AC Ventures hits $205m in final close of third fund

AC Ventures, an early-stage VC firm that focuses on Indonesia startups, has closed its third fund after raising more than US$205 million in committed capital. With the latest fund, the firm’s total assets under management (AUM) have climbed to US$380 million.

AC Ventures’ founding partners (from left): Adrian Li, Pandu Sjahrir, and Michael Soerijadji / Photo credit: AC Ventures

The limited partners of the fund include prominent companies such as the World Bank’s International Finance Corporation and Disrupt AD, the venture arm of state-owned Abu Dhabi Developmental Holdings.

According to AC Ventures, around 40% of the LPs in the third fund were US and Europe-based investors, while 35% come from Southeast Asia, and 10% from the Middle East and North Africa. AC Ventures did not disclose the origins of the remaining investors.

The VC has been disbursing capital from the latest fund since March 2020. Fund III reached its first close by securing US$56 million in commitment seven months later, having invested in 30 businesses so far and on track to deploy more than US$100 million by the end of 2021. The fund’s current return stands at a 1.94x multiple on invested capital (MOIC).

The fund targets early-stage startups that have ticket sizes of a few hundred thousand to a few million dollars, depending on their size and maturity. The fund can also top up its investment in any firm by up to 10% of the total fund size or around US$20 million.

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AC Ventures itself was founded as a merger between two Indonesian VC firms, Convergence Ventures and Agaeti Venture Capital, in 2019. Those firms had delivered returns at 2.99x and 2.41x gross MOIC, respectively.

According to a statement, AC Ventures’ portfolio firms have raised US$500 million in follow-on funding in the past 18 months. Two of them, payments company Xendit and used-car marketplace Carsome, crossed US$1 billion in valuation to enter the unicorn club earlier this year.

The company focuses on popular sectors such as ecommerce, fintech, and solutions for SMEs in Indonesia. “As the sectors mature, the new verticals in terms of target market and kind of products sold will open up,” AC Ventures’ managing partner Adrian Li told Tech in Asia.

To prove his point, he highlighted the emergence of dark stores or the quick commerce concept, companies building fintech infrastructure, and B2B marketplace for niche sectors such as construction.

The VC firm currently has around 20 employees in Indonesia and Singapore, and plans to double that number by 2023.