cultural and Entrepreneurial Barriers

Ok, so the takeways: Despite Japan’s challenges — a stifling economy, a “no-risk” culture, and a venture capital scene that might be described as “still in beta” — something magical happens when you toss all these barriers out the window and just let people play a high-speed startup simulator.As we simulated the chaotic, deal-making frenzy of startup life, it became clear that speed and capital strategy transcend culture. The moment you throw a bunch of hungry founders into the mix, let them loose on the “Scale-up!” simulator, and watch them scramble for investment rounds, the playing field levels out — and very quickly, it’s all about who can spot a good deal before the other guy does. It was like Shark Tank, except with way more caffeine, fewer sharks, and more snow.

And then, of course, there was the sheer joy of cultural exchange — you know, that beautiful moment when you can almost hear the wheels of innovation turning as we all connected over a shared love of startup chaos. Sure, my luggage was still missing (thanks for that, Japan Airlines), and I was down to the clothes I had on my back, but none of that mattered. 

Recommendations to the JP ecosystem

So what’s needed to unlock Japan’s startup potential? Three things stand out.

First, founders need to lead. As Brad Feld argues in Startup Communities, ecosystems don’t work unless entrepreneurs take charge. That means more than just building companies — it means organizing meetups, forming angel networks, getting corporates off the sidelines, nudging universities to spin out research, and fostering a culture where taking the leap is normalized. Bottom-up energy beats top-down plans every time.

Second, the capital needs to flow. Japan has no shortage of wealth, but too little of it finds its way into early-stage ventures. The government should grease the wheels with tax incentives and encourage institutional investors to take startup exposure seriously. If they want innovation, they’ll need to fund it — and fast.

Third, open the gates. Japan has a deep-rooted tradition of self-reliance and closed borders, but in startups, outsiders are often the spark. Some of the most dynamic ecosystems — from Silicon Valley to Berlin — thrive because immigrants bring hunger, fresh ideas, and a higher tolerance for risk. Japan should welcome entrepreneurial migrants and make it easier for them to start and scale companies here. Talent is global — Japan’s startup scene should be too.

A huge shoutout goes to Miho Tanaka, Kentaro Morita, Seiko Miura, and the rest of the Hokkaido Innovation Week team for pulling this off. You all somehow managed to get a bunch of diverse people in the same room, with no luggage, in a snowy wonderland, and made them believe they could solve all of Japan’s entrepreneurial challenges — one deal at a time. It was honestly a win for the ages. And let’s face it, with the high-speed, deal-making frenzy we unleashed, I think we might’ve been the real startup rocket fuel Hokkaido was looking for.

About Marcus Hølland Eikeland

Marcus is the Director of Program at LUMO Labs – a European VC who invests in deeptech solutions within health, education and climate. To date, he has had leading roles in other firms such as Katapult and Playbook 17, supporting over 150 founders in developing transformative solutions to some of the world’s most pressing challenges. Marcus also mentors at Stanford University, guiding the next generation of eco-preneurs as part of the Stanford Summer Ecopreneurial Immersion (Eco-SEI) program. He also serves on the selection committee, shaping the future of sustainable innovation at the Graduate School of Business.

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Building Innovation Superclusters

Around the world, Innovation Superclusters are on the rise. But what, exactly, are Innovation Superclusters and why do they matter?  

INNOVATION SUPERCLUSTERS IN SIX POINTS

While often misunderstood due to various policies, structures, funding models, strategies and capabilities, we find that Clusters and increasingly Innovation Superclusters can be identified and understood through six key points.  A Cluster initiative on Taiwan, in Korea or the Thai Supercluster program, will be different in context, industry need, and government program, but the six principles are equally valid across geographies and culture.  

1. Engines of Growth

Successful Innovation Supercluster is first and foremost Engines of economic growth, by connecting 100’s of members and partners. From a policy- and GDP-development point of view, Clusters are expected to produce value that far exceeds the national averages across all industries.  

2. Collaboration Networks

Second, Superclusters are immense collaboration networks built around the industries of the future. These clusters exist to build out larger, more connected networks around future key industries. By pulling together industry executives, academics, investors, startups and government leaders, the Superclusters aims to build close and personal ties across domains, roles, hierarchies, and traditional silos.  

3. Private-Public Partnerships

Third, Superclusters ae large-scale private-public partnerships, developed by design. While they do require certain foundational capabilities in terms of local industry, local talent and local investors, it is really the co-development of private and public partners that make the cluster initiative a success.  

4. Trust-based

Forth, Superclusters are trust-based collaboration platforms. While the level of trust and preferred route to develop trust may vary, the essence is that industry leaders, researchers, startups and other members in the cluster should work to create trust across the entire cluster base. This translates into collaborating on projects, sharing research data, pool company data into cluster collaboration projects (Seafood industry sharing fish health data for machine learning development).  

5. Solution Creators

Fifth, great clusters are solving industry-level challenges & opportunities. Think, open innovation across a close community of stakeholders. Using our open innovation software platform, clusters can identify industry-wide challenges, challenges that then can be addressed by the cluster through joint innovation projects or innovation working groups. Over time, Superclusters should be able to take on and solve “challenges that are too big for anyone of us”, in the words of an industry CEO.  

6. Magnets

Finally, strong Superclusters become magnets. Think of magnets that attract talent, capital, researchers, and companies into the region and cluster membership base. In Canada, the Digital Supercluster is already seeing a growing number of corporates and startups relocating into the greater Vancouver region to be a part of the rapidly developing Digital Supercluster. 

PULLING IT ALL TOGETHER

We are seeing a rising interest in and understanding of building a new breed of Innovation Clusters. Governments from Canada to Thailand already have Supercluster programs in place. The EU, the Nordics, South-East Asia, Latin America, and the Middle East are all in various stages of exploring their own Supercluster Initiatives.  

Whatever model and policy they may choose, they will all need to follow the six principles listed here to Build Successful Innovation Superclusters.  

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