SINGAPORE Law and Practice Contributed by: David He, Benjamin Teo, Kinnari Sahita and Binh Vong, Gunderson Dettmer Singapore LLP
1. Trends 1.1 VC Market
ing amount within a 12- to 18-month period at the same or slightly higher valuation; • continued preference by companies and investors alike to rely on fundraising through convertible notes in lieu of priced equity financings in order to defer discussions around valuation; and • pay-to-play structures to incentivise and reward investment by existing investors and penalise non-participants. For further insight into the terms and condi - tions characteristic of recent venture financings, please see the Singapore Trends and Develop - ments chapter in this guide. 1.3 Key Industries Financial services and technology ( “fintech” ) start-ups continued to account for a significant portion of all venture funding in Singapore, par - ticularly those seeking to offer payment and lending solutions to the large unbanked but digitally sophisticated populations in suburban and rural areas. Businesses leveraging block - chain and Web 3.0 technologies to solve foreign exchange and currency inefficiencies also saw success in fundraising. E-commerce and con - sumer-focused start-ups with reliable revenue streams and the capacity to turn a profit (even at the expense of growth) continued to attract investors with a renewed preference for financial stability over scale. The application of generative AI (as opposed to traditional, symbolic AI) by start-ups is driv - ing a new wave of investor interest in fintech, healthtech, biotech, e-commerce and many other sectors. Start-ups that adopt the power of AI hold a distinct competitive advantage by harnessing the power of data augmentation to innovate more quickly, optimise processes, and deliver superior products and services. These
Notable VC Financings of the Past 12 Months Notable 2024 VC deals involving Singapore- headquartered companies included: • insurtech start-up bolttech’s Series C fund - raise – USD100 million; • semiconductor manufacturer Silicon Box’s Series B fundraise – USD200 million; • AI and data collaboration start-up Atlan’s Series C fundraise– USD105 million; and • open-source developer platform start-up Supabase’s Series C fundraise – USD80 mil - lion. 1.2 Key Trends Macroeconomic headwinds, including high inter - est rates and volatile capital markets, persisted as many start-ups approached the end of their cash runways. Financial irregularities resulted in the repricing and collapse of several start-ups, most notably, the high-profile downfall of agr - itech unicorn eFishery. Geopolitical challenges, such as wars and tariffs, also had significant repercussions for the fundraising landscape in 2024. Notable trends included: • further risk shifting in venture financ - ing rounds from investors to founders by requiring founders to stand behind warran - ties (including being expected to provide uncapped indemnities on an expanded set of fundamental matters, including company financials), and investors conducting addi - tional due diligence before committing to invest; “wait-and-see” approach by investors hesitant to commit entire allocations without concrete evidence of performance, resulting in an uptick in tranched closings, with inves - tors retaining the option to invest the remain -
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