tech in asia tech venture investment report h22016

H2 2016 Asia Tech Venture Investment Report

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Content Page

Introduction 3

H2 2016 Report highlights 4

Overall deal volume 5

Top performing countries, startups, and VCs 6

Startup maturity per region 9

Top performing verticals per region 15

Ecommerce venture funding: India vs Indonesia 21

Exits 21

Methodology 23

Credits 24

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Introduction

Tech in Asia tracks tech venture funding across Asia. Our data goes back to 2012.

This half-yearly report looks at the most recent developments in the region’s booming tech scene in terms of funding activity, fast-growing verticals, and exits - and how these fit into the bigger picture.

The Tech in Asia database comprises more than 37,000 tech ventures, with a focus on Southeast Asia, India, and China. It grows daily.

We also track funding activities in countries, including Japan, South Korea, Taiwan, Pakistan, Bangladesh, and UAE. As our datasets in each of these countries grows, they will be included as additional regional clusters in future reports.

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H2 2016 Report highlights

A cooling down in tech venture funding was felt across Asia in the second half of last year, with India hit the hardest.

The repercussions of India’s struggles, especially in its ecommerce sector, are becoming very real in 2017, with

several valuation cuts and layoffs.

China still holds a strong lead over all other countries. The number of deals with Chinese startups was almost

double, and the number of investment dollars received four times as high as the top four Asian countries in that time

period combined.

Southeast Asia in H2 2016 shows that it’s writing its own history instead of following India’s and China’s path. For the

first time, the fintech vertical attracted more VC interest than ecommerce. Indonesia defied downturn trends

and drew more investment dollars than in the same period the year before.

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Overall deal volume

● Overall deal volume cooled down in Asia

after peak in H2 2015/H1 2016

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Overall deal volume - top 5 countries H2 2016

Not all countries suffered equally.

● In India, the amount invested shrank to almost a

third of the size of H2 2015

● China’s total dollars invested nearly halved

● Singapore’s rose by 20 percent, Japan stayed

level

● Indonesia was H2 2016’s winner with a whopping

26x increase in dollars invested despite a slight

drop in the number of deals

China still holds massive lead in the region. In H2 2016,

startups here saw almost double the number of deals and

attracted four times the number of dollars invested in the

succeeding top four Asian countries combined.

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Top 5 funding rounds H2 2016

China

India

Singapore

Indonesia

Japan

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WM Motor, BEST logistics, Dingding Yueche, Zhiche Auto, Daikuan

Hike, TCNS Clothing, BookMyShow, Rivigo, InCred Finance

Grab, Carousell, Paktor, Vizense, Funding Societies

Go-Jek, Matahari Mall, Oto, HaloDoc, Cashtree

Seven Dreamers Laboratories, Smart News, Freee, Raksul, Wealth Navi

Top 5 venture capital firms by deal activity H2 2016

Sequoia Capital (32 deals)

Shunwei Capital (17 deals)

Matrix Partners China (17deals )

500 Startups (16)

Saif Partners (15)

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China, India, Indonesia, Singapore, Thailand

China, Singapore

China

Hong Kong, India, Indonesia, Japan, South Korea, Malaysia, Philippines, Singapore, Thailand, Vietnam

China, India

● Series A fundings are the most common in

China, peaking at more than 660 deals

recorded in 2015

● In line with Asia-wide funding cooldown,

the number of seed and series A rounds

dropped last year. The drop was especially

significant for seed-stage startups

● Year of the bridge rounds: Bridge rounds

were on the rise, indicative of a more

difficult funding climate

Startup maturity - China

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● Median deal sizes roughly follow the same

pattern, becoming slightly smaller last year

● Bridge undisclosed rounds have a less

stable pattern

Startup maturity - China

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● In India, seed-stage startups are dominant

● Growth in seed-stage deals leveled off,

while series A saw a decline

● Same as in China, the uncertain funding

climate led to a rise in bridge rounds as

these tend to be easier to close and help

startups through a downturn

Startup maturity - India

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● In India saw an early boom in median deal

size specifically in the series A stage in

2013

● While the number of seed deals in India is

huge, the median deal size remains more or

less stable - and lower than in Southeast

Asia

Startup maturity - India

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● In Southeast Asia, seed-stage deals

outnumber all others and are still growing

● The number of deals in other stages

continues to grow too, with less growth in

series A deals but a rise bridge deals

Startup maturity - Southeast Asia

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● Median deal sized continued to grow in

2016, with the exception of late stage deals

● The US$66 million series B round raised by

Lazada in 2012 is an outlier. It was one of

only two series B deals that year, and the

other startup didn’t disclose the amount

raised

Startup maturity - Southeast Asia

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● Ecommerce continued to attract the most

deals in China last year. It’s been the

leading category for the past five years

● Fintech is the second most relevant

category

Top performing verticals - China

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Top emerging verticals* - China H2 2016

