Among other key findings of the report, Singapore surpassed 2020 venture capital investments in the first half of 2022 and is on track to surpass record highs seen in 2021. Crypto, blockchain and Web3 startups are driving much of the growth in the region, with almost $1 billion funding to date in 2022, on track to surpass the $1.45 billion total in 2021 in SEA. Highlights are included below, and the full report can be viewed here.
Double on South East Asia
The company started investing in SEA in 2020 when Sanjay Zimmerman moved to Singapore. Since then, the firm has supported several companies in the region, including Instant coffee, Smooth, Una Brands, Pop mealand XANDER. As part of its commitment to the region, White Star Capital has officially opened an office in the CapitaSpring building in Singapore and now has six investment professionals based in the country. The firm too recently announced Promotion Cristina Ventura and Joe Quinn Wei to the general partners of the company.
SEA is the first new region for venture capital investments this decade, with 10% of the world’s population, 4 times the growth in GDP per capita compared to the world average, the second fastest growing labor force fastest in the world and a growing base of 480 million internet users in the region. There have been more $120 billion in venture capital invested in start-ups in SEA since 2019. In light of this rapid growth, White Star Capital has released its second report on the venture capital landscape in the region. The results multiplied the company’s long-term enthusiasm for the region.
Main findings of the Southeast Asia report
The report shows that funding is moving away from later-stage deals and into earlier-stage deals, which affects overall deal value. Although valuations are down from the previous quarter, the number of transactions remains constant. And, while SEA was once seen as an M&A exit market, public market exits have taken off in 2021 – and some have been spectacular. For example, GoTo $1.1 billion The IPO in 2022 nearly equaled the total value of exits for the entire SEA market in 2021.
Although the number of venture capital operations in South East Asia remains at an all-time high, the amount of venture capital invested fell in Q1’22. The main reason for this discrepancy between the number of transactions and the capital invested is the significant drop in valuation. The median valuation of South East Asia startups fell 50% from Q4’21 to Q1’22.
Venture capital activity in SEA is strongly correlated with the growth of e-commerce, which has grown at a CAGR of 40% since 2013. More than half of the region’s 42 unicorns are in e-commerce and payment electronics, but the region is seeing a significant increase in funding. activity in health and edtech as well.
SEA becomes the capital of investment in digital assets
The most notable trend – SEA is at the forefront of digital asset development, with an impressive 627 crypto/blockchain companies headquartered in the region. To date, there has been $3.3 billion of venture capital investments in digital asset companies in the region. Many of these investments were fairly recent, with more than $2.5 billion occurred within the past 18 months. Indeed, SEA has become the capital of investing in digital assets, with the 10 most active venture capital firms in the sector having made more than 300 investments. Venture capital investment in digital assets in SEA is on track to top 2021 in the first half of this year, even in light of the market cooling.
Strength of Singaporeand a readjustment Indonesia
Despite its size, Singapore has become the hub for startups in the region. As a country with a population of only 5.9mit is impressive that startups based in Singapore succeeded in raising $4.2 billion in 2022 since the beginning of the year only. The number of deals also appears to be significant with 249 deals already closed in 2022. As the top country in terms of venture capital funding per capita, Singapore has created a healthy ecosystem where startups have sufficient access to capital.
On the other hand, Indonesia has seen a decline in funding, with the surge in secured venture capital in 2021 ($9.3 billion) unmatched in the 2022 YTD, with only $1.3 billion so far. It should be noted that there were 222 deals in 2021 and 86 in 2022, suggesting that valuations are falling and investors are looking for investments in early-stage companies. Indonesia however, remains promising due to its large population and growing middle class. The country is also home to several unicorns and has wide access to finance.
“We believe South East Asia is one of the most exciting markets for venture capital investment, given its diverse population, rapidly growing economies and incredible technological advancement,” said Eric Martineau-Fortinfounder and managing partner of White Star Capital. “We are doubling down on the region by opening a Singapore office, appointing two new general partners and investing in early-stage, growth-stage and late-stage start-ups. We have now strengthened our position as the partner of choice for entrepreneurs in the region. »
“It has been inspiring to see the growth of the tech ecosystem across South East Asiaand Asia more broadly, over the past 18 years,” commented Cristina VenturaChief Catalyst Officer and General Partner at White Star Capital. “The region is getting better and better, and I look forward to establishing a permanent office with White Star Capital in Singapore. Looking ahead, we are focused on accelerating human capital, growth and ecosystem value in the region. The combination of exceptional talent, economic growth, availability of venture capital, early success stories and support from government institutions makes SEA an incredibly exciting place to be an investor right now. »
For the full report, please visit Medium.
About White Star Capital
White Star Capital is a multi-stage global technology investment platform that invests in exceptional entrepreneurs building ambitious international businesses. Operating from New York, Paris, London, Montreal, TorontoGuernsey, Tokyo, hong kongand Singapore our presence, our perspective and our people allow us to partner closely with our founders to help them develop internationally.
SOURCE White Star Capital