Tracxn, a leading global SaaS-based market intelligence platform, has released its SEA Tech Semi-Annual Funding Report - H1 2023. The report, based on Tracxn’s extensive database, provides insights into the SouthEast Asia (SEA) Tech space.
Funding into the SEA Tech space fell 71% from $8 billion in H1 2022 to $2.3 billion in H1 2023. Total funding in H1 2023 is also 45% lower than $4.3 billion raised in H2 2022. This decline was largely driven by a plunge in late-stage investments in the first half of 2023, which fell 54% and 72% when compared with H2 2022 and H1 2022 respectively.
The first two quarters of this year experienced similar levels of funding. Investments worth $1.15 billion and $1.17 billion were recorded in Q1 2023 and Q2 2023, respectively. Six $100 million+rounds were observed in H1 2023, as against eight in H2 2022 and 18 in H1 2023.
H1 2023 is the least funded half year since 2020. The SEA Tech startup ecosystem witnessed its highest funding in 2021 after which there is a steady decline in the funding. Investments into this region fell by 39% in 2022, when compared with 2021. Some of the major reasons for this downward trend could be the rising interest rates and the current macroeconomic environment.
Fintech, Enterprise Applications, and Retail are the top-performing segments in this space in H1 2023. These segments witnessed a drop in funding in the first six months of 2023, when compared with H2 2022. The FinTech sector has raised a total of $926 million in H1 2023, contributing almost 40% of the funds raised by the SEA Tech startup ecosystem during this period.
Two segments which observed upticks in funding are Auto Tech and InsurTech. Funding in the Auto Tech segment has grown from $23.6 million in H2 2022 to $317 million in H1 2023. Funding in the InsurTech segment has risen from $98.7 million in H2 2022 to $262 million in H1 2023.
Only one company - eFishery - entered the unicorn club in H1 2023, compared with six new unicorns in H1 2022. The first half of this year saw 29 acquisitions, compared with 43 in H2 2022 and 69 in H2 2022. Five companies from this space went public in H1 2023, as against just one in H1 2022.
In the SEA region, Singapore, Jakarta and Petaling Jaya cities were the top-funded cities in the first six months of 2023. Petaling Jaya. Companies in the SEA Tech space in Singapore attracted investments worth $1.2 billion, while those in Jakarta and Petaling Jaya raised $378 million and $202 million respectively.
East Ventures, Seeds Capital and Y Combinator were the most active investors in the SEA Tech space in H1 2023. Y Combinator, East Ventures, and 500 Global were the top seed investors, while Gobi Partners, SMDV, and Peak XV Partners were the top early-stage investors. IN terms of late-stage investments, SoftBank, Avataar Ventures, and Prosperity7 Ventures were the top late-stage investors.
