Southeast Asia’s startup market did not bounce back in 2025. It reorganised.

After years in which capital chased super-app ambitions, consumer land grabs and speculative technology narratives, the region’s venture ecosystem has settled into a more sober phase. Funding has stabilised at a lower base, and investors are now looking for businesses that can prove commercial urgency, cleaner unit economics and a shorter path from product to revenue.

“What we’re seeing at this point is stabilisation rather than a rebound,” said Minette Navarrete, President and Managing Partner of Kickstart Ventures, in the Southeast Asia Startup Funding Report 2025 by DealStreetAsia and Kickstart Ventures.

Also Read: Late-stage deals revive in Southeast Asia, but early-stage founders remain under pressure

That distinction matters. A rebound would suggest a return to the easy-money cycle that shaped much of the 2010s and the pandemic-era boom. Stabilisation points to something different: a market learning to live without excess liquidity. The result is a sharper sector-by-sector sorting of winners, with fintech, applied AI and defensible commerce models emerging as the clearest signs of where capital still has conviction.

Fintech finds its floor

Fintech remained Southeast Asia’s most active and heavily funded startup vertical in 2025, even as overall numbers reflected a cooler market. The sector raised US$1.3 billion across 111 equity deals, one of its quietest performances in six years. Yet the slowdown appears to have eased, suggesting fintech has found a workable funding floor.

That resilience is not surprising. Financial services in Southeast Asia remain fragmented, underpenetrated and unevenly digitised. Across markets such as Indonesia, Vietnam and the Philippines, large populations are still moving from cash-based transactions into digital banking, payments, investments and insurance.

In Singapore, meanwhile, fintech has become more institutional, tied closely to wealth management, capital markets infrastructure and digital asset regulation.

The standout category was wealthtech, which recorded 39 deals worth US$375 million. Its rise reflects both demographic and market realities: a growing middle class, higher mobile adoption and increasing demand for digital investment products beyond basic payments.

Some of the year’s largest fintech rounds reinforced this shift. Cross-border payments company Thunes raised a US$150 million Series D round, valuing the company at US$1.42 billion. Digital wealth platform Endowus secured US$87.5 million, while Syfe raised US$53 million. Digital asset banking group Sygnum also raised an oversubscribed US$58 million strategic growth round.

Also Read: The end of Southeast Asia’s unified startup funding story?

These deals show that investors are not abandoning fintech. They are moving away from loosely defined financial inclusion stories and towards infrastructure, wealth platforms and regulated digital asset services that can serve both consumers and institutions.

DeFi moves inside the system

Perhaps the most notable change is the way decentralised finance, or DeFi, has shifted from crypto speculation into mainstream financial plumbing.

In 2025, DeFi-focused models accounted for 39.6 per cent of all fintech equity deal volume, or 44 deals, and 29.6 per cent of total fintech deal value, with US$380 million raised. That marks a significant maturation from the pre-2021 period, when blockchain startups in the region were often treated as high-risk bets linked to token trading cycles.

The newer wave is more pragmatic. Blockchain infrastructure is being applied to lending, cross-border settlement, custody and tokenisation — the process of representing real-world assets such as funds, bonds or private equity on digital ledgers. In theory, tokenisation can reduce settlement time, improve transparency and make some assets easier to access or trade. In practice, it only works if regulators and institutions trust the system.

That is why compliance has become central to the next phase of digital assets. “Trust is paramount — this is why we continue to operate with full regulatory compliance across all regions,” said Mathias Imbach, Co-founder and Group CEO of Sygnum.

Sygnum’s work on tokenised money market and private equity funds with global names such as Fidelity International and Hamilton Lane illustrates how the sector is changing. The point is no longer to build parallel financial systems outside regulation. It is to use blockchain architecture to remove inefficiencies within existing capital markets.

For Southeast Asia, this is especially relevant. The region has long struggled with fragmented payment rails, varying regulatory regimes and cross-border settlement frictions. If digital asset infrastructure can reduce those bottlenecks without increasing systemic risk, DeFi’s next chapter may look far more institutional than ideological.

AI grows up, painfully

Artificial intelligence went through a similar reset.

The data analytics and AI or machine learning category recorded just 20 deals in 2025, with total funding of US$214 million. On the surface, that looks like a sharp fall from the excitement that followed the rise of generative AI. But it also signals a more disciplined market.

Also Read: Southeast Asia startup funding finds a floor, but not a rebound

Investors are no longer rushing to fund expensive attempts to build foundation models, which require enormous capital, specialised talent and computing power. Instead, money is flowing into applied AI: agents, document processing, customer service automation and enterprise software that can reduce costs quickly.

The year’s notable AI-linked deals included Whale’s US$60 million Series C and Video Rebirth’s US$50 million transaction. Other funded companies included fileAI, which raised US$14 million for document processing; Pollo AI, which secured US$14 million for generative tools; and WIZ.AI, which raised US$12 million for conversational automation.

The common thread is immediate business utility. AI is being judged less by how futuristic it sounds and more by whether it can shorten workflows, improve service quality or protect margins.

That fits the mood among Southeast Asian conglomerates, which remain important customers, partners and investors for startups. Carl Cruz, President and CEO of Globe, said inflation and changing consumer behaviour have pushed large companies to optimise capital expenditure and prioritise technologies that “move the needle”. For Globe, that means embedding AI into customer engagement and network operations rather than treating it as a side experiment.

Cezar Consing, President and CEO of Ayala Corporation, similarly identified AI, fintech and renewable energy as strategic priorities. His comment that “the big bucks go to the mature platforms” captures the broader investor mindset: in this market, technology must attach itself to clear corporate needs.

E-commerce splits in two

E-commerce, once the region’s favourite consumer-internet story, shows the harshest version of this reset.

Deal flow fell to a historic low of 26 transactions in 2025, largely because early-stage funding froze. Investors are wary of new platform models that require heavy spending on subsidies, logistics and customer acquisition before profitability is visible.

Yet e-commerce was not written off entirely. Instead, capital clustered around a small group of scaled, de-risked companies. Six late-stage deals made up most of the vertical’s US$472 million in funding value.

Malaysia’s Ashita Group reached unicorn status after raising US$155 million in growth equity. Singapore-based Carro secured US$60 million for its automotive transaction platform. Indonesia’s ASTRO raised US$51.9 million, while SIRCLO secured US$38.3 million to support e-commerce tools for merchants and brands. Vietnam’s Coolmate raised US$22.3 million, showing that vertically integrated consumer brands with stronger economics can still attract capital.

The lesson is clear: generic consumer marketplaces are out of favour, but B2B and B2B2C models remain investable when they offer transparency, repeat transactions and clearer monetisation.

The new regional playbook

Across sectors, Southeast Asia’s 2025 funding pattern points to the same conclusion. Capital is still available, but not for growth at any cost.

Also Read: Inside SEA’s AI gold rush: The 20 investors writing the biggest cheques

SaaS, B2B workflows, regulated fintech infrastructure and applied automation are benefiting because they promise predictable revenue and lower customer acquisition burdens. Startups are also placing more value on strategic investors that can open doors to procurement channels, regulated industries and overseas markets.

Logan Tan, Co-founder and CEO of Eezee, summed up the lesson bluntly: “The collapse of several highly funded unicorns here is proof that raising large sums to chase hypergrowth without solid fundamentals is unsustainable.”

