Venture Capital in Asia: Landscape Overview

BFP Silver is a VC fund of funds investing in early-stage VC funds globally. You can find some notes below on why investing in Greater China and South-East Asia is an important part of BFP Silver’s asset allocation.

State of Venture Capital in Asia

Long-term growth and strong returns in VC investing despite decline since the market correction in 2015

  • 162 VC Funds currently raising money in Asia
  • VC performance in Asia has been consistently strong recently, with median net IRRs of ≈15% for 2011–2013 vintage funds outperforming North America and Europe-focused funds

Greater China — Second Largest VC Market Globally

  • Second largest economy in the world (after the US) with 1.3bn mobile users
  • Some of largest global internet companies (e.g. Alibaba, Baidu) and VC deals (e.g. Didi,
  • Beijing as global number 2 in terms of VC funding with $1.9bn in Q3 ’16 (San Francisco with $3.3bn)
  • According to OECD, China will surpass US by 2019 to become №1 in R&D spending globally

South-East Asia — The Next China?

  • Large population with strong consumer demographics leads to great opportunities
  • 260m internet users, estimated to grow to ≈480m by 2020 (≈3.8m / month)
  • SE Asia’s internet economy of $30bn expected to grow to $200bn by 2025

Selected Players in the Ecosystem

Drivers for VC Firms

  • Reasonable entry valuations compared to other regions like the US
  • Greater interest from deep-pocket investors in later stages facilitate follow-on financing rounds
  • Subsidies from governmental organizations
  • Due to growing entrepreneurial culture in China and Singapore start-up scene attracts more and more talent
  • Massive amounts of R&D spending in China leads to technological advantages versus other regions globally

Vertical Trends


Bain & Co.: Can Southeast Asia Live Up to Its E-commerce Potential,

BCG Global Wealth Market-Sizing Database, 2015,

CB Insights Unicorn Research,

Deloitte SE-Asia Report:

e-conomy SEA Presentation by Google and Temasek,

Gartner: Enterprise IT Spending in Southeast Asia Will Reach $62bn by 2018,

Internet World Stats,

OECD — Economic Outlook for Southeast Asia, China and India 2016,

Preqin, 2016 Global Private Equity and Venture Capital Report,

Preqin, Asia Attracts Record Venture Capital Investment in Q2 2016,

Preqin Special Report: Asian PE and VC, September 2016,

Preqin, Venture Capital in South East Asia 2016,

Venture Pulse, Q3’16, Global Analysis of Venture Funding, KPMG International and CB Insights, Oct 2016,

We Are Social — Digital in 2016,


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