Singapore just released its report on venture funding for 2025, and almost every write-up reads the same way. Funding winter. Capital’s gone quiet. Hold the line, it’ll come back.
I think that’s the wrong story.
I’ve been sitting with these numbers for a few days, and the more I look at them, the more I’m convinced we’ve been telling ourselves the comfortable version. The comfortable version is that the money left and the money will return. The harder version, the one I actually believe, is that the region made a strategy bet a decade ago, the bet didn’t have an exit attached to it, and 2025 is just the year the math stopped hiding. We’ve had a few of these years where the math stops hiding. This is another one.
So let me do a bit more opining than usual. This one’s a little spicy.
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The number everyone read
The headline is genuinely rough. In 2025, Singapore recorded 472 venture deals, down 35 percent from the year before. Total capital raised came in at 4.6 billion US dollars, down 34 percent year on year. And Singapore is the strong one. Across the ASEAN-6, both deal value and deal volume hit a four-year low.
Now hold that next to the United States in the same year. Silicon Valley deal value nearly doubled, to around 160 billion dollars. A lot of that was two rounds: OpenAI at 40 billion, Anthropic at 15 billion.
Two companies, in one country, raised more than ten times what the entire island of Singapore raised across 472 deals all year.
The easy conclusion is that capital is concentrating into American AI and starving everyone else. That’s true as far as it goes. There’s real gravity pulling allocators toward the bleeding edge, and that gravity sits in Silicon Valley.
But that’s a description of the weather. It doesn’t tell you why our house is the one with the leak.
For that, you have to go back further than last year, and look at what we actually spent the money on, and what we expected to get out the other side.
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The bet we made
Here’s the part that doesn’t get said enough. For most of the last decade, Southeast Asia poured its venture money into consumer. Ride-hailing, e-commerce, food delivery, the super-app. The big, beautiful, blitzscaled consumer story where you capture a young, mobile-first population of 700 million and become the thing they open twenty times a day.
I’m not mocking it. I lived through the optimism. Grab, GoTo, Sea, Lazada, Shopee. These companies built the rails the whole region runs on now. Digital payments are everywhere because of them. That’s real, and it was needed. Consumer is the precedent layer. Most maturing markets start there, build the rails, then transition. That part is natural.
But look at the allocation. In 2023, more than a third of Southeast Asian venture deal value went into consumer. The honest caveat is that “consumer” is a fuzzy line, depending on whether you fold in consumer fintech, so treat the exact figure loosely. Even on the conservative read, you land somewhere north of thirty percent. Run the same count in the US that year and you’re in single digits. The number I keep landing on is around three and a half percent.
Read that again. We put an order of magnitude more of our capital into consumer than the most mature venture market on earth did.
And we weren’t growing out of it. We were accelerating into it. Consumer’s share of regional deal value kept climbing while software’s share fell. So while the US was doing the boring, durable thing, funding enterprise software and infrastructure, we were doubling down on the consumer copycat play right as the cheap money drained out.
Why does that matter? Because of what happens at the end.
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The door that was never there
Every venture dollar is a bet on an exit. Money goes in, and somewhere down the line it has to come out bigger, through a sale or a listing. No exit, no returns. No returns, no next fund.
So how did the region do on exits? Here’s the number that should be tattooed on every term sheet. Since 2015, the entire Southeast Asian venture market generated roughly 70 billion dollars in exit value. Sounds fine until you look underneath. More than 55 billion of that came from three exits, all in 2021. Stretch it out and nearly 87 percent of all exit value since 2015 came from six companies. Take it to the top twenty and you’re at 96 percent.
Yes, there’s always a power law. Concentration is normal. But strip out a handful of unicorns and the regional market has returned almost nothing to almost everyone. The investment-to-exit ratio has run consistently above twenty to one. Twenty dollars in for every dollar that found its way out.
It’s been a trap. The Hotel California of venture. You can check in, but you can never leave.
And here’s the part that connects the dots. The few giant exits we did get didn’t happen here. Grab went out via a SPAC on the Nasdaq. Sea listed on the New York Stock Exchange. They had to leave to get out. The Singapore Exchange, the biggest in the region, ranks only ninth by market value in Asia-Pacific, and several regional exchanges still carry listing rules strict enough to keep a cash-burning consumer company out entirely. For a blitzscaled consumer business, the local IPO was a closed door.
So put it together. We funded consumer companies built on the growth-at-all-costs playbook, and that playbook only pays off through a big public listing. We never built the public markets to list them on. We built companies for a door that, at home, was never there.
That’s not a winter. Winter ends. This was a design flaw.
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Consumer is the hardest thing to sell, everywhere
This is the part I want founders and investors to chew on, because it goes beyond us. Consumer is one of the hardest categories to exit anywhere in the world.
