Cross-border trade often occurs in fintech, where companies send money to another country. However, David Yi and Simon Shin want to apply that concept to the world of venture capital.
Yi and Shin founded the Ethos Fund two years ago to bridge startup opportunities and communities between Vietnam and the United States. Yi says the five-person firm is one of the few, if not the only, funds focused exclusively on strengthening opportunities between these two countries.
They closed an inaugural fund with $12 million in capital commitments from a group of limited partners, including Elite Education Group, i-Scream Edu, Orions Bridge Capital, Strong Ventures and founders of Altos Ventures, Hashed, Tapas Media, JLin LLC and Meridienlink. .
Yi and Shin are working with companies in two ways: in the United States to invest in what they call “third culture founders,” whom they define as “brilliant minds who not only belong to one culture but have been shaped by several , “Solve the problems that interest them.
The other is in Vietnam to invest at a very early stage: pre-product and pre-revenue. They are also investing smaller checks in third culture founders there who fall into categories, including returned Vietnamese diaspora, Vietnamese Americans and expats residing in Vietnam, and subsequently doubling down with larger checks in validated startups.
Ethos Fund co-founders David Yi and Simon Shin. Image credits: Ethos Fund
“Ethos is called Ethos because we focus on the spirit of the founders,” Yi said. “For us, it is very important that founders are more than cross-cultural things. Their third culture means that they have their own unique third culture that they have built throughout their lives that goes beyond skin color or geography.”
Yi and Shin, both Koreans, met in 2020 when Yi was CEO of Riiid Labs, an artificial intelligence company for education. His background is quite unique: Shin previously worked at different tech companies, including Chegg, primarily in product management in Los Angeles. He moved to Korea in 2014 to run a startup called Hellocafe before joining venture capital firm Bluepoint Ventures.
Meanwhile, Yi began his career as a Peace Corps professor in China. That led him to start his own educational technology company. That eventually grew into eight companies, two of which exited, many of them in the Irvine, California, area, including EduGroup. He later worked at Lyceum Partners before moving to Southeast Asia to work at ACT and K12, among others.
One of the things Yi noticed about his startups was that they weren’t growing beyond a certain stage.
“I thought maybe it’s because I don’t know how to manage people well,” Yi told TechCrunch. “I also thought: why doesn’t my income go beyond a certain point? It’s because I didn’t know how to crack the code to be the one to get the biggest companies.”
But there are always new things to learn, and in this particular case, Yi learned two things: he actually didn’t know how to manage people professionally, and the technology couldn’t scale unless they got to the business-to-business business. Now the couple wants to help startup founders discover those lessons early on.
“When you’re CEO of a startup, you learn as you go,” Yi said. “He had different personalities and he didn’t know what he didn’t know. I was able to learn by going to a larger company to understand their infrastructure. Then you can filter what is applicable to the startup or not.”
Leveraging their background in edtech, Yi and Shin also believe that venture capital is education, which is why they host live programs and events. These include the New Venture Challenge, also known as “Founders on a Plane,” and Saigon Fest, which transports entrepreneurs and investors between Vietnam and the United States to learn from each other.
The couple has made nine investments so far, Shin said. One of those announced recently (and at the right time) was Oyl, which is building a digital wallet for a Bitcoin economy. Last week, Bitcoin hit an all-time high. Ethos has also invested in companies such as upskilling platform Skola, AI-based marketing company Needle and Mirrorscape, which is developing a virtual tabletop tool for gaming.
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