Indonesia-based venture capital firm AC Ventures said Wednesday it had closed its Fund III with over $205 million in committed capital, bringing the firm’s total asset under management to over $380 million across its funds.
The fund was oversubscribed and participated by renowned global and regional institutional investors, including the World Bank’s International Finance Corporation (IFC) and Disrupt AD, Abu Dhabi Developmental Holdings (ADQ) venture platform, AC Ventures said in a statement.
“Drawing on our personal experience as entrepreneurs – building businesses in emerging markets from start to acquisition and initial public offering – we are uniquely positioned to partner with our portfolio founders to tackle the challenges faced by rapidly scaling startups.
“It is reinforced by our partners’ highly complementary backgrounds from the US, China, and Indonesia and extensive investing experience in successful digital ventures, bringing valuable networks and insights our founders can capitalize on,” said Adrian Li, Founder and Managing Partner, AC Ventures.
According to the statement, Fund III has been investing actively since its first close in March 2020 and has completed 30 investments out of a targeted 35, anticipating over $100 million deployed by end of 2021.
It said several of these ventures – all invested during the pre-series A stage – have grown tremendously through the COVID-19 pandemic, helping consumers and businesses survive the disruptive period. These ventures include Shipper, Stockbit, Ula, Aruna, Bukuwarung, and Colearn, which are already Centaurs with some approaching Unicorn valuations.
It also said the fund is already showing strong early traction, with multiple on invested capital (MOIC) at 1.94 times less than two years from the first close.
“The growing base of internet users and tech-enabled services has made Indonesia home to many of South East Asia’s largest digital platforms. Not only is this attracting more investment into the country, but it is also providing new and innovative solutions to solving today’s most pressing challenges,” said Azam Khan, IFC Country Manager for Indonesia, Malaysia, and Timor-Leste.
“IFC’s partnership with AC Ventures underscores our long-term commitment to Indonesia’s economic development and digital transformation. This investment aims to support the advancement of the promising and vibrant start-up ecosystem and has the potential to transform economic and social lives for all, including the most vulnerable,” he added.
According to the statement, AC Ventures’s latest fund also continues the firm’s original fund strategies of targeting early-stage Indonesia-focused technology-enabled startups.
The firm employs a deeply thematic and disciplined approach towards early-stage investing coupled with a strong founder focus. It also uses a comparable market and business model analysis to build sector expertise which enables quick decision making when committing to early-stage companies – which the firm has noted to be a critical factor in securing the best deals.
“At AC Ventures, we leverage our reach to connect our entrepreneurs to the broader ecosystem of local platforms and companies, as well as global domain experts. With decades of experience in investing and building businesses in Indonesia, we ensure that our portfolio founders are equipped with the resources and networks they require to build billion-dollar businesses. We’re grateful to be in a position to help catalyze change for Indonesia’s rapidly growing digital ecosystem,” said Michael Soerijadji, Founder and Managing Partner, AC Ventures.
In line with AC Ventures mission to empower entrepreneurs with experience, network, and capital, the larger fund will enable the firm to further invest into providing deep tactical support to founders through its Value Creation Team. This team – comprising functional experts with deep industry experience – will work across the firm’s portfolio to support talent operations, business development and regulatory, growth and capital formation.
“Indonesia presents a massive, ever-growing internet economy opportunity and the pandemic boosted this further by significantly accelerating digital adoption and consumption nationwide across different consumer and business segments. Not only is the resilience of Indonesia’s economy in the face of this adversity gives internet sectors a massive opportunity to rebound, but the exit landscape is also heating up, as we will see notable public exits in the coming future from regional tech giants,” said Pandu Sjahrir, Founding Partner, AC Ventures.
AC Ventures was formed in 2019 as a merger between two leading venture capital funds in Indonesia – Agaeti Venture Capital and Convergence Ventures. The firm works closely with entrepreneurs and complements them with research-driven knowledge, action-orientated portfolio support, capital value creation team, business development, network and resources.
AC Ventures partners have been investing in the early-stage Indonesian technology ecosystem since 2014 and have a portfolio of over 100 companies across its funds, making it one of the largest Indonesia-focused early-stage venture capital firms.
Among its early investments, two companies, Xendit and Carsome, have already emerged as Unicorns. In the past 18 months – as digital adoption has accelerated due to the pandemic – growth in AC Ventures portfolio rapidly increased, resulting in over $500 million in follow on funding raised in the newest portfolio alone from well-known global investors such as Sequoia, Tiger Global and Prosus, which also subsequently helps to generate greater economic impact for Indonesia.