Renee, who are you and how did you come to Singapore?
I have been a corporate lawyer in Paris for more than 17 years and moved to Bali in late 2012.
I intended to set up a local consulting business designed for assisting the French communities worldwide in their acquisitions of real estate. I needed to learn the basis and find a good Indonesian lawyer to assist me.
After 3 weeks or so, I was back to venture capital transactions. One cannot escape its destiny. Someone I met the summer before though a common friend in Paris was raising funds for his startup, located in Singapore with an operational company in Indonesia. He found investors and wanted me to assist him in the legal negotiations. As I was familiar with cross-border transactions, I knew that venture capital transactions are pretty standardized and that I only needed to be checked by a lawyer in Singapore, in particular to implement the transaction. The client accepted and we closed successfully the deal a couple of months later.
I understood immediately how the region worked and that Singapore was the main hub for all investments in South East Asia.
I stayed 5 years in Bali, coming to Singapore countless times (at least once a month) before co-founding Genesis Avocats Singapore, foreign law firm, with Genesis Avocats, prominent parisian law firm and moving in permanently in Singapore in September 2017.
How do you support the Startups ecosystem? Why did you focus on tech?
I assist french investors (both business angels and venture capital funds) in their investments in local startups (whether with french founders or not). I also assist french founders of local startups in their fundraisings. The founders are not often familiar with the mindset of investors, with the key points of a transaction and could accept anything from investors.
I also try, at my level, to make the local startup ecosystem known abroad, in particular in France and in the neighbouring countries in Asia. I also make a lot of introductions between people, both locally and internationally.
When I was a kid, I was pretty skilled at math and sciences but wanted to be a lawyer since age 15. Focusing on tech, since the very beginning of my practice, allows me to reconcile my practice with my original skills. Nothing happens by accident and I realized that only a couple of years ago.
What are your main advice for company willing to raise funds?
Regardless of how much you think you know or how much you’ve read, hire a lawyer.
In many cases you will be the least experienced person around the negotiating table. VCs negotiate for a living, business angels are quite familiar with the process and a lawyer on your side will help balance things out.
When choosing a lawyer, make sure she not only understands the deal mechanics, but also has a style that you like working with and that you are comfortable sitting alongside of. This last point can’t be overstated—your lawyer is a reflection of you, and if you choose a lawyer who is inexperienced in such transaction, is ineffective, or behaves inconsistently, she will reflect poorly on you and decrease your negotiating credibility.
What are the mindset of investors when raising funds ?
The investors (VC and business angels) have several concerns and considerations when they invest equity within a company.
The main reason (at least as much important as the business itself and the exit opportunities) is the team (founders and executives) involved in the project. This is the main criterium of any equity investment, at any stage (early stage or just before IPO). If they don’t like the team, if they find the team too young or too unexperienced, or not focused enough, they will not invest no matter the quality of the project.
Investors want to make the greatest capital gain further to the global sale or the IPO of the company. Investors prefer no dividend to be distributed so that the company can invest, grow and increase its valuation.
They want to supervise the utilization of the money invested.
All these concerns are addressed by the transaction documents (subscription and shareholders’ agreement).
In South East Asia (but also in Europe), it is very complicated to finance a project with no income. Before raising funds with professional investors (other than friends and family), the company must have generated revenue, even very few, just to show to potential investors that it can make money with the idea.
(ed. Alice Besomi- VC Jungle-Ventures)
What founders must bear in mind when raising funds ?
Founders must always remember that there are plenty of money to be invested and very few great projects. This is a win win : you need money, investors need good investment. In other words, if an investor discusses with you, it is not because it likes you, or wants to make you a favor, but because it considers your project and team as a good opportunity for it.
Time is the most precious resource and it is non renewable so an investor would not waste time with you just because it thinks you are a nice person.
Too many times, I have seen founders keen to accept anything and everything from unscrupulous investors just because they wanted money desperately. You must stay calm, focused and act rationally. Ask people who raised funds before, ask your lawyer, ask people you trust the most. That’s the point of hiring a lawyer before signing a term sheet with investors : to help you negotiate the terms and conditions of the investment. If you hire a lawyer after the signature of the term sheet, just to negotiate the transaction documents, it could complicate the negotiation.
Before Series A, as founders, you need to bear in mind that VC are not comfortable with too many shareholders in the cap table, to say the least. I have seen cases with dozens of shareholders. It could have taken months to gather all these minority shareholders in a dedicated company (called SPV), which would have made the whole deal more complicated to implement. In that cases, the VC decided not to invest.
It can be necessary to “clean” the cap table prior to Series A, to anticipate VC’s objections. Keep it simple !
Focusing on tech deals as a Corporate Lawyer, how “Dare you” do it?
Why not ? Why a woman’s work should be limited to some areas or industries that are considered « for women » ? After Barack Obama’s election, there was the dream of a post racial society in America. Similarly, I dream about a post gender society, where your gender will be irrelevant when it comes to business.
Whereas there are more women than men in the legal profession, very few women are partners in business law firms in Paris (except in mine, as, out of 6 partners, only 2 are men !) and when they are, their areas of expertise are always the same : intellectual property, competition, employment, almost never mergers and acquisitions, venture capital and finance. What I call the « wall ceiling» that confines women into certain areas is even more difficult to break than the « glass ceiling».
Even in tech, the startups founded by women evolve often around family and kids, or in tech areas whose underlying industries are broadly opened to women such as ad tech. Why do we censor ourselves as girls and as women?
How to fight the diversity bias in this environment?
Empower ourselves. Power cannot be given, it must be taken. Like Magdalena Yesil says in her book “Power Up”, “get an A in Attitude and a F in victim”. As soon as you start considering yourself as a victim, you give up on attitude and winning mindset, and you become one ! As women, we must work harder, and dare more, to make it happen. You are a woman and you firm do not appoint you as a partner ? Set up your own practice ! You are an executive who is not promoted within the company, set up your business !
In other words, we must change the rules from without, by founding businesses, by investing, by daring to be anything we want to be.
If we are mothers, we must educate our children, boys and girls, so that they can learn that gender does not matter. If a girl likes sciences and has the intellectual capacity to do so, she must become an engineer, a researcher and not think that it is not for her, that it’s a « boy » thing. I was very lucky in this respect as both my parents did so with me. They encouraged me in getting an education in the field I wanted. Should I have wanted to become a rocket scientist (all conditions being met !), they would have supported me. I am very grateful to have been raised in that mindset.
Most importantly, we must support each other, we must have faith in one another. We must stop bashing other women because of their looks, because of their center of interests, because of who they are. It is a daily fight to change sexist biases, interiorized by too many women including towards themselves.
Renee, thank you ! Linkedin Renee Kaddouch
Get in touch with us @ womenfrenchtech at gmail dot com
In collaboration with Amel Rigneau & Sophie Guo