Editor's take: The week that was — Aug 29-Sep 3

Let me begin the weekly wrap-up with one of our most recent stories.

Late Friday, Saudi Arabia’s communications and IT minister Abdullah Al-Swaha said the Gulf Kingdom plans to launch a joint fund with Indonesia-focused venture capital firms to back later-stage startups in the Southeast Asian country.

The announcement followed the minister’s closed-door meeting with the co-founders and CEOs of Indonesian unicorns Blibli.com, Ajaib, Xendit, J&T Express, and Kopi Kenangan.

Let’s look at what else happened during the week.

LP-GP news

International Finance Corporation (IFC) is considering an investment of up to $50 million in the latest private equity vehicle of India’s Lighthouse Funds.

The Asian Development Bank (ADB) has approved a $50 million commitment to the latest fund of one of India’s oldest private equity firms, True North.

Taiwan Life, which is part of CTBC Financial Holdings, approved a commitment of up to $10 million to Oak Hill Capital Partners VI (Offshore), the sixth flagship buyout fund of New York firm Oak Hill Capital.

Malaysia-based COPE Private Equity plans to launch a new fund next year as it expects to finish deploying its fourth vehicle by Q1 2023. The firm is currently investing out of COPE 1, an evergreen fund, and closed-ended fund COPE IV.

Hong Kong-based SC Lowy has closed its latest direct lending fund at $350 million, alongside $100 million in a parallel co-investment managed account, to double down on Asia-Pacific’s special situations opportunities.

Singapore-based Vickers Venture Partners has closed its sixth fund at $260 million, roughly half its original target of $500 million. The fund close comes amid a sluggish fundraising environment, especially after the global public markets began to turn at the start of 2022.

Singapore-based PE firm Heritas Capital has launched a $50-million impact fund to back innovative and high-growth social enterprises across Asia.

Merak Ventures, an early-stage venture capital firm, has launched a new fund with a target corpus of $100 million to invest in Indian startups.

An increase in the number of funds currently in the market and an uptick in interim closes in H1 2022 suggest that 2022 could be a robust year for venture capital (VC) fundraising in Southeast Asia. As on June 30, there were 90 SE Asia-based VC funds on the fundraising trail.

Funding updates

Chinese internet giant Alibaba has invested $912.5 million into its Southeast Asian e-commerce arm Lazada, bringing its total capital infusion into the latter this year to $1.3 billion.

Southeast Asian recruitment platform Glints bagged $50 million in a Series D round co-led by DCM Ventures, Lavender Hill Capital and existing investor PERSOL Holdings.

Singapore-based blockchain remittance firm Lightnet Group secured $50 million from alternative investment group LDA Capital. The capital will be used to grow Lightnet’s infrastructure, operations and team.

Indonesian restaurant tech startup Esensi Solusi Buana, better known as ESB, secured $29 million in a Series B round from various investors, including Northstar Group and Alpha JWC Ventures.

Vietnamese edtech startup VUIHOC raised $2 million in a pre-Series A funding round led by venture capital firm BAce Capital.

Pakistan-based e-commerce platform PriceOye raised $7.9 million in a seed funding round led by US-based JAM Fund and backed by investors including PayPal founder Peter Thiel.

Chinese firm Bao Pharmaceuticals bagged over $100 million in a Series B round of financing led by Oriental Fortune Capital to ramp up its efforts to develop and commercialise recombinant protein drugs and antibody drugs.

Indian fintech startup EarlySalary announced raising $110 million from TPG’s Rise Fund and Norwest Venture Partners.

At a time when garnering growth capital has become a challenge for bigger companies, there has been a boom in early-stage startup funding in India. Funding across pre-seed and seed deals increased 90% to touch $596 million in Jan-July 2022 compared with the same period last year, according to data compiled by DealStreetAsia.

Other news

Singapore-based used car marketplace Carro recorded its first profitable year so far, achieving more than S$650 million ($464 million) in revenue and doubling its gross profit in the year ending March 2022.

Alibaba-owned Lazada has picked up a stake in PT Smartfren Telecom, part of the Sinar Mas Group, a top executive at the Indonesia-listed telecom operator told DealStreetAsia.

Warburg Pincus-backed Aseana Insurance has acquired Indonesian general insurer Asuransi Bina Dana Arta (ABDA) for $59.5 million.

Pakistani fintech and logistics startup PostEx has bought local logistics service provider Call Courier to tap into the country’s e-commerce sector, which is projected to grow to $12 billion by 2025.

GoTo makes headlines

Indonesia’s largest tech firm GoTo reported wider losses in the first half of 2022, despite a 49% year-on-year growth in gross revenue. Its losses in the January-June period of 2022 stood at 13.64 trillion rupiah ($920 million), up 117% from 6.28 trillion rupiah in the same period last year. The news sent its shares tumbling.

On its earnings call, the company said it hopes to accelerate its path to profitability on the back of a better cost structure and scaling up its ecosystem play.

The company, which is understood to be in talks to raise about $1 billion through a convertible bond issue, announced the acquisition of local crypto exchange PT Kripto Maksima Koin for 124.8 billion rupiah ($8.3 million) this week.

Going public

PT VKTR Teknologi Mobilitas Indonesia, a unit of the Indonesian conglomerate PT Bakrie & Brothers, is looking to raise $45 million through a listing on the local stock exchange in November 2022.

Djarum-backed online travel agent Tiket.com’s initial public offering on the Indonesian Stock Exchange (IDX) has been pushed back further but is “definitely happening this year,” said a top executive.

AI-based predictive maintenance software firm Avanseus has agreed to merge with Nasdaq-listed blank cheque firm Fat Projects Acquisition Corp. The deal would give Avanseus a pro forma enterprise value of approximately $135.7 million.

Crypto news

An executive of Thai crypto exchange Bitkub has been fined for insider trading related to a failed acquisition by the country’s oldest bank. The Securities and Exchange Commission said it would fine Samret Wajanasathian 8.53 million baht ($234,481) and bar him from serving as chief technology officer of Bitkub Blockchain Technology, a wholly-owned subsidiary of Bitkub, for 12 months.

The Indonesian government is set to launch a crypto bourse by the end of 2022 as part of efforts to protect consumers amid rising interest in digital currencies.

Thailand’s second-largest digital asset exchange Zipmex has been fined a total of 1.92 million baht ($52,244) by the country’s Securities and Exchange Commission.

The inside story

Asian food delivery platform Foodpanda is laying off staff across Southeast Asian markets, including the Philippines, Thailand and Singapore, we reported this week. The company later confirmed the development, attributing it to the need to cut costs and inch closer to profitability.

Meanwhile, in India, the government has sprung into action and started sending notices to startups that have raised funding through backdoor channels from Chinese investors despite its restrictions.

The place to be

With global investors diversifying their portfolios against a backdrop of uncertainty and challenges in China – the largest market in Asia – Southeast Asia should see more private capital allocations, said Soo Yar-Ping, a partner at Adams Street Partners, in an interview.

Soo will be joining other leading executives from the private equity and venture capital world to talk at length about Southeast Asia’s position as an investment destination amid the ongoing global uncertainty at DealStreetAsia’s Asia PE-VC Summit 2022 (Sept 27-28). Have you booked your tickets yet?

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