This week, DealStreetAsia – DATA VANTAGE released its latest report, SE Asia Deal Review: Q3 2024, which saw startups in the region record their worst performance in terms of private funding deals in the last six years.
Regional startups notched 134 equity deals to raise a total of $979 million in the July-September quarter, according to the report. This is the first time since 2019 that quarterly proceeds have fallen below the $1-billion mark.
The weak Q3 performance saw deal volume plummet to 474 in the first nine months of 2024 — the lowest since 2020. Meanwhile, the year-to-date funding of $3.26 billion was less than half the capital raised in the same period of 2020, highlighting the region’s prolonged funding slowdown amid challenging global conditions.
Scroll down for the other developments of the week.
LP-GP news
Global impact fund manager LeapFrog Investments is said to be finalising the close of its targeted $1-billion fund by the end of this year, marking a delay of more than six months from its original timeline, according to people familiar with the situation.
Even as continuation vehicles as an exit route are picking up in Southeast Asia, they should be used to unlock value from strong assets, not as a fallback option amid a tepid exit environment, feel experts.
Historically dominated by minority investments, Asia Pacific’s private equity secondaries market is now witnessing more buyouts, said a top executive from Blackstone Strategic Partners. More buyout deals are now available in the region as the number of funds has multiplied and sponsor-backed assets have matured. This has paved the way for secondaries players to step in and provide liquidity to investors in old but attractive portfolios.
Global private markets firm Partners Group has hired an executive from Atlantic-Pacific Capital to spearhead its Asia operations, alongside Asia chairman Kevin Lu.
Malaysian sovereign wealth fund Khazanah will launch new initiatives to boost its venture capital ecosystem, following the acquisition of Malaysia Venture Capital Management (MAVCAP) and Penjana Kapital in July this year.
Malaysia-based private equity firm Bintang Capital Partners has launched a new impact fund with a focus on women empowerment in the local semiconductor industry.
The Hong Kong government will set up a HK$10 billion ($1.2 billion) fund of funds to invest in the innovation & technology sector in a move to boost the city’s standing as a technology hub.
US private equity giant Warburg Pincus announced that it committed A$490 million ($327 million) to MA Financial’s A$1-billion Real Estate Credit Vehicle. The vehicle is expected to provide global institutional investors access to Australia’s real estate credit market, funding high-quality developers and residential real estate projects.
From fundraising to exits, China’s venture capital and private equity industry is currently going through some of the most challenging times, Xu Qing, managing partner at Oriza FoFs — the fund of funds (FoFs) arm of Suzhou Oriza Holdings — said at DealStreetAsia’s Asia PE-VC Summit 2024.
Singapore-based private equity firm Falcon House Partners, which is considering setting up a continuation fund, is also evaluating the transfer of three of its portfolio companies into this vehicle, multiple sources told DealStreetAsia.
Indonesian state-owned VC firm Jakarta Ventura is gearing up to establish itself as a prominent player in the nation’s startup ecosystem by investing through blended financing, equity, and debt, Chrisantina Lunaryati, president director of Jakvent, told DealStreetAsia in an exclusive interview.
XA Network, a Singapore-based investment network founded by former Google employees, has expanded to Africa with the launch of XA Africa, which will connect tech founders with seasoned investors.
Deal updates
Temasek-backed impact investment firm ABC Impact is in talks to pick up a stake in India’s DCDC Health Services, which operates a dialysis chain under the brand Deep Chand Dialysis Centre, DealStreetAsia has learnt.
Andalin, a Jakarta-based digital freight forwarding company, has raised at least $1.5 million in fresh equity funding as part of its Series C round, regulatory filings showed. The round was anchored by Intudo Ventures and backed by Hiven.
Chinese state-owned carmaker Guangzhou Automobile Group is investing a combined $104.8 million in the country’s IPO-bound autonomous driving startup Pony.ai and auto parts manufacturer Chenzhi Technology.
Drinks maker China Resources Beverage has applied for a HK$5.04 billion ($649.25 million) Hong Kong initial public offering, an exchange filing showed, making it the city’s largest new share sale this year.
Chinese smart electric vehicle (EV) maker AVATR Technology is targeting up to 10 billion yuan ($1.4 billion) for its Series C funding round, which could bring its valuation to over 30 billion yuan ($4.2 billion).
India’s omnichannel beauty platform Purplle has closed its Series F round at Rs 1,500 crore ($179 million) with a fresh investment tranche of Rs 500 crore ($60 million).
Indian fine jewellery retailer GIVA Jewellery has raised Rs 255 crore ($30.4 million) in its extended Series B round led by Premji Invest, Epiq Capital, Edelweiss Discover Fund, and the top management of GIVA.
Djarum Group, through its entity PT Lingkarmulia Indah, plans to buy a stake worth 2.25 trillion rupiah ($145 million) in the e-commerce company PT Global Digital Niaga Tbk (Blibli Group) through a private placement.
Sales commission management platform Everstage has raised $30 million in its Series B round of funding led by Fidelity-backed global venture capital firm Eight Roads Ventures.
Tiger Global-backed Mensa Brands, which acquires fashion, home, and personal care labels, is in the process of shifting its domicile from Singapore to India, joining a host of companies that have either relocated or are in the process of relocating to the South Asian country, DealStreetAsia has learnt.
