Fund focus: TukTuks answers call for Thai exposure

Thailand-focused venture capital funds are few and far between, typically managed by regional corporates with limited ecosystem creation agendas and operational scope. As soon as LPs – principally local investors – were presented with something more appealing, they jumped at the opportunity.

500 Startups, which claims to be the first major Silicon Valley accelerator and seed-stage investor in the Thai market, offers a case in point. Its Thailand-focused fund, known as 500 TukTuks, has surpassed a $10 million target to close at $15.4 million, with over 90% of the capital coming from domestic high net worth individuals and corporates.

“Our partners get invited by corporates to speak about 500 Startups a lot, and we have gotten interest from the media exposure,” says Mameaw Sapprasert, the senior investment manager for TukTuks. “The fund just extended automatically.”

Launched in 2015, TukTuks focuses mostly on seed-level companies, which are considered particularly underserved by the local VC environment. It has invested in 30 companies so far and is aiming for a portfolio of up to 70. Investments cover a number of internet-enabled segments, although financial technology has emerged as one of the most promising areas. Fintech companies backed by the fund currently include payment solutions start-up Omise and FinAccel, a company that offers instant credit checks and loans to e-commerce consumers with smart phones.

Deployment sizes range from $100,000-$150,000, and about one third of the portfolio companies have already received follow-on capital or are close to receiving their next round. One notable later-stage commitment led to participation in an $11 million Series A round for online fashion retailer Pomelo.

Such post-seed investments will be the focus of 500 Startups’ Bangkok office going forward as it launches a second TukTuks vehicle towards the end of the year. Details have not been fully fleshed out as yet, but the fund could write checks closer to the $500,000 range, targeting more mature companies.

The plan represents part of a broader Southeast Asia push by the firm and a growing consensus that some countries in the region have been underinvested. Based on a combination of large-scale mobile penetration trends and a conducive local culture, Sapprasert sees Thailand as one of these blind spots, with untapped potential for fostering start-ups with $1 billion-plus valuations.

“In this region, Indonesia, Malaysia, Vietnam and Singapore – they all have unicorns, but Thailand doesn’t yet. It’s a new area for start-ups to come and have their business because Thai people use social media a lot, and they’re not afraid to try new things,” she says. “That’s a huge advantage in coming here.” 

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• Topics
• Southeast Asia
• Venture
• Fundraising
• Technology
• Thailand
• 500 Startups
• TMT