Rebright Partners enters India with a new $20M fund focused on investing in mobile startups

Rebright Partners, a startup fund backed by leading Japanese internet companies and focused on investing in startups in Southeast Asia, announced today that it has formed a new fund called Rebright Partners II Investment Partnership, looking to enhance investments in consumer-focused mobile-first or mobile-only startups in India.

The fund is valued at 2.4 billion yen or $20 million, following the “zeroth” fund Batavia Incubator launched in 2011 in partnership with Indonesian financial conglomerate Corfina as well as the first fund launched in 2011.

According to Morgan Stanley's latest report, "The number of internet users in India has risen steeply from 50 million in 2007 to 100 million in 2010 and more than 300 million by 2014, making India the second-largest internet market (after China) in the world. The time taken to add incremental 100 million internet users has shrunk from 10 years in the previous cycle to under two years now and this has happened predominantly because of the rapid pace at which smartphones are being adopted. We believe this growth has legs, as the incremental users are not just big-city users. Smartphone shipments have grown from over 40 million in 2013 to over 80 million in 2014 and are likely to inch up to meet the increasing demand from the network effect that is being generated."

With this new fund, Rebright Partners has appointed Brij Bhasin, who earlier worked at Bangalore-based accelerator GSF, while inviting former Deloitte Tohmatsu employee Takumi Kawai as an investment manager for the Southeast Asian market.

In India, Rebright Partners has invested in four local startups, including Tookitaki (big data analysis) and Newsinshorts (curated news app) so far, while also evaluating multiple startups.

According to Rebright Partners Takeshi Ebihara, Japanese mobile apps like Smartnews or Mercari are doing well not only in Japan but also globally. Rebright Partners wants to bring these experiences from the Japanese mobile industry to the startup ecosystems in India and Southeast Asia to help them grow further and faster.

In an email interview with YourStory, Takeshi Ebihara shared his plans for India, saying they will be looking out for founders who are smart, young and a team with strong tech talent. Here are the excerpts.

YS: What will be the focus of the fund?

TE: We will focus on the Indian consumer mobile internet sector. The stage we will go after are pre-launch super seed to series A. And we will be looking out for companies with founders who are smart and young, and a team with strong tech talent.

YS: When you say mobile, what will it entail?

TE: Our best preference will be mobile app focussed startups; News In Shorts is a good example of that. Focus is the key for seed startups, we would like founders to focus on the most important and crucial platform to reach consumers, which according to us is the mobile.

However, it does not necessarily have to be mobile only, but at least have a sense of the above. We believe that smartphone internet usage would be the next big thing in India, and we have lots of excellent role models of mobile-only businesses in Japan (and China) to provide useful insight to Indian founders.

YS: Which kind of companies will be of interest to you initially?

TE: We are interested in the space in which we have invested in SE Asia like e-commerce, travel, food, ad-tech, price-comparison, motion, media, car and transportation. We prefer a large space, and look for disruption of legacy inefficiency using software and internet.

YS: Are you going to be in India more often? 

TE: Absolutely. And now we have an on-ground team too.

YS: And how are you viewing the Indian market?

TE: I personally prefer to use the phrase (which I have created myself) that India is "the next and last superpower." Not only because of the size of the domestic market, but the quality and quantity of tech talents is of top level in the world. We will see to it that India produces tons of excellent young founders.

It would be a matter of great happiness and honor to work with such young talents, and taking on a role of the bridge-head between India and Japan, and SE Asia. We have recently seen a lot of interest from Japan to collaborate with the Indian startup ecosystem. Softbank has made some big investments in Ola, Housing, and Snapdeal, and as we write this more players are scouting the Indian market for strategic alignment.

Brij Bhasin, the new lead in India added, "I'm excited to learn from Rebright on its experience in the evolution of the SE Asia and the Japanese market. I think culturally we are similar in many ways and will be able to help Indian founders in deeply understanding the consumer mindset."

According to Brij,

We are actively evaluating startups for seed investments and will be making a few announcements in the coming weeks. We are looking for startups with strong teams that are deeply looking at the Indian consumer market. As Ebihara said every startup has to be strong on mobile and in addition to the ones mentioned, we will invest in gaming, digital media, consumer mobile apps in communication, social, C2C commerce and marketplaces.

Also listen to Takeshi Ebihara, Founder & General Partner of Rebright Partners gave the audience a peek into the Southeast Asian market for product entrepreneurs at TechSparks 2014 Grand Finale.