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Hotel booking site RedDoorz raises S$1.4m from Temasek-backed venture

SINGAPORE: Online budget hotel booking platform RedDoorz has raised US$ 1 million (S$ 1.4 million) in venture debt from InnoVen Capital, a joint venture between Temasek Holdings and United Overseas Bank (UOB).

The announcement on Tuesday (Apr 4) follows a string of venture debt financing agreements that InnoVen has inked over the past year as part of its goal to provide up to US$ 500 million in venture debt financing to start-ups in China, India and Southeast Asia.

InnoVen Capital, first formed in India about nine years ago, was rebranded in 2015 following a buyout by Temasek Holdings and UOB, with each committing up to US$ 100 million in paid-up capital. The start-ups that have since come under its radar include various sectors such as e-commerce and financial technology (FinTech).

Venture debt, a relatively new concept in Southeast Asia, is a type of financing for start-up firms which may not yet have the cash flow or assets to use as collateral for loans. It is an alternative to bank loans or raising capital by selling stocks to investors.

Mr Chin Chao, InnoVen’s CEO for Singapore and Southeast Asia, said: “We are constantly on the lookout for companies that have a solid track record and good backing, and the unit economics of RedDoorz have been impressive.”

For Singapore-based RedDoorz, the venture debt deal announced on Tuesday is an extension of the start-up’s Series A funding round, which was led by the likes of World Bank’s private financing arm International Finance Corporation and Singapore venture capital firm Jungle Ventures.

Founded by entrepreneur Amit Saberwal in 2015, RedDoorz has about 500 properties, mainly in Indonesia, listed on its online platform. Moving forward, the start-up is betting on rising disposable income and increased travel spending within Southeast Asia to fuel its expansion beyond Singapore and Indonesia.

“In the last one year, our revenue has grown 12 times while maintaining best-in-class unit economics. With this additional funding, we aim to leverage the strength of Southeast Asia’s economies to grow RedDoorz to become the largest online budget accommodation brand in the region,” said Mr Saberwal in a press release.

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Channel NewsAsia Singapore Business News