There’s a new venture capital fund on the scene in Southeast Asia, after Singapore-based Monk’s Hill Ventures launched a US$80 million (SG$100 million) fund focused on the region.
The fund is targeting young companies in the consumer and enterprise technology spaces, with a particular interest in those with e-commerce, mobile, big data and cloud-based services. The aim is to mix investments across early-stage, Series A and Series B funding in Southeast Asia, with growth rounds for international companies that want to expand into Asia.
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The fund carries a lot of money for Southeast Asia but, more than that, it is being run by vastly experienced entrepreneurs who have plenty of business acumen to pass on to the community.
The founding team includes Peng T. Ong, who started Interwoven (which listed on the NASDAQ) and co-founded Match.com, Kuo-Yi Lim, who previously managed a US$200 million Asia fund for Infocomm Investments, and Stefan Jung, who established Rocket Internet companies Lazada and Zalora in Southeast Asia.
Thomas Clayton completes the team but, unlike the full-time partners, he will combine his current role as CEO of mobile social network Bubbly with a position as “special advisor” to Monk’s Hill.
Entrepreneurs backing entrepreneurs
The team is positioning itself as “entrepreneurs backing entrepreneurs” and it aims to fix a number of issues within Southeast Asia’s growing tech space. Primarily the founders believe they can help with the “lack of operational experience” that they have observed, in additional to providing more funding opportunities.
“There are clearly two big gaps in the market. One is the much talked-about Series A funding gap. However, the more significant one that we see is the lack of seasoned entrepreneurs, with deep operating experience, as investors—people who can roll up their sleeves and really help entrepreneurs,” said Ong in a statement.
Becoming the Andreessen Horowitz of Asia
Clayton told TNW that Monk’s Hill Ventures is launching “a typical VC fund” with a rough 10-year estimate. However, he expects that new funds will be raised every two to three years since the team is “in this for the long-term.” He has been in negotiations to sell Bubbly for around six months, but he has no immediate plans to go full-time, even when a deal is reached, that is something that would happen on a later timescale.
On the subject of investing outside of Asia, Clayton reveals that the fund will target participation in “a select few” Series B and C rounds from proven companies based in other parts of the world. As an example, he cited Airbnb and Twilio as the kind of startups they would target, though he made it clear that it wouldn’t be these companies themselves.
That said, the primarily goal is to be Southeast Asia’s biggest technology VC fund.
“We want to be the Andreessen Horowitz of Asia,” Clayton explains.
“Ready to invest tomorrow if we could”
The team will begin with offices in Jakarta and Singapore, with a view to expanding its presence over time. Clayton explains that, in particular, they will look closely at startups in Singapore, Indonesia, the Philippines, Vietnam, Thailand and Malaysia, but will spend time in Silicon Valley and Japan.
“The partnership has built up a proprietary deal flow itself with a strong presence in Southeast Asia and regular trips to Silicon Valley. The team also has excellent relationships with seed-stage funds and leading VCs around the world,” Clayton says.
To that point, it has built up a database of over 1,000 startups in Asia to give it some initial leads and deal flow. Clayton reveals that the team started tracking deals a year ago, when the initial idea of creating a fund was first raised, and the shortlist has grown quickly from an initial 200.
“There are lots of opportunities to invest tomorrow if we could,” he says. However, realistically, the first Monk’s Hill Ventures deals are likely to be announced over the coming two or three months after the fund is closed and other red tape and administrative requirements are fulfilled.
Asian funds investing worldwide
The new fund is great news for entrepreneurs in Southeast Asia, where funding and experienced mentors can be difficult to secure, particularly for startups based outside of Singapore and in their early stages of life. It’s interesting that the focus will include international deals — that’s something that is very much the aim of another recent fund in Asia, from SparkLabs in Korea.
Monk’s Hill Ventures is one of six venture capitalist firms that secured a total pot of US$48 million (SG$60 million) in investment grants from the Singapore government earlier this year. The National Research Foundation (NRF) matches the funds on a one-to-one basis in an effort to help stimulate investment and startup growth.
Beyond that grant, however, Clayton says the fund’s LPs are mixed bag, which tap into the founding partners’ global networks.
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