The Southeast Asia Exit Landscape

Southeast Asia (SEA) has a young and vibrant technology startup ecosystem. An ecosystem that is maturing at a rapid pace and with capital increasingly allocated to up and coming tech startups. With the rise of unicorns, foreign venture capital and corporates, Golden Gate Ventures in partnership with INSEAD felt it was time to revisit earlier research relating to the exit landscape. In the analysis, we’re taking a deeper look at the historical exits (strategic acquisitions, IPOs, and trade sales) and make a forecast of potential exits for the next 5 years.

“There is certainly no better time to be an entrepreneur in the thriving entrepreneurial ecosystem of Southeast Asia. Investors in Europe and the US are looking to increase their exposure to the funds in this region and those imminent exits will only increase their commitment. The growing interest of corporates in the startup space is certainly a development to watch; they may offer an additional exit avenue or fill funding gaps in certain countries.” ~ Claudia Zeisberger, Professor of Entrepreneurship & Family Enterprise at INSEAD

We re-looked our previous predictions (Bamboo Report, Q3 2015) and found them to be generally in line (albeit slightly too conservative) with the actual exits between 2016–2018

With many recent developments in the past few years, such as the 2017 IPO of Sea Group on NYSE, Grab’s acquisition of Uber SEA in 2018, and the emergence of at least 6 new SEA unicorns since 2015, we decided to re-evaluate the SEA exit landscape, conduct a survey in collaboration with INSEAD to gauge GPs’ sentiments, and develop a new forecast.

Number of Exits by type

In this new forecast, we decided to employ a new methodology, leveraging past SEA exit data, as well as inputs from global benchmarks and results from INSEAD’s survey. We are estimating at least 700 anticipated startup exits between 2023–2025, and this is in line with the overall optimism that other GPs have according to the survey.

Among major drivers of future exits include: Unicorns becoming acquirer (example of Go-Jek* acquiring 7 other startups between 2017–2019), growing Corporate VCs investment…