East Ventures reaches $57m first close on eighth fund

LPs include global and regional institutional investors, including Adams Street Partners and Temasek Holdings-owned Pavilion Capital. East said it kept the target below $100 million to maximize speed and flexibility of deployment.

East closed its sixth and seventh funds last year, with its sixth flagship fund exceeding an initial target of $30 million to raise $75 million from the likes of Adams Street, Pavilion, and Sinar Mas Group. This was followed by a $250 million final close for EV Growth, a later-stage joint venture between East, Sinar Mas Digital Ventures, and Japan’s YJ Capital. Pavilion is also an LP in EV Growth, alongside Indies Capital, SoftBank Group and Yahoo Japan.

The latest fund will invest will extend the mandate of its predecessors, backing seed-stage companies across ASEAN in a range of technology-enabled sectors. East has further positioned Fund VII as targeting post-lockdown opportunities across the region, noting that many entrepreneurs have been forced to leapfrog into digital transformation and bypass years of the usual adoption process.

“The pandemic has created a chance for a new breed of entrepreneurs to think about new problems and how to solve them in efficient ways via technology,” Willson Cuaca, a managing partner at East, said in a statement. “We remain optimistic about the future of Southeast Asia’s digital economy, and we’re particularly bullish on the Indonesian market. We feel the current situation proves our core hypothesis that great founders will find a way to make their companies thrive, even in times of crisis.” 

East claims that half of its funds have returned more than the amount of capital invested by LPs, with multiple portfolio companies achieving multiples of 1,000x and distributions to paid-in capital rates as high as 7x. Notable exits include the acquisition of e-commerce start-up Kudo by Grab in 2017 and the acquisition of financial technology provider Moka by Gojek earlier this year. They were estimated to be worth $100 million and $130 million, respectively. Both deals were in Indonesia, which represents the bulk of the East portfolio. 

“We realized that the majority of our CEOs have never been in crisis before,” Cuaca added. “Because of this, we are doing health checks with our portfolio companies. Instead of immediately advising on tactical business plans, we first try to help the founder understand the crisis and how severely it is impacting their company. Only after founders understand these things can they begin to cultivate their own strategy and implement it tactically. In this respect, we’re trying to convey the importance of wartime leadership.”

Founded in 2009, East operates across offices in Jakarta, Singapore, Tokyo and San Francisco. The firm describes itself as the most active VC in Southeast Asia, having backed more than 170 companies to date, among them Traveloka, Tokopedia, Grab, and Gojek. In most cases, East was one of the first investors in these companies. It also leverages access to Indonesian co-working space CoHive, which received $13.5 million last year from Korea’s Stonebridge Ventures.

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• Topics
• Southeast Asia
• Fundraising
• Venture
• Indonesia
• East Ventures
• seed
• Adams Street Partners