"A lot of investors are shifting towards a secondary approach. People looked at some of the success of the interest rate policy. Some people can play it, and some people can’t, especially if you are a lead VC. A secondary is a pretty strong signal that you don't believe in a company, so it's difficult for a lead VC to do that. So, we're seeing all the proliferation of party rounds. Another significant approach is the rise of private debt, where investors are turning to venture debt or equity with debt-like structures and aims for reliable returns through interest rates and quicker capital retrieval. There's a noticeable trend of funds incorporating private debt strategies." - Jeremy Au
"If you're looking at historical data, many Southeast Asians, particularly in Singapore, are covering geographies outside of their home base. Investors with exposure to India are spending significant time there due to the positive outlook on the market. Many Singapore-based or US-educated investors are covering regions like Australia, New Zealand, the US, and Europe. While based in Singapore, they might cover 10-20% of the Southeast Asia market but are primarily hunting for deals outside the region." - Jeremy Au
"What we'll see is that many larger funds in Southeast Asia have already downsized, which can be seen both positively and negatively. During the zero interest rate policy era, they raised very large funds, but now they'll raise smaller, more disciplined, and structured investments for the region. The bearish perspective is that they couldn't raise as large a fund as before, partly due to a cautious approach by general partners and limited interest from LPs in overly large funds. It's a two-way discussion, reflecting a new reality. The next generation of VCs will likely operate with smaller funds than in the past." - Jeremy Au
In this episode, Jeremy Au speaks on Darwinian VC evolution: strategy changes due to low Southeast Asia fund performance 0.4X versus USA, India, and China.
Keywords: Darwinian VC Evolution, Strategy Changes Due to Low Southeast Asia Fund Performance 0.4X, USA India China Comparison, Singapore, Southeast Asia, VC, Thought Leadership
