I refuse to believe that we have passed the first month of 2023.
Perhaps this has something to do with the back-to-back public holidays that we had in January and the fact that we mostly spend the month planning and figuring things out. But I feel like time moves at an unnaturally fast speed, and we have just woken up after a long sleep –being made aware of all the things we need to catch up with.
So, how was the Southeast Asian tech startup ecosystem in January?
One notable thing is that we are still wary about the state of the world today. While borders have reopened and we are pushing back thoughts about the pandemic to the back of our heads, there are specific issues that we remain fixated on. One of them being the funding winter.
There are many reasons to worry, especially after last year’s waves of company layoffs. The string of bad news continues as we witness notable e-commerce companies such as China’s JD leaving the Indonesian market.
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But there are reasons to remain optimistic.
In January, we saw how several new funds were being launched for startups in SEA. The majority of them are focusing on bigger markets in SEA such as Indonesia, with a collaboration between MUFG and Danamon for a US$100 million fund and a first close of the latest fund for Northstar Group. For Singapore, two PEs have partnered to launch a US$700 million tech fund.
Companies also continued to announce their funding, and we noticed supply chain and agritech as popular sectors for the month.
Does this mean January is the month when we can feel slightly more optimistic about the future?
Even if it does, there are still many things that we have to do.
In a special feature that e27 published, we look at the possibilities of how Chinese VCs be a “potential wild card” for SEA during funding winter.
“China and the Association of Southeast Asian Nations (ASEAN) have long enjoyed close economic ties. According to a Global Times report of last August, the two-way investment between the world’s second-largest economy and the ASEAN was US$340 billion as of July-end 2022,” our editor Sainul Abudheen K wrote.
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“The Chinese VCs are turning their focus to the ASEAN because of a slowing economy back on the home turf for many reasons, including a surge in COVID-19 infections and deaths and strict lockdowns … The question is: Is China stepping up its investment activities in the region during the Funding Winter, and how vital is the role of Chinese VCs in SEA?”
SEA investors came back with various responses to this. While some believe that China might provide an alternative, others such as Monk’s Hill Ventures’s Founding Partner Peng T. Ong and Tin Men Capital’s Murli Ravi are more careful.
“There won’t be any significant rise in activity [in terms of VC investments]. Our investors are basically from our region. So China is unlikely to play a significant role here,” Ong says.
So where can we find our beacon of hope in this challenging time? I personally believe that we should learn to be okay with saying that we do not have the answer yet and that this is a moment of exploration. We look at all the possibilities and prospects and work on the ones that seem plausible.
Time moves fast, but with the right attitude, we may have it on our side.
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Image Credit: Redd F on Unsplash
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