SE Asia Deals Barometer Report: Startup funding hits five-month high of $1.16b in Dec

Startup fundraising in Southeast Asia ended 2023 on a positive note as privately-held companies in the region managed to scoop up $1.16 billion in funding in December, a five-month high.

The amount raised from 41 deals represents an over 200% increase from November’s $382 million secured from 45 transactions, according to proprietary data collated by DealStreetAsia.

There were 11 transactions in December that did not disclose the funding size.

The December fundraising also brought back the fundraising to above the psychologically-important $1 billion mark, after dropping in October and November. Monthly fundraising in 2023 surpassed the nine-digit figure just four times— in December ($1.16 billion), May ($1.05 billion), July ($1.78 billion), and September ($1.1 billion).

However, the overall startup funding in December was buoyed mainly by the $634 million that e-commerce giant Lazada pocketed from its parent company Alibaba.

Without the Lazada deal, startup funding in the month would have stood at $526 million, which is still higher than November’s fundraising, which was the lowest in all of 2023.

On a year-on-year basis, the December 2023 fundraising was about 4% lower than the $1.21 billion that startups raised from 57 transactions during December 2022.

The data compiled by DealStreetAsia in December included venture capital deals, private equity, debt financing, corporate rounds, and convertible notes. There were also 14 transactions in December that did not disclose the funding stages.

Two megadeals push up deal value

DealStreetAsia’s compilation shows that there were two megadeals—transactions worth at least $100 million—in December, which brought the total number of such deals in the entire 2023 to 27. In November, there was only one megadeal that raised $132.7 million—Singapore Life‘s corporate round.

Alibaba’s $526-million capital injection into Lazada topped the megadeal table in December. It was the fourth by Alibaba into its arm in 2023, bringing the total infusion to about $1.8 billion in 2023.

In July, Lazada secured $845.44 million from Alibaba, which gained control of the business in 2016. In April, Lazada received another $352.9 million in capital infusion from its parent.

Megadeals of December 2023

Aside from Alibaba’s capital infusion into Lazada, Silicon Box, a Singapore-based semiconductor design and device integration services startup, also raised $139.4 million in the initial close of its Series B funding round last month. (Silicon Box announced this month that it raised a total of $200 million in the close of its Series B round).

The round was anchored by Praesidium Capital, a US-based investment company that lists Jesslyne Widjaja and Emmeline Widjaja of the Indonesian conglomerate Sinar Mas family as its directors.

The month of May posted the most number of megadeals so far this year at five, but the total amount raised was only about $649 million that month.

The region produced only one unicorn in 2023—eFishery, which garnered a valuation of over $1 billion after it raised $108 million in May. In 2022, eight startups had earned the much sought-after unicorn tag, while in 2021, the number stood at 23.

Singapore remains the top investment destination

In December, Singapore remained the top destination for investment in Southeast Asia, accounting for about 82% of all the capital raised in the month.

Data compiled by DealStreetAsia showed that startups based in the city-state bagged about $950 million from 20 transactions, leading the pack in terms of deal volume and value, boosted by the Alibaba-Lazada deal.

The average deal size in Singapore last month was $67.9 million. Six deals did not disclose their financial details. That compares to the overall average deal size of $38.6 million in SE Asia last month.

In Indonesia, 10 transactions raised $109.5 million in total, up from a mere $35.8 million in November.

The top deal in the country was insurtech startup Qoala’s $39.5 million funding from PayPal Ventures, the corporate venture arm of payments giant PayPal, and US-based insurer MassMutual.

Vietnamese startups raised $15.2 million from five transactions, led by healthcare firm Nhi Dong 315’s $14.5-million funding from Singapore investor GIC.

Malaysia witnessed four funding deals that raised $17.5 million in total, led by the $8.3-million pre-Series B funding in LiveIN, a provider of affordable long-stay rental property solutions in Southeast Asia.

The Philippines’ lone transaction raised $64 million while Thailand witnessed one deal that did not disclose funding amount, according to DealStreetAsia’s compilation.

Fintech, healthtech top deal volume

Startups in the fintech and healthtech / healthcare sectors witnessed the most number of deals in December with eight transactions each.

However, Lazada’s capital injection brought e-commerce to the top of the leaderboard in terms of deal value, at $634.11 million from just two transactions.

Fintech firms secured $190 million in total funding, bannered by the $64 million that Philippines-based Maya Innovations raised from existing investors PLDT, Vision Investment Holdings, Tencent, and SIG. Qoala’s $39.5-million debt funding added to the total dough.

Startups in the healthtech and healthcare space secured a total of about $73.6 million in December, led by the $40.8-million funding that Singapore-based Doctor Anywhere secured in its Series C round. The funding round was backed by existing investors including Square Peg and Novo Holdings.

Meanwhile, in December, startups operating in the greentech sector raised $35 million in total from two deals while those in the software and IT sectors secured $20 million in aggregate funding.

Early-stage funding remains dominant

In December, investors continued to focus on early-stage investments. DealStreetAsia’s compilation showed that there were eight Seed, seven Series A, and four pre-Seed rounds in Southeast Asia in the month. Fourteen deals did not disclose their funding stages.

Singapore-based programmable bank services provider Pave Bank raised the largest Seed funding in December at $5.2 million. The round was led by 468 Capital, with participation from Quona Capital, FT Partners, BR Capital, w3.fund, Daedalus, and angel investors.

For the entire month, there were also three Series B rounds and one each for pre-Series C, Series C, private equity, corporate round, and convertible notes.