Indian budget supermarket chain Vishal Mega Mart filed papers for an 80 billion rupee ($952 million) initial public offering, joining a growing list of companies tapping the country’s bustling capital market.
Billing software firm Zuora has agreed to be acquired by buyout firm Silver Lake and Singaporean wealth fund GIC in a deal valued at $1.7 billion, sending its shares up nearly 6% in early trading.
Rigaku Holdings raised 129 billion yen ($863 million) after the Japan X-ray testing tool maker priced its IPO at the top of its range, according to a regulatory filing.
OQEP, the exploration and production business of Oman’s state oil group, has raised $2.03 billion from its initial public offering (IPO) on the local stock exchange, in the Gulf country’s biggest-ever listing.
At a time when Indian edtech companies are having a tough time finding investors, executive education-focused startup Eruditus has amassed $150 million in its Series F funding round led by private equity firm TPG’s The Rise Fund.
Mitsubishi Corporation is acquiring about 6.5% of Global Fintech Innovations Inc (Mynt), the parent company of the Philippines’s major finance super app GCash, according to regulatory filings.
Alibaba Group’s Sun Art Retail Group, the operator of supermarket chain RT-Mart, has received a privatisation offer from a potential buyer, marking a significant step in Alibaba’s efforts to divest its offline retail assets.
Deep dives
Kuldeep Singh Rajput, the founder of digital therapeutics unicorn Biofourmis, has sold his shares in the company to existing investors and launched a new healthtech startup. Rajput, who stepped down from the CEO role at Biofourmis in August 2023, offloaded the 96.6 million shares he owned in the firm to 19 other shareholders in the last week, according to filings with Singapore’s Accounting and Corporate Regulatory Authority (ACRA).
As China strives to build an OpenAI challenger, prestigious universities are increasingly seen as the cradles for such research-heavy deep tech ventures, with professor-turned-entrepreneurs leading many of the country’s fastest-rising artificial intelligence-generated content unicorns.
The rising interest in India’s healthcare space from a raft of deals is shining the spotlight on opportunities outside top cities to tier 2 and 3 towns of the country. Driving this trend is a shift in mindset among healthcare service seekers and doctors in the past few years.
US stock market operator Nasdaq expects key Japanese startups to list on its bourse as early as next year, driven by revived momentum in Asia’s No. 2 economy and a new generation of entrepreneurs who are looking beyond the borders of their East Asian nation.
Chinese online marketplace giant Temu’s official entry into Vietnam is predicted to reshape the country’s e-commerce landscape, which is dominated by the likes of Shopee, TikTok Shop, and Lazada.
As it moves ahead with its Southeast Asia expansion, Thai fashion brand Pomelo is also looking at new markets such as the Middle East and India.
Agricultural drone company Avirtech’s ex-CEO Rendy Ferixsen The, and a few of his family members, are currently being investigated by Singaporean and Indonesian authorities for allegedly embezzling over $3 million from the company.
In India’s red-hot quick commerce industry, the competition is no longer just about delivering groceries or daily essentials in a jiffy. The likes of Swiggy, Zepto, and Zomato’s Blinkit are now slugging it out to deliver freshly prepared meals to your doorstep in less than 15 minutes.
Malaysian budget carrier AirAsia plans to launch flights to Africa, Europe and the US in the coming years as the regional airline group that has focused on Asia eyes global expansion under a new structure.
Venture capital and private equity investments in China fell 38.7% on the year in the first half of 2024, to 196.7 billion yuan ($28 billion), according to research company Zero2IPO. Money raised by fund managers also dropped 22.6% to 622.9 billion yuan. The decline in startup funding has raised concerns that China is falling behind the US in cutting-edge technologies.
Q3 2024 turned out to be quite a paradox for India’s fintech sector. While fundraising by startups in the sector jumped more than 66%, there was a steep fall in merger and acquisition activity during the quarter, belying the notion that increased funding usually triggers a wave of consolidation.
Indonesian construction startup Gravel has laid off more than 35% of its workforce, citing financial losses, less than a year after raising significant funding, DealStreetAsia has learnt.
China’s burgeoning deep tech space has seen yet another professor-turned-founder raise funding for his venture. Beijing-based Robot Era, which develops embodied intelligence and general humanoid robots, just raised almost 300 million yuan ($42.2 million) in its Series pre-A round of financing.
Affordable Chinese food and beverage chains like Mixue and Haidilao are strengthening their positions in Southeast Asia, pulling in young consumers with low prices amid a growing sense of caution about the pressure they put on local industries.
Earning reports
Southeast Asian insurtech platform Qoala curbed its net losses by 36% in 2023 as its revenue more than doubled, according to its recent regulatory filings. Its revenue grew 144.5% last year to nearly $18 million.
Singapore-based cleaning robot manufacturer LionsBot International’s losses rose sharply in 2023 on lower revenue and higher administrative expenses, regulatory filings showed.
Moglix, the B2B industrial products online marketplace and unicorn backed by Tiger Global, and its subsidiaries, trimmed losses by almost 8% in the financial year ended March 31, 2024, compared with a year earlier, show regulatory filings.
