FEBE Ventures is the latest venture capital (VC) firm to join the tech investment arena in Vietnam with a $25 million early-stage fund.
The fund, which will invest in early-stage startup companies, has made its first close after securing the backing of entrepreneurs and family offices from Asia, the US and Europe, as well as senior executives at LinkedIn, Goldman Sachs and Jardine Matheson.
The three co-founders of FEBE Ventures have personally committed 10 per cent of the fund, and expect a second close in 2020. The fund is accredited by the Monetary Authority of Singapore.
Acronym of “For Entrepreneurs, By Entrepreneurs”, FEBE Ventures is sector and business model agnostic, and aims to provide pre-seed to Series A capital ranging from $100,000 to $1 million to startups across Southeast Asia with its main focus on Vietnam.
The firm has also announced its maiden investment in Singapore-based clear braces startup Zenyum’s Series A round alongside Sequoia Capital and other VCs.
“We selected FEBE Ventures to participate in our Series A as we value their local expertise and entrepreneurial experience, which will help with our company’s regional expansion into Vietnam,” said Julian Artopé, Zenyum’s founder and CEO.
Two of FEBE Ventures’ co-founders, Eric and Jean-Marc Merlin, founded AppleTree Group in Vietnam in 1993, which now has a presence in 21 countries with more than 4,500 employees, and operates across distribution, retail, hospitality and tourism.
Its third co-founder and managing partner is Olivier Raussin, formerly a general partner at Project A Ventures, a $480-million European venture builder and VC fund. Prior to Project A Ventures, Raussin was an entrepreneur and had also held executive roles at Google, YouTube, Microsoft and Yahoo.
The FEBE Ventures team, including but not limited to its co-founders, has in the past invested in a total of 31 companies in Asia, Europe and South America. Vietnam-based e-commerce company Leflair is one of such investments, in which the partners came in as its first seed investor before it raised follow-on funding from private equity firms such as Caldera Pacific and Belt Road Capital Management.
“In terms of timing, it’s never too early to reach out. We have already invested in quite a few Powerpoint-stage businesses and we are happy to support founders at the MVP phase,” said Jean-Marc Merlin, one of the three co-founders.
With its young demographic and steady GDP growth of 6-7 per cent per year, Vietnam’s digital economy has been growing at a CAGR of 20.5 per cent. The country is also adding more than 25,000 new tech developers every year and developing a strong entrepreneurial culture. Growth-stage VCs from developed countries like Korea, Singapore and Japan are already very active in Vietnam, while there is a need for more VC flow at early stages, according to the general partner.
“We invest in entrepreneurs who want to become regional leaders and we are acting on two main corridors: Southeast Asian startups that want to enter Vietnam early and Vietnamese founders who want to expand regionally,” said Eric Merlin.
Olivier Raussin, FEBE Ventures’s managing partner, added: “Our main value proposition for entrepreneurs is that since we are ourselves entrepreneurs at heart, we fully understand founders’ pain points and needs when building startups in Vietnam. Our main mission is to help founders solve problems and scale their business quickly by sharing with them key learnings from our past successes and failures.”
With its evolving tech ecosystem, Vietnam has got a lot of interest from the VC world into its startups at multiple stages. While later-stage investments are typically done by regional fund managers, the country has also seen a number of dedicated early-stage funds such as 500 Startups Vietnam, ESP Capital and Nextrans. Country-focused funds that write bigger checks include VinaCapital Ventures and Vingroup Ventures.