A Guide to Southeast Asia's Most Active VCs
The Southeast Asian (SEA) startup market is in a very healthy state. This guide will explain exactly why before getting into details on 10 of the most active VCs in the region
Why Is The Southeast Asian Startup Market Looking So Bright?
Let’s start with some growth figures and why SEA startup founders are finding an increasing number of VCs willing to invest in their business idea.
In 2021 a record US$25.7bn in funding was raised by Southeast Asian startups. That figure is more than double the investment given in 2020.
This clearly shows the growing strength and attraction of the region for venture capital firms and private equity investment. This growth is being fuelled by 3 major factors:
- After recent global uncertainty caused by the pandemic, VC and private investors in the region have regained their risk appetites.
- There are vastly improved exit outlooks.
- Startup founders are finding growing new business opportunities thanks to digitization rollouts across the region.
Further proof of this upsurge is the fact that the region welcomed 25 new unicorns in 2021 which included several exits.
Examples are the Singapore-based Grab Holdings Inc - better known as Grab. They class their super-app as being an ‘Everyday Everything app’ and provide users with food delivery, transportation, and digital payment services all via a simple-to-use mobile app.
Grab raised US$5.4bn via its IPO in December 2021 which was the 4th largest exit in Asia that year. The Indonesian e-commerce firm Bukalapak listed in 2021 while Jakarta-based Gojek (offering an on-demand multi-service platform and digital payment technology) and Tokopedia (an Indonesian e-commerce company offering online shopping and financial services) merged in May 2021 to form GoTo with their exit also occurring in 2021.
3 Growth Areas & Government Assistance Is Fuelling The Fire
A key market driver for VC investment is pointing to the rapidly rising internet economy and the fact that growth potential is digitalization-driven. Industry analysts are also putting out forecasts that predict the Southeast Asia region will become the fourth-largest worldwide economy by 2030.
Looking at a Google, Temasek, and Bain's report shows how the region's internet economy has grown. In 2015 it stood at US$32bn, by 2020 this was US$105bn. The ever-increasing digital adoption continues to lead consumers to develop new habits.
This is resulting in increased investor interest from those looking to fund startups whose goal is to digitize currently antiquated processes. Areas of particular interest are in the healthcare, retail, and finance sectors.
It is the healthtech, e-commerce, and fintech sectors that are continuing to gain traction with e-commerce and fintech startups proving to be particularly investor-attractive. This is due to the opportunities available within the SME (Small and Medium-sized Enterprises) market.
Other appealing factors in the increasing number of new businesses and seed investments come through government subsidies, incubators, accelerators, and a healthy, rising pool of angel investors. In terms of government assistance, Singapore is notable. Their government is providing 70% of funding for emerging tech startups that seek an initial investment round of US$250,000.
10 Of The Most Active VCs In Southeast Asia
Now that the scene is set as to why the Southeast Asian region is so attractive to startups and VCs alike, here are 10 of the VC firms that are most active in this region:
500 Southeast Asia
Entrepreneurs Dave McClure and Christine Tsai founded this US-based VC firm and seed accelerator as far back as 2010. The company then launched its regional affiliate 500 Durians seven years ago with a recent name change to 500 Southeast Asia.
This created a family of dedicated funds intending to attract attention and investment for founders in the Southeast Asia region.
Their success is unquestionable. To date, this VC firm has made 250 investments (and counting) in the region. Their investment interests spread across multiple sectors from the internet to deep learning startups and include several of the region's unicorns.
Their high-value portfolio contains 15 companies valued between US$ 100 million to US$ 999 million. Highly successful examples are HappyFresh, Carousell, Red Doorz, and Lingokids. They also proudly boast Southeast Asia’s only Decacorn; Grab, the Singapore-based supper app.
Other major successes are Bukalapak, the Indonesian e-commerce platform which marked the country’s biggest ever IPO, FinAccell, a rapidly growing Indonesian fintech company, and Malaysia’s Carsome, a used car marketplace and the country’s first unicorn.
500 Southeast Asia average 35 new investments per year and look to be involved in 50 new fundraising rounds during the same period.
Founded in 2009, East Ventures are an Indonesian-based venture capital firm. Since inception, they have developed into a holistic platform to provide multi-stage investment that includes Seed and Growth funds. To date, they have assisted over 200 companies in Southeast Asia.
The company was an early believer in the Indonesia startup ecosystem and is the first investor of the country’s unicorn companies; Tokopedi and Traveloka.
