South East Asian startups are witnessing rising investment potential amid the crisis

Southeast Asia’s start-up scene is showcasing increasing investment potential as the COVID-19 has drastically shifted the dynamics for the long-term as stated by one of the leading venture capital firms.

Despite the impact of the pandemic, the setbacks have provided many opportunities for new start-ups in the region. New businesses that are related to digital technology adoption, including but not limited to education technology, financial technology and health technology, and others have been confronting success. Any crisis if comes brings a lot of opportunities as well.

Some of the biggest and most successful business start-ups or tech companies have been founded during various crisis like the lights of 2008 Financial Crisis and dot-com bust.

Past Monday, Indonesian ride-hailing company Gojek had announced its merged with an e-commerce player Tokopedia to combine forces thereby creating GoTo Group. The deal is seen as an important move as the company is looking forwards to go public at a valuation of over USD 35 billion to USD 40 billion.

Ahead of the announcement, one official stated that the valuations might have become a little bit frothy which can be regarded to the recent hype amid the pandemic. However, the official assured that the valuation is reasonable overall.

Many other companies are looking forward for public listings via special purpose acquisition companies (SPAC), as they have grown in popularity around the South-East Asian region as well as across the globe. Previous month, another regional ride-hailing giant Grab had announced that the company is going public on the Nasdaq Index in an about USD 40 billion SPAC merger.

Many countries have been witnessing SPACs as an opportunity for some of the tech companies based in the region to tap into the U.S. public markets. Some correction on the noise may be around the corner. However, in the long run, the method is likely to stay.