GCV Powerlist 2018: Tony Chao

Under Tony Chao, senior investment director and general manager, Applied Ventures, the corporate venturing subsidiary of semiconductor technology provider Applied Materials, has moved closer to Asia, the source of much chip demand and technology.

Omkaram (Om) Nalamasu, senior vice-president and chief technology officer for Applied Materials, for last year’s award said: “Applied Materials is a leader in materials engineering, committed to solving high-value problems across multiple industries in addressing market and technology disruptions.

“Tony Chao and his Applied Ventures team lead the charge for the company in brave new industries like augmented and virtual reality, artificial intelligence, robotics, personalised medicine and digital manufacturing. Tony’s career has grown in tandem with the portfolio, which has grown roughly 10-fold over the past decade. Among CVCs, Tony has also pushed the envelope in corporate-government partnerships, most recently a Korea-based fund that is the first of its kind. We are very proud of his team’s progress and synergistic collaboration with portfolio startups, and look forward to further accomplishments.”

Last June, Korea’s Small & Medium Business Administration and the Korea Venture Investment Corporation agreed with Applied Materials to raise a W30bn ($26m) fund for investment in South Korean venture firms and small and medium-sized enterprises.

State-backed fund-of-funds Korea Venture Investment Corporation (KVIC) committed as a limited partner (LP) in the fund in order to aid South Korean startups. The stakeholders have not disclosed the size of the fund, but a regulatory filing indicates they wanted to raise $40m.

Chao credited Joseph Jeong, a principal and GCV Rising Stars 2018 winner, for leading “our efforts in launching a new Innovation Fund focused on Korean investments and helped secure external LP investors, enabling our transition for a single LP CVC to a broader approach that focuses on synergy value creation across entity and geographic boundaries.”

As well as the Korea fund, which has already had its first deal list on a stock exchange, according to Chao, Applied Ventures is opening an office in Singapore to identify opportunities across the region.

The unit, which invests up to $50m a year, is particularly keen on collaborating with other investors in Asia.

Applied Ventures’ portfolio includes Tera-Barrier, a Singapore-based producer of flexible barrier films used in flexible electronics to protect them from damage by moisture and oxygen. It invested an undisclosed amount in the company in 2009.

However, many of its deals are still in the US. Applied Ventures took part in US-based semiconductor manufacturing technology producer Inpria’s $23.5m series B round in July, led by Samsung Ventures.

Chao joined Applied Ventures in 2007 before taking over a year ago from Chris Moran, who now runs aerospace company Lockheed Martin’s corporate venturing unit.

Chao’s interest and insight in Asia is understandable given his previous work at China-based Mustang Ventures and as the technical lead for the engineering team at Cymfony among other roles since the millennium. His MBA at Harvard and earlier undergraduate and master’s in electrical engineering and computer science from Massachusetts Institute of Technology gave him a premier education he has translated into a material career.