OpenAI, the company behind ChatGPT, dominated headlines after closing a whopping $6.6 billion round that pushed its valuation to nearly $157 billion. A day later, it announced securing a $4 billion revolving credit line.
The funding comes as the company is undergoing restructuring efforts and executive changes, including the abrupt departure of its longtime CTO, Mira Murati.
OpenAI is on track to generate $3.6 billion in revenue this year, but its losses are projected to exceed $5 billion. According to a New York Times article, the loss figure does not cover equity-based compensation for employees, among several significant expenses not fully explained in its recent deal documents.
As part of the funding round, OpenAI has two years to convert into a for-profit business, or its funding will convert into debt.
LP-GP updates
Blackstone, the world’s largest alternative asset manager, has started raising its third Asia-focused private equity (PE) fund, targeting at least $10 billion, according to a Reuters report. The new buyout fund will primarily focus on India.
Private credit continues to enjoy a “golden” moment after the recent interest rate cut in the US, Blackstone CEO Stephen Schwarzman told Nikkei in an interview, anticipating strong borrowing demand in the corporate sector.
Alternative investment firm TPG has named Joel Thickins, its head of Australia and New Zealand, as the co-head of its Asia business. He will work alongside Ganen Sarvananthan, who leads the firm’s activities in Asia and the Middle East.
Brookfield Asset Management sees Southeast Asia as a rapidly growing market experiencing substantial capital inflows and an increasing number of buyout opportunities, especially due to its family-owned industrial and manufacturing businesses.
Singapore-based Azalea Investment Management has closed its two latest funds after raising a combined $480 million. Both funds surpassed their target of $200 million each.
Investors in infrastructure funds are now looking beyond global allocation and mainstream strategies as demand for energy consumption in Asia rises and the world of alternative investing evolves.
Peak XV Partners, one of the largest venture capital (VC) firms in India and Southeast Asia, is reducing the size of its $2.85 billion fund by 16%, attributing the decision to soaring valuations in India’s richly priced public market.
Asian venture debt investor InnoVen Capital is seeking to raise a total of around $350 million for two funds dedicated to startups in Southeast Asia and India, according to multiple sources privy to the matter.
Southeast Asia’s private investment landscape is undergoing a transformative shift, with a new generation of fund managers emerging to capitalise on the region’s growth potential. Experts speaking at the recent Asia PE-VC Summit 2024 said these up-and-coming players must diversify to differentiate themselves in a crowded market.
About 17.9% of investment decision-makers at Southeast Asia-headquartered venture investors are women, according to a new DealStreetAsia report. The proportion of female investment decision-makers has remained relatively stagnant since 2023 (17.4%).
Family offices in Asia should follow the footsteps of institutional investors if they want to scale up and manage wealth beyond the first and second generations — mostly where riches are concentrated in the region, industry experts said at the Asia PE-VC Summit 2024.
The recent valuation correction in India’s startup ecosystem was a necessary response to the excessive capital influx that occurred during the pandemic, according to limited partners.
Valuable Partners, a venture debt firm founded by former Ascent Capital partner Ajay Mittal and ex-banker Rahul Gupta, has hit the first close of its $100 million maiden fund amid growing demand for the alternative asset class.
International Finance Corporation (IFC) is considering a proposal to invest up to $30 million to become the anchor investor in Japan-based GI Capital Management’s Asia Debt Opportunities Fund II.
Despite global economic headwinds, seasoned VC investors Jenny Lee of Granite Asia and Shailendra Singh of Peak XV remain optimistic about investment opportunities in China, India, and the rest of Asia.
News from SE Asia
Beijing-based state-owned enterprise China Finecast International Corporation China (CFIC) has offered to acquire Innovalues, a Singapore-based precision parts manufacturer backed by Northstar Group, according to a deal document seen by DealStreetAsia.
Healthcare-focused PE firm Quadria Capital is understood to be weighing an investment in Vietnam-based hospital chain Tam Tri Medical.
Australian lender ANZ and Indonesia’s Gunawan family are reportedly considering selling a combined controlling interest in Jakarta-listed Bank Pan Indonesia (Panin Bank), in which they each hold substantial stakes.
Following a surge in travel bookings post-COVID and strategic efficiency enhancements, Southeast Asian travel tech leader Traveloka turned profitable last year. A regulatory filing shows that the firm posted $7.4 million in net profit attributable to shareholders for the year ended Dec. 31, 2023.
