SE Asia Deals Barometer Report: Fundraising plummets to seven-month low in Nov

Startup fundraising in Southeast Asia dropped to a seven-month low in November, according to proprietary data compiled by DealStreetAsia, highlighting a continued tightening investment environment for privately held companies across the region.

Fundraising plummeted to $174 million last month, marking a 36% decline from October’s $272 million.

The number of equity deals, at 28, was also the lowest this year and in the last 12 months. In October, startups were involved in 44 equity transactions.

On a year-on-year basis, equity funding last month fell 55% compared with $382 million in November 2023.

The funding transactions collated in November included venture capital deals, a private equity transaction, equity crowdfunding, convertible notes, and corporate funding rounds. Debt deals have not been included since DealStreetAsia has limited visibility into Southeast Asian startups’ debt financing rounds.

Eight transactions did not disclose their funding size.

November marked the eleventh consecutive month in 2024 when equity funding in Southeast Asia fell short of the $1 billion mark.

The last time fundraising crossed that $1 billion threshold was in December 2023, boosted by e-commerce giant Lazada’s $634 million fundraising from its parent company Alibaba, pushing overall fundraising to $1.2 billion that month.

In November, the average deal size, based on transactions with disclosed funding amounts, stood at $8.7 million, higher than the $7.78 million in the previous month.

No megadeals in November

The subdued funding in November underscores a cooling investor sentiment, evidenced by investors’ reluctance to write large cheques. Notably, there were no megadeals—transactions valued at $100 million or more—in the month.

The biggest funding in the month involved WadzPay, a Singapore-based blockchain technology and financial services company, which raised $37 million in a private equity round.

Top Deals of November 2024

Vietnam’s Techcoop also raised $28 million, the second-biggest transaction in November, in equity funding as part of its $70-million Series A round last month. The round also included $42 million in debt financing. The round was backed by venture capital firms TNB Aura and Ascend Vietnam Ventures.

In 2023, Southeast Asian startups raised approximately $7.72 billion in funding from 716 equity deals, with Lazada alone raising $1.9 billion from its parent Alibaba Group. The annual deal value was down 53% from 2022, while the equity deal volume fell 30%.

In the first nine months of 2024, Southeast Asian startups raised $3.26 billion from 474 transactions. The deal volume was the lowest since 2020.

Singapore remains the funding leader in SE Asia

Singapore continued to reinforce its status as a premier regional hub for startups and investment in November, capturing approximately 76% of the total funds raised across Southeast Asia in the month.

DealStreetAsia’s data indicates that Singapore startups were involved in 14 investment deals that amassed a total of $132.2 million. This substantial lead underscores the city-state’s robust ecosystem for emerging businesses and its attractiveness to investors.

WadzPay’s $37-million PE funding was the biggest in the city-state last month. This was followed by the $27.3 million Series B funding in energy storage systems maker Ampd Energy, anchored by private investment firm Kibo Investment and venture investor Openspace Ventures.

The average deal size in Singapore last month, based on deals with announced amounts, was about $12 million. Three deals did not disclose the amount raised.

Vietnamese startups signed five deals totalling $35.8 million, while their counterparts in Indonesia secured four deals raising $1.2 million. Malaysia contributed two deals in November with $3.1 million, the Philippines saw two deals amounting to $1.5 million, and Thailand recorded one deal with an undisclosed amount.

Last month’s overall fundraising only involved startups in Singapore, Indonesia, the Philippines, Vietnam, Malaysia, and Thailand. Myanmar did not witness any deals.

Investors still favour fintech

DealStreetAsia’s compilation showed that the financial technology (fintech) sector continued to attract the most funding in the region in November, clocking six deals that raised a combined $63 million, accounting for about 36% of the total amount raised.

The largest fintech deal during the month was the $37 million that Singapore-based startup WadzPay raised in its PE round. This was followed by StakeStone’s $22-million investment round, led by Polychain Capital.

Startups in the green tech sector raised $31 million in total. Agritech had one deal that raised $28 million while construction tech raised $15.2 million in funding, the compilations further show.

Strong preference for early-stage funding

A closer look at the 28 deals that startups in the region were involved in last month showed that investors continue to favour early-stage deals, with seed-stage funding getting the most interest, in terms of deal volume.

The largest Seed stage deal in November was signed by Singapore startup StakeStone, which raised $22 million. The round was led by Polychain Capital and backed by Binance Labs, OKX Ventures, and SevenX, among others.

There were nine Seed deals, four Series A, three pre-Seed rounds, two Series B, two pre-Series A, one PE, one pre-Series B, one equity crowdfunding, one corporate round, and one convertible note deal.

Some notable debt rounds

There were also some notable debt deals in the region in November, which were not included in the above analysis. Atome Financial, for instance, secured a syndicated credit facility of up to $200 million led and arranged by HSBC, with additional support from DBS Bank, SMBC Singapore, and Baiduri Bank of Brunei.

Meanwhile, digital finance platform Funding Societies secured a third credit facility from lender HSBC under the latter’s $1-billion ASEAN Growth Fund.

In another significant debt financing, Singapore-based digital infrastructure platform Olea Global Pte Ltd (Olea) has secured $100 million in warehouse financing from HSBC and alternative credit manager Manulife Investment Management.