As the Asia technology ecosystem grows, corporate venture players are taking on a bigger role in private markets. In Q1’17, corporates participated in 125 deals across $6.6B in funding, more than any quarter in 2016.
Corporates also increased their share of participation in deals to tech startups in Asia significantly, reaching 40% of deal share in Q1’17 compared to 31% in the previous quarter.
Using the CB Insights database, we highlighted the top corporate investors in the region in the past year and analyzed how these 12 players are fueling innovation in the Asia tech ecosystem and where they’re focusing their investments.
1. Tencent Holdings
Chinese internet giant Tencent Holdings is the most active corporate investor in Asian technology startups, making over 30 total investments to VC-backed tech companies in Asia since Q1’16. Most of Tencent’s investments in Asia over the five quarters preceding Q2’17 went to startups based in China, with deal activity almost exclusively focused on mobile or internet software/services and e-commerce businesses.
Tencent counts a whopping 19 of the 60+ total Asia-tech unicorns in its portfolio – far and away the most of any corporate investor in the region – and made four unique investments in Asia tech unicorns in Q1’17 alone, participating in follow-on rounds to China-based bike-sharing startup Mobike and Q&A site Zhihu, as well as India-based Flipkart’s $1.4B Series J, participating alongside corporate investors eBay and Microsoft. (Tencent also made a third investment in Mobike in June.) Other notable recent tech deals include participation in Kuaishou’s $350M Series D, and online medical association firm Hao Daifu’s $200M Series D.
2. SBI Investment
Prior to January 2015, Tokyo-based SBI Investment – the venture arm of SBI Group’s asset management business – had made about 10 portfolio investments globally since 2000. Since Q1’16, however, the firm has become a highly active investor in Asia, participating in at least 18 deals to tech companies in the region through Q1’17.
SBI shows a strong preference for investing in its fellow Japanese companies, many of them early-stage, with all but four of its Asia-tech deals since Q1’16 going to Japan-based firms. One notable exception is the firm’s $30M investment in Seoul-based Yello Mobile, an umbrella company that acquires mobile startups, in Q1’16. (The deal is SBI’s only unicorn investment over the five-quarter period.) SBI invested in five Japan-based tech startups in Q1’17, including participating in Japan-based digital health startup CureApp’s $3.4M Series A and IoT data platform aptpod’s $5.8M Series A.
3. CyberAgent Ventures
CyberAgent Ventures is an offshoot of Tokyo-based CyberAgent, a publicly traded internet advertising and social gaming company. The venture arm says it primarily makes investments in early-stage Asian internet businesses with global expansion potential, with a preference for companies at the seed-stage: More than half of its investments in Asian tech companies from Q1’16 to Q1’17 went to companies at the seed stage.
CyberAgent made just one investment in Q1’17, a follow-on in Japan-based restaurant-website developer Favy’s $3M Series A. Notable investments over 2016 included participation in a $2.25M Series B to HarukaEdu, an Indonesia-based provider of online education solutions, and a $4.2M seed round to NIDA Rooms, a travel e-commerce site.
4. Brand Capital
An offshoot of The Times Group, India’s largest media conglomerate, Brand Capital makes “brand building” investments in mobile, internet software, and e-commerce businesses. Brand Capital’s investments in Asia tech from Q1’16 to Q1’17 all went to India-based companies, including a $25M Series A to Meru Cab Company, a “radio taxi” company moving into inter-city ride-sharing, and participation in a $6M Series A to MyGlamm, a marketplace for on-demand salon services. Brand Capital co-invested alongside corporate investor L’Occitane in the MyGlamm deal.
Brand Capital counts a $20M convertible note investment in Indian unicorn Quikr, an e-commerce site specializing in online classifieds, among its Q3’16 deals. But given that Quikr had already raised beyond Series H, the late-stage investment is a highly unusual one for Brand Capital’s portfolio; all of the firm’s other Asia tech investments over the five quarters preceding Q2’17 went to companies at the seed or Series A stages.
Original Resource: cbinsights.com