That is the region’s new venture reality. Southeast Asia is not short of opportunity. It is short of patience for weak business models. The startups best placed for the next cycle will be those that can sell into real pain points, survive slower fundraising windows and grow without depending on perpetual subsidy.

The reset may feel uncomfortable. But for an ecosystem built across diverse, fragmented and often difficult markets, this discipline could become a strength.

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Bitcoin trades at US$77,260.09 today, with a 24-hour trading volume of US$26,479,119,535. The premier digital asset gained 0.22 per cent over the last day. The asset briefly climbed above US$80,000 before sellers dragged the valuation back to US$76,000. Kalshi participants currently favour an US$82,000 target for September.

Market participants betting on this outcome expect the asset to rise by at least seven per cent from its current US$76,000 level. This collective mood suggests speculators view the short-term pullback as a minor hurdle rather than a trend reversal. Buyers halted the August rise and pushed the token into a weaker trading range.

My perspective aligns with these speculators because market psychology often treats brief corrections as healthy consolidation phases before the next major breakout. Smart investors use these minor dips to accumulate more assets at discounted prices. The sheer size of the daily trading volume proves that immense capital continues flowing into the ecosystem.

Buyers step in aggressively whenever the valuation dips below key psychological thresholds. This underlying strength provides a solid foundation for future upward momentum and sustained investor confidence across all global exchanges. Global institutions allocate substantial portfolios to this sector to hedge against traditional currency devaluation and to secure long-term wealth preservation.

August delivered a phenomenal rally for the digital asset. Buyers pushed the valuation up about 25 per cent, from roughly US$62,500 to over US$78,000. The token peaked near US$81,138 during that specific period. The current US$82,000 Kalshi forecast sits slightly above that recent high. Buyers repeatedly tested the US$80,000 resistance level over the past few days.

These persistent attempts prove that underlying demand remains robust despite the immediate drop in valuation. Analysts see a high probability that the asset will touch US$82,000 this month. Market observers focus heavily on whether buying sentiment will hold near the resistance line.

Repeated tests at the resistance level eventually weaken that barrier. Sellers exhaust their supply during these tests, and buyers eventually absorb all available sell orders. Historical patterns support this optimistic outlook. The asset maintained a consistent record of September gains over the past four years. Seasonal strength often drives investor confidence and attracts fresh capital into markets. Traders remember these historical trends and position their portfolios accordingly.

This collective anticipation creates a self-fulfilling prophecy that drives valuations higher. Retail participants join the rally when they see large institutional funds accumulating positions during these seasonal windows, and they mimic those trading behaviours to capture similar financial rewards.

Also Read: Can Bitcoin defend the critical US$76,500 foundation zone before the September 11 inflation data triggers another massive liquidation cascade?

The broader digital asset market faces distinct challenges even as Bitcoin shows relative strength. Ethereum dropped 0.93 per cent to US$2,389.35 over the last 24 hours. The second-largest digital asset underperformed Bitcoin’s slightly positive price action. A massive cascade of leveraged long liquidations was the primary driver of this underperformance. Exchanges wiped out approximately US$96 million in Ethereum long positions.

The broader crypto market saw exchanges liquidate over US$367 million in total positions during the same time. Long positions accounted for the vast majority of these forced closures. This derivatives squeeze created immense forced selling pressure. Algorithms automatically sold assets to meet margin calls, pushing the valuation below the critical US$2,400 support level. High leverage always fuels rapid declines. The market effectively cleared overextended bullish bets and generated a sharp, high-volume downward move.

These liquidation cascades are necessary market cleanings. They remove fragile leverage and build a much stronger foundation for future valuation appreciation. Healthy markets require periodic flushes to wipe out greedy speculators and reward patient long-term holders. Trading platforms constantly monitor these margin requirements and adjust their internal risk parameters to prevent systemic failures during extreme volatility spikes.

Broader macroeconomic pressures also weigh heavily on digital assets. Ethereum shares a strong 67.8 per cent correlation with the S&P 500. This high correlation indicates that traditional stock market movements heavily influence digital asset valuations. A broad risk-off shift swept through global financial markets.

Geopolitical tensions pushed Brent crude oil prices above US$95. Higher oil prices ignite inflation fears and drive Treasury yields higher. Investors typically sell risk assets when inflation fears rise and bond yields offer better returns. Spot selling pressure increased alongside these macro headwinds. A major market participant moved 70,739 Ethereum tokens worth roughly US$174 million to exchanges over two days.

Large holders usually signal an intent to sell when they transfer assets to exchanges. Institutional exchange-traded fund inflows also slowed significantly during this period. I interpret these whale movements as strategic portfolio rebalancing rather than a complete loss of faith in the asset.

Smart money often takes profits after strong rallies and waits for better entry points. These large players have the capital to move markets and always seek optimal liquidity conditions to execute large trades. Professional fund managers analyse these on-chain metrics daily to predict future supply shocks, and they adjust their exposure levels based on precise wallet movements.

Also Read: Sellers reject Bitcoin at US$81,000 and Asia has not even opened: what the next session will reveal

Market participants now watch critical support levels to gauge the future direction of valuations. The immediate technical structure looks bearish after sellers broke US$2,400. The next major support cluster sits between US$2,350 and US$2,320. Liquidation heatmaps show dense liquidity resting in this specific zone.

Buyers must defend this area to prevent a deeper correction. A successful defence could allow the asset to consolidate and range between US$2,320 and US$2,440. A failure to hold this zone opens the door for a drop toward US$2,200. The Federal Reserve’s policy decision on September 16 is the most important near-term catalyst. Traders currently price in a 68 per cent chance of a rate hike. A hawkish central bank decision could easily extend the current downturn.

A dovish surprise might catalyse a massive relief rally across risk assets. I expect extreme volatility surrounding the central bank announcement. Investors should watch the valuation reaction at the US$2,320 level and monitor exchange-traded fund flow data closely.

These metrics will reveal true institutional sentiment and dictate the next major market trend for the remainder of the year. Economic analysts constantly track these interest rate probabilities and model various economic scenarios to prepare clients for potential monetary policy shifts.

Evaluating both assets together reveals a complex market environment. Bitcoin leads the charge with resilient price action while Ethereum battles intense derivative liquidations and macro headwinds. Traders must navigate these diverging narratives carefully. I advise market participants to focus on underlying fundamentals rather than short-term valuation fluctuations.

The digital asset space always experiences violent swings before establishing long-term trends. Patient observers will capitalise on these temporary dislocations and build substantial wealth over time.

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The views expressed in this article are those of the author and do not necessarily reflect the official policy or position of e27.

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The post Bitcoin slipped below US$80,000, so why are traders still betting on US$82,000? appeared first on e27.

For many companies in Asia, distress rarely arrives as a single dramatic event. It tends to build quietly: a more expensive lender replacing a bank, a missed fundraising target explained away as timing, profits that look healthy on paper but do not turn into cash, or a trusted senior executive leaving without a clear successor.

Those signals are now becoming harder to ignore. New analysis from global consulting firm AlixPartners has identified four early warning signs that APAC business leaders, investors and lenders should watch closely as insolvencies rise across the region: declining access to quality capital, a mismatch between EBITDA and cash, missed milestones and targets, and senior management churn.

