Southeast Asia-based startups kicked off 2021 in style, raising a record $6 billion in the first quarter of the year. Deal count, too, jumped amid signs of economic recovery and mass inoculation programmes to curb COVID-19 across the region.

According to our latest report, companies in the region inked at least 211 deals in the first quarter to raise close to 70% of the total capital secured in 2020. Of this, $4 billion was raised by ride-hailing giant Grab and Indonesia-headquartered logistics firm J&T Express—both companies raised $2 billion each—as they prepare for their public market debut in the US.

Even without these two mega-rounds, the Q1 fundraising performance shows strong signs of recovery since the pandemic first hit the region a year ago. In terms of deal count, the January-March period saw a 48% increase relative to the previous quarter and a 43% increase year-on-year.

Fundraising activities in the first quarter yielded at least three unicorns – J&T Express with an estimated valuation of $6 billion, Grab’s fintech subsidiary Grab Financial Group ($3 billion) and IP intelligence startup PatSnap (over $1 billion).

East Ventures co-founder and managing partner Willson Cuaca said there were two factors driving the Q1 recovery: faster and more widespread digitalisation of consumer and business activities during the pandemic; and improving investor confidence on the black of declining active COVID-19 cases and mass vaccinations.

“Last year, we at East Ventures spent a significant amount of time and energy to take care of existing portfolio companies. Now that they have survived the worst of the crisis and even come back stronger, we can now start looking for new startups for investment opportunities,” said Cuaca.

Sharing a similar note, Jungle Ventures managing partner David Gowdey said startups that had raised funds from existing investors in 2020 would emerge for equity rounds this year to resume growth.

“I think we will continue to see the larger startups in SE Asia list on the US public markets, so they can provide liquidity to early investors and employees, but also access the public capital markets to fund their growth,” Gowdey said.

The rise of wealth tech apps

Fintech startups dominated activities in the first three months, generating 65 deals with at least $1.1 billion in total proceeds.

Grab Financial Group made history by raising the largest Series A round by a Southeast Asian company when it announced a $300 million capital injection from a group of investors led by South Korean firm Hanwha Asset Management.

In another notable deal, Ant Group-backed Philippine e-payment firm Mynt raised $175 million from US-based Bow Wave Capital, thereby inching closer to unicorn status.

The most interesting development in the first quarter, however, was the rise of wealthtech startups, particularly in Indonesia, where millennials and Gen Z users are driving the demand for securities investments and robo-advisors.

Within fintech, wealth tech emerged as the most popular sub-category with a total of 15 deals recorded in the first quarter, followed by e-payment (13), insurtech (9) and P2P lending (6). Wealthtech firms raised $267 million in total throughout the January-March period, while e-payment firms generated $393 million.

Among the wealth tech apps, Indonesia’s Ajaib was the largest fundraiser with its $90 million Series A round, while robo-advisor Bibit and its parent company Stockbit raised $30 million and $35 million, respectively.

The SE Asia Deal Review: Q1 2021 report covers fundraising by startups in the first quarter and the previous year, including data on:

• top dealmakers and sectors in each country
• quarterly deal value and volume trends
• median deal sizes
• deal volume at different funding stages.

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