Tin Men Capital beats odds with 2.5x returns amid tech winter

At a time when fundraising in Southeast Asia is at its lowest level in six years, Tin Men Capital is defying expectations.

The Singapore-based VC established its first fund in 2018. The total value to paid in capital (TVPI) of Tin Men Capital Fund I is now at 2.5x, putting it in the top 10% compared to US-based funds with the same vintage, according to data from private market insights company Carta.

TVPI measures the realized and unrealized value of the total amount of capital contributed by investors in the fund. A TVPI of 2.5x means that for every US$1 invested, investors gain US$2.50 in returns. However, TPVI does not take into account the time value of money, so factors like inflation are not considered.

Tin Men Capital co-founders Jeremy Tan (left) and Murli Ravi / Photo credit: Tin Men Capital

Jeremy Tan, the VC firm’s co-founder, made the announcement during the Tin Men Exchange Forum held with stakeholders this October.

Tin Men’s first fund raised US$30 million and bankrolled seven startups, which include Singaporean e-ticketing firm GlobalTix and media SaaS Intelligent Video Solutions, which has since been acquired.

The fund also recorded an internal rate of return (IRR) of 25.6%, Murli Ravi, the VC firm’s co-founder tells Tech in Asia in an interview. IRR is a calculation of the expected return a fund will generate on an annualized basis.

That rate puts Tin Men Capital Fund I in the top four VC funds identified by Alternatives.pe. That is also among the highest recorded IRR for funds in the region for vintages between 2016 and 2018, according to a Tech in Asia report in January.

See also: These VC funds lead SEA, but are they truly winning?

However, Tech in Asia has not been able to independently verify Tin Men’s numbers as Alternatives.pe does not have any data on the VC’s fund performance.

A realistic exit

Tin Men usually takes a 15% to 25% equity in startups it invests in, often making them the second-largest shareholder after founders, Ravi tells Tech in Asia. The VC’s initial check sizes range from US$2 million to US$4 million, though it has a history of participating in the follow-on rounds of its portfolio companies.

Meanwhile, its second fund registered a TVPI of 1.1x, placing it in the top 25% of best performing funds when compared to US-based funds with the same vintage.

Raised in 2022, Tin Men Capital Fund II has backed startups including AI Palette, an AI-enabled consumer insights firm that was acquired early this year.

Ravi believes that targeting enterprise-focused businesses and investing in only two to three startups a year have helped Tin Men achieve the feat.