Why Regional Exit Markets Still Lag

Reuniting after more than a decade since their days in This Week in Asia Podcast from 2009, Michael Smith Jr., co-host of The Generalist podcast, and Daniel Cerventus Lim, semi-retired entrepreneur and community builder in Malaysia, join us for a candid assessment of Southeast Asia's tech ecosystem evolution. In this raw conversation, Michael offers his unflinching perspective on what he calls the 'broken windows era' of Southeast Asian tech, arguing that recent alleged fraud cases like E-Fishery and Tanihub require serious consequences to restore investor confidence, while questioning whether the region was ever correctly modelled for Silicon Valley-style outcomes. Daniel shares his pivot from startup founder to search fund advocate, explaining his bullish view on acquiring profitable traditional businesses and reflects on whether the region's potential was genuinely unrealized or simply impossible to achieve. Together, they explore the shift from venture-backed unicorn dreams to bootstrap realities, debate work ethic of Southeast Asia founders in comparison with Chinese and Indian founders, and discuss why the future of Southeast Asian tech may lie in smaller, profitable exits rather than the massive IPOs once envisioned.

"I think wealth creation here is very SME-focused." - Daniel Cerventus Lim

"Basically whether, it's SME or startup, to me now it's just: can you build a profitable business?" - Bernard Leong

"I have this philosophy that I think people don't agree with me, but we're in a broken Windows era of Southeast Asia and the only way in my opinion, the windows get fixed is if some of these people are behind bars." - Michael Smith Jr.

Episode Highlights:
[00:00] Quote of the Day by Daniel Cerventus, Bernard Leong & Michael Smith JR
[00:59] Introduction: Daniel Cerventus and Michael Smith Jr. from the Generalists Podcast
[06:00] Multiple alleged frauds in Southeast Asia: E-Fishery, Tanihub
[09:57] Southeast Asia in "broken windows era"
[11:26] Only exits from seed to Series A
[11:47] B rounds virtually gone, A rounds endangered.
[14:00] 50-100 million exits still viable
[16:30] Malaysian crypto companies globally focused
[19:25] Country expansion model in ASEAN doesn't work
[23:02] Israel model: never think local market
[24:15] Razer story: HP Mafia network backing
[25:07] Supabase: not really Singapore capital, but globally successful
[30:18] Chinese founders arriving with speed
[31:19] Work ethic comparisons with India
[32:34] Search funds emerging in Singapore
[37:25] Mainstream media ignores bootstrap success
[39:50] Search fund model targeting aging operators
[41:21] SME vs startup distinction blurring
[46:20] Hedge funds questioning regional companies
[49:32] Unrealized vs impossible potential debate
[51:07] Bangladesh ecosystem showing promise
[53:20] Structural exit issues remain unsolved
[54:31] Reset creating better founder discipline
[55:40] Optimistic on Southeast Asia's startup ecosystem
[57:21] Closing

Profile:

Michael Smith Jr., Tech Evangelist from Oracle & Co-Host, LinkedIn: https://www.linkedin.com/in/smittysgp/ YouTube: https://www.youtube.com/@TheGeneralistsPodcast

Daniel Cerventus Lim, semi-retired entrepreneur, Community Builder in Malaysia and TEDxKL founder. LinkedIn: https://www.linkedin.com/in/cerventus/ Facebook: https://www.facebook.com/groups/80164351656

Podcast Information: Bernard Leong hosts and produces the show. The proper credits for the intro and end music are "Energetic Sports Drive." G. Thomas Craig mixed and edited the episode in both video and audio format.

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