Early-stage venture capital firm 500 Startups disclosed on Monday that it cut its largest deal in Asia with a $20-million investment in Singapore-based Carousell’s recent $85-million Series C round. The deal also marked the VC firm’s first-ever investment made through a special purpose vehicle (SPV) in Southeast Asia.
Carousell’s Series C round was co-led by existing investors Rakuten Ventures and EDBI. Other participating investors in the round were Golden Gate Ventures and Sequoia India as well as Asian financial services group DBS.
The SPV raised $20 million in just six weeks, said 500 Startups managing partner Khailee Ng. The VC is now looking at bigger ticket sizes and more such SPVs for similar deals.
“As a world of new money seeks investment in later stage startups, many of our Limited Partners (LP, or rather, investors in our funds) have grown more eager to make larger follow-on investments in our successful portfolio companies,” Ng said.
He added that fundraising can be an exhausting process for even the best of founders, and the SPV was to help LPs skip the competition with late-stage focused VC firms, funds and PE firms.
“This complements our LP’s investments into our seed funds, as it allows them to participate in otherwise inaccessible companies for direct investments.
“We know this is extremely valuable for new capital allocators in new markets. Most of all, we believe in creating more inclusive world of tech investing. Hence, we may consider more [such] vehicles for LPs in the future,” said Ng.
500 Startups had backed Carousell through its Southeast Asian fund 500 Durians in the startup’s first financing round in 2013.
Besides Carousell, another large check that was cut by 500 Startups recently was by its Japan-focused fund in Japanese startup SmartHR’s $13.3-million Series B in January this year.
The funding was entirely led and completed by 500 Startups Japan via an SPV and marks the first Series B investment by the VC firm.
Founded in 2010, Silicon Valley-based 500 Startups has invested in over 2,000 companies at the seed stage, across more than 60 countries.