Vertex Ventures makes first close of fourth Southeast Asia fund at $230m

A man carrying an umbrella walks along the Jubilee Bridge in front of the city skyline in Singapore, on Wednesday, July 12, 2017. Singapore is scheduled to release second-quarter gross domestic product data on July 14. Photographer: Nicky Loh/Bloomberg

Vertex Venture Holdings Ltd. raised $230 million in the first close of its fourth Southeast Asian fund to back technology startups across the region and India.

The Singapore-based venture capital arm of Temasek Holdings Pte plans to finalize the funding in the next few months, which could take it above the first close, said Chua Kee Lock, managing partner of Vertex Ventures Southeast Asia and India. Most of the investors in its third fund, including Cathay Financial Holding Co., have backed the new one.

After the success of its bet on ride-hailing app Grab, now Southeast Asia’s most valuable startup, Vertex plans to continue backing early-stage technology for financial services, enterprise and consumers in the region. The net internal rate of return of its third Southeast Asian and Indian fund, which started in 2016, was 45.2% as of December, according to a presentation to investors.

“Our investors have shown confidence in us by participating in the first closing, which hit the initial target of the fund,” Chua said. “The reality is that there are some concerns about the trade war and valuations and the fundraising environment is getting harder.”

Earlier Vertex investments include online shopping store; InstaReM, a cross-border digital payments startup; Validus, an online financing marketplace; and Binance Asia, a cryptocurrency exchange platform.

The VC firm got its start three decades ago and Chua joined as chief executive officer of Vertex Venture Holdings in 2008 and expanded it into a global operation with $2.5 billion under management as of October. Today, it manages portfolios in China, Israel, India, Southeast Asia and the U.S.

The new fund comes amid a flurry of fundraising activities in the region. Jungle Ventures is currently raising a $200 million fund, while Golden Gate Ventures has teamed up with South Korea’s Hanwha Asset Management to raise a $200 million fund.