Things certainly do not stop there though and a selection of notably well-established companies in their portfolio include Ruangguru, Warung Pintar, Tech in Asia, Xendit, IDN Media, ShopBack, KinWorks, Waresix, Sociolla, Kudo (acquired by Grab) and both Loket and MokaPOS (acquired by Gojek.)
Preqin has named East Ventures the most consistently top-performing global VC fund and the most active investor in South East Asia and Indonesia in particular.
Some of the latest deals this go-ahead VC firm has completed include Base (PT Basis Inovasi Global), AWST (ArtWallSt) FitHappy, Runchise, and Cariuma.
With dual Headquarters in Los Angeles and Singapore, Wavemaker Partners is an international VC firm founded in 2003. They have now established themselves as one of the most active early-stage investors in the Southeast Asia region. They back enterprise, deep tech, and sustainability companies.
The company has backed over 170 start-ups in the region with 85% of those in the enterprise and deep tech sectors. Funding-wise, Wavemaker has over US$ 300 million in AUM (Assets Under Management) spread across four funds in the region.
They have overseen more than 10 exits to date and these have had an aggregate enterprise value of over US$ 700 million. This includes Moka's mobile POS system acquired by Gojek, Wavecell, a cloud communications software firm acquired by 8x8, and TradeGecko, an inventory and order management platform acquired by Intuit.
All of these M&A (Merger & Acquisition) deals are currently among Southeast Asia’s top 10 of all time.
Wavemaker has recently announced the closing of its 4th fund at US$ 136 million which is a 22% increase from its previous fund. That equates to the largest ever fund focused on early-stage enterprise, deep tech, and sustainability startups in the Southeast Asian region.
Startups in the climate tech arena can also be assured that Wavemaker Partners have no intention of standing still. The firm has launched ‘Wavemaker Impact’, a climate tech venture co-builder.
This is the first-of-its-kind climate tech venture builder in the region. The aim? To co-found 100x100 companies and those with the potential to deliver US$ 100 million in revenue while annually abating 100 million metric tons of carbon emissions.
Founded in 2002 on the back of China’s tech, media, and telecoms boom Gobi Partners have grown significantly during the last 2 decades. They now describe themselves as the most interconnected Pan-Asian VC firm.
This is seen in their impressive US$ 1.5 Billion AUM (Assets Under Management) across North-, South- and Southeast Asia. While they are headquartered in Kuala Lumpur and Hong Kong they also have 15 locations across key markets which includes Jakarta, Singapore, Bangkok, and Ho Chi Minh City.
The key focus is on investments from the early to the growth stages. Their mission is to help and support emerging and under-served markets. Preqin has named Gobi Partners among the most active in ASEAN (Association of Southeast Asian Nations) VC deals during 2019 and 2020.
13 funds have been raised to date and over 310 startups across 13 Asian markets have been invested in. That includes 45 in the Southeast Asia region. The company has nurtured 9 unicorns which includes Malaysia’s first-ever unicorn, Carsome, the car e-commerce marketplace.
Staying with Malaysia, Gobi has invested in 21 startups. These include PolicyStreet, the insurtech company, and Favful, the beauty social commerce platform. Moving on to Indonesia, they have invested in 14 startups which includes the country’s premium coworking space, GoWork, and in Singapore, they have invested in 7 startups.
One thing is for sure, Gobi Partners are focusing on continually increasing their presence in the Southeast Asia region.
CyberAgent Capital began life in 2006 in Japan. Their mission statement “change the world from Asia” makes it clear that they are spreading their wings. Investment is mainly in tech startup companies across China, Korea, and Taiwan but they are a growing influence in the Southeast Asia region. Their 8 offices include ones in Thailand, Indonesia, and Vietnam.
Investment preference is wide and ranges from mobile applications and e-commerce to mobile games and the internet. Particular company strength is helping startups to grow quickly while maintaining a solid base and structure in the ever-fast-moving internet industry.
Investment has been given to 80 startups worldwide, 35 of these in Southeast Asia. This includes the Indonesian e-commerce unicorn Tokopedia which merged in 2021 with ride-hailing giant Gojek to create the tech giant GoTo.
CyberAgent Capital has also been involved in 6 M&A (Merger & Acquisition) deals in the region. These deals include Elara Technologies, the Singapore-based realty consultancy platform, and the Thai shopping comparison platform Priceza.
