Singapore-based Jungle Ventures has launched First Cheque@Jungle, a new initiative aimed at spotting and investing in a wave of Asian tech founders even earlier in the pipeline.
It targets pre-seed and seed stage startups in Southeast Asia and India, with a view to investing a minimum of $2 million split equally between equity and a no-cap convertible note, in what it hopes will be a more founder-friendly, less dilutive offering for young tech upstarts.
All capital will be deployed out of Jungle’s existing $600 million Fund IV, which it closed in early 2022. The initiative will be led by Rishab Malik, a three-time founder of tech companies across India and Singapore, who today serves as a venture partner at Jungle Ventures.
He will also be supported by Livspace founder and COO Ramakant Sharma; PaySense co-founder and CBO Sayali Karanjkar; and TradeGecko co-founder Cameron Priest, who will join as venture builders offering operating insights and one-to-one founder time on areas like early-stage product market fit and team building.
The move marks a slight shift in Jungle’s deal-sourcing strategy.
The Singapore-based VC previously tapped on SeedPlus for pre-seed to seed deal flow in the region before the seed-stage investor called it quits in 2020. Jungle was an LP in SeedPlus’s first $18 million fund.
With First Cheque@Jungle, the Southeast Asian and Indian VC firm aims to bring most of that deal sourcing in-house by tapping on its portfolio founders and operators to further scale Jungle’s network while investing value-add back into new founders.
Unlike most early-stage VCs in the market, Malik asserts that First Cheque@Jungle will not run large-scale founder programmes or social meets. Instead, it will focus on providing more dedicated one-to-one consults with seed founders.
The move to “brand” Jungle’s seed-stage push also signals a drive by the Southeast Asian VC to further differentiate itself in this competition for talent.
“India has certainly emerged as a larger and deeper market for seed talent. We see second-time, third-time founders, really senior people who have seen the beginnings of startups across early- and growth-stages and are setting out to start companies again,” shared Rishab Malik, venture partner at Jungle Ventures.
“In Southeast Asia, the velocity of dealmaking and capital deployment has slowed down, but we’re also seeing founders going out to start companies now. Many are taking a longer-term lens to building,” added Malik.
Seed-stage deal flow has slowed in Southeast Asia in the last year. According to DealStreetAsia’s DATA VANTAGE, seed round deals slipped 43% year-on-year to 126 in H1 2023 compared with the same period last year. The median value of seed funding rounds also amounted to $2.2 million, a decrease from $3 million recorded the same time before.
Malik declined to share how many seed-stage deals Jungle plans to invest from the fund. However, Jungle has already deployed in at least three seed deals since last year. They are e-commerce enablement software firm AMP; Southeast Asian lifestyle brand company HypeFast; and Web 3.0 women’s only community platform, CoTo.
Similar to its thesis, First Cheque@Jungle is sector-agnostic and looks across consumer, software and B2B sectors. However, it highlights “founder-market fit” as an important criterion for investment. This refers to a founder with a unique and differentiated right to win in the category he or she is building, explained Malik.
“That comes with having strong operating or domain experience/expertise. Having founder experience isn’t a requirement per se. But it requires the person to deeply understand his/her domain and thereby formulate a unique advantage to building within that domain,” shared Malik.
Successful seed startups will be eligible for lead or co-lead opportunities in subsequent Series A funding rounds, with cheques ranging from $5-10 million per company, added Jungle Ventures. Doing so further allows the VC firm to make informed and long-term bets on these firms as they grow with these founders.