Venture capital firm Vertex Ventures, which is backed by Singapore state investor Temasek, expects to raise at least $400 million next year for a new fund focusing on Southeast Asia and India, a senior executive said.
"Probably, the second quarter of next year is when we'll kick off the process for our fund five," Ben Mathias, a Bengaluru-based managing partner at Vertex Ventures Southeast Asia and India, told Reuters during a visit to Singapore.
Vertex Ventures Southeast Asia and India fund is part of Vertex Holdings' network of global funds. It raised $305 million in its fourth fund.
The move comes at a time when start-ups and privately-held companies are actively raising funds, both in Southeast Asia and India as investors bet on post-pandemic plays.
Mathias said Vertex plans to invest money from its fourth fund until the end of next year and then raise fund five next year which it will start deploying in 2023.
"We have not decided how big the fund will be but it's safe to say that it will be bigger than fund four."
Vertex Holdings, ranked as one of the biggest Southeast Asian-based funds, has $5 billion in assets under management across its funds and has about 200 active portfolio companies. The funds focus on investments in their regions of industry specialisation and are run independently.
The Vertex Southeast Asia and India fund had first invested in Grab in 2013 when it was a start-up. Grab has now become Southeast Asia's biggest ride-hailing and food delivery platform and is going public through a deal that values it at nearly $40 billion.
Vertex's portfolio includes payments firm Nium, online grocery platform HappyFresh and PatSnap, an intellectual property platform.
While India, Singapore and Indonesia have been the focus for the VC firm, it is now also hunting for investments in Thailand, Malaysia and Vietnam.
"There's...a lot of capital coming to this region, which is a testimony to the way both Southeast Asia and India are being viewed as very good investment opportunities," Mathias said, but added that the interest was also driving up valuations.
"There definitely will be a correction. The question is when that will happen," he said.