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Gobi Partners and MAVCAP launch new seed-stage startup fund for Southeast Asia
March 28, 2016 News

A new fund for startups in Southeast Asia has been announced today. It comes from Shanghai-headquartered venture capital firm Gobi Partners in collaboration with Malaysia Venture Capital Management Berhad (MAVCAP).

The Gobi MAVCAP ASEAN SuperSeed Fund, or just SuperSeed Fund (the other one is rather a mouthful) is a US$14.5 million pool that will target seed-stage companies in the region. Gobi’s Singapore-based partner Kay-Mok Ku confirms to Tech in Asia that the fund is fully financed. It will be managed out of the VC’s recently established office in Kuala Lumpur, its sixth regional office to date.

Come one, come all

Kay-Mok, along with Thomas G. Tsao, co-founding and managing partner of Gobi Partners, and Jamaludin Bujang, chief executive officer of MAVCAP, will serve on SuperSeed’s investment committee. Gobi’s Victor Chua will be the investment director making the deals.

SuperSeed will look for startups across Southeast Asia in a variety of verticals, including advertising, big data, cloud computing, connected devices, content and digital media, ecommerce, financial tech, Internet of Things (IoT), online tourism, and Muslim innovation.

The fund is casting a wide net for three reasons: “First, these are areas in which we have experienced success in China and are already active in, so we have insights into how each respective industry works and resources in place to help these companies grow after the investment,” Kay-Mok says. “Second, there are areas where MAVCAP brings more to the table, such as Muslim innovation, in which the fund can strongly benefit from; Third, we believe that these sectors represent key emerging trends in Southeast Asia that will shape the region’s technological, consumption and economic landscape.”

The average deal size is expected to be about US$500,000, mainly for seed rounds and the occasional series A. Kay-Mok says the fund doesn’t have a specific amount of equity that it takes from the investee startups. “For reference, we may take 15 to 35 percent in any given deal for rounds as sole investors,” he says. “This allows us to have enough of a share and interest to be relevant and involved in the startup’s growth, but not too much to be overbearing or controlling.”

Kay-Mok says the fund will preferably be a lead investor, although it will follow for the right deals. “We welcome other VCs to participate in rounds either as lead or follow on. We believe in a community approach to investment – you know the saying, ‘it takes a village,’” he adds.

Experience

The SuperSeed fund is the second collaboration between Gobi and MAVCAP, as the latter contributed in the former’s US$50 million ASEAN fund for series A investments in 2015. The two teams share office space in Kuala Lumpur and work closely together, Kay-Mok says.

“We are one of the first homegrown Chinese venture capital firms and MAVCAP is Malaysia’s first VC firm, so we have similar experiences and perspectives in each of our respective markets. MAVCAP brings us strong local perspectives and resources. Having been here from the start, they deeply understand Malaysia’s startup ecosystem and can bring meaningful institutional resources to the partnership,” he adds.

Kay-Mok feels that Gobi’s 15-year experience of working with startups in Asia and MAVCAP’s local support and resources make the fund an attractive proposition. “We’ve successfully helped companies go IPO, put together M&A events and, yes, have been there when the shit hits the fan,” he says.

“This is a seed fund, but we’re looking at planting coconut-sized seeds into companies with strong potential. In some cases, we believe that even if we don’t provide the most in terms of capital, intangibles such as our expertise, experience, resources and strategic network will more than compensate here.”

The fund has already closed five deals so far: ecommerce startup Nuren, services marketplace RecomN, social impact startup YouthsToday, crowdsourced tours site Triip, and restaurant discovery app Offpeak, whose series A in 2015 was partly financed by the fund.

 

This article was originally published on techinasia.com and can be viewed in full here

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