B Capital closes Asia-US tech fund at $360m

Saverin launched the business with Raj Ganguly, previously of Velos Partners and Bain Capital, and they brought in Boston Consulting Group (BCG) as a sponsor. The fund had a target of $250 million and reached a first close of $143.6 million in May 2016 with commitments from investors in the founders’ personal networks, BCG and BCG Digital Ventures.

B Capital describes itself as a global VC firm that invests in healthcare, financial technology, industrial logistics, and consumer enablement companies. It has offices in Los Angeles, San Francisco, New York, and Singapore. Last year, the firm hired Kabir Narang from Eight Roads Ventures to lead investments in Asia. The focus is on early expansion capital, typically Series B and C investments of up to $20 million.

B Capital made its debut investment in India last December, leading a funding round for point-of-sale payments specialist Mswipe. This was preceded by an investment in Icertis, a contract management software provider with bases in the US and India. This week, Icertis announced it has raised a $50 million Series D round, with B Capital among the investors that re-upped.

Other deals in the region have focused on Southeast Asia. The portfolio includes health technology start-up CXA Group, last-mile delivery company Ninja Van, and peer-to-peer lending and invoice financing platform Capital Match.

“We continue to strive to be a launch pad for entrepreneurs across a wide range of verticals and seek to provide our portfolio companies with the necessary resources and access to some of the most important business leaders,” Saverin, who is based in Singapore, said in a statement. “We are committed to helping the next generation of entrepreneurs deliver transformative technology to the world and are strategically positioned to disrupt the realm of venture investing.”

Ganguly has previously noted that India and Southeast Asia are the regions where B Capital sees the biggest white spaces in the VC ecosystem in terms of the availability of capital at different stages, the presence of institutional investors, the amount of start-up talent, and the number of exits. He said the most significant potential funding gap lies in growth stage rounds when companies are trying to evolve from proving product-market fit to achieving scale.

Seed and Series A investments accounted for about 80% of overall Southeast Asia venture capital deal volume in 2012-2016, according to AVCJ Research. The Series B portion was just 10%. This finding correlates to a study published by Google and Temasek Holdings in 2016. Of the 681 start-ups in Southeast Asia that received funding between 2010 and 2015, 508 were at the seed stage. Later stage activity was limited, although five start-ups received 65% of all capital committed in 2015.

Government initiatives have helped drive seed-stage activity, which has generated opportunities for growing number of Series A investors. Several VC firms want to support companies as they pursue meaningful scale, at which point the likes of Chinese internet companies and PE firms get interested. In addition to B Capital, Gobi Partners, Monk’s Hill Ventures, and Vickers Venture Partners have either raised or are looking to raise funds that would enable them to target Series B and above.

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• Topics
• Southeast Asia
• Fundraising
• Venture
• Technology
• South Asia
• Southeast Asia
• India
• B Capital
• TMT