B2B SaaS, social commerce, fintech, medtech are next SE Asia trends to watch, says Golden Gate Ventures 

Photo: Internet Archive

B2B software services, social commerce, fintech and medtech are the next big sector trends to watch in Southeast Asia, according to a Golden Gate Ventures report released to commemorate the firm’s 10th year anniversary.

Southeast Asian B2B and B2B2C startups are expected to raise over $1 billion by 2023, up from its projected figure of $605 million this year, according to the report. This category of startups is expected to capture a greater share of total capital deployed by investors at 30-50% in the next decade. This will mirror a more developed market like the US, where almost 60% of funded startups are B2B companies.

Source: Golden Gate Ventures.

The rise in e-commerce adoption, growing GDP per capita will also mean that social commerce as a percentage of overall commerce will also grow over time, similar to China’s experience in the last decade. According to Golden Gates estimates, Southeast Asian social commerce GMV stands at around $1 billion this year and is expected to cross $10 billion by 2026 and $100 billion by 2030.

Fintech-only unicorns will also emerge in Southeast Asia, projected Golden Gate Ventures. According to its tally, there is just one fintech unicorn in Indonesia and none in the Philippines, Thailand and Vietnam. That’s compared to 3 in the United Kingdom, 20 in the US and 225 in China. There is still further upside potential yet for Southeast Asian markets, especially with its growing internet population, unbanked consumer base, and low mobile wallet penetration.

Source: Golden Gate Ventures

Meanwhile, medtech fundraising is expected to cross $1.5 billion by 2025, up from $1 billion this year. It also expects a rising focus on healthcare, home healthcare, medtech AI, biotechnology and medtech information systems.

The Southeast Asian ecosystem has matured

The Southeast Asian startup ecosystem has come a long way over the last ten years, having grown both in size and maturity across deal sizes and fundraising. According to the report, $6.5 billion was invested in Southeast Asian startups in 2020, a 50x increase from just $130 million in 2010. It also expects this to exceed $14 billion by 2023 as the ecosystem matures.

Source: Golden Gate Ventures

The number of mega-deals – defined as post-Series C and sized $100 million and above – has also grown substantially, with 15 of such deals announced in 2020, accounting for over half of the total capital invested that year. This was compared to virtually none in 2010.

The size of funding rounds also expanded across stages. The seed, Series A and Series B average round sizes saw steady growth year-on-year of 1.22x, 1.35x and 1.23x respectively, as the startup ecosystem matured and investor appetite for Southeast Asian opportunities grew.

Source: Golden Gate Ventures

B2C sectors hogged most of the funding over the last 10 years, although they cover a wide range of industries including entertainment and media, e-commerce, edtech, fintech, food and transport, healthcare, logistics, online travel and others.

The top three verticals with the highest number of startups securing over $50 million in funding in the last decade were e-commerce, fintech, and entertainment and media. The top three verticals with the fastest growth in startup funding in the last five years were food & transportation, fintech and logistics.

Entrepreneurs are also growing in maturity and experience.

The rise of “Generation 1.5” – referring to former senior employees at high-growth tech companies like Grab and Gojek – are starting their own startups today. Examples include names like JJ Chai from Rainforest, Tiger Fang from Kargo, and Tessa Widjaja from Xendit.

Former investors have also turned operators, such as Aaron Tan from Carro, and Ankiti Bose from Zilingo. Their experiences are generating diversity in terms of culture, background and expertise, leading to a new generation of entrepreneurs in Southeast Asia, noted Golden Gate Ventures in the report.

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.