Predictions for Singapore’s startup ecosystem in 2017
Last year proved to be a great year for venture capital and tech startups. In terms of funding, 2016 was nothing short of stellar for Singapore. A total of US$3.5 billion worth of private equity and VC investments were raised, the highest recorded in the past five years. We witnessed multiple successful exits via IPOs and acquisitions. Lazada was acquired by Alibaba, Luxola was acquired by LVMH, while CMON and Anacle listed on Hong Kong’s GEM exchange. Will 2017 prove to be as lucrative for the local VC and startup ecosystem as 2016?
While mostly positive, the year was peppered with a few headlines that indicate a bearish outlook for the months to come. FlipKart experienced a massive devaluation, RedMart was acquired at a fraction of the funds that they raised, JFDI closed down its accelerator program and early stage funding declined. These headlines serve as harsh anecdotes that indicate a maturing ecosystem.
2016 was also a year of reality checks. The startup ecosystem underwent refinement as resilient “cockroach” startups started appealing to more investors than the glittery unicorns. Growth potential didn’t matter as much as burn rates, and the harsh realities of sustainability reared its unforgiving face. Some of us faltered and caved in to the pressures of 2016, while many of us took it in stride and came out stronger.
Later-stage startups managed to draw in most of the funding last year. They are now ripe for potential exits. Several companies have started streamlining processes and tightening budgets, which could be a sign for potential IPOs. Alternatively, they could just be trying to improve bottom lines for better valuations this year. Either way, many of these doe-eyed startups have grown hair on their chins, and are ready to stand on their own two feet. With higher quality companies that are determined to prove financial sustainability, we can expect to see more later-stage funding in 2017.
That said, having earned some wisdom over the past few years, investors are now in a better position to assess and invest in early-stage startups too. We are excited to see what 2017 has in store for us. Hopefully, we’ll see new innovation and bigger strides in the development of the startup ecosystem here in Singapore!
#fund raising #Singapore #start-up #valuation #Venture Capital