Also Read: Malaysian pension fund KWAP moves to contain damage after eFishery fraud shock

The report comes at a tense moment for Asian businesses. According to Allianz’s Global Insolvency Outlook 2026-27, company insolvencies in Asia rose by 39 per cent in 2025, with increases recorded across almost every major financial centre. Hong Kong and Singapore, two of the region’s most important capital and restructuring hubs, each saw insolvencies climb by 33 per cent.

For Southeast Asia’s startup and growth-company ecosystem, the findings land close to home. The region has spent the past two years adjusting to a funding environment where capital is still available, but far less forgiving. Investors are pushing harder on unit economics, lenders are scrutinising cash flows, and founders who raised during the low-interest-rate era are discovering that survival depends less on headline growth and more on discipline.

Capital gets more expensive before it disappears

The first red flag, AlixPartners says, is a company’s declining access to quality capital. In simple terms, this means a business is no longer able to raise money from the most reliable or lowest-cost sources, such as established banks, existing shareholders or institutional investors, and is forced to turn to more expensive or less sophisticated providers.

That shift matters in Asia because the region’s corporate landscape is dominated by smaller, privately held and family-owned businesses. Micro, small and medium-sized enterprises make up an estimated 97 per cent of all companies in APAC. Many do not disclose detailed financial information, making it harder for lenders, suppliers and investors to spot problems early.

“When companies start tapping higher cost debt providers or less sophisticated retail investors for additional funding, it can be an indication that a company’s relationship with banks or shareholders is no longer willing to commit additional capital,” said Patrick Bance, Partner and Managing Director in Singapore at AlixPartners.

In Southeast Asia, this is particularly relevant for startups that previously relied on frequent equity rounds to fund expansion. When venture capital slows, some firms turn to venture debt, revenue-based financing, bridge notes or informal sources of capital. These tools are not inherently problematic. But when they are used to plug operating losses rather than finance clear growth, they can indicate that the business is running out of room.

Profit is not the same as cash

The second warning sign is a persistent gap between EBITDA and cash generation. EBITDA, or earnings before interest, taxes, depreciation and amortisation, is often used as a rough measure of operating performance. But it excludes several real costs, including debt servicing, tax payments and the ageing of assets.

That distinction is becoming more important as interest rates remain higher than they were during the funding boom. AlixPartners cited data showing that nearly one-fifth of total Asian corporate debt is owed by companies with low interest coverage ratios. An interest coverage ratio measures how comfortably a company can pay interest on its debt from earnings. A low ratio suggests that even a profitable-looking business may struggle to meet its obligations.

Also Read: Indonesia detains 3 more suspects in TaniHub investment fraud case

“A persistent mismatch between EBITDA and cash generation is the surest warning sign,” said Matt Hinds, Partner and Managing Director in Singapore at AlixPartners. “As an early client said to me, ‘It’s never too early to start worrying about cash.’”

For founders, this is a reminder that growth metrics cannot indefinitely substitute for liquidity. A company may show rising revenue, improving gross margins or positive adjusted EBITDA, while still burning cash because customers pay late, inventory builds up, expansion costs rise, or loans come due. In sectors such as e-commerce, logistics, electric vehicles and hardware, working capital can quickly become the difference between a turnaround and a restructuring.

Missed targets start to tell a story

The third signal is repeated failure to meet milestones and commitments. One missed target may reflect market conditions or operational friction. A pattern of delayed filings, reduced fundraising plans, broken lender promises or shifting shareholder updates points to something deeper.

Bance noted that “delayed statutory filings and delayed or downsized fundraising efforts can be an early warning sign of potential disagreements about asset valuation, business performance, forecast cashflows, and investor confidence in the company.”

This is especially relevant in Southeast Asia, where private companies often disclose less than listed businesses but still depend heavily on trust. A startup that repeatedly misses product launches, revenue targets or fundraising deadlines may find that stakeholders become less willing to extend patience. Suppliers may tighten payment terms, investors may demand harsher conditions, and lenders may ask for additional security.

Also Read: Nadiem Makarim, eFishery, and the end of blind faith in startups

In a weaker funding market, missed milestones can also create a valuation problem. Companies that raised at high valuations in 2020 or 2021 may resist down rounds, while investors may be unwilling to price new capital on outdated assumptions. The result is delay — and delay can consume cash.

Leadership exits can deepen the damage

The fourth warning sign is churn at the top. Leadership changes are not unusual, particularly in young companies. But repeated departures among senior executives can disrupt operations, weaken morale and worry investors. AlixPartners estimates that replacing departing leaders can set a company’s progress back by as much as 12 months.

“If you are seeing increasingly high levels of management churn, the thing you are going to worry about is that they are not getting rid of those who are responsible for poor performance,” Hinds said. “It is the good ones who will go somewhere else. And management churn, in itself, is disruptive.”

In Asia, the issue is not limited to professional management teams. Many companies are family-controlled, and succession planning can become a material risk. If strategy, relationships and institutional knowledge sit with one founder, patriarch or matriarch, an unplanned transition can quickly destabilise even a viable business.

Una Ge, Partner and Managing Director for Greater China at AlixPartners, said many Chinese companies still view the business as part of the family legacy, making ownership continuity important. “The issue is whether the right succession planning is in place and being executed. In many cases, formal succession planning remains limited,” she said.

The same concern applies across Southeast Asia, where many large private groups remain family-run and many startups are still founder-dependent. Investors often back founders as much as business models. When key people leave, confidence can leave with them.

The cost of waiting

The common thread across AlixPartners’ four warning signs is time. Early distress gives companies options: refinancing, cost restructuring, asset sales, management changes, fresh equity, or a negotiated reset with creditors. Late distress narrows the menu and raises the cost.

Also Read: “Special Projects” and shady metrics: TaniHub whistleblower speaks as top execs detained

That lesson is increasingly relevant for the region’s startup economy. The easy-money years rewarded speed and scale. The current cycle is testing resilience, transparency and cash discipline. For founders and boards, the warning signs are not reasons to panic. They are reasons to act before the market acts for them.

The post For Southeast Asian startups, distress may show up before the cash runs out appeared first on e27.

In the second year of my country risk role at an Indonesian insurer, I sat in a senior management meeting where a proposed product was on the table. The credit risk was material, the operational risk was novel, and the regulatory positioning was ambiguous. I raised three specific concerns. The chief executive listened, nodded, thanked me, and approved the product. Two weeks later, when the proposal moved to the Risk Committee, my concerns were not in the materials. The committee approved unanimously.

Eighteen months later, the product produced the loss event the three concerns had predicted.

The failure was not technical. The risk analysis had been correct. The framework had been adequate. The reporting lines were documented. What had failed was the culture around all of it, the small, accumulated decisions that determined whose voice carried weight in the room, whose concerns made it into the materials, and what it cost professionally to say something the room did not want to hear.

After fifteen years inside risk functions across banking, insurance, and multifinance, I have come to believe most risk failures inside financial institutions are not technical. They are cultural. The frameworks have improved dramatically over two decades. The cultures around them often have not. The technical fixes do not solve what is broken.

Three cultural failures I see most often

These show up across institutions, sectors, and geographies. The institutions that have one of them often have all three.

