Temasek shifts focus to growth, late-stage startups

Temasek will reduce direct investments in early-stage startups and focus more on growth and late-stage companies, according to Fock Wai Hoong, the firm’s Southeast Asia head.

The Singapore state investor aims to prioritize businesses with established models and clearer unit economics.

Capital deployment will target scaling up these startups, while Temasek’s fund vehicles like Vertex Ventures will continue to back early-stage firms.

The company still plans to expand its Southeast Asia portfolio, depending on suitable opportunities.

Temasek is also looking for exit options through public markets and trade sales, citing developments such as Indonesia depositary receipts on the Singapore Exchange.

Fock noted that more startups now consider regional or domestic listings instead of Nasdaq, especially when local markets offer better brand recognition and liquidity.

Temasek has also implemented stricter due diligence, including deeper integrity checks and a push for audits by major accounting firms.

🔗 Source: The Business Times

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Implications, context, and why it matters.

Temasek trims direct early bets as Southeast Asia money shifts to later rounds

Private money into Southeast Asia’s digital economy reached US$7.7 billion in the 12 months to June 2025, about 70% below the 2021 peak of US$27 billion 1.
Seed to Series B deals shrank from roughly 30% to around 20% in the past year 1. Investors focused on later rounds.
Temasek limits early-stage exposure to 6% of its portfolio, split between direct stakes and venture capital (VC) funds 2.
That stance could make fundraising tougher for early founders in a market where seed to Series B share has already fallen 1.

VC funds and accelerators can fill early-stage gaps as Temasek pulls back on direct bets

Temasek now uses fund vehicles such as Vertex Ventures for early exposure 2. Other institutions may step in. Accelerators (short-term programs that provide mentorship and small initial checks) see more deal flow (the pipeline of potential investments).
The regionwide drop in seed to Series B share leaves pockets where seed money is scarce 1.
Investors who map where Series A (the first major venture round) volumes fell by country or sector deploy capital in spots with lower competition and more reasonable valuations.
Venture lenders (specialized debt providers to startups) or revenue-based financing providers (repayment as a small share of future revenue) back startups seeking non-dilutive capital (no equity given up) to reach profitability.