The capital funding required to set up ventures by tech companies in Singapore reportedly weakened in 2022 on account of a disturbance in the macroeconomic environment that made investors cautious. The volume of deals dropped by 11 percent to 651 Y-o-Y, while the total deal volume went down to USD 11 billion as per reports from Enterprise Singapore and Deal Street Asia.
Alibaba Group however, were able to prop up deal value slightly, with a USD 1.63 billion injection into its subsidiary Lazada Group. The volume of capital funding went down from 244 in the fourth quarter of 2021 to 133 in the same quarter of 2022. This could also result in a further slowdown in 2023.
Despite this, many new start-ups have managed to gather a substantial amount of funding which has helped Singapore maintain a lion’s share in the equity fund-raising in South-East Asia. In 2022, the Republic amassed 63.8 percent of deal value, with Indonesia following closely at 21.9 percent.
Major deals included fintech Coda Payments’ raising of USD 690 million with the help of GIC, Insight Partners, etc. Princeton Digital was also able to gather USD 500 million with funding from Mubadala, an Abu Dhabi state fund.
However, several crossover funds active in late-stage investments backed down, as their portfolios fluctuated. In the area of deep tech, which is one of the growth areas for Singapore, deal values fell from a record high to USD 1.95 billion, indicating a 24 percent drop.
On the other hand, there are over 21 seed-stage start-ups that are close to Series A funding stage, and 7 companies close to Series B stage. The Singapore government is also striving to collect sufficient funding in various ways. Seeds Capital, which is the investment arm of Enterprise Singapore managed to collect USD 40 million and USD 132 million via private funding, almost double of the amount from five years.
Source Credit: https://www.straitstimes.com/business/venture-funding-for-singapore-start-ups-weakens-in-2022