Biotech

Crowdsourcing

Video

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Growth rate: 233 percent. Notable companies funded in H2 2016:

● Novogene (Latest Funding: Series B / US$72,600,000 / Nov '16)● MicuRx Pharmaceuticals (Latest Funding: Series C / US$55,000,000 / Sep '16)● TenNor Therapeutics (Latest Funding: Series B / US$25,000,000 / Sep '16)


● ZhongTopia (Latest Funding: Seed / US$14,900,000 / Jul '16)● 51Haohuo.com (Latest Funding: Bridge / US$4,470,000 / Oct '16)● Laimaidi.com (Latest Funding: Seed / US$2,250,000 / Aug '16)


● Baidu Video (Latest Funding: Series A / US$155,000,000 / Apr '16)● Quanmin.tv (Latest Funding: Series A / US$74,900,000 / Sep '16)● AcFun (Latest Funding:Series A / US$60,000,000 / Jan '16)

*highest growth rate in number of deals from H2 2015 to H2 2016

● India’s ecommerce vertical has

continuously attracted the most tech

venture deals since 2012.

● Unlike in China and Southeast Asia,

fintech in India hasn’t emerged as one of

the two top performing verticals.

Health-related startups play a bigger role

than in the other regions.

Top performing verticals - India

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Top emerging verticals* - India H2 2016

Agriculture

Biotech

Internet Infrastructure

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● CropIn (Latest Funding: Undisclosed / US$2,000,000 / Aug '16)● Crofarm (Latest Funding: Seed / US$1,500,000 / Jul '16)● IntensAquatica (Latest Funding: Seed / US$409,898 / Jul '16)


● Mitra Biotech (Latest Funding: Series B / US$29,600,000 / Aug '16)● Vyome Biosciences (Latest Funding: Series C / US$26,300,000 / Aug '16)● Invictus Oncology (Latest Funding: Series A / US$1,880,000 / Sep '16)


● Knowlarity (Latest Funding: Series C / US$20,000,000 / Nov'16)● appSAY (Latest Funding: Seed / US$150,000 / Sep '16)● 14 Square (Latest Funding: Seed / Undisclosed / Oct '16)

*highest growth rate in number of deals from H2 2015 to H2 2016

● Fintech’s rapid rise: In 2016, fintech took

over as the vertical attracting most deals

in Southeast Asia

● Health and education have not established

themselves as top verticals for tech

venture funding, unlike in India.

Top performing verticals - Southeast Asia

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Top emerging verticals* - SEA H2 2016

Real Estate

Security

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● POPETY (Latest Funding: Seed / US$1,160,000 / Dec '16)● Greyloft (Latest Funding: Seed / US$1,100,000 / Sep '16)● Gachvang (Latest Funding: Seed / US$500,000 / Oct '16)


● Dropsuite (Latest Funding: Stage undisclosed / US$5,000,000 / Nov '16)● Sixscape Communications (Latest Funding: Stage undisclosed / US$1,400,000/ Dec '16)● Apvera (Latest Funding: Stage undisclosed / US$1,200,000 / Nov '16)

*highest growth rate in number of deals from H2 2015 to H2 2016. In Southeast Asia, only two verticals stood out with a significant increase in deal numbers.

● Exits (including M&A and IPOs) are

growing, yet not with the exponential

trajectory of deal activity

● The exit ratio in Asia overall has remained

relatively stable. In 2016, there was one

exit for roughly every 14 deals

Exit ratio

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Exit ratio per region H2 2016

China (961 deals, 24 exits )

India (428 deals, 65 exits )

SEA (141 deals, 18 exits )

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Exit ratio China: 40x*

Exit ratio India: 6.6x

Exit ratio SEA: 7.8x

*China’s figure is higher because most of the exits logged there (22 out of 24) were IPOs. Our data on

Chinese startup acquisitions isn’t complete. In India and Indonesia, exits almost always acquisitions.

In H2 2016, India had only one IPO out of 65 exits. There was no exit through IPO in Southeast Asia.

Methodology

The Tech in Asia database comprises more than 37,000 tech ventures, with a focus on Southeast Asia, India, and China. It grows daily.

We scan international and local news, database entries, startup and VC firms’ websites for updates. However, some startups choose not disclose their fundraising activity, which means they do not factor into this report. Southeast Asian tech startups, in particular, tend to not disclose the amount of funds raised.

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Credits

Research and data visualization Editing Design

Queena Wadyanti

Head of research

Dian Fadhila

Research analyst, data visualization

Nadine Freischlad

Editorial lead

Judith Balea, Terence Lee

Editors

Andre Gunawan

Editorial designer

For feedback, data licensing or collaboration requests please contact [email protected] 24 of 24

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