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Deal Street Asia: Japan’s Genesia Ventures to ramp up SEA’s share in Fund 3

In an exclusive interview with Deal Street Asia, General Partner Takahiro Suzuki (Taka) shared our aim to increase our investments in Southeast Asia (including India) while primarily allocating 60% to Japan and 40% to Southeast Asia and India. For our current third fund, our average investment size in Southeast Asia ranges from 500K to 1M USD. With additional investments, we can invest up to 5M USD per company. We do not have a specific annual target for the number of companies, but each fund typically invests in about 40-50 startups. Among these, around 20 are investments in Southeast Asia, including India.

Furthermore, Taka also shared his views about the changing investment landscape for early-stage ventures in the Southeast Asia region. More specifically, compared to the period from 2016 to 2022, the current market environment appears more challenging. This is largely due to the emergence of numerous unicorn companies in Southeast Asian countries, with many startups prioritizing top-line growth regardless of cost. Consequently, these startups often experienced revenue growth along with increasing losses. In the current market environment, such forced growth is no longer acceptable, and late-stage startups are facing a tough situation. However, looking at Southeast Asia from a long-term perspective, we are confident that the region will continue to experience macroeconomic growth, leading us to maintain an optimistic view of the exit environment.

Fortunately, we always prioritize quality growth over aggressive top-line growth, so we have been focusing our discussions on quality growth with an emphasis on unit economics with many of our portfolio founders. The current market environment offers a significant opportunity for startups that can achieve such quality growth.

The startup ecosystem in Southeast Asia has been primarily centered in Indonesia and Singapore. However, over the past 4-5 years, Vietnam’s presence has been on the rise. Investors outside Southeast Asia have also begun to notice the Vietnamese market. In addition, we have observed a consistent growth in the quality of entrepreneurs on a year-by-year basis. This is a very positive sign that encourages our belief that the Vietnamese startup ecosystem is on a robust growth trajectory. With the increasing quality and innovative mindset of entrepreneurs in Vietnam, we are confident that the Vietnamese startup ecosystem will significantly expand and flourish in the forthcoming years.

Getting asked about our upcoming plan in the reason, Taka also shared our focus on building a community where our portfolio’s founders and executives can support and enrich each other. As many founders often feel isolated and struggle to seek advice. We aim to alleviate this by fostering a community where founders can understand and support each other, adding depth to the ecosystem. In April this year, we plan to host a Global Founders Gathering in Tokyo. We will invite our founders from Indonesia, Vietnam, and India to participate. This event will provide opportunities for business matching with Japanese companies and foster deep discussions on various themes. In 2024, as part of our community-building efforts, we plan to open Orbit HCMC, a community and co-working space for our startups in Ho Chi Minh City, Vietnam. This space is designed to naturally unite startups, investors, and talents.

If you're interested in reading the full interview, please see the article below.

Thank you and keep fighting!!

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