Venture debt firm InnoVen Capital closes two maiden funds in Vietnam

InnoVen’s Southeast Asia CEO Chin Chao said Vietnam is a crucial market for them.

Vietnam wants ride-hailing companies to operate like transportation services, including installing taxi-style light-boxes. Photo by Shutterstock

One of Asia’s most prominent venture debt firms InnoVen Capital said Friday it has invested an undisclosed amount of venture loan in e-commerce platform Tiki.vn and Hanoi-based UP Co-working Space as a stepping stone to enter Vietnam’s fast-growing tech ecosystem.

Apart from Tiki.vn and UP Co-working Space, InnoVen also announced a round of venture debt in Indonesian logistics company Kargo and e-scooter sharing company Beam Mobility. It didn’t reveal the deal size.

Vietnam has always been a crucial country of focus for InnoVen since the company started operating in Southeast Asia three years ago, said Chin Chao, Innoven Capital’s CEO of Southeast Asia. Backed by Temasek Holdings and United Overseas Bank (UOB), InnoVen offers structured debt solutions ranging from venture debt, acquisition finance, growth loans, to working capital facilities for startups to accelerate their growth while minimizing equity dilution.

InnoVen’s portfolio companies are in consumer Internet, mobility, consumer brands, hospitality, and various other sectors. Notably, many of its Indian portfolio companies are unicorns and soon-to-be unicorns such as as Swiggy, Byju’s, Oyo, Practo, among others.

The company is active in India and China before it expanded its operations in Southeast Asia. According to its website, InnoVen has loaned money to 25 companies in China, 30 in Southeast Asia and 100 Indian startups.

Moving forward, InnoVen will continue to look for investment opportunities in Vietnam. It said it is already in talks with a few more startups in Southeast Asia for a possible round of investment.

Venture debt is a relatively new concept in Southeast Asia but across the region, startups and founders are increasingly seeing it as an alternative solution to equity funding as it allows entrepreneurs to raise money without diluting their share in the company.

Despite starting operation in Southeast Asia in 2015, InnoVen is considered a pioneer in the region. However, with the entry of Genesis Alternative Ventures in May this year, it has got some company. In partnership with the Indonesian Bank CIMB Niaga, Genesis recently launched a USD 21 million venture debt fund for Indonesia.