Malaysia-based Iris Capital Partners launches $37.8M Venture Debt Fund

(ASEAN Startups) Malaysia-based venture debt firm Iris Capital Partners has launched the country’s first privately led venture debt fund, the Iris Fund, which aims to finance high-impact startups from Malaysia and the ASEAN region.

Malaysia-based Iris Capital Partners launches $37.8M Venture Debt Fund

The firm is one of eight VC fund managers selected under the Dana Penjana Nasional (DPN) program through Penjana Kapital, which is owned by the Finance Ministry of Malaysia. Penjana Kapital administers and facilitates the deployment of the Dana Penjana Nasional, a matching fund-of-funds program where the Government of Malaysia will match, on a 1:1 basis, funds raised by the VC fund managers from foreign and private local investors.

The pioneer fund is co-managed by South Korea asset management firm Hanwha Asset Management Co ., making this the group’s maiden venture debt partnership in Malaysia. The size of the fund will be MYR160 million ($37.86 million) and capital was contributed from Penjana Kapital and a host of institutional and high net worth investors, Iris Capital said in a statement on Monday.

“While the Iris Fund isn’t limited to specific sectors or funding stages, we do look for companies with comprehensive business plans and projections that have clear strategies for long-term growth prospects. The Fund is aimed to diversify capital sources for startups and help strengthen the financing opportunities in Southeast Asia,” said Iris Fund Chairman Wan Kamaruzaman Wan Ahmad.

“This inaugural venture represents the group’s strong belief in the growth of the region. The fund will be the first of many partnerships with Iris Capital Partners as the group is looking to invest more in Malaysia and Southeast Asia,” said Kimo Kim, Partner at the Iris Fund. “This fund aims to offer more accessible financing to startups and SMEs – while allowing founders to control their dilution better.”

The Iris Fund aims to help propel Malaysian and Southeast Asian startups and SMEs to greater heights, as well as aid in the growth of Malaysia’s economy through companies that are creating job opportunities in Malaysia, it added.

Venture debt funds allow for more accessible financing options for early-stage startups with validated business models and clear market growth opportunities, including minimizing shareholding dilution, enhancing financial liquidity, and providing support for fundraising rounds throughout the region, the company said. This allows companies to maintain more autonomy over their assets while providing access to financing that will allow them to grow significantly over shorter periods of time.

As one of the top three asset management firms in Korea, the partnership with Hanwha brings to the table an incredible wealth of unparalleled expertise, Iris Capital said. Kimo Kim comes from a long history of corporate venture capital and managing pension funds predominantly in the Southeast Asian region and now serves as the Principal for Hanwha Growth Fund under the Hanwha Asset Management Co., while Yuntek Jung manages over 15 Global VC Funds and Direct Investments under Hanwha Asset Management Co, the company added.

The Iris Fund’s maiden investment, Growthwell Group Pte. Ltd (Growthwell Foods), is an alternative meat and seafood protein provider for F&B businesses in Singapore and 10 other countries in the APAC region. The Iris Fund was part of the $22 million Series A funding round by the company alongside other renowned investors, including Temasek Holdings Limited, Creadev, GGV Capital and DSG Consumer Partners.

Growthwell, who is behind the vegan plant-based brand HAPPIEE!, egg-free cooking ingredients brand OKK, and plant-based ready meal brand Gomama, plans to use these investments to expand their manufacturing facility in Johor Bahru that is projected to create more job opportunities for Malaysians.

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