Trinity Record Label Forms CVC, Explores Creative Economy Investment Opportunities

In 2019, Trinity Optima Production (TOP) was involved in a digital product development consortium. His consortium with three other record label companies, namely Musica, Aquarius and My Music, resulted in an agreement j together with PT Mahaka Radio Integra Tbk (MARI) to work on platform on-demand audio Noice.

Now, the company declares its full commitment to open up investment opportunities and start-up business development or projects that can actually add value to the group's ecosystem. TOP announced the establishment Corporate Venture Capital (CVC) under the name Trinity Ventures (TV) to smooth its transition as a business group (holding company).

In its official statement, the company said that it already has a management team with solid knowledge and experience to move towards a larger corporate scale in the entertainment industry. Meanwhile, Trinity Ventures engaged Jagartha Advisors as an investment advisor who played a role in conducting the investment assessment and due diligence against candidates investees.

Based on a separate interview with DailySocial.id, CEO of Trinity Optima Production Yonathan Nugroho said he was taking on a dual role to lead TV. "Regarding the legal entity, PT already exists. However, because this is a CVC and only uses internal funds, we have not yet applied for a license as a venture capital company," said Yonathan.

For your information, Trinity Optima Production was founded by Adi Nugroho, Handi Santoso, Effendy Widjaja, and Yonathan Nugroho in 2003. The company has a strong track record in the entertainment industry; houses a number of veteran artists, including Armand Maulana, Sherina, and Afgan.

Outside of record labels, TOP expands its business scale by entering into music publishing and marketing talent through Trinity Artist Management (TAM), as well as Trinity Creative Technology (Dignitiy) for digital content marketing.

Investment hypothesis

At the start, investment opportunities in start-up businesses are often measured by the vision/value for founder, competitive advantage a product/service, and valuation. However, looking at current industry and market developments, TV is focusing more on businesses that have long-term sustainability and focus on problems in the sector it is involved in, no longer just pursuing growth.

Yonathan said, there is no particular sector being targeted, TV is opening itself up to opportunities as wide as possible investing in startups as well as projects that provide added value to the Trinity Entertainment Group (TEG) ecosystem. Apart from that, his party has prepared a number of risk mitigation plans taking into account the current macro situation.

"In the initial stage, we focused on the creative economy sector related to the film, music and industry direct-to-consumer (D2C). Currently, our position is to explore opportunities on virtual influencers or metahuman. We are not focused on digitalizing a business sector. "We leave [development] of the business model and product to the owner," he explained.

It was stated that TV was formed to expand network reach and collaboration opportunities as long as it was visionary and the innovation was disruptive. That is, the business model or product/service has pain point, positioning, opportunity to scale up clear.

It seeks to collaborate projects/solutions owned by startups across sectors, and not rigid on certain ideals. This collaboration can be carried out betweentalent or on projects/portfolios in which TV invests.

"After all, we have a core business in the entertainment industry that we own spirit managing talent or people. We are used to flexibility in processing work programs. Therefore, in the context of candidates investees"We hope that business owners are also open to collaborating with the entertainment industry," he added.

Sources of funding

TV will use two funding models, namely (1) providing capital to existing businesses well-established and medium fundraiser, as well as (2) funding, managerial assistance and support from the operational side, campaign, to sponsorship. Especially in the second model, TV focuses on investment in the real sector, such as brand, community, or startup with a specific project.

"Transfer process Knowledge and Advisory "In business management, this is a choice that we feel is very important for business friends who are still starting out," said Yonathan.

According to Yonathan, TV does not map out a funding model based on stages (training) startup, but rather on the needs of the business owner. Meanwhile, the parent company can be involved in managing its management, human resources or products so that it can make a positive contribution to the company.

"We cannot mention the value of the investment prepared. However, for the initial stage, we are still using internal funding sources from Trinity Entertainment Group. We do not rule out the possibility of collaborating with a Limited Partner (LP) who is interested in [investing] in the creative economy sector and its derivatives in future," he said.

He admitted that he was not only targeting new sources of income, but also opening up various options for business investment or projects that could produce strategic added value.

Creative economy

The trend of investing in start-up companies is also of interest to the Indonesian entertainment sector. This is partly driven by the development of Web3 technology which opens up interesting exploration space for content creators, both music, films, videos, illustrators and works of fiction.

Famous Allstars is one of them who is interested in developing content creators in the Web2 and Web3 era. One of them is a plan to establish creator venture by identifying two interesting pillars in the F&B and beauty sectors. Famous Allstars is the umbrella entity channels popular creative content and platforms that connect brands with an influencer.

The Ministry of Tourism and Creative Economy noted creative economy export value in Indonesia reached $23,9 billion in 2021, up from the previous year's $18,8 billion. The government targets this value to reach $25,14 billion in 2022.