Singapore-headquartered venture capital firm Golden Gate Ventures is seeking $120 million for its fourth fund dedicated to backing early-stage tech startups, Bloomberg reported on Tuesday, citing an email the firm sent to investors.

Golden Gate focuses on areas including fintech, marketplaces, social commerce, healthtech, edtech, agritech and entertainment, according to the email. Its three primary markets are Singapore, Indonesia and Vietnam, according to the report.

Founded in 2011, Golden Gate has since launched three funds and backed startups including online classifieds app Carousell, used-car marketplace Carro, Indonesian clinic network Klinik Pintar; social commerce platform Chilibeli, payments platform Stripe, delivery firm Ninja Van, among others.

Golden Gate’s move comes at a time when Southeast Asia is attracting more investors into the region. In the first half of 2021, the number of investments in the region surged 20 percent over the year-ago period to a record, with Indonesia and Singapore attracting the lion’s share of funding, according to a report by Southeast Asian venture capital firm Cento Ventures. Total fund inflows amounted to $4.4 billion, Reutersreported last week.

Investor interest is being driven by the region’s growth potential, with its internet economy forecast to more than double to $360 billion in gross merchandise volume by 2025. The region’s digital economy is expected to reach $363 billion by 2025.

Earlier this month, Indonesia-based venture capital firm AC Ventures announced that it had closed its Fund III with over $205 million in committed capital.

Deals for internet companies in Southeast Asia totaled $11.5 billion in the first half of this year, putting the region on track to surpass the $11.6 billion investment in all of 2020, according to a report published by Google, Temasek and Bain & Co.

The development also came as Southeast Asia’s startup ecosystem has come into the limelight after several fundraising activities and IPO on the US market in recent months.

Singapore-headquartered super app Grab has made its market debut on Nasdaq last week after a record $40 billion merger with a special purpose acquisition company (SPAC). Grab’s Indonesian rival GoTo Group has raised $1.3 billion last month, ahead of an IPO planned for next year. Vietnam-based data-driven loyalty platform Society Pass Incorporated (SoPa) has also started trading on Nasdaq last month.

Valuations of startups in Southeast Asia have become ‘irrational’ due to heavy capital inflows from global investors, a partner at Golden Gate Ventures told Reuters last week.

China’s crackdown on its tech sector has also contributed to capital injections to the region, causing valuations of many startups to outpace their business principles, Justin Hall, a partner at Golden Gate Ventures, said at the Reuters Next conference.

“One of the biggest factors when it comes to the irrational valuation … is the influx of U.S. and global money. There is an extraordinary amount of money coming into the region … and the end result is that you have … too much money chasing after too few deals,” Hall was quoted as saying.

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AC Ventures raises over $205M for oversubscribed Fund III to invest in Indonesia’s next generation of technology leaders