The burgeoning growth stage startups in Asia

The Asian startup ecosystem is thriving. Despite the economic and funding slump.

Not just in terms of venture capital flowing in and investors betting big on the continent, but also in terms of the scale Asian startups have reached.

As per a new report by Startup Genome , there are 12.5k tech scaleups globally, of which Asia houses 2.8k. Startup Genome defines a tech scaleup as a tech startup that has a valuation of $50 million or more.

Why does a tech scaleup matter? It indicates that the startup has the potential to grow pretty rapidly. According to the report, startups that successfully reach the Scale stage typically grow at 50% to 100% per year. The most successful ones—the top 10%— grow a lot faster, at about or above 100% per year.

Of the top 10 countries with the most scaleups, five are Asian—China, India, Israel, Singapore, and South Korea.?

While the US tops the global list with 7,184 scaleups, China tops the Asia list with 1,491 such companies and is positioned second worldwide. India is ranked fourth with 429 scaleups, and Israel sits at seventh position with 246 scaleups. South Korea and Singapore land at 9th and 10th places with 164 and 133 scaleups, respectively.

More than 1,800 scaleups worldwide belong to biotech and pharmaceuticals, which is the leading industry by number of scaleups. Fintech comes in second with over 1,700 scaleups.

Globally, tech scaleups are now worth US$17 trillion—which is 53% of the value of all tech companies. The top countries by combined scaleup valuation are the US, China, India, the UK, and Canada.

Asia accounts for US$4.2 trillion or 25% of the global scaleup valuation.

In terms of investment raised, globally, scaleups have raised over US$114 billion in 2023 so far. About 31% of this investment went to Asia. For context, North American scaleups received 55% of this VC funding worldwide.

On that note, let's dive into this week's recap.

Buzzing Deals

As weeks pass by, the number of deals seems to be increasing. The past week saw a slew of new funding, particularly in the early-to-growth stages.?

• Vietnamese genetic testing major Gene Solutions has raised US$21 million in a series B round from Mekong Capital . The company is known for its flagship non-invasive prenatal testing product that analyzes fetal DNA to determine the baby’s risk of developing specific abnormalities. Founded in 2017 by Vietnamese scientists, the company aims to make genetic testing affordable and accessible in developing countries. With the new funding, Gene Solutions plans to expand to other countries in Southeast Asia.?
• Indonesian raw materials platform bababos has recently landed a US$3 million seed round check from?East Ventures, Patamar Capital, and Accion Venture Lab. Bababos runs a platform that connects small and medium enterprises (SMEs) with suppliers of raw materials like steel, polymers, and chemicals. The company has worked with over 400 SMEs so far in the country and aims to increase that to 1,000 SME manufacturers by 2023 end.?
• Singaporean online beauty retailer Evo Commerce has secured US$2.8 million in debt and equity financing from IJK Capital Partners, Quek Siu Rui, co-founder of Carousell, Joel Neoh, co-founder of Fave, and Tipsy Collective. Founded in 2020 by three former employees of Grab, Evo Commerce offers health, beauty, and wellness products directly to consumers. It will use the fresh funds for product and market expansion.
• Indonesian agritech startup Kora, which aims to improve the quality and quantity of post-harvest maize, a prime source of animal feed, has raised US$400,000 in pre-seed funding from Antler and Gibran Huzaifah, co-founder and CEO of aqua-tech unicorn eFishery. Kora currently helps about 130 farmers produce more nutritious and consistent-quality maize which allows them to sell directly to large buyers at competitive rates.
• Singapore-based medtech startup Awak Technologies , which is developing a wearable device that allows kidney dialysis to be performed on the go for end-stage renal disease patients, has raised a US$20 million series B round . It will use the funding raised from Lion X Ventures and Vickers Venture Partners to complete the ongoing human clinical trial with Singapore General Hospital. The company aims to launch its flagship device in the US, where it expects to start a final pivotal trial in 2025.
• Singapore-based online streetwear marketplace Novelship has bagged US$9.5 million in a series B funding round led by East Ventures , iGlobe Partners , and GSR Ventures . Set up in 2018, Novelship sells sneakers, clothing, as well as physical and digital collectibles. The company had recently onboarded American rapper Snoop Dogg as a strategic advisor. Novelship will use the fresh funds to strengthen its presence across Southeast Asia by expanding its offerings as well as by improving its logistics operations and authentication processes.?

