Temasek Ramps up Investment in Fintech Amidst Global Downturn

Temasek Ramps up Investment in Fintech Amidst Global Downturn

by August 2, 2022

Singapore’s state-owned investor Temasek is doubling down on fintech this year, participating in at least seven funding rounds involving companies in the sector since the beginning of the year, an analysis by Fintech News Singapore found.

The figure nearly matches the total number of deals it participated in for the whole year 2021, which stands at less than ten, findings from desk research that used data from Crunchbase and Dealroom show.

Financial services remain the largest representation of Temasek’s portfolio.

 

In 2022, Temasek continued to demonstrate its bullishness towards the Indian startup ecosystem, participating in at least two fintech deals in the country since the beginning of 2022: FPL Technologies’ US$100 million Series D, and Open’s US$50 million Series D.

FPL Technologies is a credit card-based fintech firm which operates credit score platform OneScore and issues credit cards under the OneCard brand, and Open is a small and medium-sized enterprise (SME)-focused neobanking platform. Temasek has been a stakeholder in Open since 2021.

Temasek, which has doubled its India portfolio in the past five years, has pumped in a total of US$16 billion in the country so far. India constitutes more than 5% of Temasek’s global portfolio. The investment firm is betting big on segments like financial services and agritech, Ravi Lambah, head of investment group at Temasek, told Moneycontrol in an interview earlier this month.

Besides investments in India, Temasek also took part in funding rounds involving fintech companies from the UK, leading Thought Machine’s US$160 million Series D, and investing more money in a follow-on round for its portfolio company FNZ Group.

Thought Machine builds cloud-based platforms for the banking industry, and FNZ Group is an investment platform technology provider to major financial institutions.

In Asia, Temasek was among the investors in a US$200 million Series B+ round closed in March by Amber Group, a Hong Kong-based cryptocurrency finance service provider. It also made in May a follow-on investment in ShopBack, a Singaporean rewards and discovery platform.

Bahamas-headquartered cryptocurrency exchange FTX Exchange is another portfolio company that received additional investment from Temasek this year.

Other private fintech companies Temasek has in its portfolio include UK paytech firms Soldo and SumUp, open banking startup TrueLayer, Singaporean payment company Nium, and Indian investment platform iCapital Network.

In 2021, some of Temasek’s fintech portfolio companies were listed on stock exchanges, including Indian digital insurance marketplace PolicyBazaar, US payments enablement and software company Flywire, US lending platform Blend, and US business payments firm AvidXchange.

Ranked among the top ten investors in the world, Singapore’s Temasek invests in assets that are aligned to four structural trends that shape its long-term portfolio construction, namely digitalization, sustainable living, future of consumption and longer lifespans. It follows a bottom-up investment approach and focuses on assets that are likely to give steady returns in the long run.

Temasek’s portfolio crossed the S$400 billion threshold for the first time in March 2022, increasing by S$22 billion from the previous financial year ended March 2021, according to the firm’s annual portfolio performance numbers, released on July 12, 2022.

The value of unlisted assets in Temasek’s portfolio rose four times to S$210 billion in the financial year ended March 31, 2022, from S$53 billion a decade ago. Unlisted assets overtook listed assets for the first time, accounting for 52% of Temasek’s portfolio.

Temasek Net Portfolio Value since Inception, Source: Temasek

Temasek Net Portfolio Value since Inception, Source: Temasek

 

Featured image credit: Edited from Unsplash