• The marginalised CRO. The Chief Risk Officer reports to the Chief Financial Officer instead of the Chief Executive Officer. The CRO’s compensation is influenced by institutional profitability. The CRO is not part of the executive committee that decides strategy, only the one that reviews risks afterwards. Every piece of this signals to the rest of the organisation that risk is a function, not a counterweight.
• The rubber-stamp committee. The Risk Committee meets monthly. Materials are prepared two weeks in advance, reviewed by management, finalised by the chair. By the time the committee meets, the decisions have been made. Committee members ask polite questions. Minutes record consensus. The information that should have been challenged was never presented in a form that allowed challenge.
• The yellow flag problem. Risk officers learn, often through specific incidents in their early careers, what it costs professionally to colour something red. A red flag stops a deal, blocks a senior executive’s project, requires the institution to file an awkward disclosure. A yellow flag does none of those things. The same situation that should be red, the loan exposure that exceeds prudent limits, the operational gap that has not been remediated, the regulatory finding that has not been closed, becomes yellow, then amber, then “acceptable with monitoring.” The risk function learns to be polite. The institution accumulates the losses anyway.

Also Read: Why building a people-first work culture in HR tech matters more than ever in Southeast Asia

What healthy risk culture looks like

Three patterns separate the institutions where risk works from those where it does not.

The CRO sits at the executive table. Direct reporting to the CEO, not through the CFO. Part of the executive committee that decides strategy. Compensation independent of short-term performance. None of this is sufficient on its own. All of it is necessary.

Disagreement is rewarded. The institutions with the strongest risk cultures actively promote risk officers who, at some specific moment in their tenure, said something the room did not want to hear and turned out to be correct. The promotion is the signal. The rest of the function notices. The next time a difficult call needs to be made, more than one person is willing to make it.

Public losses are studied. When something goes wrong, the institution does a serious, written post-mortem, shared internally, that does not assign individual blame. It maps the decisions, the assumptions, and the cultural mechanisms that allowed the loss to happen. Institutions that do this once become institutions that do it routinely. The ones that do not accumulate the same loss patterns for decades.

What CEOs and boards should watch for

A small number of signals reliably indicate which side of this line an institution sits on.

How does the CRO leave a Risk Committee meeting? If the CRO consistently leaves more agitated than they arrive, the meetings are not working. The risk function is bringing issues the committee is not engaging with.

How long has it been since a risk officer was promoted on the strength of a specific disagreement? If the institution cannot name an instance, the message inside the function is that disagreement does not pay.

When the last significant loss event happened, what document existed afterwards? If there is no written post-mortem, or it was a defensive memo rather than an honest analysis, the next loss event is already in motion.

Also Read: The unspoken crisis: Are we building a new digital divide in agriculture?

The macro stakes

The conventional response to risk failure is to invest in technical infrastructure, better systems, more granular models, deeper reporting. Most of these investments are reasonable. None of them solves the cultural problem they often distract from. The institution that buys better risk software while leaving its CRO reporting to the CFO has spent money on the wrong layer.

The cultural changes are harder than the technical ones. They require uncomfortable conversations about reporting lines, compensation, and the unspoken rules about who gets to disagree. They cost executive capital. They produce no software contract to point to. They are also the only ones that consistently work.

After fifteen years inside risk functions, the institutions I trust most are not the ones with the most sophisticated frameworks. They are the ones where the risk officer in the back of the room is willing to interrupt the CEO, and where the CEO listens. Most risk failures, when you trace them back honestly, are cultural failures wearing a technical disguise. The institutions that figure that out, and act on it, are the ones whose risk function will be doing more than reporting when the next significant loss event arrives.

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Editor’s note: e27 aims to foster thought leadership by publishing views from the community. You can also share your perspective by submitting an article, video, podcast, or infographic.

The views expressed in this article are those of the author and do not necessarily reflect the official policy or position of e27.

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The post The yellow flag problem: Most risk functions fail at culture before they fail at technique appeared first on e27.

For years, Southeast Asia’s online used-car platforms were judged mainly by how fast they could expand: more inspection centres, more listings, more buyers, more cities. Carsome’s latest numbers suggest the sector has entered a different phase, one where scale still matters, but profitability is becoming the sharper test.

The Malaysia-headquartered used-car e-commerce group reported record quarterly EBITDA of US$8.3 million for the second quarter of 2026, up 38 per cent from a year earlier. It marks the company’s tenth consecutive profitable quarter on an EBITDA basis, a milestone that matters in a market where digital automotive players have often struggled with high operating costs, thin margins and uneven consumer trust.

Also Read: Carsome hits US$5M EBITDA in most profitable quarter yet

The firm sold 35,903 vehicles during the quarter ended June 30, up 11 per cent year-on-year. Gross profit rose faster, climbing 15 per cent to about US$43.8 million. The company said the improvement was driven by a larger share of retail transactions and financing services, rather than simply higher vehicle volumes.

That distinction is important. Wholesale used-car transactions can drive scale, but retail sales, financing, warranties and related services typically create stronger unit economics. In plain terms, Carsome is trying to earn more from each car it touches, not just sell more cars.

“Q2 delivered what we set out at the start of the year. We sold 11 per cent more cars, grew gross profit by 15 per cent, and grew EBITDA by 38 per cent,” said Eric Cheng, co-founder and Group CEO of Carsome. “Each line growing faster than the one before is what operating leverage looks like in practice.”

From volume chase to operating leverage

EBITDA (earnings before interest, taxes, depreciation and amortisation) is not the same as net profit. But for high-growth companies, it is often used as a measure of whether the core business can generate cash-like earnings before accounting and financing costs.

In Carsome’s case, the latest quarter indicates that its cost base is not rising as quickly as gross profit. That is the operating leverage Cheng referred to: once inspection infrastructure, showrooms, logistics networks and technology systems are in place, every additional transaction should ideally contribute more to earnings.

This is a notable shift for a company that, like many venture-backed platforms, spent its earlier years building density across markets. Southeast Asia’s used-car trade remains fragmented, with many purchases still happening through small dealers, informal networks or offline classifieds. Platforms such as Carsome have tried to bring more structure to the process by offering inspections, fixed-price retail experiences, trade-ins, financing and after-sales support.

The challenge has always been execution. Cars are expensive physical assets. Unlike purely digital marketplaces, used-car platforms carry inventory risk, require refurbishment capacity, need large inspection networks, and must win trust from both sellers and buyers. Expansion can become costly if volumes do not rise quickly enough to absorb fixed expenses.

Carsome’s tenth straight EBITDA-positive quarter suggests the company is finding a more sustainable balance between growth and cost control, at least at the operating level.

Malaysia deepens, Indonesia expands

During the quarter, Carsome continued to add physical locations in its core markets. In Malaysia, it opened three new sites in Sungai Petani, Bukit Tinggi in Klang, and Sungai Buloh, bringing its network to 55 inspection centres and showrooms nationwide.

Also Read: Carsome turns profitable in FY2024 with US$10.5M EBITDA

Malaysia remains a strategically important market for the group, not only because it is Carsome’s home base, but also because vehicle ownership is high by regional standards. The country has a mature used-car ecosystem, but it remains highly fragmented, leaving room for players that can offer standardised inspections, transparent pricing and financing options.

