Casual Explainer: Tangent
Working at Tangent I often find myself in the position of trying to translate and distill the many things Tangent tries to be and do. I figured, why not write one massive casual explainer consolidating the bits and pieces? Here is an attempt for the interested applicant/everyday reader.
What is Tangent about?
There is a natural limit to language and definitions, especially when the very thing you’re describing has been intentionally kept amorphous in its form. The essence of Tangent is simple: it’s an unconventional incubator for unconventional tech entrepreneurship.
It's an unconventional incubator in the sense that there is intentionally no determined structure (see: the “Programme happenings” section at the bottom of this essay). It’s for unconventional tech entrepreneurship in the sense that we’re sector agnostic. That means we’re much less interested in what industry you’re in and much more interested in how you think about building something and applying technology to it. Technology, at its core, is a tool that can be applied to any and all industries.
What is the selection criteria?
Consequently, our selection criteria are broad. Between our approach to the use of AI (see: 4 types of AI businesses) and our belief in keeping it sector-agnostic, we keep the top of the funnel large. We'd rather cast the net as wide as possible and let interesting people find and self-select into the programme.
We can’t give you a clean answer as to how precisely the bottom of the funnel is constrained, as we’re very much still figuring that part out ourselves. But one factor we can name is your desired mental model. What we’re explicitly not doing is a Venture Capital (VC) fund model. We want to invest in companies that can become cash-flow positive as soon as possible. We’re largely uninterested in hypothetical enormous markets that have to be created at great expense, or deep technology that has to be invented under conditions of great uncertainty. Those kinds of ideas are what VC was designed to fund (see: Wishlist).
What is Tangent trying to do?
What is the purpose of Tangent? There are three broad categories, though they’re really just three perspectives on the same experiment.
1. Can we build a new private equity 0-to-1 model?
Almost every incubator you’ve heard of is a VC funded one. The VC model is engineered around power-law outcomes and eventual exits. This means that a VC firm will put money into a lot of companies expecting most to die with the bet that one or two will return the entire fund many times over. To make that work, you’ll need enormous potential markets, companies that grow explosively, and an ecosystem of large acquisitions and IPOs.
That model is strained under the Singaporean and Southeast Asian context where domestic markets are small and fragmented. To attain a large market means going global before you’ve proven anything. VCs require you to take on really bad unit economics to reach that scale (longer write up on mechanics coming soon)
So we seek to answer a different question: what if you incubated companies with a private equity philosophy instead of a VC one?
Private equity speaks in the language of cash flow, profitability and durable unit economics. It is interested in businesses that generate cash flow fast. Private equity typically applies to already existing mature companies. What we’re curious about is the application of said mindset onto non-VC companies when they’re on the 0-to-1 stage.
2. To create a different path from university
The social mobility promised by the standard conventional path (good neighbourhood → good primary → good secondary → good JC → good university → good job) is growing increasingly tenuous. We are not anti-university, but we do think it shouldn’t be the only legible route to building a good life and doing interesting work. Tangent is an attempt to offer another option.
3. Community!
Can we build a community of people interested in building tools for interesting applications?
Building anything from zero is lonely. A lot of what actually helps a young founder isn’t necessarily capital or mentorship; rather, it’s the community that surrounds them, working towards the same things across potentially disparate fields.
Programme happenings
I mentioned earlier that Tangent is “unconventional” partly due to its intentional lack of structure. The programme is “demand-led,” so the shape of each cohort arises from the participants themselves. If participants realise there’s a shared need, the team runs something to meet it. A concrete example from Cohort 1: participants flagged that they were struggling with cold outreach, so a workshop was run just for that.
There is some scaffolding to each cohort. Week 1 begins with more built-in programming, for onboarding and for everyone to get to know each other. We do regular stand-ups on Monday, Wednesday and Friday, and we have Friday drinks as well.
One thing we learnt in Cohort 1 is that participants who show up in person most consistently benefit most from the programme. They get the most face time with the team and can actively push for and request certain programming. Participants also help each other with networks, tools, and experience. For example, one team was able to seek advice from another on how best to scrape and collate potential partners.
Harper is a programme associate at Tangent.
