Singapore state investor Temasek and Singapore-headquartered banking group DBS announced on Friday that they will jointly launch a $500 million growth stage debt financing platform.
DBS–the largest lender in Southeast Asia–and Temasek have entered into an agreement to jointly launch the platform, called EvolutionX Debt Capital.
Headquartered in Singapore, EvolutionX will provide non-dilutive financing to growth stage technology-enabled companies across Asia, with a focus on China, India, and Southeast Asia, DBS and Temasek said in a joint statement.
“The investment in EvolutionX provides an opportunity for us to play an integral role in nurturing and financing the growth of Asia’s future unicorns while forging partnerships and ecosystem opportunities with these high-growth technology-enabled companies,” DBS Group Head of Institutional Banking Tan Su Shan said.
“Growth debt is fast emerging as an alternative source of financing for high-growth technology companies that traditionally only raised equity as a source of capital. Apart from helping founder entrepreneurs avoid dilution of share equity in the company’s initial stages of development, growth debt also serves as a complementary tool to tide these companies, which are often cash strapped, through unexpected market and economic headwinds by extending their cash runway,” she added.
“Technology and digitization will have a pervasive impact across many sectors and will continue to transform our economies and communities. Temasek believes in the purposeful use of our capital to create and catalyze solutions for gaps we see today, to stimulate innovation and growth for long term, sustainable value,” Temasek Chief Investment Strategist Rohit Sipahimalani said.
The growth of debt capital space presents a significant opportunity, and EvolutionX will invest in opportunities arising from an increasingly digital economy – across sectors such as financial services, consumer, healthcare, education, and industrial development – to accelerate growth and build the next generation of technology leaders, according to Temasek.
The platform will be led by Joint Interim CEOs Amit Sinha, Group Head of Telecoms, Media and Technology, Institutional Banking Group at DBS, and Aftab Mathur, Director, Investment (Innovation) at Temasek, before a full-time CEO is appointed in the next few months.
Headquartered and listed in Singapore, DBS is a financial services group in Asia with a presence in 18 markets. DBS provides a full range of services in consumer, SME, and corporate banking.
Singapore state investor Temasek is a global investment company with a net portfolio value of S$381 billion ($283 billion) as of March 31, 2021. Headquartered in Singapore, it has 13 offices in nine countries around the world.
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Featured photo credit: DBS