Chills and growth
Benjamin Cher
Today, we’ve got the deets on:
- Funding trends
- Regulation’s effect on cross-border payments
Dear Garage reader,
The startup ecosystem appears to be feeling some chill from the funding winter despite some signs of a spring thaw in the last quarter of 2023.
A new report by data intelligence platform Tracxn showed that South-east Asia startup funding in the first quarter of 2024 fell 13 per cent to US$816 million compared with the same quarter last year. The quarter is also the lowest funded quarter in the last five quarters.
A key missing piece in the funding picture is large deals of over US$100 million, a sign that late-stage deals are not coming through.
More attention is still being paid to early-stage startups, with the segment having grown 60.9 per cent to US$526 million in Q1 2024, according to the report. This made up the bulk of the funding raised in the quarter.
The fall in funding levels tallies with what investors told Garage last year about funding trends in 2024: Late-stage investors don’t appear to be interested in any particular startup.
This lack of funding is also part of a snowball effect from the investor side, as venture capital firms took longer to raise less funds in 2023.
Elsewhere, cross-border payment startups are seeing the ongoing regulation of the sector as a possible boon. Regulation raises barriers to entry that burning cash alone can’t overcome.
Still, there are some notable regulatory incidents, with Nium linked to money laundering allegations in India and Wise suspending its e-wallet feature in Indonesia.
However, with funding secured to grow their teams and enter new markets, cross-border payment startups still see 2024 as a year of growth.
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That’s it from us; check below for more stories. Have a good week!
5 things to know
- Rebranding GRANITE Global Ventures Capital’s (GGV Capital) Asia unit has been rebranded as Granite Asia, with plans to become “Asia’s leading multi-asset investment platform”. Read more
- More dry powder HSBC announced on Wednesday (Mar 27) the launch of a US$1 billion Asean growth fund for businesses looking to expand regionally and a separate US$150 million lending fund for companies in Singapore. Read more
- Bitcoin fervour THE approval of Bitcoin exchange traded funds (ETFs) in the US has resulted in a more favourable view of the cryptocurrency, according to a survey by crypto exchange Independent Reserve. Read more
- Cash for nappies MALAYSIA-BASED Applecrumby has raised a US$4.2 million round of funding from venture capital firm 500 Global. Read more
- More funding INDONESIA-BASED insurtech startup Qoala has closed a US$47 million Series C round led by PayPal Ventures, the corporate venture arm of PayPal; and MassMutual Ventures, the venture capital unit of US insurance group MassMutual. Read more
