Singapore's Jungle Ventures raises $240 million for third Southeast Asia fund

SINGAPORE/NEW YORK (Reuters) - Singapore’s Jungle Ventures said on Wednesday it has raised $240 million from investors, including Temasek Holdings, for a third fund designed to back Southeast Asian startups, highlighting the growing interest in the region’s technology firms.

Jungle Ventures’ latest fund comes as a growing number of venture capital firms, including Vertex Ventures and Golden Gate Ventures, have been raising funds focused on the region this year.

Investors are betting on the market potential of Southeast Asia’s population of 640 million, which is fast going online, and using smartphones to shop, commute and make payments.

The region’s Internet economy is forecast to balloon to $300 billion by 2025 from an estimated $100 billion this year, according to a report by Google, Temasek and consultants Bain & Co.

More than 90% of the capital was from institutional investors, with about 60% coming from outside Asia - mainly the United States and Europe, Jungle Ventures’ managing partner Amit Anand told Reuters.

The investors include German development finance institution DEG, the World Bank Group's IFC, Bangkok Bank's BBL.BK corporate venture capital fund Bualuang Ventures, Dutch development bank FMO and Cisco Investments.

The fund exceeded Jungle Ventures’ initial target range of $150 million to $200 million, Anand said. In its previous fund, the company raised $100 million from investors in 2016 and its debut fund had raised $10 million in 2012.

Jungle Ventures’ portfolio includes Singaporean hotel booking and management platform RedDoorz, cloud-based software provider Deskera, research platform Smartkarma and Thai fashion e-commerce start-up Pomelo Fashion.

The firm has created an internal rate of return of about 79% with its four exits that included vacations rental platform Travelmob, Anand said. It typically allocates $10 million-$20 million per company, making 10 to 15 key investments in each fund.

Reporting by Aradhana Aravindan in Singapore and Chibuike Oguh in New York, Editing by Sherry Jacob-Phillips