Venture capital sector sees further expansion in Singapore

Despite the COVID-19 pandemic, Singapore’s start-up environment has continued to prosper and has stayed buoyant. In 2021, start-ups in Singapore raised a total of S$14.7 billion, almost triple the amount that was raised in 2020.

Singapore is also making its mark as the start-up hub of Southeast Asia. In spite of the pandemic, Southeast Asian start-ups raised a record US$25.7 billion in funding in 2021, more than double that raised in 2020. Among the top 10 fundraisers in Southeast Asia in 2021, half of the start-ups were headquartered in Singapore with total funds raised of close to US$3 billion. These significant milestones point to a maturing start-up ecosystem in Southeast Asia, with Singapore at the forefront of developments.

Growth in Venture Capital Funds & Fintech

There has also been a growth of new venture capital (or VC) funds being formed, driven by the increase in Southeast Asian start-ups. It has been reported that seven out of the 22 funds that reached a final close in 2021 were first-time funds, up from just three in the previous year.

In spite of the covid 19 pandemic, the fundraising climate in Southeast Asia has showed no signs of slowing. Fintech remains a key space in Singapore’s start-up ecosystem, with decentralised finance and blockchain start-ups in particular forming a sizeable sub-sector. The e-commerce and logistics sectors also remain bright spots. With the increasing focus on environmental, social and governance (ESG) issues regionally and globally, it is expected that start-ups in the ESG space will be a growing sector in Singapore’s venture capital landscape. Other sectors that are attracting more focus locally include advanced manufacturing, health, biotech and agritech.

Waystone can assist with obtaining the Capital Market Services Licence to operate in Singapore as a Venture Capital Fund Manager. Please reach out to our APAC Compliance Solutions team for an initial discussion.