Southeast Asia VC companies extra impacted from SVB fallout than startups
SINGAPORE — In comparison with startups, Southeast Asia’s enterprise capital companies might see an even bigger affect from the collapse of Silicon Valley Financial institution as a result of discovering a alternative for the U.S.-based financial institution within the area might be difficult.
“I believe from a VC agency’s perspective, you will note an even bigger affect right here,” mentioned David Gowdey, managing associate at Jungle Ventures, instructed CNBC’s “Squawk Field Asia.”
“That is often because the native banks right here aren’t offering the identical product and companies that SVB supplies,” Gowdey mentioned Tuesday, including that SVB was Jungle Ventures’ main financial institution.
Whereas SVB served tech startups and enterprise capital companies largely positioned within the U.S. or have a presence within the U.S. Some VCs primarily based in Southeast Asia — comparable to Jungle Ventures and Golden Gate Ventures — have been additionally purchasers of SVB.
The financial institution offered VC companies and startups entry to the U.S. capital market in addition to networking alternatives within the U.S.
SVB served and constructed a really sturdy product providing for VC companies, mentioned Gowdey, including that Jungle Ventures will now in all probability should “search for a Huge 4 participant within the U.S. to be our associate.”
When it comes to changing a number of the options that SVB supplies within the U.S., it’s “going to be laborious,” mentioned Vinnie Lauria, managing associate at Golden Gate Ventures, on CNBC’s “Avenue Indicators Asia” on Tuesday.
“We have been a shopper of SVB so we perceive the value-add very properly,” mentioned Lauria.
Lauria certified that lower than 1% of Golden Gate Ventures’ total portfolio had banked with SVB. For these corporations backed by Golden Gate that banked with SVB, they didn’t have interaction full banking companies with the U.S. financial institution, he mentioned.
Solely two corporations in Jungle Ventures’ portfolio of greater than 70 startups had publicity to SVB, mentioned Gowdey.
“That was often because [these two companies] had operations within the U.S.,” he added.
Whereas the 2 corporations had publicity to SVB, just one had materials publicity, mentioned Gowdey, including that the corporate that confronted materials publicity had engaged SVB for payroll companies.
As for startups in Southeast Asia, VC companies say they won’t seemingly be hit by the contagion from the collapse of Silicon Valley Financial institution.
“The truth is, right here in Southeast Asia, loads of the startups have been actually buffered. Most didn’t financial institution with Silicon Valley Financial institution,” mentioned Lauria from Golden Gate Ventures.
“So the fact is, Southeast Asia is already very remoted from what was taking place in Silicon Valley,” he mentioned.