We are Vietnam's MOST EXPERIENCED PRIVATE EQUITY FIRM
MOST EXPERIENCED PRIVATE EQUITY FIRM
WE ARE PIONEERS IN
We used to do Private Equity like everyone else. We thought that giving our investee companies solutions and knowledge would help them excel, but it did not make much impact. In 2007, we embarked on a 3-year transformation journey and invented a new approach to adding value to our investee companies.
Our approach, Transformational Private Equity, is grounded in coaching technology. It starts with an organization’s shared committed goal in the future, which could be called a Vision. Then we focus on transforming how situations occur for people in that organization such that they take the necessary actions or conduct the necessary conversations that lead to the results necessary to be on track for their long term vision. This requires discovering and creating new ways of looking at what they are dealing with, stepping out of comfort zones, practicing new ways of communicating or behaving, that ultimately lead to sustainable breakthroughs in performance across the organization.
WE CONSISTENTLY ADD VALUE FROM
Vision Driven Investing framework
In the early years, we applied value-addition programs focusing on best practices such as Six Sigma, Lean Manufacturing, manuals of best practices, etc. We had lots of ideas that we thought would help the investee companies. However, no matter how great our ideas were, this had little or no impact.
In 2009, concurrent with Mekong Capital’s own transformation, we developed a new Vision Driven Investing framework (VDI). VDI requires that our partnership with every investee company begins with their own committed vision for their future. Starting from their committed vision, the VDI framework is essentially 15 perspectives to look from. Each company can continuously discover what works for them towards fulfilling their breakthrough vision.
THAT CORRELATE TO OUR
Since 2009, we have validated an extremely strong correlation between the performance of each investee company and the degree to which they implement the 15 elements of the VDI framework. This however is no coincidence as the VDI framework has been continuously revised based on what’s working best, or not working, at our investee companies.
In other words, the companies that have achieved the greatest mastery of the 15 VDI spaces are the same investee companies that have been the most successful in our portfolio, generating the highest profit growth and the greatest investment returns.
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WE INVEST EXCLUSIVELY IN VIETNAM’S
In our first five years, we mainly invested in export-oriented manufacturing, which didn’t go well. However, in 2005 we started to notice that our investee companies with both export and domestic division were consistently enjoying more stable growth and higher margins with their domestic business. In 2006, when starting to dip our toes into consumer investments with a personal care products company called ICP, we began to see some positive results.
Over the next few years, we gradually shifted our attention towards domestic consumer businesses, with some notable successes such as MobileWorld, Golden Gate, Masan Consumer, etc. By 2009, it was clear that our best-performing investments were in consumer sectors, and since then, we have been focused exclusively on making new investments in these sectors.
Mobile WorldRetail chain
In January 2018, Mekong Enterprise Fund II completed the sale of all of its shares in MobileWorld after a 10.5 year holding period. MobileWorld has established itself as Vietnam’s market leader in mobile device retail through its Thegioididong.com store network, and consumer electronics and household appliance retail under the DienmayXANH store network. The company is rapidly expanding its 3rd retail concept, mini-supermarket chain BachhoaXANH, in Ho Chi Minh City. The Fund originally invested in MobileWorld in May 2007 when the company operated around 7 stores. By the time the Fund completed its exit in January 2018, the company was operating more than 2,000 store locations. This tremendous growth led to a 57x return multiple for the fund over the lifetime of the investment.”
Mekong’s investment in MobileWorld is the subject of a 3-part case study written by the National University of Singapore (NUS) and published in the Ivey Publishing case study catalogue in May 2018. The 3 cases are available at Ivey Publishing’s website at the following links:
- Mekong Capital and Mobile World (A): Growing a US$100 Million Company In Vietnam
- Mekong Capital and Mobile World (B): Bob Willett
- Mekong Capital and Mobile World (C): Venturing into New Countries and Segments
Vietnam Australia International SchoolEducation
In 2017, Mekong Enterprise Fund II completed the sale of all of its shares in Vietnam Australia International School (“VAS”), the leading private bilingual dual-curriculum K-12 education service provider in Vietnam. The Fund originally invested in VAS in April 2010.
Masan Food CorporationFMCG
In November 2010, the Fund divested 100% of its shares through a negotiated block transaction on the OTC market. The Fund originally invested into Masan Food, the leading maker of branded sauce and seasoning products and a major player in the large instant noodles market, in May 2009.
International Consumer Product (ICP)FMCG
In February 2011, Mekong Enterprise Fund II Ltd has successfully divested 100% of its investment in International Consumer Products (“ICP”) to a strategic investor, Marico Ltd., a publicly listed consumer products company based in India. The Fund had invested in ICP in October, 2006.
Golden GateRestaurant chain
In August 2014, Mekong Enterprise Fund II completed the sale of all of its shares in Golden Gate, one of the leading restaurant chain operators in Vietnam. The Fund originally invested in Golden Gate in April 2008. The Fund achieved a 9x return on its investment over the 6 ½ year holding period, driven by the expansion of Golden Gate from one brand with 7 restaurant locations at the time of the investment to more than 10 brands with around 75 restaurant locations by the time of the exit.
Mekong’s investment in Golden Gate was the subject of a case study written by INSEAD and published in March 2016. The case study is available here: PE in Emerging Markets: Can Mekong Capital’s Operating Advantage Boost the Value in its Exit from Golden Gate Restaurants?
Pizza 4P’sRestaurant chain
When MEF III divested in 2022, Pizza 4P’s grew from a chain of 8 restaurants in 2018 to a network of 27 restaurants in Vietnam and Cambodia, representing growth of more than three times. During this rapid growth, Pizza 4P’s has successfully maintained its uniquely high-quality standards and commitment to delivering ‘Wow’ dining experiences to its customers. As a validation of its stronghold in customer experience, Pizza 4P’s has been nominated as the Best Pizza in Vietnam and Cambodia as part of the Asia’s Best Awards 2022 by the well-known international magazine Travel + Leisure Asia.
OUR ELITE TEAM PROVIDES ACCESS FOR
In the initial years, Mekong Capital team members had solid financial experience. We thought that our rich knowledge could add a lot of value to our investee companies. However, it did not work out well. So we embarked on a transformation journey in 2007. We blew up and reinvented everything about Mekong Capital, including who we are, our culture, how we add value, how we see the world.
What emerged today is a high-performance team of 60 people on the ground in Vietnam, united by our shared commitment to transformation and breakthrough results. The results we deliver start with who we are being and how we empower the success of each other and our investee companies
WE PIONEER UNPRECEDENTED
LEVELS OF TRANSPARENCY
From the very beginning, we chose to adopt radical transparency and high reporting standards. We are open to share our insights, stories, case studies, and other media that shed light upon our unique approach.Visit our media center
WE ARE COMMITTED TO
ENVIRONMENTAL & SOCIAL DEVELOPMENT
We used to relate to Environmental, Social and Governance (ESG) as requirements imposed by investors in our funds. We committed to minimize harmful impacts on our communities and our environment based on an exclusion list. Then we required our investee companies to comply with it. Subsequently, we realized that organizing around a compliance checklist did not create a sense of ownership and enable us to maximize the value that ESG can create.
Since then, we redefined Environmental & Social commitment to no longer be a compliance issue and transformed it into a commitment for the future generated by our investee companies, which is well-aligned with their visions. Therefore, their commitment to Environmental & Social naturally pulls them into actions, which will lead to the fulfillment of their visions.