Singapore-based venture debt firm MARS Growth Capital has launched its first equity fund with an initial $500-million commitment, marking its official foray into the equity space.
Dragon Fund I will make growth equity investments into private, tech, and tech-enabled companies, with deal sizes between $20 million and $100 million. It will initially focus on the Asia-Pacific region.
MARS Growth Capital is a joint venture established in 2021 between Mitsubishi UFJ Financial Group (MUFG) and Liquidity Group, an AI-based financial asset management firm.
In a statement, MARS said the launch of Dragon Fund I builds upon the success of the firm’s non-dilutive funds powered by MUFG’s initial financial commitment of $750 million.
“With the initial close of Dragon Fund I, MARS Growth Capital underscores our commitment to offering financial stability for high-potential enterprises,” said Fumitaka Nakahama, group head of global corporate and investment banking at MUFG.
Dragon Fund I will look to invest in companies with exceptional management teams, strong execution track record, and high growth potential, said Ridhi Chaudhary, managing director and a GP partner of the fund.
MARS Growth Capital currently utilises an AI-based credit model developed by Israel-based Liquidity Capital to analyse and fine-tune deal flow. This “hybrid model” comprises a mix of AI and on-hand human expertise, enabling MARS Growth Capital to accelerate its decision-making processes, it said.
“The ability to extend the decision-science technology beyond non-dilutive financing into equity funding is not only a testament to the technology itself but, more importantly, the deep relationship between MUFG and the Liquidity Group,” MARS said.
In May, the firm had launched two new debt funds—MARS Japan Fund and MARS Europe Fund—that provide financing to Japanese and European startups.
MARS Japan Fund provides growth financing to promising pre-unicorns and unicorns in Japan while MARS Europe Fund invests in European tech startups that address various social issues such as climate change.
Last month, MUFG announced it has increased its capital commitment to the non-dilutive funds of MARS Growth Capital from $750 million to $1 billion.