AI-driven businesses in Asia to get more support as DBS partners Granite Asia

SINGAPORE – AI-driven businesses in Asia are set to receive stronger backing to support their growth under a new collaboration between DBS and multi-asset investment platform Granite Asia. 

For a start, the partnership has closed a US$110 million (S$126.5 million) fund for selected initial public offerings of AI-driven companies in the region.

DBS said on Feb 23 that the collaboration will offer services to support high-growth Asian companies across every stage of their life cycle, from private capital to public markets. 

These services comprise financing, advisory for mergers and acquisitions, and capital raising activities such as bond issues or IPOs.

The tie-up, which runs for three years, will give DBS wealth clients early access to growth-stage companies and those preparing for an IPO.

Granite Asia allows investors to access various asset classes – from private equity and private credit to publicly traded securities like stocks and bonds.

Ms Tan Su Shan, chief executive of DBS, said this partnership is the first of its kind for DBS with an asset manager. 

It leverages Granite Asia’s strong connections with founders and its track record of supporting and investing in innovative Asian companies.

Ms Tan added that DBS is able to serve these founders across its full spectrum of capabilities spanning wealth, institutional banking and global financial markets.

This “offers differentiated investment opportunities to clients and creates new pathways for ambitious founders to expand internationally”, she said.

The AI-driven fund is the first in a planned series under the partnership, and is focused on businesses where artificial intelligence is central to how they operate or create value for customers. This is unlike AI-enabled companies that simply use the technology to improve work processes.

AI-driven companies include Netflix; mobility, delivery and financial services superapp Grab; gaming and e-commerce firm Sea; and Chinese tech giant Tencent.

The fund is seeded with capital from investors across South-east Asia, South Asia and Europe. Granite Asia will allocate the pooled funds to selected IPOs of AI-driven companies in Asia.

The timing appears to be right for a collaboration. Data provider Crunchbase noted that as at Feb 20, more than 13,000 AI-driven companies have been founded in Asia since 2015. 

Many of them are now seeking capital injections to accelerate their expansion plans.

Ms Tan said: “With capital flows into Asia set to rise over the coming years, this initiative catalyses a vibrant funding ecosystem at a time when listings are returning to Asia’s equity markets.”

Granite Asia has guided five portfolio companies from private markets to a public listing over the past six months. The asset manager has 10 more IPOs in the pipeline.

So far, it has invested in 127 companies valued at more than US$1 billion and supported 65 IPOs globally. 

Mr Foo Jixun, senior managing partner of Granite Asia, said: “Over more than two decades, Granite Asia has partnered closely with founders building category-defining companies across Asia.”

He said the collaboration with DBS allows the company to enhance its suite of services to high-growth Asian businesses “as capital markets momentum returns and growth capital becomes more accessible across the region”.

DBS and Granite Asia will develop a private capital product designed to help tech-driven Asian businesses grow and transform “with non-dilutive capital”, allowing the founders to raise funds without giving up equity ownership.