Broom, an Indonesian digital automotive startup, has raised $25 million in an extended Series A round led by existing backer Openspace Ventures.
Singapore-based parenting platform Welovesupermom has secured at least S$18 million (about $14.1 million) in its latest funding round anchored by VC investor Granite Asia, per regulatory filings.
Indonesian insurtech startup Rey has secured additional seed funding of $3.5 million led by new investors CyberAgent Capital, Arthazen Capital, and PT Gametraco Tunggal, while Philippine startup Enstack is understood to have raised $3 million in its latest funding round.
Singaporean tech group Sea has applied for a digital banking licence in Thailand after launching the business at home and entering several other Southeast Asian countries.
Dutch development bank FMO is weighing a proposal to invest an additional $10 million in Agrocorp International, a Singapore-headquartered agri-commodities trading company.
China updates
Investors expect increasing industrial collaborations and capital flows between China and the Middle East despite a slowdown across global markets. Still, challenges remain for fund managers looking to translate the closer regional ties into actual fundraising.
Kasikornbank has become the first Thai lender authorised by the Asset Management Association of China to tap into the county’s PE market. Its PE unit plans to launch funds targeting investments in high-growth potential companies in China through the secondary market or co-investments.
China’s BingEx raised $66 million in a US IPO, which valued the courier delivery firm at $1.17 billion. The listing signals a recovery in investors’ risk appetite and easing regulatory hurdles.
China’s sovereign wealth fund, China Investment Corp. (CIC), has begun due diligence on the potential acquisition of three of the country’s largest bad debt managers, according to a Caixin report.
Asair, also known as Guangzhou Aosong Electronic, which engages in the production of micro-electromechanical systems (MEMS) sensors, has secured 700 million yuan ($99.8 million) in a Series D funding round.
Shanghai-listed Chinese semiconductor foundry business Nexchip is roping in external investors to inject 9.55 billion yuan ($1.36 billion) into its wholly-owned subsidiary to expand chip production facilities.
News from India and the rest of South Asia
Singapore state investor Temasek Holdings is in talks to buy a minority stake in India’s biggest snack maker, Haldiram Snacks, in a transaction that could value the firm at about $11 billion, per a Bloomberg report.
360 ONE Asset Management (formerly IIFL Asset Management Ltd) has initiated talks with the Bharti Group to acquire a stake in its life insurance venture as the Indian telecom major looks to exit its non-core assets, DealStreetAsia has learnt.
Following a notable decline in healthtech valuations in India, the market has stabilised with surviving companies being fairly valued, according to Biju Mohandas, Partner and Global Head of Healthcare Investments at LeapFrog Investments, a global impact fund backed by Singapore’s Temasek.
SoftBank-backed Indian food delivery company Swiggy has received shareholder approval to use a provision that will allow it to increase the size of fresh issue in its IPO to 50 billion rupees ($595 million) from 37.5 billion rupees, per a Reuters report.
India’s Matrix Gas & Renewables aims to raise 10 billion to 12 billion rupees ($119-$143 million) via an IPO as the company looks to take advantage of the country’s hot public market to fund its green hydrogen projects.
The Asian Development Bank (ADB) will invest $25 million in a certified climate bond issue by mid-market lender Vivriti Capital. The proceeds will provide capital to companies in sectors such as electric vehicles, solar and wind energy, and waste management.
IFC is considering extending a $60-million loan to Renata PLC, one of the leading pharmaceutical companies in Bangladesh, according to a disclosure.
Trends and analysis
Southeast Asia’s fintech industry has been under the weather recently, with declining investment and valuation drops. Experts, however, argue that the sector remains a viable long-term opportunity if approached with the right strategy.
Southeast Asia’s climate tech industry has the potential to grow into a hub for green investments and innovations despite the broader funding crunch, according to industry leaders. At the recent Asia PE-VC Summit 2024 in Singapore, panellists agreed that the sector benefits from strong alignment among stakeholders who recognise the urgent need to address climate change.
Building resilience and adaptation has become essential in markets vulnerable to climate disasters. These efforts should align with promoting financial inclusion and empowering women, as addressing inequalities is critical to ensuring the effectiveness of climate interventions, both in financing and product development, said panellists at DealStreetAsia’s Asia PE-VC Summit 2024.
