JAKARTA (TheInsiderStories) – East Ventures (EV) is collaborating with Tokyo’s based YJ Capital Inc. and SMDV –venture capital (VC) firm under Sinar Mas Group –, to set up EV Growth to grab growing digital companies in Indonesia.
Trough this collaboration the three parties are targeting to invest US$150 million in the startups in the country. EV Growth aims at Southeast Asia pioneering companies, especially Indonesia, to provide growth-stage capital injections, particularly in the Series B.
Willson Cuaca, Managing Director and Founder of EV, said there is a lot of room for the new VC to invest in Indonesia. The reason EV set up the joint venture is because He believed the country will produce more unicorns in the future.
“The opportunity just came at the right time as Yahoo Japan and Sinar Mas are looking for partners Indonesia, therefore we decided to partner with them (YJ Capital),” he said at the launch of EV Growth on March 22.
He continued, the three investors have injected $100 million of the total commitment of $150 million in the new VC. EV Growth is targeting to invest $5-15 million per startup, and according to him, so far this is the biggest investment for growth funding venture capital.
Roderick Purwana, Managing Partner of SMDV added EV Growth is targeting to invest in 20 startups in the next few years. Meanwhile, CEO of YJ Capital–unit of Yahoo Japan–Shinichiro Hori adding since 2015, the company has invested in five companies in South East Asia.
The VC tries to find a business partner in each region. According to him, currently Japan only has one unicorn but Indonesia has four unicorns, therefore, there is a bright growth potential in the future.
Senior Advisor for SMDV Franky Widjaja also commented the reason why SMDV joined with EV and YJ Capital because right now the company has a market capitalization of $27 billion. He said Indonesia has a huge potential to create a ‘silicon valley’ in this country.
“Indonesia is at the right time, right place and has the right people. The launching of this fund is at the right time. We have established relations with EV for seven years,” he said.
Widjaja established a venture capital firm called SMDV in 2014. Within a short span of time and support from Sinar Mas’ strong network of companies, SMDV has positioned itself as one of an active venture capital company in Indonesia with more than 10 portfolio companies.
Minister for Information, Communication & Technology Rudiantara is optimistic that the country to create five unicorns until 2019. Based on Coordinating Board for Investment data, He said, the digital investment reached $4.7 billion in 2017.
According to him, Southeast Asia now has six to seven unicorns and four of them are in Indonesia. In 2017, the total funding flowing to technology-based startups in Southeast Asia reached $7.9 billion, a four-fold increase from the value in 2015.
Singapore and Indonesia dominate, of which 71.2 per cent of total funds flows to Singapore and 22.1 per cent goes to Indonesia. However, of all the investments that flow, only eight per cent of the funding goes to series B funding. This shows a gap that hinders the acceleration of digital startup growth in Indonesia.
Currently, EV is an early stage venture fund focused on Southeast Asia and Japan. With a focus on Southeast Asia, as well as networks across Indonesia, Japan, and the United States, EV is currently investing in more than 300 companies in Asia and the United States. Included in East Ventures Indonesian portfolio is Traveloka, Tokopedia, Ruangguru, IDN Times and MokaPOS.
YJ Capital was established in August 2012 and has invested in more than 80 companies, spread across Asia and the United States supported by South Korean’s Softbank Group Corp. Yahoo Japan itself is a top public company in Japan engaged in technology.