500 Global closes $143M fund for Southeast Asia startups
500 Global, a venture firm and seed accelerator, has recently secured $143 million in funding for their largest Southeast Asia early-stage fund. The fund, called “500 SEA III,” has a group of limited partners, including a sovereign wealth fund, public and private pension funds, a university endowment, and companies valued at over $1 billion in 500 Global’s portfolio. Initially, the goal was to raise $75 million, but the fund surpassed expectations and closed at $100 million. It’s important to note that the remaining $43 million was raised for their growth vehicle, not the early-stage fund.
According to 500 Global, 500 SEA III will invest primarily in businesses and technologies that promote rural digitalization, sustainable cities, human and machine productivity, healthcare, food security, and financial inclusivity. The fund aims to support 100 startups in pre-seed, seed, and Series A stages, providing initial investments ranging from $250,000 to $500,000 across various countries in Southeast Asia, including Malaysia, the Philippines, Vietnam, Thailand, Singapore, and Indonesia.
Startups in Southeast Asia are rapidly growing and are expected to be a leading source of global economic growth in the coming years. This is due to several factors, including increased urbanization, trade, diversification of supply chains, real estate, and a push for sustainability. According to Cento Ventures, venture capitalists have invested in 393 Southeast Asian startups in the first half of 2021 alone. Furthermore, a Golden Gate Ventures report predicts that the region’s startup funding could exceed $14 billion by 2023. Investors such as Argor Capital, Square Peg Capital, Sequoia India and Southeast Asia, AC Ventures, and Lightspeed have all been actively investing in the region. However, potential headwinds may arise in the future that could deter investors from Southeast Asian startups.
According to a recent report by Bain & Company, Southeast Asian governments are taking steps to support the growth of tech companies while imposing tighter regulations and higher taxes on them. For example, Indonesia has passed a law that requires tech firms with online services to pay value-added tax on local sales, even if the purchases are initiated offshore. Similarly, Singapore, the Philippines, and Malaysia have introduced digital banking licenses.
500 Global, a VC firm, has backed over 340 companies across Southeast Asia, including e-commerce platform Carsome, ride-hailing app Grab, and Indonesian aquaculture startup eFishery.
According to a press release, Christine Tsai, CEO and founding partner of 500 Global, continues expressing her confidence in Southeast Asia’s potential and opportunities. She believes the region’s entrepreneurs will benefit from their genuinely global venture platform, which has deep local roots and in-market expertise. With headquarters in San Francisco and assets under management worth $2.4 billion, 500 Global has already supported over 2,800 companies in over 80 countries. The company has a diverse team of approximately 190 entrepreneurs, investors, and operators based in over 25 countries.