DEG, the investment arm of German state-owned development bank KfW, is set to invest $18 million in Vertex Ventures’ latest SEA and India Fund V. The investment is aimed at promoting growing businesses in the Southeast Asian region that have a high developmental impact, contributing to the local tax base and creating demand for qualified labor.
According to regulatory filings, Vertex Ventures will use the fund to support innovative technology companies within traditional industries, improving resource utilization and supporting sector development. The fund has reportedly raised commitments worth between $300 million to $400 million from institutional investors, including Temasek, Singapore’s sovereign wealth fund, which has committed $100 million as an anchor investor.
DEG Invests $18M in Vertex Ventures
Vertex Ventures is reportedly aiming to raise a target of $500 million for the SEA and India Fund V, which will be its fifth such fund. The firm previously raised $305 million for Fund IV in 2019, which focused on early-stage tech startups in the region.
The current fund will be used to support businesses in India and Southeast Asia, where Vertex Ventures already has a strong presence. The firm has more than $1 billion under management and has invested in over 78 startups globally, including India-based startups such as D2C meat and seafood unicorn Licious, two-wheeler marketplace BeepKart, fintech platform Kissht, and audio streaming major Kuku FM.
DEG has also scaled up its investments in India recently, with Bike Bazaar raising $10 million from the firm earlier this month. Between 2019 and 2020, DEG invested in fintech startup LivFin in multiple tranches.
The announcement of the investment comes at a time when investors are accumulating more dry powder, especially in India, where startups have been facing a funding crunch due to market volatility and macroeconomic pressures. With Vertex Ventures and DEG committing significant funds to the region, it is expected that more investors will follow suit, further boosting the startup ecosystem in Southeast Asia and India.
In conclusion, DEG’s $18 million investment in Vertex Ventures’ SEA and India Fund V will be used to promote high-impact businesses in the region, contributing to the local tax base and creating demand for qualified labor. The fund will support innovative technology companies within traditional industries, improving resource utilization and supporting sector development. With Vertex Ventures and DEG committing significant funds to the region, it is expected that more investors will follow suit, further boosting the startup ecosystem in Southeast Asia and India.
