Mapping Temasek’s role in the startup space (updated)

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This is the updated version of the article which was first published on November 15, 2022.

Three years ago, Tech in Asia chronicled Temasek’s journey from an investor to a venture builder with the launch of its own startups. At that time, the Singapore state-owned investment major – which does not manage taxpayers’ money – had about nine companies under it, five of which were startups it launched.

In April 2023, that number has grown by over 4x to 38 companies, with 12 of them being startups. Today, this has risen further to 50 companies, with 15 of them being startups.

This figure excludes seven startups that the investment firm’s companies acquired: Dreamcloud and Decision Science Agency, which were bought by Temus; BasisAI, which was acquired by Aicadium last year, Sembcorp, where Temasek owns 49.6% stake in the firm, Rivulis, which was acquired in 2020, and Elements Material Technology acquired last year.

Besides startups, Temasek has about 20 investment firms and a venture-building arm. It is also involved in a number of projects such as NovA, a joint initiative by MAS and Singapore’s National AI Office on how to assess financial risk. Both Temasek and Aicadium are part of the project’s consortium of members.

The state-owned investment firm’s venture-building endeavor seems to have picked up steam over the last three years, though it founded its first venture as early as 1988 – Vertex Ventures. Temasek has created 18 startups and made two acquisitions since 2020.

This momentum of creating its own startups has ultimately led Temasek to launch a venture-building company called Menyala in 2022, which means “light up” or “ignite ” in Malay. Menyala aims to launch startups that make disruptive technologies accessible and useful. Its initial focus is on emerging areas such as Web3, creator economy, and virtual worlds and experiences.

The most recent startups from Menyala’s stable include Authentick, a platform that lets users buy digital collectibles or NFTs and check their validity, and search platform Splore. Earlier this month, Menyala led a US$4 million seed round into Authentick.

“The whole idea is, can we spark the next big set of disruptive businesses? Also, can we do this in a more systematic and scale manner going forward?” Pradyumna Agrawal, managing director for blockchain investments at Temasek, tells Tech in Asia. He adds that the firm has hired product leads, engineers, and designers, and it is working on the next set of problem statements in music, NFTs, gaming, and search, among other sectors.

See also: The investor’s gambit: Temasek launches its own startups

Agarwal says that while Temasek will continue to invest in startups, the firm realized that given the emergence of technologies such as blockchain and AI, there was an opportunity to help accelerate the process of building businesses and ventures. “These are big bold areas where you cannot just have any small group of individuals come up and do it. It needs institutional heft and support,” he adds.

This can be clearly seen as most of Temasek’s venture-building efforts have been in spaces where the technology is still nascent and being developed.

Besides this, venture building also gives Temasek more control of the outcomes of these startups, which also makes them a relatively safer bet. Instead of injecting funds in an external startup working on decentralized tech, “venture building is the best way to deliver results,” said Song Hwee Chia, deputy CEO at Temasek International, in a previous interview with Tech in Asia.

Ren Yeong Sng, Temasek’s managing director of AI strategy and solutions, tells Tech in Asia that it is well-positioned for venture building as many of its startups are working on solutions that relatively take a longer time period to develop and hence require the long-term capital support, which the investment firm can provide.