Thursday, 30 March 2023

Fundnel and BRI Ventures to launch a new fund for access to growth-stage start-ups

5 min read

Fundnel Group (Fundnel), one of the largest marketplaces for alternative assets in Southeast Asia has signed a memorandum of understanding (MOU) with BRI Ventures (BVI) to launch a first-of-its-kind BVI – Fundnel Secondaries Fund (Fund). The collaboration increases accessibility for a wider range of investors to invest directly into the high-growth Indonesian start-up ecosystem.

Indonesia’s digital economy is expected to grow 18.9% from $44 billion in 2020 to $124 billion in 2025, bolstered by increasing smartphone adoption, mobile-first development and expansion of technology, media and telecommunications infrastructure in rural areas. Now, Fundnel and BVI have joined forces to offer global investors access to the growth-stage Indonesian start-ups.

The strategic partnership leverages on BVI’s strong record of investing and Fundnel’s access to a strong pipeline of deals. The Fund aims to build a portfolio of high-growth Indonesian companies through a nontraditional route of investment that will directly support founders, employees and early-backers. This strategy aims to re-ignite stakeholders’ excitement to continue building these high-growth companies while allowing existing investors to reinvest capital into other exciting opportunities which will contribute to a vibrant start-up ecosystem in Indonesia and Southeast Asia. Fundnel and BVI will also work with start-ups to find structured and standardised processes for employees to find secondary liquidity for their stock options.

The MOU signing ceremony was held at the Embassy of the Republic of Indonesia in Singapore and was attended by esteemed investors, senior management of both Fundnel and BVI, and graced by the presence of Indonesian Ambassador Suryo Pratomo. Under the MOU, global investors will be able to invest in Indonesian growth-stage start-ups. Upon signing of the MOU and through this strategic partnership, Fundnel and BVI expect to attract investments of at least $50 million.

Over the past three years, Fundnel has received a total of $22 billion in secondary transactions across 1,000+ orders. Fundnel’s licenced status and deep engagement in the Southeast Asian fundraising ecosystem grants greater access and pricing leverage to acquire shares in unicorns regionally.

In line with the idea of creating access and liquidity in the market, Fundnel is looking to explore tokenisation of the Fund on Hg Exchange (HGX) to provide further liquidity for investors. With tokenisation, a valuable channel may be opened for investors to tap on liquidity on the HGX and it is intended to allow new investors to access high-growth companies in the region with a minimum ticket size of $10,000, a small fraction of the customary $200,000 ticket.

Pratomo said, “ASEAN countries should work together to spur economic growth and Indonesia is a strategically important market in Asia. Indonesia is a country of 600 million people with a GDP of 2.5 trillion and Indonesia is one of the most rapidly growing start-up ecosystems in Asia, with the country being home to many top start-ups. We hope to see more strategic partnerships like BVI and Fundnel to enrich the start-up ecosystem in Indonesia”.

Nicko Widjaja, CEO of BRI Ventures said, “Exit environment has been more challenging these days due to various unfavorable macro conditions that lead to a supply crunch. Through this exclusive partnership with Fundnel Group, BRI Ventures is thrilled to make growth capital investments in private late-stage Indonesian companies to help provide liquidity in the market. Together with BRI Ventures’ strong track record of investments and huge ecosystem and Fundnel’s extensive pipeline of secondary opportunities, this partnership will also serve as an attractive entry point for larger foreign funds to enter Indonesian growing tech start-ups”.

Kelvin Lee, co-founder and CEO of Fundnel said, “Indonesia has a very good ecosystem for start-up development and hence we are privileged for this opportunity to work with BRI Ventures. It is an endorsement of our capabilities to add value to start-ups in Indonesia. This MoU builds on our existing strong partnership with BVI and by combining BVI’s extensive network and Fundnel’s digital marketplace, we are confident to be strategically placed to assist start-ups in achieving their growth trajectory and potential. This MOU also marks our commitment to provide access and liquidity to Indonesian start-ups”.

Re-disseminated by The Asian Banker

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