More founders looking to add venture debt to fundraising toolkit: Chin Chao, InnoVen Capital

Chin Chao at the Asia PE-VC Summit 2016 in Singapore. Photo: DEALSTREETASIA

Fresh from drawing a hefty $200-million commitment from its shareholders Temasek Holdings and United Overseas Bank, Singapore-based venture debt provider Innoven Capital is looking to accelerate its expansion across its three markets and also make larger follow-on investments in portfolio companies.

InnoVen Capital – which was formed in 2015 with the acquisition of Silicon Valley Bank’s business in India by Temasek Holdings and UOB  – has supported over 200 startups with over $500 million in financing. Some of its notable investments include Swiggy, Oyo, Byju’s, UCommune, Momenta, Akulaku, Carsome and RedDoorz.

In an interview with DEALSTREETASIA, Innoven Capital Singapore and Southeast Asia CEO Chin Chao said, “I believe all three geographies [India, China & SE Asia] will grow substantially in the next 3-5 years, but I think China will have the highest growth potential for us, given the size and depth of the venture capital market.”

The venture lending firm entered China a little over a year ago and has already built a portfolio of nearly 30 startups.

Sharing his observations on the relatively new venture debt space in Asia, he said, “We have seen an increasing number of founders wanting to add venture debt as part of their fundraising toolkit.”

Another interesting trend that InnoVen Capital is leveraging on is the increased demand for cross-border venture debt. “As companies expand geographically from India to Southeast Asia or from Southeast Asia to China, they are looking for venture debt in each geography,” he added.

Edited excerpts from the interaction:-

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