Cross-border trading is a common practice in the world of fintech, with companies transferring funds between countries. But for David Yi and Simon Shin, the potential of cross-border transactions extends beyond traditional finance. They have set their sights on transforming the world of venture capital with this concept.
Two years ago, Yi and Shin launched Ethos Fund, a five-person firm dedicated to connecting opportunities and startup communities between Vietnam and the United States. According to Yi, their firm is one of the few – if not the only one – focused solely on empowering cross-border opportunities and collaboration between these two countries.
Ethos Fund recently closed their inaugural fund, securing $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 from Altos Ventures, Hashed, Tapas Media, JLin LLC, and Meridienlink.
Their approach involves working with companies in two distinct ways. Firstly, in the U.S., they seek to invest in what they call “third culture founders” – individuals who possess “brilliant minds” shaped by multiple cultural experiences and are driven to solve meaningful problems.
The second aspect of their strategy is focused on early-stage investments in Vietnam, targeting pre-product and pre-revenue startups. Additionally, they are providing smaller investments to third culture founders in categories such as returned Vietnamese diaspora, Vietnamese Americans, and expats residing in Vietnam. For validated startups, Ethos Fund is also prepared to offer larger investments.
“Ethos is called Ethos because we focus on the ethos of the founders,” Yi explained. “For us, it’s critical that the founders not only engage in cross-cultural activities but also possess their own unique third culture – one that they have developed throughout their lives. This culture goes beyond external factors like skin color or geography.”
Yi and Shin, both of Korean descent, first crossed paths in 2020 when Yi was the CEO of Riiid Labs, an AI-focused education company. Their backgrounds are quite unique – Shin previously worked in product management at various technology companies, including Chegg, in Los Angeles. After moving to Korea in 2014, he led a startup called Hellocafe before eventually joining the VC firm Bluepoint Ventures.
On the other hand, Yi’s journey began as a teacher for the Peace Corps in China. This experience eventually led him to start his own edtech company, which grew into eight separate successful ventures – two of which Yi exited. Many of these businesses were in the Irvine, California area, including EduGroup. Before founding Ethos Fund, Yi also worked with Lyceum Partners and had a stint in Southeast Asia, working with companies like ACT and K12.
Yi observed that his startups seemed to hit a growth ceiling at a certain stage. He questioned whether this was due to his lack of knowledge in managing people or because the technology simply couldn’t scale. After discovering that he needed to improve his management skills professionally and that the technology needed a business-to-business strategy, he and Shin vowed to help startup founders learn these lessons early on.
“As a startup CEO, you are continuously learning on the job,” Yi shared. “I had different personalities, and I was unaware of my own limitations. Working at a larger company allowed me to understand their structures better, and I could filter which aspects were applicable to startups and which were not.”
Drawing on their collective experience in the edtech space, Yi and Shin believe that venture capital is a form of education. As a result, they have integrated live programs and events into their approach, such as the “New Venture Challenge,” also known as “Founders on a Plane,” and “Saigon Fest,” which brings together entrepreneurs and investors from Vietnam and the U.S. to learn from one another.
So far, Ethos has made nine investments, according to Shin. One of their recent announcements – Oyl – is building a digital wallet for a Bitcoin economy, which could not have come at a better time as the cryptocurrency reached an all-time high last week. Other companies in their portfolio include up-skilling platform Skola, AI-powered marketing company Needle, and Mirrorscape, a virtual tabletop tool for gaming.
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