AppWorks closes third fund with $ 150 million for startups in Taiwan and Southeast Asia
AppWorks, the Taipei-based venture capital firm focused on Taiwan and Southeast Asia, today announced that it has closed its third oversubscribed fund, raising $ 150 million. Sponsors of AppWorks Fund III include Taiwan Mobile, Axiom Asia Private Capital, Fubon Life, TransGlobe Life, Hongtai Group, Wistron, Cathay Pacific, Phison Electronics and the Taiwan National Development Fund. Many of these LPs also participated in AppWorks’ second $ 50 million fund in 2014.
AppWorks’ total assets under management (AUM) now stands at $ 212 million. As part of the Fund III closing, AppWorks is recruiting new investment associates and analysts, particularly those who will focus on finding deals across Southeast Asia.
Jamie Lin, president and founding partner of the company, told TechCrunch that Fund III had an initial target of $ 100 million, but exceeded it due to the strong performance of AppWorks’ second fund.
Fund II’s portfolio includes Lalamove and 91APP, and at the end of July 2021, its Total Release Value (TVPI), or return multiple net of fees, was 3.3x. In comparison, the top quartile of global VC and private equity funds launched at around the same time have a TVPI of 2.4x, according to data from Cambridge Associates. Fund II also achieved an internal rate of return (IRR) of 34.7%, compared to 26.1% for the other funds.
Founded in 2009, AppWorks launched its accelerator program before launching an initial $ 11 million fund in 2012. The AppWorks ecosystem now includes 414 active startups that have collectively raised $ 4.3 billion and have a overall valuation of $ 17.4 billion. Over the next 10 years, AppWorks’ goal is to increase that number to 1,000 active startups with a collective value of over $ 100 billion.
Lin said AppWorks has a strong inbound pipeline as many startups in its ecosystem, including those led by Accelerator alumni and its mentor network of around 100 seasoned entrepreneurs, have achieved the fit. with the product market, are scalable and must raise funds to accelerate growth.
Fund III is intended for a portfolio of around 40 startups, split evenly between investments starting at $ 2 million in Series A to C and early stage investments. Start-up stage checks can range from around $ 50,000 to $ 200,000, depending on the needs of a startup. A portion of the fund’s capital will also go to companies in AppWorks’ current portfolio as they reach maturity.
The three main investment themes of AppWorks are Southeast Asia, blockchain and artificial intelligence.
Lin said that many of the AppWorks accelerator graduates over the past three to five years have come from Singapore, Malaysia, Vietnam, and increasingly, Indonesia and the Philippines. (AppWorks also serves as the LP in about 15 seed funds across Southeast Asia, which has helped it maintain a strong deal flow despite travel restrictions linked to the pandemic).
AppWorks’ current blockchain investments include Dapper Labs, Animoca Brands, and Splinterlands. Lin is particularly fond of NFTs and their “ability to break into the physical and digital worlds,” as well as the potential of blockchain to change the way people play (for example, the game model for winning Splinterlands is known).
Investing in a combination of start-up and growth operations means that the schedule of Fund III will be more evenly distributed. The approach is “best for LPs, but also comes primarily from our philosophy of putting founders first,” said Lin. “A lot of our old Accelerator startups are first-time founders, so they need help right from the start-up stage. A lot of our mentors have already raised seeds or Series A rounds, and they come to us when they need someone to lead a $ 10 million, $ 15, or $ 20 million Series B. This stems from our particular deal flow, since we primarily support our former founders and mentors, so we have two very different types of deal flows.
Fund III has already supported alumni of the AppWorks accelerator like Pickone, WeMo Scooter, Omnichat, XREX, Blocto, SoopahGenius and Docosan. Investments from his network of mentors include Carousell, Dapper Labs, Tiki, Card, Yummy Corp and Animoca Brands.