Why are there so few exits in Southeast Asia? It’s a fair and increasingly common question among LPs. 

With disappointing IPOs, struggling unicorns, and a funding slowdown since 2022, it’s natural to ponder whether the rewards for investing in Southeast Asia still justify the risk.

As early-stage investors in the region, we borrow a line from Mark Twain: “Reports of my death are greatly exaggerated.”

We don’t dismiss the concerns about Southeast Asia’s startup scene but the reality is more nuanced. We believe it can produce strong exits, but expectations were arguably set too high, too soon. 

Valuations surged, round sizes grew, funds got larger – and exit expectations followed. So how did we get here?

The Feast vs The Famine

The region’s fundamentals were compelling: young, growing populations, rising incomes, and rapid tech adoption. These drew founders and investors alike. 

Then COVID happened. Instead of slowing the scene down, things accelerated: consumers spent more online than ever, stimulus flowed, and cheap capital (interest rates at 0.08%) fuelled the surge.

Deal count rose ~60% to 1,824 in 2021 from 1,141 in 2020, and value jumped ~70% $16.9B from $9.9B.

2021 was the peak of the period we dub “The Feast” – with 23 new unicorns minted, more than the prior 7 years combined. 

By mid-2022, interest rates climbed. By 2024, deal count fell ~50% and value ~55%. This marked the start of “The Famine.”

Unicorn creation slowed dramatically as well. From 2022 onward, the region added only 14 unicorns – a clear sign of recalibration.

Beyond interest rates, wars (Russia vs. Ukraine; Israel vs. Hamas) and tariffs contributed to the world being more volatile, uncertain, complex, and ambiguous (VUCA).

What This Means for Exits

During The Feast, investors backed 3 broad types of companies:

1. Weak companies that shouldn’t have been funded. This is inherent to venture: risk-taking inevitably produces write-offs and zombies, regardless of the cycle.

2. Good companies that raised too much at inflated valuations. Examples like Grab and GoTo show that strong consumer usage doesn’t guarantee strong investor returns. Private and public investors value companies differently.

3. Good companies that weren’t overfed and remained promising. These built capital-efficient, resilient models solving meaningful problems. Yet they were often overlooked for a few reasons:

• They had unfamiliar models without clear comparables
• They operated in less-favoured markets (e.g. Philippines, Vietnam)
• They faced skepticism about global competitiveness, especially if they’re in enterprise, deep tech, or sustainability 

These companies did more with less. They’re likely to define the region’s next wave of exits – but they also need time. 

Do The Promising Startups Deserve More Time? 

We believe yes, mainly for 2 reasons:

1. Anything of significant, long-term value is difficult. Short-term gains are easier; meaningful, long-term outcomes are not. Building strong companies requires sustained effort and discipline.

2. Southeast Asia’s startup ecosystem is about 8 years younger than India’s. India is now seeing strong exits, but it had a head start. 

One way we can say a startup ecosystem has achieved a level of critical mass is when local venture capitalists raised funds of over US$100 million and global venture capitalists set up local offices. 

Our research shows India achieved this around 2006 to 2008, while Southeast Asia reached this point around 2014 to 2016.

Both regions saw early standout exits (Walmart’s acquisition of Flipkart in India in 2018; Sea’s and Razer’s IPOs in Southeast Asia in 2017), followed by weaker post-Feast exits.

India is now entering its 3rd wave. In 2024, it became a leading IPO market, with companies listing based on real earnings, cost discipline, and clear models – not hype (e.g. TBO Tek and Go Digit). Even consumer names (e.g. Swiggy) had solid unit economics.

This signals maturity: companies go public because they’re ready, not because capital is abundant. We expect Southeast Asia to follow a similar trajectory.

What the Next Wave of SEA Exits May Look Like

Future exits may not mirror the oversized expectations of 2021. Instead, we may see a mix of:

• Mid-sized exits ($250M-$500M) – still strong outcomes, particularly for early investors
• Strategic acquisitions – driven by fundamentals, IP, stellar customers, or outstanding talent
• Private equity buyouts – for profitable, cash-generating companies with defensible moats
• Measured IPOs –  grounded in more predictable growth and economics that meet the bar of public equity investors;
• and home runs ($1B or more) – we continue to be hopeful that the region will see its fair share.

A combination of these outcomes should help rebuild confidence in the region.

A Reset, Not a Retreat

At Wavemaker Partners, we say: Opportunity = Actual Value – Perceived Value. 

During The Feast, perceived value far exceeded reality. Today, perception has reset, while actual value continues to grow quietly. This gap is where venture returns are made. 

