DBS, Temasek set up $500 mn financing platform for growth stage firms

Singapore-based financial services group DBS and Temasek have set up $500 million financing platform, EvolutionX Debt Capital (EvolutionX) for non-dilutive funding to technology-enabled firms with a focus on China, India, and Southeast Asia.

It will be led by Joint Interim CEOs Amit Sinha, Group Head of Telecoms, Media and Technology, at DBS, and Aftab Mathur, director, Investment, at Temasek, before a full-time CEO is appointed in the next few months.

DBS said in a statement that EvolutionX will invest in opportunities arising from an increasingly digital economy – across sectors such as financial services, consumer, healthcare, education and industrial development.

Tan Su Shan, group head - Institutional Banking at DBS said, growth debt is fast emerging as an alternative source of financing for high-growth technology companies that traditionally only raised equity as a source of capital.

The growth debt helps founder entrepreneurs avoid dilution of share equity in the company’s initial stages of development. It also serves as a complementary tool to help these companies, which are often cash strapped, tide over unexpected market and economic headwinds.

It will create a financing solution to fulfil capital funding needs within the industry. This partnership also serves as a natural extension to both DBS and Temasek’s existing early-stage debt initiatives and investment activities.

Rohit Sipahimalani, chief investment strategist, Temasek said, partnership with DBS will provide a meaningful alternative for technology-focused growth companies in Asia that may face debt funding needs between the venture debt and late stage debt financing phases.