The after-effects of a pandemic-induced global slowdown, rising inflation and geopolitical tensions are sending shockwaves across the startup world, and Asia is no exception. With fundraising becoming tougher and layoffs becoming more common, caution is the keyword.
The week started on a sombre note with Indonesia-listed technology major PT GoTo Gojek Tokopedia (GoTo) reporting a wider loss in the first three months of 2022 despite a 53% year-on-year growth in gross revenue. At the same time, the company has injected fresh capital to the tune of $58.6 million into its subsidiaries Velox SEA and GoPay, according to regulatory filings.
With crashing stocks and rising inflation, a wave of layoffs seems to be sweeping the startup ecosystem in Asia’s three biggest markets – China, India, and Indonesia. While in China, tech giants such as Alibaba Group and Tencent Holdings have reportedly prepared a plan to cut tens of thousands of jobs this year, at least 5,600 startup employees in India have been impacted by cutbacks and termination since the beginning of the year.
As the Southeast Asian PE-VC industry comes of age, fundraising has become more vibrant, including activity by first-time funds focusing on the region. However, the ongoing turbulence in the market will put emerging managers to the test.
Quick commerce startups in Indonesia have been on a fundraising blitzkrieg even as the overall tech sector is reeling under a severe fund crunch amid geopolitical tensions and rising inflation. However, investors are quick to point out that it is still early days.
PE-VC deals
In Asia’s biggest fundraising news this week, Vivo Capital, a global healthcare investment firm, has held the first closing of a new RMB-denominated fund at $600 million, with a total fundraising target of about $1.5 billion.
The parent company of India’s ShareChat has raised nearly $300 million in fresh funding from Alphabet Inc’s Google, media giant Times Group and Singapore’s…