Carsome also expanded in Indonesia, opening four new locations in Greater Jakarta. The company now has 10 inspection centres and showrooms in the area. Indonesia is a more complex prize: it is Southeast Asia’s largest economy and has a vast population, but car ownership remains lower than in Malaysia or Thailand. That creates long-term upside, though the market can be difficult to serve because of geography, financing gaps and varying consumer behaviour across cities.

The group’s partnership with Suzuki Cars Malaysia as the carmaker’s exclusive official trade-in partner also points to a wider industry trend. Automakers and distributors are increasingly looking for structured trade-in channels to support new-car sales, while digital platforms want access to higher-quality used-car supply. In markets where affordability is under pressure, the line between new and used-car ecosystems is becoming more intertwined.

Why used cars matter in Southeast Asia

Used cars occupy a practical space in Southeast Asia’s transport economy. New vehicles have become more expensive for many households, while public transport access remains uneven outside major urban centres. At the same time, motorcycles dominate in several markets, but as incomes rise, many families still aspire to own a car for safety, comfort and mobility.

Financing is central to that transition. A platform that can combine vehicle discovery, inspection, credit assessment and loan facilitation has a better chance of capturing more value across the transaction. It may also reduce friction for consumers who are wary of hidden defects, unclear pricing or unreliable dealers, long-standing pain points in the used-car market.

For Carsome, the shift toward financing and retail is therefore not just a margin story. It is also a way to become more deeply embedded in the buying journey, rather than acting only as a marketplace or sourcing channel.

Still, risks remain. Higher interest rates can dampen demand for vehicle financing. Inventory-heavy models can suffer if prices move suddenly. Consumer confidence, fuel prices and regulatory changes can all affect car purchases. In Indonesia especially, competition for reliable supply and affordable credit can be intense.

A crowded road ahead

Carsome’s closest regional rival remains Singapore-headquartered Carro, another major integrated used-car platform with operations across Southeast Asia. In Indonesia, players such as Moladin have also targeted the used-car and auto-financing chain, while traditional dealers, bank-backed financing networks, and classified platforms continue to compete for consumer attention. Globally, companies such as CarMax in the US have shown how large used-car retailers can scale, but they have also demonstrated how exposed the model can be to credit cycles, inventory costs and shifts in vehicle prices.

That competitive backdrop makes Carsome’s profitability streak more relevant. The company is not operating in a winner-takes-all software market; it is competing in a capital-intensive, operationally messy industry where local execution often matters more than brand alone.

Cheng said Carsome’s priorities for the rest of the year remain “growing transactions, expanding unit economics, and demonstrating operating leverage”. The phrasing may sound like standard corporate discipline, but in the context of Southeast Asia’s startup ecosystem, it reflects a broader reset.

Also Read: Riding into its first profitable year, Carsome looks forward to strengthen its presence in the Philippines

Investors are no longer rewarding growth at any cost as freely as they did during the low-interest-rate years. Startups across the region, from fintech to logistics to commerce, have been pushed to prove that their models can generate durable margins. Carsome’s latest quarter fits that wider narrative: the company is still expanding, but the bigger story is that each layer of growth appears to be contributing more to earnings.

The next test will be whether it can maintain that trajectory as it adds more sites, pushes deeper into Indonesia, and grows financing-led transactions without taking on excessive risk. For now, its second-quarter results give the used-car platform something many scaleups in Southeast Asia are still trying to secure: evidence that growth and profitability can move in the same direction.

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Southeast Asia’s venture capital market is no longer in freefall. But calling it a recovery would miss the more important story.

The region’s startup funding landscape in 2025 has split into two very different markets, according to the “Southeast Asia Startup Funding Report for 2025” by DealStreetAsia and Kickstart Ventures. At the top end, mature companies with revenue, governance and clearer paths to liquidity are once again attracting large cheques. At the bottom, seed and pre-seed founders are still battling lower valuations, slower decisions and investors who want proof far earlier than they did during the boom years.

Also Read: The end of Southeast Asia’s unified startup funding story?

“What we’re seeing at this point is stabilisation rather than a rebound,” said Minette Navarrete, President and Managing Partner of Kickstart Ventures. That distinction matters. Capital is moving again, but with far less tolerance for speculative growth.

The result is a more disciplined Southeast Asian venture market, one that is rewarding companies seen as de-risked, while forcing younger startups to survive longer on leaner terms.

Late-stage capital finds its way back

The clearest sign of reopening came in late-stage funding. Deal volume more than doubled to 24 late-stage transactions in the second half of 2025, compared with 10 in the first half and nine in the second half of 2024. Late-stage equity proceeds rose to US$2.23 billion in the second half, up from US$760 million in the first half.

On paper, that looks like a strong comeback. In practice, the rebound was heavily shaped by a small number of very large deals. The most obvious example was Princeton Digital Group’s US$1.3 billion growth equity transaction in Singapore, which accounted for a large share of late-stage capital raised.

Strip out such mega-rounds, and the picture becomes more measured. Capital was spread across more transactions, but cheque sizes remained cautious. Investors were not returning to the 2021-era habit of backing ambitious narratives at almost any price. They were concentrating capital in companies with scale, market position and a credible route to public markets or strategic exits.

Even so, the reopening was significant enough to create four new unicorns in Southeast Asia in 2025, compared with one in 2024 and two in 2023.

Singapore-based healthtech platform Ultragreen.ai reached unicorn status after a US$188 million pre-IPO growth equity round that valued it at US$1.3 billion. Its subsequent listing suggested that public market investors remain willing to back healthtech companies if they can show clinical validation and revenue depth.

Malaysia’s Ashita Group joined the club after raising US$155 million in growth capital, signalling that scaled e-commerce and B2B2C models can still attract premium pricing when they demonstrate defensibility. Singapore payments company Thunes raised a US$150 million Series D, taking its post-money valuation to US$1.42 billion, while digital asset banking group Sygnum also crossed the threshold after an oversubscribed US$58 million strategic growth round.

These companies sit in very different sectors, but they share a common theme: they are not being funded purely on market potential. Investors are looking for proof that the business model can withstand scrutiny.

The lead investor problem

For late-stage founders, the market has improved, but it has not become easy. The biggest challenge is often finding the first investor willing to set the terms.

Also Read: Southeast Asia startup funding finds a floor, but not a rebound

Mathias Imbach, co-founder and Group CEO of Sygnum, said the central difficulty in closing its growth round was “finding the lead”. Once a credible lead investor is in place, the rest of the syndicate can follow. Without one, even strong companies can remain stuck in prolonged negotiations.

That reflects a broader shift in Southeast Asia. Growth investors are spending more time on due diligence, valuation benchmarks and downside protection. They are still willing to write large cheques, but only when they believe the company can justify the price through revenues, margins, governance and eventual exit potential.

For founders, this means late-stage fundraising has become less about creating competitive heat and more about building conviction among a smaller pool of selective investors.

Early-stage founders face a harder market

The other half of the story is far less comfortable. Early-stage activity, from pre-seed to Series B, continued to slow. Deal volume fell to 209 transactions in the second half of 2025, from 218 in the first half and 259 in the second half of 2024.

Proceeds did rise to US$1.28 billion in the second half from US$1.10 billion in the first half, but this was not a broad-based easing. The increase came from a narrower group of stronger companies rather than a general revival in risk appetite.