The Feast made investing seem easy: follow capital, copy models, join large rounds. Many believed more funding meant inevitable success.

The Famine is proving otherwise. Real opportunity now lies with investors who are curious, who think for themselves, have the courage to act on their convictions, and are right enough of the time.

Southeast Asia is not facing an exit drought. The next generation of companies is already building toward meaningful outcomes.

Rather than a retreat, this is likely the quiet before the harvest.

Versions of this piece were first published on Business Times and Tech in Asia.

Featured image by Robert Eklund/Unsplash

KUALA LUMPUR, 3 March 2026 — Aonic, a Malaysia-founded drone technology company operating across Southeast Asia, today announced that it has secured USD 10 million in new funding. The Series A funding round is led by Kairous Capital, a regional private equity and venture capital firm backed by Jelawang Capital, Malaysia’s National Fund-of-Funds through its Emerging Fund Managers’ Programme. The investment will accelerate Aonic’s regional and international expansion, deepen R&D, and scale its Malaysia-built drones, software, and services.

SINGAPORE, 24 February 2026 — Eezee, a Southeast Asia–based procurement platform focused on enterprise tail-end spend, has raised a US$5 million pre-Series B round, led by Korea Investment Partners Southeast Asia, with existing investors such as Kickstart Ventures and Wavemaker Ventures doubling down. The oversubscribed round also included participation from several strategic investors.

SINGAPORE, 11 February 2026 — Oneteam, a Singapore-headquartered SME acquisition platform focused on succession solutions, today announced it secured a dedicated M&A financing facility from Polaris, the alternative financing arm of GB Helios, which formed part of the financing for its second acquisition completed in September 2025.

SINGAPORE, February 5, 2026 – Wavemaker Partners today announced the promotion of Rachel Ng to Partner, People & Platform, reinforcing the firm’s commitment to nurturing leadership, organisation, and culture both internally and across its portfolio.

In her expanded role, Rachel oversees Wavemaker’s Platform functions, including People & Platform, Communications, Finance, Legal, and Portfolio Management. She is also the programme lead for Wavecrest, Wavemaker’s non-profit initiative supporting talented youths from underprivileged backgrounds.

“We believe we are in the people business. We recognise that the best founders, LPs, advisors, and employees all have choices on who they work with. We believe that attracting, nurturing and retaining top talent puts us in the best position for long-term success. Rachel’s promotion reflects both our continuing commitment to this belief and recognition of her valuable contributions to our firm and our community,” said Paul Santos, Managing Partner, Wavemaker Partners. 

Rachel joined Wavemaker in July 2019 and has since progressed through roles including Chief of Staff and Principal, People & Platform. She has supported the firm’s growth from 17 to 44 team members, establishing its people philosophy, performance and learning frameworks, and total rewards structures.

She has also played a key role in strengthening Wavemaker’s community, establishing advisor and supplier networks and organising founder-focused workshops and events. Rachel co-designed the firm’s Building Culture programme, working closely with portfolio company founders to clarify their culture, align processes and structures, and strengthen decision-making.

Commenting on her promotion, Rachel said: “I’m incredibly grateful for the trust of my colleagues, founders, and friends in our community, and excited to deepen our culture-building and leadership development initiatives at Wavemaker and across our portfolio companies.”

“Rachel has been a trusted thought partner to leaders across our firm for many years, spanning multiple funds, and she has had an outsized impact on our founders and portfolio companies,” said Andy Hwang, General Partner, Wavemaker Partners. “What sets her apart is her ability to win people’s trust and bridge different interests and perspectives to help teams find the best way forward, especially during tough times.”

About Wavemaker Partners
Wavemaker Partners is Southeast Asia’s leading venture capital firm investing in Enterprise, Deep Tech, and Sustainability startups. Since 2012, it has backed over 200 companies in the region, with over US$500 million in total committed capital across multiple funds, including Wavemaker Impact (venture build), Wavemaker Ventures (early-stage investments), and Wavemaker Growth (growth-stage). The firm has also generated over US$2 billion in enterprise value through successful exits. Its notable limited partners include Pavilion Capital, Temasek Holdings, the International Finance Corporation, Cercano Management, and DEG (investment arm of Germany’s state-owned development bank KfW). Committed to trusted partnerships and sustainability, Wavemaker Partners empowers founders solving meaningful problems with unique, scalable, and defensible solutions. Today, 92% of the firm’s active portfolio startups in Southeast Asia contribute to at least one UN Sustainable Development Goal. For more information, visit wavemakerpartners.com. 

For media inquiries, please contact:
Jum Balea, VP for Communications, Wavemaker Partners
[email protected]