Krungsri Finnovate (KFin), the corporate venture capital arm of Bank of Ayudhya (Krungsri), has partnered with EfraStructure Co to launch a private equity trust aimed at supporting local startups and investing in tech startups across Asean.
The private equity trust, named Finno Efra, is planning an initial public offering in the third or fourth quarter, with the goal of raising 1-1.3 billion baht.
KFin has committed to investing 200 million baht in the fund, according to Sam Tansakul, KFin's managing director.
Finno Efra is also open to high-net-worth retail investors, with a minimum investment of 500,000 baht per investor through One Asset Management.
Additionally, Krungsri's corporate clients are allowed to invest in the private equity fund with a minimum ticket size of 38 million baht each.
According to Mr Sam, Finno Efra initially aims to invest in 50 tech startups across various industries in Asean, with 60% of the investments targeting Thai startups and 40% focused on regional startups, particularly in Vietnam, Indonesia and the Philippines, in line with Krungsri's regional networks.
The investment in tech startups across Asean will align with the expertise of the two business partners, focusing on sectors such as fintech, edtech, healthtech, agritech, mobility tech, martech, HR tech, travel tech and e-commerce.
The fund is primarily designed to support startups in the seed to pre-Series A stages, with a particular focus on sectors driving impact and digital transformation.
Investment deals will range from 8-40 million baht, adhering to relevant regulations and company guidelines. The investment period is set at four years, with an expected return of 15% per year, according to Mr Sam.
The seed stage is generally characterised by product development and market research, while the pre-Series A stages refer to the early phases of startup funding that occur before a company reaches its Series A funding round.
This period is crucial for startups as they lay the groundwork for their business model and seek initial investments.
Additionally, Mr Sam said the business partners plan to establish an accelerator programme to help startups progress from the seed to pre-Series A stages, fostering stable growth towards the Series A stage.
Series A funding is a crucial stage in the lifecycle of a startup, marking the first significant round of venture capital financing after the initial seed funding. This stage is essential for companies looking to scale operations, develop products and establish a market presence.
"CVC in Thailand typically focuses on the Series A level and above, which contrasts with practices in other Asean countries where early-stage startups are often prioritised. This strategy is designed to catalyse the growth of new ventures and strengthen the ecosystem's foundation," he added.
Separately, Pawoot Pongvitayapanu, chief executive and founder of EfraStructure, said apart from the limited funds, there is a pressing need for robust mentorship programmes. Accelerators and incubators are vital to the emergence of new startups, serving as crucial bridges between investors and startups.
KFin and EfraStructure will launch the Finno Efra Accelerator Programme. This will provide startups with access to a vast network, experience and expertise, ensuring a comprehensive curriculum that covers all critical aspects for startup success. The programme is carefully designed to help startups reach their full potential.
Each Finno Efra Accelerator course will run for four months, enrolling 10 startups per cohort. Participating startups will have the opportunity to secure funding and connect with a diverse investors.