Northstar closes PE fund at $810m, VC fund at $89m

Northstar Equity Partners IV launched in early 2014, with a target of around $800 million and a hard cap of $1 billion, and it achieved a first close of $500 million in July of that year. The process was complicated by a challenging fundraising environment and uncertainty about the Indonesia.

According to a source familiar with the firm, the major issue for LPs has been the volatile rupiah, followed by the economy. When Northstar raised its third fund - which closed in 2011 at $820 million - Indonesia was on a role, with growth topping 6%. The Asian Development Bank is projecting 4.9% for 2015.

Although Joko Widodo was elected president last year on the back of renewed optimism, the source adds that the jury is still out on promised reforms.

Northstar was founded by former Goldman Sachs banker Patrick Walujo and Glenn Sugita in 2003. The firm raised $110 million for its first fund and followed up with a second vehicle of $285 million in 2008.

Fund II is in exit mode, having realized 60-70% of its positions. For example, Northstar still holds a portion of shares in Bank Tabungan Pensiunan Nasional (BTPN), a co-investment with TPG Capital. It made another partial exit in February, selling 17.5% to Japan's Sumitomo Corp. for IDR5.93 trillion ($461.8 million). This is part of the deal whereby Sumitomo agreed to buy 40% of BTPN.

Fund III has 15 portfolio companies, of which two have been exited. The new fund will follow a similar strategy to its predecessor, committing 70% of the corpus in Indonesia and the rest in other Southeast Asian markets.

Northstar entered the VC space last year when Shane Chesson, previously a technology-focused investment banker, and Hian Goh, an entrepreneur best known for setting up the Asian Food Channel, joined the team. The plan was to support start-ups throughout Southeast Asia with Singapore as a hub.

NSI received backing from Temasek Holdings in the first close of its debut fund. Several other institutional investors are said to have come in towards the end after being impressed by the performance of the firm's portfolio.

NSI focuses on Series A and B investments and has backed the likes of restaurant reservations platform Chope, online grocery retailer Redmart, big data company Crayon Data, automatic flatbread maker Zimplistic Inventions, online travel agent Oway, insurance marketplace CXA, and motorcycle transportation courier service Go-Jek.

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• Topics
• Fundraising
• Southeast Asia
• GPs
• Venture
• Buyout
• Northstar Group
• Fundraising
• Southeast Asia
• Indonesia
• NSI Ventures
• Venture