Southeast Asia Tech Investment 2023 H1

In the first half of 2023, Southeast Asia’s tech deal landscape appears to be reversing to pre-COVID, and quickly possible pre-unicorn era, standards. 

The region saw a 54% year-on-year drop in tech investment volume to $3.1B, the lowest H1 investment since 2017. 

The return to pre-bubble valuations and deal sizes is following the decrease in investment volumes but with a significant lag. Interestingly, this market correction only took place a full year after the first chills of the market downturn were felt in the US, with the region only experiencing a sharp decline in capital intake only towards the end of 2022.

Despite the challenging investment climate, Southeast Asia’s core venture stack held up surprisingly well. We saw capital across pre-A to Series C (all $0.5-50M per deal ranges) still being deployed at about the same pace as in the preceding three years. Series B valuations experienced the most turbulence, with Indonesia and the Philippines leading the way. 

In addition, the report covers the following topics:

• After “double bubble” investment activity reset, the bottom is near
• SEA investors maintain the pace, valuations begin to adjust 
• Search for the “Next Indonesia” is on pause, with Philippines falling off the radar
• Liquidity window is shut 
• Digital financial services is still the largest sector, with adjustment in its sub-sectors 

Here are some highlights of the report:

• Southeast Asian investments dropped 54% YoY to $3.1B in H1 2023
• The Philippines market drops off the radar
• Digital financial services persist, claiming 41% of funding in Southeast Asia
• Tech leaders share values are stabilising into a range of 25% to 50% of the IPO price