Preqin’s Private Equity Online tracks a total of 474 Asia-focused venture capital funds that have reached a final close since 2011, securing $61bn in aggregate capital commitments. Just over three-quarters of these vehicles solely invest in one country, while the remainder have a more diverse investment mandate.
As shown in the charts above, venture capital firms targeting Asia tend to raise more capital and close more vehicles if they are focused on investments in a single country than their geographically diverse counterparts. This is unsurprising, as local GPs (which have raised 87% of country-specific venture capital funds in Asia) are in a more advantageous position to negotiate with domestic portfolio companies than their more pan-Asia-focused peers, and may have greater networks and expertise in their domestic markets.
Generally, for both country-specific and continental vehicles, the number of funds closed annually and aggregate capital raised has declined over recent years. Funds focused on a single country in Asia have declined from 108 vehicles reaching a final close for an aggregate $17.4bn in 2011, to 59 funds raising an aggregate $6.7bn in 2015, while the number and aggregate capital raised by multi-market vehicles remains more stable. In 2016 so far, equal numbers (6) of single-country and multi-market vehicles have been raised, securing $1.7bn and $1.6bn respectively. It will be interesting to see if venture capital fundraising focused on Asia this year will surpass that of 2015, and whether these trends will persist over the next few years.