SINGAPORE (Feb 4): The venture capital and private equity (PE) ecosystem in Southeast Asia is entering a new phase of growth as investments in the region reach record levels, according to global management consulting firm Bain & Co.

The region had seen low levels of investment over the past decade, with PE investments ranging from US$6 billion to US$9 billion a year. However, the tide turned in 2017 as the number of recorded venture capital deals rose to 524 — four times the level in 2012 — and PE deal value rose 75% to US$15 billion, breaking out of a decade-long phase of flat growth. What is the reason for this development? Suvir Varma, partner and Asia head of private equity at Bain & Co, puts it down to four factors.

“First, the amount of money invested in the region was significantly higher than before. Second, the money was put to work not by a concentrated set of people such as Temasek Holdings and Khazanah Nasional Bhd, but by a broad range of investors, including global and local PE and venture capital funds,” he says.

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