SE Asia Deals Barometer Report: Startup fundraising falls below $1b for the first time this year in Nov

November was the worst month so far this year for Southeast Asia’s startups in terms of both fundraising value and volume, show proprietary data compiled by DealStreetAsia.

Startups in the region amassed a mere $743 million from 67 transactions — venture capital, private equity, debt financing, and corporate rounds — last month, marking the first time that fundraising fell below the psychologically-important $1 billion mark this year.

The funding value was 42.4% lower than October’s $1.29 billion, while funding volume fell 9.4% from the previous month’s 74.

On a year-on-year basis, the fall was even starker as startups had raised $5.2 billion from 119 deals in November 2021.

Of the 67 transactions last month, the values of 21 deals were undisclosed.

The November data further underscored investors’ cautious stance amid the ongoing global economic slowdown and the write-offs triggered by the collapse of crypto companies.

November saw only three megadeals, i.e transactions where the funding size is at least $100 million. They raised a combined $338 million, or 45.5% of the month’s overall fundraising. In October, five megadeals had raised an aggregate of $830 million.

Last month’s megadeals were raised by Indonesian state-owned pharmaceutical company Kimia Farma Apotek; Singaporean pharma firm TauRx; and data analytics company Near.

Kimia Farma Apotek, a subsidiary of PT Kimia Farma, raised over $119 million after selling a 40% stake to Indonesia’s sovereign wealth fund INA and China’s Silk Road Fund. Kimia Farma’s business spans pharma, raw material, manufacturing, pharmacy, and healthcare services.

TauRx Pharmaceuticals, a UK- and Singapore-based company that focuses on Alzheimer’s disease, announced raising $119 million in Series A funding from undisclosed backers. The company intends to use the funds to accelerate development plans for regulatory approval in China.

Data analytics startup Near also raised $100 million in debt financing from Blue Torch Capital. Near’s patented technology analyses data on approximately 1.6 billion unique user IDs and 70 million points of interest in more than 44 countries.

The three megadeals of November 2022

Singapore continues to dominate

Data compiled by DealStreetAsia show that Singapore startups were involved in 29 transactions that brought in an aggregate of at least $357 million in funding, accounting for about 48% of the total funds raised in November.

The funding volume and value, however, were down from the 42 deals that raised $822 million in October, when Singapore accounted for 64% of the total funds raised.

Two of the megadeals that took place last month involved startups in Singapore — TauRx Pharmaceuticals and Near.

Indonesian startups bagged at least $216 million in funding from 16 deals last month, lower than the $289 million that Indonesian firms raised from 20 deals in the prior month. Kimia Farma’s $119 million funding was the country’s biggest in November.

Startups in Vietnam scored about $95 million in total from nine transactions, with Vietnamese financial services firm F88 leading the pack with its $60-million loan from Lending Ark Asia Secured Private Debt Funds and Lendable.Venture investors see abundant opportunities for long-term growth in Vietnam’s tech space, according to a recent DealStreetAsia report.

Malaysia saw six deals that raised a total of about $42 million while the Philippines raised at least $32 million from four transactions. Thailand had two deals that raised $2.5 million while Myanmar registered one transaction with an undisclosed funding amount.

Fintech, healthtech shine

Startups in the healthcare/healthtech/pharmacy verticals together grabbed the most funding with a total of about $283 million in their kitty across six transactions, with two of the month’s megadeals happening in this sector – Kimia Farma Apotek and TauRx Pharmaceuticals.

In terms of deal volume, fintech continues to be an investor favourite as startups in this space were involved in 13 funding transactions that raised a combined $182 million. The figures, however, paled in comparison to the $679 million that fintech startups raised from 18 transactions in the prior month. Vietnamese startup F88’s $60 million financing was the top fintech deal in November.

Together, the top five sectors — healthtech/healthcare/pharmacy, fintech, data analytics, e-commerce, and marketing tech — raked in $676.5 million, accounting for about 91% of the total deal value in November.

Early-stage deals in favour

Early-stage fundings continued to dominate the region’s dealmaking activities in November in terms of deal volume, with seed taking the lead at 18 deals, lower than the 21 seed rounds in October, DealStreetAsia’s compilation showed.

E-commerce startups Beam (Thailand) and PasarMIKRO (Indonesia) raised the largest seed funding in November at $2.5 million each.

Pre-Seed and Series A rounds posted nine deals each while five deals took place in the Series B stage. There were also nine transactions that did not disclose the funding stages.