Fund focus: Makara goes global in IP search

Intellectual property (IP) became a policy priority for Singapore in its own right in 2013, when the government announced a 10-year master plan to turn the country into a global IP hub within Asia. The idea was to become the location of choice for IP transactions and management, IP filings, and IP dispute resolution.

More recently, there have been calls for Singapore to scale up by building greater capacity for IP commercialization. The Ministry of Law and the Intellectual Property Office of Singapore (IPOS) responded with more development proposals and several concrete goals. These include increasing the number of IP-related jobs from 500 to 1,000 within five years, helping 1,500 companies understand the value of their IP by 2019, and providing IP audits and assistance to 150 local businesses, also by 2019.

Private sector involvement in this initiative will be driven in part by the S$1 billion ($716 million) Makara Innovation Fund (MIF), launched by IP Value Lab, the enterprise engagement arm of IPOS, and Singapore-based GP Makara Capital. The LP base comprises strategic investors from within and outside of Singapore. They are expected to help portfolio companies access growth markets overseas as well as participating in larger-ticket deals as co-investors.

“To understand the value proposition behind MIF, it helps to note that, traditionally, private equity strategies tend to be organized by geography and sectors. However, in the advent of knowledge-based economies, we find that these constraints are being challenged daily, particularly by innovation-driven companies,” says Ali Ijaz Ahmad, CEO of Makara Capital.

He describes MIF’s investment strategy as enterprise-driven. There are no sector or geographic constraints in terms of where it can deploy capital; the priorities are identifying companies with globally competitive technologies and solutions, and fostering organic and M&A strategies to accelerate portfolio company growth. MIF is said to be the first PE vehicle in Southeast Asia with a mandate to target IP-driven opportunities internationally and pursue cross-border regional expansion.

Areas of interest include urban solutions, advanced technologies, financial technology, consumer, alternative energy and healthcare. It is estimated that bringing more IP onshore could contribute at least S$1.5 billion to Singapore’s economy over the next five years. 

The fund will back 10-15 companies, investing $30-150 million in each one, and have them tap into Singapore’s IP ecosystem. Series C rounds are seen as the sweet spot, when companies have a proven and defensible IP and are looking to scale up internationally.

“Singapore, in particular, and Asia, in general, has a vibrant early-stage equity funding ecosystem as well as a financial system that is favorable to mature stage investments, thus creating a white space for Makara Capital on which to focus on growth-stage investing,” Ahmad adds. 

• Tweet  
• Facebook  
• LinkedIn  
• Google plus  
• Save this article  
• Send to  

• Topics
• Southeast Asia
• Growth
• Technology
• Financials
• Fundraising
• Singapore
• Makara Capital