Private Debt Fund Singapore

Singapore as a regional HQ for private debt in Asia and Southeast Asia

As mentioned in our article on private debt funds, we have built a trusted network of some of the most technology savvy private debt lenders in the world.

In Asia, we have close working relationships with five Singapore private debt funds amongst others.

Singapore is one of the top three financial hubs in the world, just behind London and New York.

It is also considered one of the most competitive markets and one of the easiest places to do business globally, due to its strategic location along trade lines, its highly established institutional setup and strong rule of law.

Continued...

Specifically in banking and finance, many global financial institutions and asset managers with operations in Southeast Asia or in Asia have selected Singapore as a base for their regional HQ. These include banks, private debt managers and large institutional investors amongst others.

Singapore is also forward-looking. In recent years, we have seen venture debt emerge as a mainstream asset class with government support, as banks loans/bank lending was not viable for the high-growth, small-mid size tech companies.

In 2015, SPRING Singapore (a Singapore government agency, now renamed as Enterprise Singapore), launched a SG$500m venture debt program with three local banks to support these high-growth enterprises. The goal was to catalyse 100 venture debt loans and provide high-growth enterprises with growth capital, working capital and financing for mergers & acquisitions (M&A).

Today in 2023, the government has further increased the loan quantum as well as their share of the loan default risk under the program. Separately, we have also seen an increase in venture debt activity, with a number of new private credit managers emerging across the region. This is in-line with the steady increase in venture capital (VC) activity in the region.

According to Cento Ventures, VC equity investment in Southeast Asia has grown from US$0.5b in 2013 to a peak of US$12.1b in 2018, and US$8.2b in 2020. Theoretically, companies can take on 25-30% of their most recent equity round as debt (other industry practices of calculating loan amounts include 5x EBITDA or 1.5x annual recurring revenue (ARR)). In reality, fast-growing tech companies have taken anywhere from 5-15% of total equity as debt. This means that there is a US$0.4b-US$1.2b venture debt opportunity in the region.

Now that you are familiar with the growing venture capital and private debt ecosystem in Singapore, two questions arise:

1) Which capital provider should your business talk to?

2) Do you know the local business culture?

If you’re unsure, we can help. Even if you know the established private debt providers (e.g. PAG, Ares SSG, CDH, SeaTown, etc) or venture debt providers (e.g. Enterprise Singapore, Indies, InnoVen, MDI Ventures etc) in Singapore, would you know who to reach out to or want to spend time reaching out to every manager?

As a debt advisory and brokerage established in 2013, we are heavily involved in the business community. We have close working relationships with over 300 private debt funds globally and have helped over 350 tech businesses secure private debt solutions to support their growth. In Asia, we have close working relationships with five Singapore private debt funds amongst others.

This means that we are able to help you save precious time by reaching out to a variety of capital providers in one go, as well as reach out to the most appropriate capital provider, anywhere in the world for your needs, while keeping your business name anonymous.

Private lending funds like to work with us for the same reason – we save them a great deal of time. We know what they want, what companies want and we help accelerate the matching process. We are able to do this as we are like an intelligence hub – we get inbound requests all the time, both from funds and from companies.

Our expertise as debt advisors and entrepreneurs allows us to evaluate your business model accurately, present a convincing case to our partners, structure a business acquisition loan around your needs and help you fight for the best loan terms.

Working with Private Debt in Singapore

Here's how 90 Seconds captured the attention of Singapore's Private Debt Funds

90 seconds is a client whom we have worked with successfully in Asia. They are a global video creation platform which allows brands to create quality videos from anywhere in the world. Their platform connects creators to brands and greatly simplifies the complexity of video production.

The company has been highly successful, having partnered with over 3,500 brands and 13,000 creators leading to over 30,000 videos created on their platform. Their global client base spans over 550 cities in 160 countries. 90 Seconds is backed by major investors such as Sequoia and Airtree.

To further spur growth to take full advantage of increasing global demand, 90 Seconds was seeking funds to invest in their growth. However, it was important to them that the growth funding was structured suitably for their growth model and came with minimal equity dilution.

Fuse Capital presented the deal to lenders from its global network of private debt funds. Given the complexity and required structuring of the deal it was important to contact suitable lenders to save time and reduce the risk of extended negotiations.

As a result of this competitive process, we selected two lenders to underwrite a loan and presented 90 Seconds with the two term sheets, giving them a choice of terms (e.g. interest rate, structure, loan amount, schedule, etc) and ability to select the deal which best suited their growth needs.

“Knowing who to talk to and what to talk about is Fuse Capital’s significant value-add. In fact, it can take years to build the types of relationships and trust that Fuse Capital already has.”

KRM22 Co-founder Karen Bach

“Thank you to the team at Fuse Capital for helping secure financing on great
terms. Fuse kept everyone well informed throughout the process, and used
their experience to smooth each party’s way through the deal. They’re a great
choice for helping scale technology businesses.”

Rovco Founder & CEO Brian Allen

“I chose Fuse Capital because I knew they could deliver at a time when it mattered most. We wanted experts in their field who could save us time and get us the best deal and they did exactly that.”

Airnow CEO Philip Marcella

“Thank you Fuse Capital for all the support. It was a pleasure working with the entire team ”

Dott Head of Strategy Steve Smith

“Fuse Capital has now successfully delivered debt funding to our business for a second time. We consider them to be true experts in their field and wouldn’t hesitate to refer them to any business looking to raise debt. Thank you for your professionalism and diligence.”

Simplestream Chairman Neil Blackley

“The support and advice our team has received from Fuse Capital has been invaluable. I would like to thank the team for their hard work especially through COVID times. Whilst we have been focused on business operations, the Fuse team were able to successfully secure essential growth funding for our future”

SLR Dynamics CEO Salim Raza

“Fuse Capital’s experience working in the private debt market gave us confidence that we could source the growth funding we needed without restrictive covenants or diluting our equity. The process of working with Fuse Capital was professional and easy. They were committed to getting the deal done and their knowledge of our business and industry and the debt market meant they produced a high quality investment memorandum.”

Working Voices CFO Stephen Furner

“Fuse Capital went the extra mile in putting together our investment memorandum. The result was a highly detailed, realistic and marketable proposition. I’m convinced the level of detail Fuse Capital put in led to our swift receipt of term sheets.”

HealthTech CFO Ian Bastow

“I liked the fact that Fuse’s team was more than happy to roll up its sleeves and do the work, Fuse Capital’s services complemented our management team’s expertise, so we could focus on the most important issue at hand… running our business.”

Rezatec CEO Patrick Newton

“Fuse Capital massively reduced the amount of work the executive team and I had to do. The firm knows its market and took on all the research. Knowing which lenders are relevant for your business can save you a couple of days per provider.”

HealthTech CFO Ian Bastow

Private Debt Singapore