Singapore Venture Funding Landscape 2023 Nine-Month Report

Singapore cemented its position as the leading technology hub and investment destination in the ASEAN 6 region in the first nine months of 2023, according to a new report conducted by DealStreetAsia in partnership with Enterprise Singapore. 

The report, Singapore Venture Funding Landscape 2023: A Nine-Month Study, captures and analyses data on private funding bagged by venture-backed companies in the city-state, along with Indonesia, Malaysia, Vietnam, the Philippines and Thailand. 

Bogged down by macroeconomic uncertainties, geopolitical tensions and high interest rates, the total private funding raised by companies in the ASEAN 6 halved in the first nine months of the year, per the report. The deal volume, meanwhile, fell 30% year on year. 

Singapore was not immune to this funding chill, but its position as a relatively mature and resilient tech hub cushioned the blow for the local startup ecosystem, which recorded lower deal volume and value corrections than the other markets in ASEAN 6.

The other highlights of the report include: 

• In 9M 2023, the city-state remained the biggest venture capital market in ASEAN 6, with an over 60% of the total share of funding in the region both in terms of the deal count and the capital raised.
• Funding for healthtech, green tech, agri tech and food tech in Singapore bucked the overall funding slowdown trend. Healthtech deal volume more than doubled in 9M 2023 versus the same period last year. Meanwhile, green tech transactions grew by over 300% during the period. With a strong tech infrastructure and supportive government policies, local startups are well-positioned to ride the next growth wave. 
• There is also growing investor interest in deep tech in the city-state. In line with the growing maturity of local deep tech startups, there was a 36% year-on-year surge in deal volume in 9M 2023.
• Investors are also leaning towards early-stage deals and seeking longer exit horizons. This trend is evident in the larger share of funding directed towards seed to Series B deals, showcasing a growing investor preference for moving upstream. Early-stage deals accounted for about 95% of the deal volume and 53% of the deal value in the first nine months of 2023, up from 90% and 46%, respectively, in the same period last year. 
• The report also looks at the funding bagged by companies across the four pillars of Singapore’s Research, Innovation, and Enterprise 2025 (RIE2025) Plan. While the Smart Nation and Digital Economy domain saw a drop in the volume of investments, there were upticks in deal count under the Human Health and Potential, Manufacturing, Trade and Connectivity, as well as Urban Solutions and Sustainability domains.

Interviews with local and regional venture capitalists indicate that the startup ecosystem has adapted to the pivot from chasing growth at all costs to prioritising long-term sustainable growth and profitability. Despite the ongoing uncertainties, investors remain bullish about businesses in Singapore and the rest of ASEAN 6 in the long term. 

Besides its established position as a strong tech and innovation hub in the region, Singapore benefits from a strong commitment by the government to catalyse innovation and a dynamic and forward-looking entrepreneurial talent pool. Local companies look well-prepared to seize new opportunities when the global macroeconomic environment regains stability.

Read the ‘Singapore Venture Funding Landscape 2023: A Nine-Month Study’ report for more.