InnoVen Capital has made its debut in the local startup scene with two separate venture-debt transactions sealed with e-commerce platform Tiki and workspace operator UP Co-working.
The value of the loans provided was nevertheless not disclosed at this stage.
The venture debt provider said that it will further focus on opportunities in the country, with other deals being assessed in the meantime.
According to Chin Chao, CEO of InnoVen Capital Southeast Asia, the firm has been actively exploring opportunities in Vietnam since it started operations in the region in 2016.
“With growing investor interest in startups in Southeast Asia, we see more and more companies and founders in the region, particularly in Vietnam, wanting to use less dilutive loan capital to accelerate expansion,” Chao said.
Venture loans are rather new to Vietnam and the region at large as it is a type of debt financing offered to venture-backed companies. Unlike traditional bank lending, venture loans are catered towards startups and growth companies that may not always have positive cashflow or assets as collateral.
InnoVen Capital, meanwhile, is a joint venture between Singapore state investment firm Temasek Holdings and United Overseas Bank (UOB). It provides less dilutive loan capital to startups across India, China and Southeast Asia and its portfolio has included early-to-late stage companies like Swiggy, Oyo, RedDoorz and others.
InnoVen has so far provided a total venture debt financing of $500 million to some 200 startups. Portfolio companies have used Innoven venture loans to extend cash runway and accelerate growth while minimising their equity dilution.
In May, the company raised $200 million in equity from its shareholders Temasek and UOB.
InnoVen has recently participated in the $7.6-million seed round of Indonesia-based logistics company Kargo Technologies and regional e-scooter sharing company Beam Mobility.
