500 Global closes $143 million fund to invest in early-stage growth startups across Southeast Asia
Global tech startups are currently struggling to raise funds due to a confluence of factors including a setback experienced by Silicon Valley Bank earlier this year. Other factors include the prevailing global economic slowdown, the ongoing conflict in Ukraine, and rising interest rates. This protracted shortage of funding has posed formidable obstacles to the growth and expansion efforts of tech startups worldwide.
Although Silicon Valley startups continue to exhibit relative resilience compared to their counterparts around the world, the startup landscape in Asia is encountering a more challenging terrain. Consequently, one venture capital firm has stepped forward to provide a lifeline to startups in Southeast Asia.
Today, 500 Global, a venture capital firm and seed accelerator, announced it has successfully closed a $143 million funding round, marking its most substantial early-stage fund for Southeast Asia to date, the firm said in anews release issued on Wednesday.
The recently launched 500 Southeast Asia III, abbreviated as “500 SEA III,” boasts an impressive lineup of limited partners, which includes a sovereign wealth fund, public and private pension funds, a university endowment, and esteemed 500 Global portfolio companies with valuations exceeding $1 billion. The total funding amount of $100 million, surpassing its initial target of $75 million. Over half of the fund’s backing comes from returning limited partners.
This early-stage fund is earmarked for investments in startups working on AI-powered technologies that propel various critical sectors, including rural digitalization, sustainable urban development, human-machine collaboration, healthcare innovation, food security, and financial inclusion. 500 SEA III aims to support a total of 100 startups at pre-seed, seed, and Series A stages, providing initial investments ranging from $250,000 to $500,000 across key Southeast Asian markets, such as Malaysia, the Philippines, Vietnam, Thailand, Singapore, and Indonesia.
“KWAP’s investment in 500 Global began in the latter’s early days through its second Southeast Asia early-stage fund. 500 Global has since grown considerably in strength to a multi-stage investment platform, and remains instrumental in securing co-investment opportunities for KWAP. We are encouraged by its efforts in developing the regional venture capital ecosystem, and look forward to the successes that our ongoing collaboration will bring in optimizing KWAP’s investment returns.” – Hazman Hilmi Sallahuddin, Chief Investment Officer, KWAP.
“We are pleased to continue our partnership with 500 Global, a venture capital manager with an extensive investment track record globally. Additionally, in line with Khazanah’s Future Malaysia Programme, an initiative under our Dana Impak (Impact Fund) mandate, we are excited about their potential to facilitate the market expansion of start-ups via their Southeast Asia platform, with the anticipation of creating new global champions.” – Dato’ Amirul Feisal Wan Zahir, Managing Director, Khazanah Nasional Berhad.
Over the years, Southeast Asia has stood as a burgeoning hub for startup activity, poised to play a pivotal role in global economic growth in the coming years. This trajectory is underpinned by several factors, including heightened urbanization, expanded trade networks, diversified supply chains, real estate developments, and a growing emphasis on sustainability initiatives.
Data from Cento Ventures reveals that venture capitalists made a total of 393 investments in Southeast Asian startups during the first half of 2021. Moreover, a report by Golden Gate Ventures suggests that startup funding within the region could potentially surpass the $14 billion mark by the year 2023.
Founded in 2010, 500 Global has backed more than 340 companies in Southeast Asia, including notable successes like Grab, Bukalapak, Carsome, Carousell, FinAccel, and Fishery. As of June 30, 2023, 500 Global manages $2.4 billion in assets and operates in over 25 countries, working closely with various stakeholders to foster thriving entrepreneurial ecosystems in regions where technology, innovation, and capital can drive long-term value and economic growth.