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AC Ventures (ACV), a enterprise agency targeted on early-stage startups in Indonesia and the remainder of Southeast Asia, has reached the primary shut of its fifth funding fund (Fund V). The fund is focusing on $250 million and has raised 65% of that capital to date, largely from restricted companions who invested in ACV’s earlier funds. Fund V has already made 5 investments, together with SkorLife, IDEAL and Atma.
The final time TechCrunch lined ACV was in December 2021, when it closed its Fund III. (Its fourth fund is concentrated on Malaysia and run by a separate crew).
Based in 2014, ACV’s portfolio now has over 120 investments in Indonesia and the remainder of Southeast Asia. Some noteworthy firms embrace Xendit, Carsome, Stockbit, Ula, Shipper and Aruna. Its crew has grown to 35 folks, with most primarily based in Indonesia, however ACV additionally not too long ago established Singapore and Malaysia workplaces. Half of ACV’s management crew are ladies and throughout its portfolio that determine is 40%.
ACV not too long ago employed Helen Wong as managing companion. Wong beforehand labored at GGV and Qiming Ventures and has served on the boards of startups like Tudou and Mobike.
The agency is sector-agnostic, however lots of its investments are in fintech, logistics, e-commerce, MSME and shopper know-how. Fund V may even give attention to new themes together with local weather tech. The agency’s examine dimension in early-stage firms is often $2 million, and it reserves a big a part of every fund for follow-on investments.
“Broadly talking, we’re investing within the digitization of Indonesia and the Southeast Asia financial system,” ACV co-founder and managing companion Adrian Li advised TechCrunch. “Final 12 months, Indonesia’s digital GDP was $70 billion and that’s anticipated to develop to over $350 billion within the subsequent 5 to 6 years. By our expertise of investing over previous funds, we’ve additionally developed experience, notably round commerce alternatives, fintech and micro- and small enterprises. Every of those thematic areas symbolize actually deep swimming pools of income potential and we’re seeing loads of methods wherein digital adoption can really make issues extra environment friendly, price much less and create worth for all of the stakeholders in these verticals.”
Along with Southeast Asia, Fund V’s LPs come from North Asia, the US, the Center East and Europe. Li stated world buyers are drawn to Southeast Asia because it continues to indicate proof of being a maturing market, with the profitable IPOs of unicorns like GoTo and Bukalapak, a rise in later-stage capital and extra secondary exits.
ACV managing companions Michael Soerijadji, Helen Wong, Adrian Li and Pandu Sjahrir Picture Credit: ACV
With its give attention to early-stage firms, ACV is commonly the primary institutional investor in startups.
“Our fund performs on a profitable technique we’ve continued to refine to be early-stage targeted,” stated Li. “Meaning backing firms at a degree the place we may be actually priceless within the shaping of a enterprise as they construct it, and likewise at a degree the place we may be significant buyers partnered with them. We sometimes put money into 30 to 35 firms per fund and reserve a deep follow-up ratio, 20-1, to put money into firms which might be executing and creating worth.”
ACV’s efforts to assist founders embrace a number of key appointments who will work carefully with startups. They’re Lauren Blasco as head of ESG, Leighton Cosseboom as head of PR and communications, and Alan Hellawell as a senior advisor and enterprise companion.
The agency’s value-add consists of working with founders to rent key expertise and sharing expertise operation playbooks. Li stated ACV likes to take a position early as a result of as groups develop, it will possibly assist startups lay down fundamentals for tradition, retaining expertise and communication. It additionally helps firms with compliance and governance, like ensuring they’ve purposeful boards and a very good set of advisors.
One other a part of its value-creation initiatives are partnerships with conglomerates and enterprise stakeholders in Indonesia that may assist startups speed up the expansion of their enterprise. For instance, it helps fintech firms work with banks or entry capital they will use for lending.
Li stated that ACV sometimes invests in 10 to 12 firms per 12 months throughout its funds, and that continues regardless of the global slowdown in venture capital investing. “At instances when cash is simpler, we could attempt to transfer a bit of sooner, and at instances like this, we could attempt to transfer a bit of slower, however essentially what we’re making an attempt to do is underwrite for the suitable firms, and so we don’t wish to be rushed by the timing of how the market is,” he stated.
Although valuations throughout all levels have fallen by about 30% to 40%, Li additionally sees upsides out there setting, together with within the high quality of entrepreneurs.
“What’s nice about any such interval is that entrepreneurs are targeted rather more on high quality metrics and product-market match earlier than beginning to scale their companies,” he stated. “I feel lats 12 months when capital was simple, in all probability plenty of firms chasing topline progress had scaled prematurely, and that’s by no means essentially the most environment friendly use of capital. It’s merely making an attempt to seize market share and get the following spherical, so I feel instances like this are good for each entrepreneurs and buyers alike.”
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