Singapore: Temasek-backed Openspace Ventures closes US$200mil Third Fund

SINGAPORE, March 12 (Bloomberg): Openspace Ventures, backed by Temasek Holdings Pte, has closed its third Southeast Asia fund at US$200 million as the venture capital firm seeks to replicate its successes in startups across the region.

The amount boosts the Singapore-based firm’s total committed capital under management to US$425 million across three funds, co-founders Shane Chesson and Hian Goh said in an interview. Investors in the new fund include Germany’s DEG, Norway’s Norfund AS, U.S. asset manager 57 Stars LLC and Japan’s Mizuho Financial Group Inc.

Openspace was among the earliest investors in Gojek, the ride-hailing upstart that went on to become Indonesia’s most valuable unicorn, as well as Biofourmis Pte, which uses artificial intelligence to provide personalized care. The startup last year secured $100 million from backers led by SoftBank Group Corp., nearly tripling its valuation. Its first, $90 million fund has returned 35.3%, according to the company.

"Our peers may do more deals, but our hit rate has been high,” said Chesson. Openspace’s portfolio of 33 companies in 12 countries also includes Indonesian telemedicine app Halodoc, Filipino video-sharing platform Kumu, Indonesian agriculture-tech startup TaniHub and Finnomena, a digital wealth management platform in Thailand.

Chesson and Goh launched Openspace, then known as NSI Ventures, in 2014, when Singapore’s VC industry was still at its nascent stages. Since then, the industry has boomed. Assets under management by Southeast Asia-focused VC firms grew to $8.9 billion in 2019, a sixfold increase from 2010, according to data complied by Preqin. They raised $2 billion in 2019, up from $100 million in 2010.

The two partners had become friends while studying for their MBAs at INSEAD in Singapore in 2004. Goh then founded the Asia Food Channel, which he later sold to Scripps Networks Interactive Inc. for about $66 million, while Chesson worked on tech deals at Citigroup Inc. in Hong Kong.

They started investing as angel investors and in 2013 made a pitch to Dilhan Pillay, who at that time was part of Temasek’s enterprise development group, on working together to grow Singapore’s fledgling startup ecosystem. The coffee meeting with Pillay, now set to take over as the state investment firm’s chief executive officer in October, led to a series of official pitches and discussions with other teams at Temasek.

Around 2014, Temasek decided to pump $90 million into four local venture capital firms -- NSI Ventures, Monk’s Hill Ventures, Jungle Ventures and Golden Gate Ventures -- to help grow the industry. The firms have all launched bigger funds in recent years, giving birth to companies like Carousell, valued at $850 million.

"The technology startup ecosystem in Singapore is so vibrant now and Dilhan helped make it happen through backing funds like ours as well as others,” Goh said.

Openspace’s team of 25 people is made up of 12 different nationalities. It has made some key hires including Jessica Huang Pouleur, a former Walt Disney executive who joined as executive director in October to lead OSV+, the company’s first growth fund targeted at mid-stage tech startups in the region.

"We are seeing a high volume of early-stage companies beginning to mature and that’s creating really attractive investment opportunities,” she said. - Bloomberg
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