AC Ventures Announces First Close of $250M Fund for Southeast Asian Startups • TechCrunch

AC Ventures (ACV), which focuses on early-stage startups in Indonesia and the rest of Southeast Asia, has reached the first close of its fifth investment fund (Fund V). The fund is targeting $250 million and has raised about 65% of capital so far, mostly from limited partners who invested in ACV’s previous fund. Fund V has made five investments including SkorLife, IDEAL and Atma.

The last time TechCrunch covered ACV was in December 2021, when the fund closed III. (The fourth fund is focused on Malaysia and managed by a different group).

Founded in 2014, ACV’s portfolio now has over 120 investments in Indonesia and the rest of Southeast Asia. Some popular companies include Xendit, Carsome, Stockbit, Ula, Shipper and Aruna. The team has grown to 35 people, most based in Indonesia, but ACV recently established offices in Singapore and Malaysia. Half of ACV’s leadership team are women, while the figure across the portfolio is 40 percent.

ACV recently hired Helen Wong as a managing partner. Wong previously worked at GGV and Kiming Ventures and served at startups such as Tudu and Mobike.

The firm is sector-agnostic, but many of its investments are in fintech, logistics, e-commerce, SME and consumer technology. Fund V will also focus on emerging themes, including climate technology. The size of the check in the firm’s early-stage companies is typically $2 million, and it accounts for a large portion of each fund for subsequent investments.

“Broadly, we’re investing in the digitization of Indonesia and Southeast Asia’s economy,” ACV founder and managing partner Adrian Lee told TechCrunch. Through our experience investing in past funds, we have developed expertise around business opportunities, fintech and SMEs. Each of these thematic areas represent deep pools of revenue potential and digital adoption can truly make things more efficient, reduce costs and add value to all stakeholders in these verticals. We are seeing many ways to create it.

Apart from Southeast Asia, the fund’s VLPs come from North Asia, America, the Middle East and Europe. Lee said international investors are drawn to Southeast Asia as unicorns such as Goto and Bukalapak continue to show evidence of a mature market with successful IPOs, late-stage capital raisings and more secondary exits.

Focusing on early-stage companies, ACV is often the first institutional investor in startups.

“Our fund plays on a successful strategy that we continue to refine to focus on early stage,” Lee said. “This means supporting companies when we are most valuable as they build their business, as well as partnering with them when we become meaningful investors. We typically invest in 30 to 35 companies in one fund, implementing a deep tracking ratio of 20-1 and investing in value-creating companies.” we will do.

ACV’s efforts to support founders include several key appointments that work closely with startups. They are Lauren Blasko as Head of ESG, Leighton Kosbom as Head of PR and Communications, and Alan Hellawell as Senior Advisor and Venture Partner.

Adding value to the company includes working with founders to recruit key talent and share talent operations playbooks. Lee ACV likes to invest early. It helps with compliance and governance of companies, such as ensuring they have functional boards and a good set of advisors.

Another part of its value-creation initiative is partnerships with conglomerates and business stakeholders in Indonesia, helping start-ups accelerate their business growth. For example, it helps fintech companies work with banks or leverage capital for loans.

According to Lee, ACV typically invests in 10 to 12 companies per year in its funds, and this will continue even as the global slowdown in venture capital investment continues. “When money is easy, we might try to move a little faster, and in times like this, we try to move a little slower, but basically what we’re trying to do is write to the right companies, etc. We don’t want to rush the timing of how the market is,” he said.

Evaluations at all levels have fallen from 30% to 40%, Lee also increases the quality of entrepreneurs in the market environment.

“The best thing to do in times like this is for entrepreneurs to focus more on quality metrics and product-market fit before they start scaling up their businesses,” he said. I think last year when capital was easy, maybe a lot of companies chasing topline growth increased prematurely, and that’s not the most efficient use of capital at all. It’s simply trying to grab market share and get the next round, so I think times like this are good for both entrepreneurs and investors.