The valuation pressure is most visible at the entry points. Median seed valuations fell to US$2 million in 2025 from US$2.5 million in 2024. Pre-seed valuations rebounded to a median of US$500,000 from US$100,000, but the report described this category as volatile.

For first-time founders, the message is clear: investors are no longer paying up for ambition alone. They want early signs of product-market fit, customer willingness to pay and a credible path towards profitability. In Southeast Asia, where markets are fragmented by language, regulation, infrastructure and consumer behaviour, that bar can be especially difficult to clear.

There are still pockets of resilience. Series A valuations held steady at a median of US$10 million, remaining above pre-pandemic levels. That suggests companies which have found initial traction can still raise on stable terms. Series B was stronger still, with median valuations rising to US$17.8 million from US$10.0 million in 2024.

This underlines the bifurcation: investors are not abandoning early-stage startups altogether. They are drawing a sharper line between experiments and businesses that have already reduced execution risk.

Logan Tan, co-founder and CEO of e-procurement marketplace Eezee, said Southeast Asian founders can no longer copy Silicon Valley’s “grow fast at all costs” playbook. “The collapse of several highly funded unicorns here is proof that raising large sums to chase hypergrowth without solid fundamentals is unsustainable,” he said.

His prescription is pragmatic: customer-led growth, margin discipline and a cash runway of one to two years. That may sound conservative, but in today’s market it is increasingly what survival looks like.

The exit problem remains

The biggest unresolved issue is liquidity. Southeast Asia has produced large technology companies, but it still lacks a deep and reliable exit market. Public listings remain selective, while strategic acquisitions are often slowed by valuation gaps between founders, investors and potential buyers.

Edgar Hardless, CEO of Singtel Innov8, pointed to the pressure created by high entry valuations from the last cycle. “The appetite of companies in this region to meet the valuation expectations from entrepreneurs and investors is more limited compared to other regions like North America,” he said.

That leaves venture funds looking for other routes to return capital. Secondary transactions, where existing shareholders sell stakes to new investors, are becoming more important. They do not solve the exit bottleneck entirely, but they can provide partial liquidity in a market where IPOs and large M&A deals remain uneven.

Also Read: Growing SEA startups with Kickstart Ventures

The broader lesson from 2025 is that Southeast Asia’s startup ecosystem is maturing, but not uniformly. Late-stage companies with scale are regaining access to capital. Early-stage founders are being forced to build with less. Investors are still active, but they are more selective, more patient and more demanding.

For the region, that may not be a bad thing. The funding boom created speed, but also excess. The current cycle is quieter, tougher and less forgiving. It may also produce companies built to last.

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On 31 August, the European Commission did something no regulator had done before: it looked at a generative AI chatbot and decided it was, legally speaking, a search engine. ChatGPT was designated a “Very Large Online Search Engine” under the EU’s Digital Services Act (DSA), placing OpenAI’s flagship product in the same supervisory tier as Google Search, alongside Reddit and Roblox, both newly tagged as Very Large Online Platforms.

The trigger was scale: ChatGPT’s search-enabled function reported roughly 159 million average monthly users across the EU in the six months to March, more than three times the 45-million threshold that pulls a service into the DSA’s strictest bracket.

Also Read: OpenAI calls for ‘AI infrastructure revolution’ to reboot Japan’s growth

OpenAI now has until the end of November to run systemic risk assessments covering everything from minor safety to electoral integrity, submit to independent audits, and open its systems to vetted researchers. Until last week, these obligations only applied to platforms like Instagram or Google Search, not to a chatbot that writes original text rather than indexing web pages.

Most of the commentary on this has understandably focused on what it means for OpenAI, and for Ireland’s Coimisiún na Meán, which now supervises an outsized share of Big Tech‘s EU compliance. But the more interesting question for readers is what happens next: because the EU rarely regulates in isolation, and Southeast Asia has a well-worn habit of importing Brussels’ homework a cycle or two later.

The Brussels effect isn’t hypothetical here; it already happened once

Southeast Asia has run this playbook before, almost to the letter. When the EU’s GDPR came into force in 2018, it didn’t just reshape how European companies handled data but it became the reference architecture for an entire generation of Asian privacy law.

Indonesia’s Personal Data Protection Law and Vietnam’s earlier data-protection decrees both borrowed GDPR’s core scaffolding: consent requirements, data-subject rights, extraterritorial reach, the works. Regional regulators didn’t hide the influence; they built on it, because writing a data law from scratch is slower and riskier than adapting one that’s already survived its first constitutional challenges.

AI regulation is following the same script, faster. Vietnam passed the region’s first standalone AI law in December 2025, effective this March, built explicitly around the EU AI Act’s four-tier risk classification — unacceptable, high, medium, low — with Vietnamese characteristics layered on top, including a requirement that foreign providers of high-risk AI systems appoint a local contact point.

Indonesia’s draft Presidential Regulation on AI, delayed from late 2025 into early 2026, follows the same EU-style risk-based logic. Thailand’s ETDA is still consolidating its draft AI principles after public consultation, with no firm timeline, but the direction of travel is identical.

A recent ISEAS analysis put it plainly: the EU’s risk-based approach has become the most widely adapted template for AI governance across the bloc, more influential than either the OECD’s principles or the innovation-first models coming out of South Korea and Japan.

Also Read: ‘AI is a race for innovation; regulation will only develop effectively once winners are announced’

So when the European Commission draws a bright line (45 million monthly users, and you’re now a “very large” service subject to search-engine-grade scrutiny), Southeast Asian lawmakers aren’t watching from a distance. They’re watching for the template.

The threshold is coming for the region, not just for OpenAI

Here’s the part that should worry SEA-based AI builders more than the Brussels decision itself: the user numbers that triggered this are no longer a Silicon Valley or European phenomenon. Indonesia is now ChatGPT’s fastest-growing Southeast Asian market, with adoption reportedly climbing by roughly 85 per cent over the past year. Thailand’s AI usage grew by more than a third over the same stretch.

None of the region’s markets have crossed a 45-million-user threshold yet, but ASEAN’s combined online population is large enough, and growing fast enough, that a Jakarta- or Hanoi-specific version of the DSA’s “very large” tier is not a fantasy. It’s a drafting decision waiting for a policy window.

And when that window opens, the compliance bill will not land evenly. A frontier lab like OpenAI or Anthropic can absorb a systemic risk assessment, an independent audit and a data-sharing regime as a cost of doing business in a market it already dominates. A Southeast Asian AI startup that are building on top of a foundation model, serving a regional language, running on a fraction of the balance sheet cannot. Vietnam’s own AI Law already requires foreign high-risk AI providers to register a local point of contact; layer three or four separate national risk-assessment regimes on top of that, each modelled on Brussels but tuned to local political sensitivities, and the compliance burden starts to look less like consumer protection and more like a moat that only the biggest players can clear.

Fragmentation, not regulation, is the real risk

This is the trap SEA regulators need to see coming. Copying the EU’s risk-based logic is not, on its own, a bad instinct; the alternative, no rules at all until something goes wrong, is worse, and the region’s own AI ethics and human-rights advocates have long argued that guardrails are overdue.

The danger is in how the copying happens: five or six ASEAN member states independently translating the same Brussels template into slightly different national decrees, different thresholds, different definitions of “high-risk,” each with its own local-contact-point requirement and its own audit cadence.

