Business Times: Share of funding for women-led startups rises, but challenges for equality remain

This is adapted from The Business Times

DIDI Gan’s mother built a textile manufacturing business while raising five children as a single parent.

South-east Asia’s tech industry remains male-dominated, although more capital is going towards startups with women in their founding teams. Startups with at least one female founder accounted for 18.3 per cent of private capital raised in 2023 – higher than the 12.6 per cent share the year before, said a DealStreetAsia report released on Mar 8.

These startups obtained US$1.4 billion out of the US$7.7 billion raised in total in 2023. The report, which looked at over 700 equity funding deals in the region, did not have comparable data for 2021.

saw a lower correction of 29.5 per cent in total deal value. DealStreetAsia analysed companies that have raised private funding at any stage of their life, and young private companies in non-traditional sectors such as digital banking.

semiconductor startup Silicon Box’s US$139.4 million raise; insurer Singlife’s corporate round of US$132.7 million; and Vietnam-based education group EQuest’s raising of US$120 million.

Silicon Box was co-founded in Singapore by American businesswoman Weili Dai. EQuest was co-founded by Nguyen Thi Tuyet Lan, while Singlife is led by chief executive officer Pearlyn Phau.

For companies with traditional organisational structures, such as Singlife and Anext, DealStreetAsia regarded the CEO role as a proxy for the founder. The top deal of the year involving a female founder or leader was the US$188 million injected into Anext Bank, a digital bank owned by China’s Ant. Anext is led by Toh Su Mei, a former regional head at DBS Bank. Female representation in entrepreneurship and venture capital (VC) has been growing steadily as the region’s tech ecosystem boomed.

In Singapore, the proportion of female entrepreneurs rose from 17.9 per cent to 24.9 per cent between 2016 and 2022, according to a study by the Intellectual Property Office of Singapore.

Still, observers say more can be done to plug the gaps. Vertex Ventures managing partner Chua Joo Hock said women founders need structured and enduring mentoring programmes.

“Over the years, we see that mentoring programmes launched by ecosystem partners tend to be sporadic; yet, having a nurturing mentor is so important to helping women founders get ahead,” he said.

Daphne Tay, who founded language-learning startup Bluente, said women are typically overwhelmingly under-represented at tech networking events.

The progress of gender diversity is complicated by uneven development across South-east Asian markets. Vietnam led the way in the share of funding bagged by female-founded startups, at 53 per cent.

The Philippines was ranked next, with 23 per cent, followed by Malaysia at 19 per cent and Singapore at 18 per cent.

The capital secured by female founders was almost evenly split between early and late-stage ventures. Early-stage funding, referring to rounds up to Series B, accounted for 44 per cent of all funding raised by female-founded teams in 2023.

“A higher percentage of late-stage startups founded or helmed by women is a welcome sign for the regional startup ecosystem,” said Deepshikha Monga, author of the report and senior editor at DealStreetAsia.

To spur even more female entrepreneurship, Vertex’s Chua said tax deduction schemes and more gender-focused funds should be considered by the government.

“The Early Stage Venture Fund (ESVF) scheme has helped seed many VC funds and startup investments in Singapore in the last decade,” he said. “But how about more gender lens ones to give dedicated support to the women entrepreneurs?”

For the latest news on Vertex Ventures SE Asia and India and our portfolio companies, follow us on Linkedin or subscribe to our monthly newsletter.