Nextrans, the South Korean venture capital investor that has made seven investments in Vietnam, has facilitated its Vietnamese portfolio to raise an additional $23 million in follow-on funding, according to a top executive of the firm.
To date, Nextrans has invested in 32 companies in South Korea, the US and Vietnam. For the Korean and Vietnamese markets, the firm invests out of a corpus of $350 million, Nextrans director Chris Chae told DEALSTREETASIA.
In Southeast Asia, Nextrans focuses on investing in Vietnam. “Before the execution of the investments, we had spent two years to understand the market, founders and build the network. We focus on the demographics, the human capital – whether there are innovative resources, and the timing. And, the Vietnamese market has them all,” Chae said.
“The proportion of Vietnamese engineers to the population is three times that of Indonesia, making Vietnam a unique tech hub in Southeast Asia,” he added.
Nextrans’ investment thesis is to make early-stage bets and to support the portfolio companies by facilitating further rounds by bringing on board other investors.
“We are focussed on early stages with amounts to make initial performance. But our major role is the syndication for the next rounds of funding,” Chae revealed.
Funds like AME Ventures, BonAngels, KB Investments, Caldera Pacific, Access Ventures and FuturePlay have joined Nextrans to invest in Vietnamese startups.
“Our shareholders are mainly Korean individuals. We take the risks and put all resources to support the companies along their journey. We operate as a corporation, not as a fund, so we don’t push for early exits. Our investors agree with that (model),” Chae said, adding that a lot of Korean investors are looking to enter the Vietnamese market.
He observes that Vietnam had very few Series A investors, but Series C investors were willing to cut large checks. The likes of JD and SoftBank Ventures Korea and others have proven that in their recent investments in Tiki and Sendo recently.
Chae said Nextrans’ mandate was to support Series A rounds and work on syndication with later-stage investors for follow-on fundings.
Nextrans is also exploring the idea of building a platform in Vietnam to make seed investments in about 100 companies over the next three years. While the current Vietnamese portfolio of Nextrans already generates revenue, the proposed platform is targeted at companies in the product-testing stage.