Golden Gate Ventures closes $60m early stage fund, to double down on SEA

Golden Gate Ventures

Singapore headquartered Golden Gate Ventures has announced the final close of its second early stage venture fund at $60 million, with participating investors from across Asia, Europe and the Middle East.

The fund was oversubscribed by $10 million, from its initial target of $50 million.

Having invested in over 30 companies across two funds, Golden Gate Ventures will double down on the Southeast Asia opportunity with its new warchest, a statement said.

In addition to its existing investors such as Singapore sovereign fund Temasek, two Asia-based institutions and a European-based media conglomerate have joined the fund as limited partners.

From Korea, Hanwha Life Insurance has partnered with Golden Gate Ventures to tap into the growing economic opportunities in Southeast Asia.

Siam Commercial Bank, is also on board. The Thai bank is considered one of the most progressive institutions in the banking industry with its recently setup venture capital arm called Digital Ventures Company Limited.

Among Singapore-based venture firms, a number of them are closing or raising their maiden and second funds.

These are Jungle Ventures working towards the final close of its $100 million second fund last year, and Innosight Ventures targeting $50 million for its second fund.

Other early-stage venture funds include Gobi Partners’ recently closed Asean SuperSeed fund of $14.5 million. Golden Equator Capital recently closed a $40 million tech fund for the region, while Wavemaker Partners is set to launch a second fund for the region.

Recent large funds closed are Monk’s Hill maiden fund of $85 million two months back, and Northstart’s NSI Ventures’ first fund above $80 million last year.

Also read: EXCLUSIVE: Golden Gate Ventures to raise $50m in second fund

Golden Gate reaches $35m first close on $50m fund

Digital Ventures chairman of executive committee Thana Thienachariya, said: “Banks will need to adapt to industry changes quickly in order to remain competitive. We set up Digital Ventures to cope with these changes and work with startups in various ways, including investment. We believe Golden Gate Ventures to be the right partner to help us identify and participate in investment opportunities in Asia which is becoming the next innovation hotbed.”

Both Hanwha Life Insurance and Siam Commercial Bank treat their partnership with Golden Gate Ventures as a rare opportunity to tap into the region’s rapidly maturing consumer markets, the statement noted.

Golden Gate Ventures’ view is the startup activity in the ecosystem is at a critical inflexion point, with venture capital funding doubling year on year in the first quarter of 2016 despite the slowing global economy and volatility in emerging markets.

Data indicates a growing number of investment rounds with $1.7 billion being invested in 473 deals over the last five months.

Despite the perceived difficulties in China affecting investor sentiment in the country, investment continues to flow into Southeast Asia.

“The region has seen the emergence of its own cohort of fabled unicorns, companies with private valuations of over $1 billion, which includes Singapore-based gaming company Garena, transportation platform Grab, and Rocket Internet’s e-commerce giant Lazada,” Golden Gates Ventures said.

High growth startups on track to reach $1 billion in valuation over the next two years have also been on the rise, with 600 million people and a rapidly growing middle class, GDP growth across Southeast Asian countries is between 6 per cent to 14 per cent year over year.

“Unlike developed markets, internet penetration in Southeast Asia is driven primarily by smartphone adoption and therefore, startups here must think mobile-first. When you compare marketplaces like Craigslist, Ebay, or even Alibaba, there’s a striking difference between their desktop-centric interfaces and the region’s homegrown mobile-first marketplace, Carousell. Carousell was the first to integrate location-based search and real-time mobile chat,” Golden Gate Ventures managing partner Vinnie Lauria commented.

Google and Temasek’s “e-conomy SEA” report has shown that the region has more than 260 million internet users, with an additional 3.8 million people coming online for the first time every month. This unprecedented adoption makes it the fastest growing internet market in the world, predicted to reach 480 million users and $200 billion in online spend by 2025.

Governments across the region have also recognized the immense benefit a flourishing technology industry can bring to the economy, Golden Gate Ventures added, noting that countries like Singapore, Malaysia, and Indonesia are actively promoting various programmes and incentives to nurture entrepreneurs and startups.

“While government programmes for startups in Indonesia are still in its infancy, the country has taken active steps towards encouraging entrepreneurship by providing SME loans at low interest rates and pledging to to raise $1 billion to finance technology startups,” it said.

In Singapore, the government committed nearly $13 billion from 2011 to 2015 for scientific research and development, while in 2015 alone, the Malaysian government announced $500 million for research, innovation, and investment.

Google and Temasek’s report forecasts $40 billion in investment over the next 10 years to match the region’s GDP growth.

Also read:

Golden Gate Ventures, Wavemaker Partners most prolific investors in SE Asia

M&As to become preferred route for startup exits in Singapore, SEA: Golden Gate Ventures

Series A investments in ASEAN tripled in 2014: Golden Gate Ventures

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.