Lighthouse Canton raises US$20m in first close of maiden venture debt fund

SINGAPORE-BASED investment firm Lighthouse Canton has raised US$20 million in the first close of its new venture debt fund, which has a target of US$100 million.

Lighthouse Canton plans to provide debt capital to tech-enabled startups in the region, it said on Monday (Jan 16). Venture debt comprises bonds and loans given to startups short of profitability or face difficulty in obtaining financing from banks.

“As the pace of venture capital (VC) activity continues to grow, it is logical that we would see a rise in venture debt demand,” said Sanket Sinha, Lighthouse Canton’s global head of asset management.

He noted that in more mature venture ecosystems such as the US and Europe, venture debt has risen to 15-20 per cent of the total VC funding, whereas this proportion is less than 2 per cent in India and South-east Asia.

Lighthouse Canton expects to deploy the capital for its fund in the next two years across 35 to 40 companies. The firm recently closed a US$40 million fund launched in partnership with Nueva Capital, which focuses on the pre-series A and series A funding rounds of companies in India.

Amendment note: A previous version of the story incorrectly stated in the headline that the fund had closed when it in fact had only reached its first close.