Other notable Southeast Asia startups in their portfolio include Vietnam’s e-commerce firm, Tiki Corporation, and Vexere, the country's largest online bus ticketing system. Viddsee, Singapore’s video entertainment platform, Indonesian-based edtech company HarukaEdu, and Fastwork which are one of the largest professional freelancing platforms in the Southeast Asian region.
Founded in 2016, SG Innovate is Singapore-headquartered and their investment focus is investing in deep tech solutions aimed at challenging global problems. Good examples of startup companies the firm is interested in include sustainability, pre-stroke detection, and financial inclusion.
To date, SG Innovate has invested more than US$ 37 million in over 80 companies in its portfolio. These startups have been in the AI (Artificial Intelligence), medtech, quantum computing, and finance spaces. The startups involved have gone on to successfully raise over US$ 516 million from the market.
Many of these portfolio companies are Singapore-based. A shining example here is Biofourmis, a fast-growing digital health company. But many other startups are prospering in the above-mentioned business sectors thanks to SG Innovates' portfolio management skills.
Insignia Venture Partners
Insignia Venture Partners is an early-stage technology VC firm. Their mission is to work with founders to build great startups across Southeast Asia. Since 2017 the company has invested in over 70 emerging tech startup companies across various industries and Southeast Asian countries.
Their main investment thrust is fintech, consumer, and marketplaces. A major focus is on the Indonesian market with 23 portfolio companies. These include category leaders Payfazz, Shipper, and Flip, the decacorn GoTo Group, and the Robinhood of Indonesia, fintech Ajaib.
Second up are 16 startups based in Singapore that include Carro, the region's largest, leading, and fastest-growing automotive marketplace. There are also 5 Vietnamese startups in the ever-growing Insignia Venture Partners portfolio.
Openspace Ventures are a multi-stage investor in the Southeast Asian B2C and B2B Business sectors. Their funds are around US$ 500 million with support given to founders in the seed and early VC stages. The company generally invests in Series A or B and early-stage tech firms.
Having invested in more than 30 startups in the region, Openspace is no stranger to this thriving market. Their portfolio covers startups from consumer and health through to finance, agritech, edtech, and SaaS.
The company has backed well-known regional unicorns that include both Indonesia’s Gojek (now GoTo Group) and FinAccel the Singapore-based fintech company since Series A. They have also invested in Chope, a Singapore restaurant booking platform, the Indonesian tech-enabled F&B business JIWA Group, and the Thai-based Finnomena which is a digital wealth management platform for investors and financial advisors.
Global Founders Capital
Global Founders Capital is not short on success. This seed and growth investor-oriented VC firm has been responsible for backing some of the world’s biggest startup successes. Think Canva, Linkedin, Revolut, and Trivago. They are well known for investing in countries whose governments actively promote entrepreneurs. Country examples of activity in the region include Singapore, Malaysia, and Indonesia.
With offices in Singapore and Jakarta, they focus on AI (Artificial Intelligence), Great Data, Commerce, Finance, and Gaming. Southeast Asian successes to date include the Singapore Unicorn online retailer Lazada, the Indonesian-based unicorn, Traveloka which is an online travel startup, and the Malaysian healthtech startup Naluri.
Golden Gate Ventures
Golden Gate Ventures are headquartered in Singapore. The mission of this global venture capital team is to power tech and innovation from Southeast Asia. They are an early-stage VC firm that has been in existence since 2011.
Four funds have been launched and AUM (Assets Under Management) is $ 250 million. To date, they have invested in over 80 companies in the region. This includes 25 in Indonesia, 20 in Singapore, 10 in Thailand, 8 in Malaysia, and 7 in Vietnam.
KPMG has named the company in the top 5 of Southeast Asian funds and this receptive VC invests in startups addressing technological opportunities that continue to arise from the growing consumer class in the region. This covers everything from consumer apps to B2B SaaS services.
The current portfolio of regional startups includes 8 exits. Among those are Wifi Chua, Vietnam’s largest mobile platform provider (acquired by Appota), TemanJalan, Indonesia’s social carpooling platform (acquired by LINE), and Singapore’s inventory management platform, Tradegecko (acquired by Intuit).
For Southeast Asian Founder Seeking Funds - Help Is At Hand
The 10 most active VCs in Southeast Asia mentioned above are not alone. The region is currently witnessing a very healthy upsurge in venture capital companies and equity investors looking to invest in startups from a wide range of business sectors.
Smart startup founders will be aware of the importance of securing those much-needed funds. Money that will propel their business through structured and healthy growth cycles. However, finding the right type of investor for your startup is easier said than done.
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