Myanmar-based startup incubator Phandeeyar Accelerator, which has so far been making investments from its own balance sheet, is for the first time in talks to raise external money for its permanent capital vehicle to clock investments in early-stage tech ventures, its CEO Jes Kaliebe Petersen told DealStreetAsia in a chat.
Phandeeyar, which means ‘Creative place,’ has so far funded 17 local startups since its inception in 2015. Going forward, it expects to raise as much as $1-2 million from limited partners (LPs) to invest over the next few years.
“We invest at an early stage, and ticket sizes are generally smaller here than they are in other countries in the region. So, we don’t need, for example, $10 million before we can start making investments,” explained Petersen. “That gives us a lot of flexibility to do the investments. But at the same time, we also have a mission to expand the ecosystem and engage more investors to commit to the startups that we support,” he added.
Even as it is a permanent capital vehicle, it’s open for limited partners to participate. For the uninitiated, a permanent capital vehicle or PCV, as its commonly called, is an investment entity created for managing permanent capital, wherein the time frame is not specified.
Phandeeyar’s portfolio includes early-stage tech companies such as RecyGlo, a recycling solutions provider that operates in Myanmar and Malaysia, freelancer platform Chate Sat and logistics startup Kone Si, which have raised capital from other investors after the accelerator put in money.
In total, over half of Phandeeyar’s portfolio firms have raised follow-on funding.
Even as the firm has not made any exits since these are just the early years of investment, Petersen revealed that the book IRR has been more than 22 per cent.
“We’re pretty happy with that,” he said.
A local chapter of the Founder Institute franchise that’s the world’s premier idea-stage accelerator, Phandeeyar invests in Myanmar startups as a venture capitalist with a special focus to create social impact, which, say experts, is important for a young ecosystem like Myanmar.
“Our goals are primarily focused on growing the pool of tech talents, providing skills to people who are either very early on the career or are looking to increasingly contribute to the tech ecosystem,” said Phandeeyar Accelerator director Joao Dutra.