Exec: SEA to see more tech start-ups


A venture capitalist sees more startups, especially in the field of technology, emerging in the Southeast Asian (SEA) region.

Paul Santos, managing partner of Singapore-based Wavemaker Partners, said that technology investments in the region have been growing through the years, although a slight dent was recorded last year amid the pandemic. 

“We have a hot market. There’s always excitement around unicorns or billion-dollar companies,” he said, noting that the demand for technology has been on the rise as well. 

In Southeast Asia, Santos said there are 40 unicorns present and 19 of them were just introduced in the past year. The remainder was launched between 2013 and 2020.

“There is real momentum in the region to create these kinds of companies,” he said. “More and more people are using technology in their day-to-day lives, and so are businesses.”

Investors are drawn to the region because of its robust macroeconomic fundamentals, he said. 

Citing reports, Santos shared that the economic block has 70-percent Internet penetration, which is higher than the global average of 59.5 percent. The number of Internet users in SEA also grew to 400 million last year from 360 million in 2019 due to the accelerated shift to digital amid the pandemic.

The Internet economy of the region is also expected to reach $300 billion in gross merchandise value by 2025  despite the pandemic, he said.

As a venture capitalist, Santos said it is crucial to back the funding of start-ups that may not offer “obvious” products and services but may yield value in the future. 

“Can we back the things that are less obvious? Can we build a conviction that they can actually be really exciting opportunities? And if we are able to do that, that’s how we get our reward,” he said.

Santos said that Wakemaker has been investing in the Philippines as well, given that it has a big population and opportunities for start-ups. 

“There are many problems to solve and you can use technology in ways that make solving it worthwhile,” he said.

“I think we have a ton of opportunities. We just have to look for these insights and back these entrepreneurs that are doing things that might not be so obvious,” he added.

According to Global Startup Ecosystem Report (GSER) 2021, Manila is one of the top emerging ecosystems for start-ups in the world amid its growing financial technology (fintech) and e-commerce space. 

The Philippines has $101-million worth of early-stage funding and $584-million ecosystem value. 

GSER pointed out that fintech start-ups in the Philippines were able to take advantage of the increasing mobile banking usage, enabling regulatory environment and unbanked segment. Meanwhile, the e-commerce revenues are pegged at over $5 million this year and forecast to reach $8.8 million in 2025.

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