Investing East: Japanese entrepreneur and investor Teru Sato has launched a new fund investing in India and Southeast Asia
Teru Sato, founder of Japanese ecommerce conglomerate, VC fund, and business incubator Beenos, is joining the investment crowd looking east, with the launch of a new fund, Beenext, which will initially invest $60 million in technology, internet, and mobile start-ups in India and Southeast Asia.
Teru Sato announces new fund Beenext to invest $60 million in India and SEA
With billions of dollars banked off the back of Silicon Valley tech, investors are keen to find the next cash pot. Teruhide (Teru) Sato, founder of Japanese ecommerce conglomerate, VC fund, and business incubator, Beenos, has joined the crowd looking east, announcing the launch of a new fund, Beenext, which will initially invest $60 million in technology (particularly B2B), software, and mobile start-ups in India and Southeast Asia.
Reinventing Beenos as a venture capital firm
This project comes shortly after Sato stepped down from his position as CEO at Beenos, the company he founded in 1999 (originally named Netprice.com), and took public on the Tokyo Stock Exchange in 2004. Originally an ecommerce company – mail-order sales through PC and mobile, purchase and sale of second-hand brand-name products, and overseas products for the Japanese market – Sato has spent a decade refocusing Beenos as a venture capital firm. It now has over 80 subsidiaries, global investment portfolios focused on ecommerce and online payments, a seed acceleration programme, and an inception programme for promising entrepreneurs.
Originally focused on home-grown investments (e.g. investment in Japanese ecommerce/data auction price comparison site AucFan, which IPO-d in 2013 and now has a $145 million market cap), Beenos has already started expanding its markets, backing a number of Indian startups (ecommerce marketplace ShopClues, digital payments Citrus Pay, ecommerce software KartRocket, ecommerce deal-searching tool BuyHatke, and car marketplace Droom).
Investing in India and Southeast Asia
India will now be key to Beenext’s strategy. Sato comments: “If you look at the US, it is already an internet-evolved market and in the last 20 years has been the largest market. But the coming 20 years, I believe, the largest market of the internet and mobile will belong to Asia, and I see India playing a key role in this growth.” “It’s a country where entrepreneurs will increasingly lead by using innovative technologies to help solve issues such as power shortages and a lack of solid social infrastructure.”
As in much of South Asia, India has far fewer established venture capital firms and a rapidly growing number entrepreneurs and companies. Interest has been growing, particularly over the past four quarters during which Indian tech companies raised a total of $1.3 billion from 266 deals (up 69% year-on-year). Investors are also attracted by a relatively safe market in the developing world: Prime Minister Narendra Modi’s promises of economic reforms (thus far not delivered but expected in the coming quarters) and his stable control of the country offer encouragement.
Beenext will primarily make early stage seed and Series A investments, anywhere from $100,000 “up to a few millions but we will not go into the double-digit-millions range,” Sato says. The new fund has made a total of 12 investments so far. Beenos itself has committed $5 million.
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