Looking back on my year at utu
I recently celebrated my one-year anniversary since I returned to utu. The company and my role within it have changed drastically in these last 12 months. In April 2023 I was asked by utu management to return to the company and take a leadership position in the fundraising effort. It presented a different challenge to the role I was in at Mission+ and Draper Startup House, where I was mostly focussing on Venture Building and investments. The year that followed resulted in a successful $33 million Series B fundraise, the acquisition of Cardspal, and a focus on reorganizing and integrating the two companies. At the risk of sounding like a cliché, here are some of my learnings and reflections.
The Switch
The prospect of leaving the exciting venture capital and venture building role was bittersweet. I loved the venture process of meeting founders with novel ideas, and the creative energy of the startup ecosystem. Every day was a different challenge full of new personalities. On the other hand, the allure of returning to utu and building up one company was one that too tempting to resist. I wanted to take my venture learnings and apply them to a business that I cared about.
Being an operator in the startup world is a hugely challenging journey. Building a company is essentially putting all your eggs in one basket rather than diversifying your risk the way they do in venture capital. The first task at hand was to help utu with their fundraising efforts. utu like all travel related businesses, had suffered massively during the Covid-19 pandemic. With planes grounded and people not traveling, it was difficult to promote the products and solutions that utu had released.
For me coming into that situation, coupled with the fact that 2023 was an incredibly difficult environment to fundraise in, presented an exciting challenge that I could immediately get involved in. The early-stage discussions with Standard Chartered Ventures had already taken place, but there was still plenty to do when structuring the deal.
The Raise & Acquisition
The first thing that struck me about our Series B raise was the ways in which Corporate Venture Capitals (CVCs) operate. CVCs typically come with a very different mandate than a traditional venture capital fund. They usually come with a greater ability to deploy capital, but with a clear mandate on which verticals are strategically important to their parent company’s goals.
CVCs can be a great value add but one of they typically operate at a much slower pace than startups and traditional venture capital funds. I would compare them to large aircraft carriers, which have a lot of power but take time to turn and manoeuvre. Startups tend to operate more as speedboats with greater agility but needing that Vitamin M to keep going. One of my main learnings from our Series B fundraising process was understanding how corporations (in this case a bank) operates. Reviews from various departments (particularly legal) need to take place before an investment. On the part of founders, additional time needs to be added to the fundraising timeline when looking to raise from CVCs, but the value of having the backing of a bigger organisation is a valuable benefit.
An additional feature of our fundraise was the acquisition of Cardspal, a Standard Chartered Ventures incubated startup that was focussing on the local Singapore rewards market and event ticketing. We saw the merchant portal as a good fit for our Thai Rewards business (utu Rewards TH). Conducting two deals concurrently, the fundraise and acquisition, was a massive undertaking by our utu team. One of the main features that enabled us to get all the work done was running two almost separate project streams. This allowed us to focus on the merits and drawbacks of each transaction and get the two deals done.
Reorganization & Culture
Having two businesses, utu and Cardspal, gave us an exciting opportunity in different business areas surrounding rewards. It also led to increased costs in terms of headcount and processes. Leading the charge on streamlining the organization gave me many teachable moments. Here are some of the highlight takeaways:
· Burn Control is King. When an acquisition goes through, initially costs can skyrocket because of duplicated processes, duplicate headcount, and operational areas that should be redundant. Getting this lower is the priority of any reorganization effort.
· Merging Cultures is Hard. Creating a cohesive company culture requires buy in throughout the organization starting right at the top. There are going to be different ways of looking at things, but if there is unity and working towards a common goal, in time the organisation will find its own identity, pulling perspectives from the two cultures.
· Not Everyone Fits. Inevitably in these situations, duplicate roles or non-alignment on goals can lead to layoffs. It sucks but unfortunately is a reality of any acquisition. Some people will want to leave because the new company’s vision may not be something that they buy into and at that point it is best for both parties to part.
· Team Building is Critical. Mixing the teams rather than leaving them operating in the separate companies was crucial to us moving forward. It allowed people to buy in to the overall vision of the company. Creating an environment where everyone feels comfortable contributing new ideas or ways of doing things is pivotal to building great products and improving on existing ones.
Conclusion
The way I would characterise the last year is growth journey. The growth journey of utu, from a smaller startup emerging bruised from the ashes of the Covid-19 pandemic to a company with exciting products and innovations, ready to take on the travel industry with fresh fervour. The growth journey of our staff, adapting to new team members, new products, and navigating resiliently through uncertainty. Finally, my own growth journey, taking on demanding projects outside of my comfort zone. Recognising weaknesses in my abilities that need to be improved upon and discovering strengths that I didn’t know I had. My first year back at utu, might have ended, but as the second year begins, I approach it with renewed enthusiasm and hope.
