By Asina Pornwasin
SOME US$13 billion (Bt408 billion) was invested in Southeast Asia’s Internet economy since 2015, including a strong acceleration of investment between 2016 and 2017, according to the “e-Conomy Southeast Asia Spotlight 2017” report.
Nearly 1,400 deals involving SEA’s Internet companies in 2016 and 2017 saw investments in series A and seed rounds. It shows that there are a lot of opportunities for Thai Internet companies, said Ben King, country director of Google Thailand.
The country’s Internet economy was valued at $10 billion in 2017, up from $5.8 billion in 2015, and it is projected to reach $37 billion by 2025.
E-commerce saw the highest growth at 43 per cent during 2015 to 2017. Meanwhile, online travel was the largest sector with $6.2 billion, followed by e-commerce with $1.8 billion. Thailand’s e-commerce market (in term of total gross merchandise value) is expected to reach $11.1 billion in 2025, with 12 times the growth rate in 10 years from 2015 (which was $0.9 billion).
In 2017 alone, $7.7 billion was invested in SEA start-ups, almost doubling the $4.4 billion invested in 2016, according to the “e-Conomy Southeast Asia Spotlight 2017” report.
King noted the report’s forecast that the SEA Internet economy would reach $200 billion in 2025.
According to the report, there are $40 billion to $50 billion in funds required over the 10 years from 2015 to 2025, to build the whole forcasted $200 billion SEA Internet economy.
However, the report also unveiled a trend that seed global and regional investors concentrating their bets by putting their majority of funds into the unicorns – start-ups having more than $1 billion in valuation.
From 2016 to the third quarter of 2017, $9 billion in funding was injected into the unicorns, $1.4 billion invested in companies having value between $100 million to $1 billion, and $1.9 billion invested in companies having valuations below $100 millions.
SEA itself has spawned seven unicorns – Grab, Lazada, SEA (a Singapore-based Internet platform), Razer (a gaming hardware company), Go-Jek (an Indonesian hyperlocal transport, logistics and payments start-up), Tokopedia (one of Indonesia’s biggest online marketplaces), and Traveloka (an Indonesian online travel aggregator).
The report was co-developed by Google and Temasek and studied four key areas of the Internet economy, including e-commerce, online media, ride-hailing, and online travel. It did not include education, entertainment, financial services or healthcare.
Republished with permission from The Nation