Vietnam’s Ministry of Science and Technology has already had to walk back parts of its draft implementing decree after industry groups warned that a rushed, EU-AI-Act-style rollout creates exactly the kind of compliance bottlenecks Brussels and Seoul are still untangling for their own laws.

Also Read: Without governance, AI agents risk becoming enterprise chaos engines

A genuinely EU-inspired approach would borrow the other half of Brussels’s playbook: a single supervisory framework, applied consistently across a bloc, rather than a patchwork of national reinterpretations. ASEAN has the institutional muscle to attempt that, a regional AI governance framework that sets one risk taxonomy and one set of thresholds, rather than leaving Jakarta, Hanoi, Bangkok and Manila to each draft their own. Without it, the region risks importing the DSA’s compliance weight without importing the one thing that makes it manageable at scale: a single market’s worth of harmonised rules.

OpenAI has four months to prove it can meet Brussels’ new bar. Southeast Asia’s regulators have rather longer than that to decide whether they’re building one rulebook, or six.

The post The EU called ChatGPT a search engine. SEA’s AI startups should worry about what comes next appeared first on e27.

For many small merchants in Southeast Asia, payments and loyalty are still treated as separate problems. One system records the sale, another handles digital payments, and a third, if it exists at all, tries to bring the customer back.

StoreHub and ShardLab now want to see whether those layers can be stitched together more tightly.

Also Read: 3 easy tips for SMEs to build overseas customer loyalty

Kuala Lumpur-based StoreHub has received an undisclosed strategic investment from ShardLab, a Singapore-based venture studio that describes itself as the innovation arm of South Korean-headquartered blockchain investment firm Hashed.

The two companies will also form a joint venture to explore new consumer payment and rewards products for merchants and consumers across the region.

No financial details were disclosed. The more important number, at least for the partnership, may be StoreHub’s newly revealed footprint: more than 20,000 merchant locations across Malaysia, the Philippines, Thailand and Japan, processing over 200 million transactions a year with around US$3.5 billion in annual transaction value.

That gives ShardLab something many frontier-technology companies struggle to access: real-world distribution.

From experiments to shop counters

ShardLab was set up through a strategic partnership between Hashed and SCBX, one of Thailand’s largest financial groups, to build and commercialise products at the intersection of financial services and emerging technologies. Its work includes programmable loyalty and rewards infrastructure, a phrase that broadly refers to rewards systems that can be automated, personalised, transferred or embedded into payment flows more flexibly than traditional points cards.

In Southeast Asia, that matters because consumer behaviour is fragmented. Customers may pay with cash, cards, bank transfers, QR codes or e-wallets, often depending on the country, merchant type and transaction size. Loyalty is equally scattered, ranging from paper stamp cards to app-based points and marketplace-led promotions.

For a restaurant chain or large retailer, building around this complexity is possible. For a neighbourhood café, salon or small F&B outlet, it is usually a distraction from day-to-day survival. StoreHub’s pitch has long been that it helps these merchants run sales, payments and operations from a single system.

ShardLab’s investment suggests the next layer could be rewards and payments that are more closely tied to actual purchasing behaviour.

Wai Hong Fong, CEO of StoreHub, framed the partnership around merchant outcomes rather than technology for its own sake.

“StoreHub has spent over a decade building the commerce and payments infrastructure that merchants across Asia use to run their businesses every day. ShardLab and Hashed have spent years at the forefront of payments and rewards technology, and this partnership is about bringing that work to real merchants at scale,” he said.

“Anything we build together must pass the same test that everything at StoreHub passes: does it help merchants sell more? The larger shift within StoreHub continues alongside this: we are rebuilding our product around AI, so that a three-person restaurant can operate with the capability of a thirty-person one.”

That last line points to a wider shift within commerce software. Merchants are no longer looking only for digital cash registers or payment acceptance. Increasingly, the question is whether software can help them forecast demand, manage staff, design promotions, reduce manual work and make better decisions without hiring more people.

Why StoreHub’s network matters

The joint venture gives StoreHub and ShardLab a controlled way to test new payment and rewards models with live merchants and consumers. The companies said specific products will be announced when they launch, rather than outlined upfront.

Also Read: Digital payments: Adapting to a changing world

That is sensible. Southeast Asia has seen plenty of loyalty experiments that were easy to announce and hard to sustain. Consumers may sign up for points, but many forget to redeem them. Merchants may offer discounts, but not always profitably. Web3-linked rewards, in particular, have often struggled when the consumer experience feels more complicated than the benefit.

The more interesting opportunity is less about asking users to understand blockchain, and more about whether the underlying technology can make rewards cheaper, more interoperable or more useful.

For example, programmable rewards could theoretically allow merchants to issue incentives based on customer behaviour, time of day, basket size or repeat visits. They could also support partnerships between nearby merchants, or enable more transparent campaign tracking.

But none of that matters unless it works at the counter, during a lunch rush, with staff who may not be technically trained and customers who simply want to pay quickly.

Hojin Kim, CEO of ShardLab, said StoreHub’s merchant base changes the nature of what his company can build.

“We have spent the past few years testing how new payment and rewards technologies can improve everyday consumer experiences. StoreHub gives us something fundamentally different: a distribution network of more than 20,000 real-world merchant locations,” he said. “This partnership is about moving from pilots to scale and building products that create measurable value for both consumers and merchants.”

A crowded commerce stack

StoreHub operates in a competitive category that cuts across point-of-sale systems, payments, loyalty, inventory and restaurant operations. In Southeast Asia, it overlaps with players such as Singapore’s Qashier, which provides smart POS and payment solutions; Oddle, which focuses on restaurant ordering and management; and Indonesia’s iSeller, which serves omnichannel retail and F&B merchants. Globally, companies such as Shopify, Lightspeed and Square-owner Block have shaped expectations around integrated commerce tools for small businesses.

The challenge for StoreHub is that merchants rarely buy software because it is elegant. They buy it because it solves immediate pain: fewer missed orders, faster payments, better cash flow, clearer stock records or more repeat customers. Any new rewards product born from the ShardLab tie-up will be judged against those practical metrics.

The regional context also cuts both ways. Southeast Asia’s young, mobile-first consumers are comfortable with digital payments and app-based rewards. At the same time, the region remains highly localised. What works for a café in Kuala Lumpur may not work for a food stall in Bangkok or a boutique in Manila. Regulations, payment rails and consumer habits vary widely by market.

That makes StoreHub’s multi-country presence useful, but also raises the bar for execution. A rewards system that depends on heavy consumer education or merchant training is unlikely to scale. A system that disappears into existing payment and checkout behaviour has a better chance.

Also Read: Malaysian startup StoreHub raises US$5.1M in Series A round led by Vertex Ventures

For ShardLab and Hashed, the deal is also a test of whether blockchain-adjacent infrastructure can find a more grounded role in everyday commerce. The sector has spent years looking for mainstream use cases beyond trading and speculation. Merchant rewards and payments are a plausible candidate, but only if the technology is invisible to users and clearly valuable to merchants.

StoreHub’s disclosure of its transaction scale suggests it is no longer positioning itself merely as a software provider for small businesses. It is becoming a commerce network with enough volume to test financial and consumer products on top of its operating system.