Think about who actually buys companies. In enterprise software there’s a deep, permanent bench of buyers who do this all day. 2025 was the most active year on record for software M&A, with strategic buyers alone accounting for around 42 percent of deals. The most active software acquirers in 2024 included IBM, Cisco, Autodesk, Nvidia. There were 22 firms that each made at least five acquisitions in a single year. That’s a machine. A standing market of people whose job is to buy companies. What are they buying for? Recurring revenue, mission-critical, sticky, hard to rip out.
Now ask who the standing buyer is for a regional food-delivery app, or who’s lining up to roll up consumer brands in a market where customers switch the second someone else runs a discount. There isn’t a bench. Consumer internet leans almost entirely on the IPO. And we just covered what happened to that door.
Let me be fair, because the honest version is more interesting than the cheap one. Enterprise exits aren’t easy either. Only about ten percent of companies tagged as software ever get acquired. IPOs are about six percent of software exits. The median software acquisition went for roughly three times revenue, not the eye-watering multiple people imagine. B2B is not a golden ticket.
What enterprise has is a functioning market of repeat buyers. Consumer mostly has the IPO. It’s a difference in optionality, in how many doors are actually open. We bet the region on the category with the thinnest exit options, and didn’t build the one exit that category depends on until recently. If you wanted to design a liquidity crunch on purpose, that’s how you’d do it.
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The people who built it are now saying it
What makes this report worth reading past the headline is the back half, where they ran candid pieces from a row of the region’s investors. To their credit, the honesty is right there.
Vishal Harnal at 500 Global names liquidity as the clearest challenge facing the region, pointing straight at underdeveloped exit markets and the long holding periods that wear founders and investors down. Angela Toy at Golden Gate is just as direct, conceding the region still lacks depth in both M&A and secondaries to get people their money out.
The one that stuck with me is from Cyril at SOSV, who lays out the question every Singapore founder eventually asks out loud. If the place you ultimately have to go for capital, scale, and an exit is San Francisco, why not just start there on day one? Why build here at all? That’s a tough one to sit with. It’s not a critic on the sidelines. It’s a GP at an active global fund saying the quiet part into a government report.
Then there’s Antler. They’ve raised about 1.5 billion dollars globally, from dozens of institutions and sovereign funds. The amount that came from Singapore institutions was around 10 million. The US allocates roughly five percent of its capital to venture as an asset class. Singapore sits well below one. So even the domestic money, the money that’s right here, mostly doesn’t back the local market. The capital sits in the city. It just doesn’t believe in the thing the city keeps saying it wants to be.
When this many people who built the market all point at the same missing piece, it stops being a complaint and starts being a diagnosis.
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So what do we actually do
To be clear, Singapore isn’t sitting still. The response is substantial: an extra billion dollars into Startup SG Equity for growth-stage companies, a new 1.5 billion dollar anchor fund aimed squarely at strengthening exits, and a Singapore Exchange and Nasdaq partnership we’ve talked about here before. Almost all of it is about building the exit door now, after a decade-plus of funding companies that needed it and didn’t have it.
I’m not saying that to dunk on the policy. The policy is correct. Real liquidity, a working M&A culture, a credible place to list, that is exactly the right thing to spend on. My point is that we’re building the staircase after everyone already jumped. The companies that needed this in 2018, 2021, 2023 are gone or got out somewhere else. The question is whether the next decade of founders builds for the door that’s finally going up.
So here’s where I land. Stop building for the exit that doesn’t exist, and start building for the one that does.
That’s been our thesis at Indelible Ventures: back the higher-probability path from where the region actually is, and keep tracking how that liquidity path shifts over time. If the dependable way out is acquisition rather than a hometown IPO, then build the kind of company that has buyers. Real revenue, defensible product, something a strategic acquirer or a private equity firm actually needs to own. Not a big user number you’re hoping a public market rewards someday. Reality over vanity metrics. Capital efficiency stops being a constraint you tolerate and becomes the strategy. The companies getting funded here, and more importantly the ones that can get out, are the ones with clean unit economics, not the steepest growth chart.
I want to say something specific about the Philippines, because I’m genuinely optimistic about it and the lesson lands well there. The consumption story is real. Household spending is something like three-quarters of GDP. The young population, the digital adoption, all of it is genuine. The trap would be to look at that and run the same blitzscaled copycat playbook that just left the rest of the region holding companies it can’t sell. The opportunity is to build for that consumption with discipline, with models that travel across similar markets, and with an exit in mind from the start.
Same demand, smarter strategy. The fundamentals are a gift. The old playbook was the problem.
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What it actually says
Southeast Asia’s problem in 2025 was never that it ran out of money. The region is full of money. Family offices, sovereign funds, the whole lot. The problem is that we built a generation of companies with no clean way to turn into returns, in the category least likely to produce them, listing on markets that mostly weren’t here.
That’s fixable. But only if we’re honest that it was a choice, not the weather.
The money will come back. The question is whether we’ll have built something it can actually leave through.
