While global venture investment rebounded last year, Asia’s funding market plunged, totaling just $65.8 billion in 2024, exactly the lowest level the market recorded in 2014.
With the exception of seed and angel, all other funding stages were down last year as geopolitical events and China’s economic woes appeared to be holding back the venture market, according to data from Crunchbase.
The fourth quarter showed some resilience, recovering from a weak third quarter, with total venture funding to Asia-based startups at $15.3 billion, up 12% from the third quarter, but in 2023. This was a 33% decrease from the fourth quarter of the year.
Deal flow also fell significantly in the fourth quarter, reaching its lowest level since pre-pandemic. Just 1,524 venture rounds were completed in Asia in the fourth quarter of last year, down 10% from the third quarter and 22% from the same quarter in 2023.
table of contents
Decrease from previous year
To understand how much of a decline from last year’s roughly $66 billion in venture funding, remember that just two years ago, total venture funding was more than double that, at about $129 billion.
Total funding in 2021 was $194 billion.
Seed and angel funding increased 5% from 2023 to $7.5 billion. However, both early-stage and late-stage technology funding took a hit.
Total early-stage funding for the year was less than $29 billion, down 5% from 2023.
The decline in late-stage and technology funding was larger than this year, totaling less than $30 billion. This is a 42% decrease from the approximately $51 billion seen in the 2023 round.
Later stages and growth rounds remain low
It was a decline in late-stage and technology rounds that hampered any idea that Asia’s venture scene would recover in 2025.
The numbers for late stage and technology rounds in Q4 actually jumped up from Q3, but that’s just because the numbers were so low in that quarter.
A total of $7.2 billion was raised in late-stage and technology rounds in the fourth quarter, an increase of 30% from the third quarter, but down from the fourth quarter of 2023, which raised $13.6 billion in such rounds. % decreased.
Asia’s largest late-stage and technology rounds this quarter included:
In October, Singapore-based data center developer and operator GDS International raised $1 billion from institutional private equity investors. In December, China-based electric vehicle brand Avatr raised a Series C worth approximately $1.5 billion. Also in December, China-based semiconductor foundry SJ Semi raised $700 million in a venture round.
Deal flow was similar, with just 124 late-stage and technology rounds announced in the fourth quarter, down 15% from the third quarter and 34% from the same quarter in 2024.
crashes in the early stages
Similar to later-stage and technology rounds, early-stage rounds also increased quarter-over-quarter but decreased year-over-year.
In the fourth quarter, early stage rounds totaled $6.4 billion with 556 announced rounds. The dollar figure was up just 3% from Q3, but down 16% from Q4 2023.
The number of deals closed was about the same as last year’s third quarter, but was down 12% from the previous fourth quarter.
Angels and seeds don’t sprout
Angel and seed funding don’t have a huge impact on the overall funding amount, but they can be a sign of where the market is heading.
Asian venture investors probably hope otherwise. That’s because angel and seed funding, the only bright spot in year-end totals, returned to record low levels in the most recent quarters of 2023, Q2 and Q3.
Total angel and seed funding in the fourth quarter was just $1.7 billion, down 13% from the previous quarter and down 6% year-over-year.
Trading volume also decreased in the first round, totaling only 844 rounds. This number was down 14% from Q3 2023 and a whopping 25% from Q4.
what we learned
Asian markets continue to be disrupted, which is probably good for venture capitalists.
The company’s overall share of the global venture market has fallen from nearly 30% in recent years to just 21% last year.
Perhaps more troubling is that while AI startups seem to be taking off around the world, this is not the case in Asia. In fact, venture funding for AI startups in the region fell to just $1.7 billion in the fourth quarter, down 28% from the third quarter of 2023 and 21% from the fourth quarter.
In fact, the region appears to have benefited little from the AI boom.
Tensions in the Middle East, slowing growth in Japan, inflationary pressures, and China’s “deflationary spiral” (the government recently raised civil servant salaries to reverse the trend) are contributing to paralyzing the region’s venture market. It is clear that .
This also does not include changes in the United States that could increase tensions with several countries on the continent.
The $66 billion in venture funding raised by Asian startups this year might not be bad.
methodology
The data included in this report comes directly from Crunchbase and is based on reported data. Data reported is as of January 3, 2025.
Note that data lag is most noticeable in the early stages of venture activity, when the amount of seed funding increases significantly after the end of a quarter or year.
Please note that all funding amounts are expressed in U.S. dollars unless otherwise stated. Crunchbase converts foreign currencies to U.S. dollars at the prevailing spot rate from the date the financing round, acquisition, IPO, or other financial event is reported. Foreign currency transactions are converted at historical spot prices, even if events are added to Crunchbase long after they are announced.
Fundraising glossary
Seed and Angel consists of Seed, Pre-Seed, and Angel rounds. Crunchbase also includes venture rounds of unknown series, equity crowdfunding, and convertible debt of up to $3 million (in U.S. dollars or converted U.S. dollar equivalents).
The initial phase consists of Series A rounds and Series B rounds, as well as other round types. Crunchbase includes unknown series venture rounds, corporate ventures, and other rounds above $3 million and under $15 million.
Later stages consist of Series C, Series D, Series E, and later character venture rounds following the “Series (Character)” naming convention. Also included are unknown series venture rounds, corporate ventures, and other rounds over $15 million. Corporate rounds are only included if a company has raised seed equity funding through a Venture Series funding round.
Technology growth has been raised in private equity rounds by companies that previously raised “venture” rounds. (So basically all rounds of previously defined stages.)
Illustration: Dom Guzman
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