Take a sneak peek at the 2024 Tech in Asia Conference Report

Southeast Asia’s tech ecosystem has come far over the last decade.

The region is home to 38 unicorns, as of February 2024, and has seen a number of its biggest tech companies – such as Sea Group, Grab, and GoTo Group – make their public market debuts. While the tech winter has left its mark, Southeast Asia is coming of age.

That’s why the theme for this year’s Tech in Asia Conference in Jakarta is “The heart of Southeast Asia’s tech ecosystem.” We’re exploring what lies at the core of the region’s startup scene and what will fuel new opportunities in the years to come.

Ahead of the conference, we’re getting a head start on the conversation with the launch of “SEA to the future: The 2024 Tech in Asia Conference Report.” It explores the specific verticals that we envision will be at the heart of Southeast Asia’s tech growth, diving deep into the sectors that will steer the region toward its next success stories.

Here’s a taste of what to expect from the report.

1. Ecommerce and fintech are here to stay

The fintech and ecommerce sectors have kept their spots among the region’s top five most funded verticals over the past five years. Startups in these segments were some of the earliest to emerge in Southeast Asia. Many of them also served as people’s introductions to the digital economy (think online shopping and e-wallets).

The challenge for companies in the sector will be to evolve even further. Ecommerce is seeing a shift, with the rise of platforms like TikTok Shop and new trends such as live commerce. Fintech, too, will need to expand beyond digital payments into other sectors, such as insurance and investments, to truly enable greater financial inclusion in the region.

“In ecommerce and fintech, where consumer awareness is much more developed, the challenge will be to identify unique insights, such as shifting consumer behaviors, and
taking a bet on new distribution and channel activation strategies to potentially leapfrog existing solutions to come up with something that caters to a new consumption pattern,” Susli Lie, partner at Monk’s Hill Ventures, said in the report.

2. All eyes are on AI

This may come as no surprise, but AI will be one of the verticals at the heart of Southeast Asia’s tech growth. The sector could potentially contribute US$1 trillion to the region’s economy by 2030, according to research by consulting firm Kearney.

The vertical is seeing robust support from governments and big tech companies alike, which are pouring investments into AI-related initiatives in Southeast Asia. The rise of generative AI could transform the way individuals work and play on the road ahead.

However, there are many uncertainties surrounding the region’s AI scene. There’s a lack of talent, regulations haven’t yet been put in place, and hallucinations – which is when an AI model offers up incorrect or imagined information – are still par for the course.

There’s also the much broader question of figuring out how much of the excitement around AI is just hype and what will happen when things calm down.

3. The question of exits and profitability

While Southeast Asia’s tech scene has matured, it is still plagued with the challenge of proving itself as a viable thesis for investors.

Despite the ecosystem’s rapid growth, Southeast Asian tech companies have seen relatively few successful IPOs, and those that have occurred have generally underperformed. On the M&A front, deal sizes in Southeast Asia are generally smaller, and much of the figures for M&As are still undisclosed, according to Tech in Asia data. Plus, while some exits have gone well – such as the US$80 million acquisition of TradeGecko – others have not been that clear-cut.

Profitability is also a persistent question in the region, having remained rather elusive for many players. Grab, for one, just posted its first profitable quarter at the end of 2023, but the firm has yet to make an annual profit.

There have been improvements across the board, but companies need to showcase both growth and profits in the long run to meet investor expectations and prove that the region can produce profitable tech companies that provide steady returns and earnings for investors.

The heart of Southeast Asia’s tech ecosystem

It’s exciting times ahead for our ecosystem, but these insights just scratch the surface.

In the full report, we dive deep into a few more verticals and go into the specific opportunities and challenges plaguing each one. We also take a look at what’s going on in other markets to understand how Southeast Asia is faring and see if we can draw any comparisons for the future.

If you want to learn more about what will lie at the heart of Southeast Asia’s tech ecosystem on the road ahead, download your copy of the report today!

Tech in Asia Conference is Our annual flagship event uniting thousands of tech enthusiasts. Engage in a world of learning, networking, and growth as you connect with industry leaders, discover groundbreaking insights, and seize unparalleled opportunities. Learn more the upcoming Jakarta edition on our website.