Ethos Fund closes first fund to invest in founders bridging US and Vietnamese tech ecosystems

Cross-border trading usually occurs in fintech, where companies send money to another country. However, David Yi and Simon Shin are out to apply that concept to the world of venture capital.

Yi and Shin started Ethos Fund two years ago to bridge opportunities and startup 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 on an inaugural fund with $12 million in capital commitments from a group of limited partners, including Elite Education Group, i-Scream Edu, Orion’s Bridge Capital, Strong Ventures and founders from Altos Ventures, Hashed, Tapas Media, JLin LLC and Meridianlink.

Yi and Shin are working with companies in two ways: in the U.S. to invest in what they call “third culture founders,” which they define as “brilliant minds who don’t just belong to one culture but have been shaped by multiple ones,” solving problems they care about.

The other is in Vietnam to invest at a very early-stage level: pre-product and pre-revenue. They are also investing smaller checks into third culture founders there who fall into such categories as returned Vietnamese diaspora, Vietnamese Americans and expats residing in Vietnam, and subsequently doubling down with larger checks into validated startups.

“Ethos is called Ethos because we focus on the ethos of the founders,” Yi said. “For us, it’s very important that the founders are more than doing cross-cultural things. Their third culture means they have their own third unique culture that they’ve built throughout their lives and that goes beyond skin color or geography.”

Yi and Shin, both Korean, met in 2020 when Yi was CEO of Riiid Labs, an AI for education company. Their origins are rather unique: Shin previously worked at different technology companies, including Chegg, primarily in product management in Los Angeles. He moved to Korea in 2014 to run a startup called Hellocafe before joining VC firm Bluepoint Ventures.

Meanwhile, Yi’s started his career as a teacher for the Peace Corps in China. That led to him starting his own education technology company. That eventually turned into eight companies, two of which exited, many in the Irvine, California, area, including EduGroup. He later had a stint with 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 past a certain stage.

“I thought maybe it’s because I don’t know how to manage people well,” Yi told TechCrunch. “I was also like, why is my revenue not going past a certain point? It’s because I didn’t know how to crack the code to be the one that got the bigger companies.”

But there are always new things to learn, and in this particular instance, Yi learned two things: He indeed didn’t know how to manage people professionally, and the technology couldn’t scale unless they got to business-to-business. Now the pair wants to help startup founders figure those lessons out early.

“When you’re a startup CEO, you’re learning on the go,” Yi said. “I had different personalities, and I did not know what I didn’t know. I was able to learn from going to a bigger company to understand their infrastructures. Then you can filter what is applicable to startup or not.”

Tapping into their edtech backgrounds, Yi and Shin also believe that venture capital is education, so they host live programs and events. Those include the New Venture Challenge, also known as “Founders on a Plane,” and Saigon Fest, which shuttles entrepreneurs and investors between Vietnam and the U.S. to learn from one another.

The pair have made nine investments so far, Shin said. One announced recently — and with good timing — 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 like up-skilling platform Skola, AI-enabled marketing company Needle and Mirrorscape, which is developing a virtual tabletop tool for gaming.

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