What Stood Out This Week

India-based early-stage VC firm Unitus Ventures is merging with its US affiliate Capria Ventures with the aim to invest in startups across stages in India and other emerging markets under a single brand. The merged entity, called Capria Ventures , will back firms in fintech, job tech, edtech, agritech, climate tech, SaaS, and generative AI in the Global South which includes countries like India. Indonesia, China, and Brazil.?

The Asian e-commerce giant Shein has pledged to invest US$85 million to empower the global fashion community over the next five years. This is over and above the US$70 million investment that it committed in April for similar efforts. Overall, SHEIN has allocated US$70 million to support its manufacturing suppliers, US$50 million for designers, and US$35 million to women, young people, and underprivileged individuals.

Chinese fintech giant Ant Group is said to be withdrawing its investment from A&T Capital, a US$100 million fund that invests in offshore crypto projects. This comes at a time when investors are still shying away from crypto-based projects and leaning toward everything generative AI. Yu Jun, a former Ant executive, who helped Ant Group set up A&T to invest in crypto, resigned a few months ago when an investigation into his workplace behaviour was launched.?

Global private equity firm KKR has bought a 20% stake in the regional data centre business of Singaporean telecom giant Singtel for S$1.1 billion (around US$806 million). KKR can also increase its stake to 25% by 2027 at the same valuation. The deal—which values Singtel’s regional data centre business, a part of its Digital InfraCo unit, at US$4 billion—is expected to be wrapped up by the end of 2023.

The Ongoing Climate Tech Action

The climate tech deals seem to have slowed down of late, but new funds are being raised to back companies working directly and indirectly on reducing carbon footprints.?

Koltiva is an Indonesian agritech startup which enables large and multinational companies to trace their food supply from small producers in Indonesia and other countries to consumers. Additionally, it offers them climate-smart farm support and risk alerts, among other things. Koltiva is also building products that can aid in assessing greenhouse gas emissions. This company has just raised an undisclosed series round led by AC Ventures , which it will use to expand its operations.?

Singapore’s climate tech venture builder Wavemaker Impact has raised US$15 million from the US International Development Finance Corporation. This is a part of the ongoing fundraise by Wavemaker Impact for its maiden fund. The fund hit its first close in November 2022 and is expected to be oversubscribed by the end of this year.?

Wavemaker Impact was set up by Wavemaker Partners in 2021 with the aim of working with experienced entrepreneurs to establish sustainability startups so as to cut 10% of global emissions by 2035. Each company it co-founds is expected to have the potential to reduce 100 million metric tons of carbon and generate US$100 million in revenue. Its partners include the Singapore government, the United Nations Development Program, Breakthrough Energy Ventures, GenZero, and Temasek.

The new funding will enable Wavemaker Impact to set up 10 companies by the end of the year and 16 companies by 2024 . So far, the firm has co-founded six companies in biochar, solar, regenerative agriculture, land restoration, food waste, and sustainable fuels.

Meanwhile, Edelweiss Alternatives, a unit of India’s Edelweiss Group, has launched its first climate fund with a corpus of US$500 million. The fund will back local climate mitigation and climate adaptation projects like renewable energy, EV infrastructure, green infrastructure, water treatment, transport decarbonisation, and industrial decarbonisation. Its vision is to boost India’s effort to become a carbon-neutral economy.?

And that’s the wrap for this edition of?#ICYMI . We will continue to curate the weekly highlights of the Asian tech ecosystem in case you missed what made the buzz in the week that just went by. You can subscribe to?#ICYMI ?to get it every Thursday to stay abreast of noteworthy tech developments.