Dymon Asia Ventures – the newly created venture capital arm of Singapore-based Dymon Asia Capital – has kicked off the process to raise a $50-million debut fund, exclusively dedicated to the fintech space, DEALSTREETASIA has learnt.
Dymon Asia Capital, co-founded in 2008 by Danny Yong and Keith Tan, currently oversees assets to the tune of over $5 billion.
The new venture fund will provide early stage capital (Seed to Series B) to fintech startups in Singapore and Southeast Asia who are working in areas such as asset and wealth management, insurance, and credit. It will invest between $200,000 and $5 million, industry executives aware of the development confirmed.
The firm will also incubate fintech startups. The first of its incubatees is Spark Systems, that provides a technology solution for emerging market FX trading, these executives added.
Dymon Asia Ventures plans to make between 10 and 15 investments from its debut fund, with about 10% of the corpus committed to startups it plans to incubate, 20 per cent to seed-stage firms, 50 per cent across Series A and B rounds and the remaining 20 per cent for select special opportunities.
Jinesh Patel, partner at the VC, and its principal investment executive, Christian Kaptein, will oversee the fund, and the portfolio companies, executives aware of the development added.
Dymon so far has not publicly commented on its venture arm. When contacted, Patel and Kaptein declined to comment.
In addition to the newly launched venture arm, Dymon also has a private equity business, which it had launched in 2012, with a commitment from Heliconia Capital Management, a wholly owned subsidiary of Temasek Holdings. In 2014, it also established a partnership with Temasek, with the Singapore state-fund committing $500 million to establish the Dymon Manager Solutions Group, and also becoming a stakeholder in Dymon Asia Capital.
While most Singapore-based venture capital firms are actively looking at the fintech space, Dymon Asia Ventures along with Life.Sreda are the two VCs from the city-state exclusively focused on this space.
Fintech accounts for an increasing part of total VC funding in Southeast Asia. According to Dymon Asia Ventures, in 2015 and the first half of 2016, $345 million of funding went to fintech in the region, representing 21.6 per cent of total VC funding in that period. However, $270 million out of the $345 million is allocated to payments and lead generation, two subsets of the fintech sector.
Dymon Asia Ventures focuses on credit, asset management, and insurance, which remain heavily under-invested.
Dymon Asia Ventures has already begun making investments from its new fund, and currently has a portfolio of about five fintech firms, even as it is learnt to be evaluating another half-a-dozen potential investments, where some are even past the due-diligence stage.
Its existing portfolio includes Singapore-based Capital Match, a peer-to-peer platform for invoice financing, 4XLabs, an enterprise Saas company that develops software solutions for money changers; Otonomos, which provides corporate governance services that cover a company’s life cycle, from formation to corporate governance and capital raising; WeConvene, a corporate access platform connecting providers with users in the investment management industry, and Spark Systems, which offers a solution for enterprise trading of emerging market FX.