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SEA tech startup funding fell 65% year-on-year in the first half of the year

SEA tech startup funding fell 65% year-on-year in the first half of the year

Companies in the Southeast Asian (SEA) tech space raised $1.6 billion in the first half of 2024, a substantial 65% decrease from the $4.5 billion raised in the first half of 2023 and 37% less than the $2.5 billion raised in the second. half of 2023, Tracxn says on Friday.

The global software-as-a-service (SaaS) market intelligence platform said in its “Geo Semi-Annual Report: SEA Tech H1 2024” that the SEA region ranks ninth globally in tech startup funding in first half of 2024.

According to the report, the funding landscape at different stages indicated varied trends.

Late-stage funding was the hardest hit, falling 69% to $421 million in the first half of 2024 from $1.3 billion in the second half of 2023, and an 86% drop from to $3 billion in the first six months of 2023.

Early-stage investments totaled $946 million in the first half of 2024, down 19% from the $1.2 billion raised in the first half of 2023.

However, this is an 8% increase from the $878 million raised in the second half of 2023.

This space attracted $234 million in seed funding in the first half of 2024, down 27% from $323 million in the second half of 2023 and down 42% from the $407 million raised in the first half of 2023.

Meanwhile, SEA tech startups raised $477 million in Q2 2024, down 85% from $3.16 billion in Q2 2023 and 57% less than $1.12 billion raised in the first quarter of 2024.

Notably, this period witnessed two major funding rounds exceeding $100 million.

ANEXT Bank raised $148 million in a Series D round led by Ant Group, while GuildFi secured $140 million in a Series A round.

No new unicorns were created in the first half of 2024, compared to one unicorn in the first half of 2023.

However, acquisition activity increased, with 36 companies compared to 30 in the first half of 2023 and 42 in the second half of 2023.

The most significant acquisition was Singlife by Sumitomo Life Insurance Company for US$1.2 billion, followed by NTT DATA’s acquisition of GHL for US$154 million.

MaNaDr, RYDE and Topindoku were the only three companies to go public in the first half of 2024.

There were just three initial public offerings (IPOs), down from seven in the first half of 2023 and four in the second half of 2023.

The leading sectors in terms of performance in the first half of 2024 were FinTech, HighTech and Enterprise Applications.

Companies in the FinTech space attracted $851 million in funding in the first half of 2023, down 20% from $1.07 billion in the first half of 2023.

Funding in the HighTech segment was $476 million, a 47% increase from $323 million in the first half of 2023.

The Enterprise Applications sector saw a 49% decrease in funding from $775 million in the first half of 2023 to $393 million in the first half of 2024.

Singapore led the region in terms of total funds raised in the first half of this year, followed by Jakarta and Bangkok.

Singapore-based tech startups raised $1.1 billion in the first half of 2024, while those in Jakarta and Bangkok raised $185 million and $150 million, respectively.

Investment activity remained robust, with East Ventures, 500 Global and Wavemaker Partners emerging as the top investors in the SEA Tech ecosystem in the first half of 2024.

SEEDS Capital, Temasek and Seventure Partners were the lead investors in the early-stage funding, while MUFG Innovation Partners, NewView Capital and Avataar Ventures took the lead investment positions in the later stage.

Antler, 500 Global Ventures and East Ventures are the main investors in the launch stage of the SEA Tech ecosystem in the first half of 2024.

These developments highlight the evolving dynamics of the SEA Tech startup ecosystem as it navigates through various stages of growth and investment trends, Tracxn said.

Tracxn: SEA tech startups see 13% drop in funding in Q1