The investment may be undisclosed, and the first products are still to come. But the strategic direction is clear: StoreHub wants to sit closer to the transaction, the customer relationship and the merchant’s decision-making layer. If the joint venture can turn loyalty from a cost centre into a measurable sales tool, it could offer a glimpse of where Southeast Asian commerce software is heading next.

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For years, bback was known in Singapore for a narrow, if relatable, promise: helping people feel less wrecked after a night of drinking. Now, under new ownership, the company wants to stretch that proposition into something broader: recovery not just from alcohol, but from exercise, travel, fatigue and the general overload of modern urban life.

DSG Consumer Partners and Saket Gore, former Asia Pacific CEO of Himalaya Wellness, have acquired Singapore-born recovery brand bback, formerly known as bounceback, from Evo Commerce. Gore will take over as CEO.

Also Read: Evo Commerce, parent of D2C anti-hangover solution BounceBack, nets US$2M

The deal value was not disclosed.

The acquisition gives bback a new owner-operator structure at a time when consumer wellness brands across Southeast Asia are trying to move beyond single-use products and build daily habits. In bback’s case, the challenge is clear: it has recognition in Singapore’s alcohol-recovery segment, but will now have to prove that consumers see “recovery” as a category bigger than hangovers.

From party relief to everyday recovery

bback’s flagship product is Party Relief, an alcohol-recovery supplement sold across more than 400 points of sale in Singapore, including Guardian, Watsons and major e-commerce platforms. The brand has also expanded into hydration and liver wellness products.

That gives it a base in retail, but the next phase is more ambitious. Gore and DSGCP want to position bback around multiple occasions: post-drinking, strenuous workouts, long-haul travel, dehydration and everyday tiredness.

“Consumers want to do more, not less, without compromising how they feel afterwards. That’s why we believe recovery is a much bigger category than it is today,” said Gore.

It is a neatly timed thesis. Across Southeast Asia, consumers are spending more on supplements, functional drinks and preventive wellness products, even as price sensitivity remains high. The pandemic made health more personal; the return of travel, nightlife and office routines has made fatigue and recovery more visible.

Singapore, with its dense retail networks, high e-commerce adoption and health-conscious urban consumers, is a useful testbed for brands hoping to travel across the region.

Still, “recovery” is not yet as clearly defined as categories such as skincare, vitamins or sports nutrition. That gives bback room to shape the language, but also places a burden on the company to educate consumers without sounding vague.

A brand built in Singapore

bback was created by Evo Commerce, led by CEO and co-founder Roy Ang, which developed the early product portfolio and built distribution across Singapore’s pharmacy chains and online marketplaces.

“bback laid the very groundwork for Evo Commerce’s journey and proved what we could build from scratch,” Ang said. “Seeing it grow into a favourite in Singapore has been incredibly rewarding.”

For DSGCP, the appeal appears to be less about buying a nascent idea and more about backing an already visible consumer brand with room to widen its use cases.

“Evo has done the initial heavy lift of building an effective, trusted product with strong consumer recognition and meaningful distribution in Singapore,” said Sameer Mehta, Managing Director and Head of Southeast Asia at DSG Consumer Partners. “We believe there is a much larger opportunity ahead for the brand in recovery.”

Also Read: Evo Commerce bags U$2.1M to expand retail touchpoints

DSGCP has spent more than a decade investing in consumer brands across India and Southeast Asia, with more than 100 companies in sectors such as health and wellness, food and beverage, beauty and lifestyle. Its Singapore portfolio includes Moom, Blood, and Protocol — all brands operating in categories where product trust, content and community tend to matter as much as shelf space.

That experience will be relevant for bback. Supplements and functional wellness products are not impulse buys alone; consumers need to understand when to use them, why they work and how they fit into daily routines. That puts pressure on branding, product education and repeat purchase rates.

Why Saket Gore matters

The appointment of Gore is central to the deal. He spent more than a decade leading Himalaya Wellness across Asia Pacific, giving him experience in health and wellness distribution across markets that can differ sharply in regulation, consumer behaviour and retail structure.

His background is particularly relevant because Himalaya has long operated in adjacent categories through products such as PartySmart, an alcohol-recovery supplement, and Liv.52, a liver health product. That gives Gore direct familiarity with both the promise and limitations of the category.

In Southeast Asia, where pharmacies, modern trade, convenience retail, traditional retail and marketplaces all play different roles depending on the country, expansion is rarely as simple as exporting a product. What works in Singapore may need new pricing, formats, education and channel strategy in Indonesia, Thailand, Vietnam or the Philippines.

For now, bback says Singapore will remain the focus. The company plans to invest further in brand building, product innovation, e-commerce and retail, while hiring locally across brand, marketing, e-commerce, content and operations.

“We want to build bback from Singapore, with the ambition to create a brand that can travel across Asia,” Gore said. “We have the foundations of an established business, but the freedom and entrepreneurial energy to shape what comes next.”

The competitive field

bback will not be building in an empty lane. In alcohol recovery, Himalaya’s PartySmart is an obvious reference point, particularly given Gore’s previous role. In hydration and everyday recovery, the company will compete for attention with functional beverage and electrolyte brands such as Liquid I.V., Pocari Sweat and a growing field of sports nutrition and supplement players available through pharmacies, gyms and online marketplaces. It will also face a broader behavioural challenge: convincing consumers that recovery is a proactive wellness habit, not just a fix after indulgence.

That distinction matters. If bback remains associated mainly with nights out, its growth ceiling may be limited by occasion. If it can credibly expand into hydration, travel and active lifestyle needs, it could sit closer to the broader functional wellness market, where repeat consumption and multiple use cases can support larger brands.

The risk is dilution. A sharp proposition can become blurry when a brand tries to cover too many occasions too quickly. The next phase will depend on whether bback can broaden its meaning while keeping the simple consumer promise that made it recognisable in the first place.

Also Read: Evo Commerce banks US$2.8M more for product development, Asia expansion

For Singapore’s startup and consumer ecosystem, the deal is also a reminder that not every venture-backed outcome needs to be a software exit. Consumer brands built in small markets can travel if they solve a specific problem, earn trust and find the right regional playbook.

bback now has new capital, an experienced operator and a backer familiar with consumer-brand building. What it does not yet have is proof that “recovery” can become a category with regional scale. That is the bet DSGCP and Gore are making, from Singapore outward.

The post DSGCP, Saket Gore buy bback to build a broader Asian recovery brand appeared first on e27.

A few years ago, in a Shanghai conference room, a Korean executive stood up and made a phone call. His joint-venture partner of more than a decade had gone quiet as their factory dispute escalated. Years of holiday gifts. A seat at the man’s daughter’s wedding. Countless dinners across two economic cycles. Surely that bought a returned call.

It rang. Nothing. It rang again that afternoon, and the next day. What collapsed in his face wasn’t the deal. It was his certainty that fifteen years had built something.

It hadn’t — not in the way he thought. He had built proximity. He had never tested whether it created obligation. We measure relationships by time. Markets measure them by what they make people do.

Did what he believed was a relationship ever obligate the other side to act on his behalf — not attend a dinner, not answer a text, but spend their own capital, risk their own standing, because of him?

Guanxi (關係) is not friendship alone. At its commercial core, it is reciprocity with memory — a running account of favours extended and owed, kept current through repeated, deliberate exchange. Feelings are the wrapping. The ledger is the thing.

China asks what you owe each other

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