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Asia Funding Plummets In Q3

Illustration of founder sitting on hour-glass shaped seat at bus stop-Asia.

Venture funding in Asia sank to its lowest level in 10 quarters as the region felt the full effects of the current private market pullback.

Mirroring what is going on in the public markets, investors slowed funding to private companies with only $21.2 billion for startups in the region. That is a 26% decrease from the second quarter and an astonishing 56% from the third quarter of last year.

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As with the global numbers, the total funding amount marked the lowest investment since the first quarter of 2020, when the world was just entering into a pandemic and only $19.6 billion was raised by startups in the region.

Not surprisingly, deal flow also suffered, hitting its lowest level since the fourth quarter of 2020. Only 1,417 deals were announced in Q3, down 18% from last quarter and 22% from a year ago.

Late stage leads in drop

While all types of rounds were down from last quarter, the biggest drop was seen in late-stage and tech growth rounds. That trend is not unique to Asia, but it was certainly pronounced.

Large late-stage and growth rounds fell 42% from last quarter to $9.2 billion. That number also represents a 71% drop from Q3 last year when the total hit $32.2 billion.

Although there were some large deals—such as Singapore-based online shopping company Lazada Group closing a $912.5 million round from Alibaba—deal flow also fell. Deal flow dropped nearly one-third from last year for the quarter with just 168 late-stage and tech growth rounds closed in Q3. That also is a decline of 18% from last quarter.

Early stage staggers

The drop in late-stage deals meant early-stage funding rounds actually saw more investment in the Q3 with $10.4 billion raised. However, that doesn’t mean things were completely positive for early-stage funding.

Early-stage deals fell 28% from Q3 last year to $10.4 billion. That was only a drop of 3% from the previous quarter, but well off the recent high of $17.2 billion in early-stage rounds we saw in Q4 of last year.

Early-stage deal flow did take a significant hit from last quarter, falling 22% to 497. That also is a drop of 16% from Q3 2021.

Seed stage uneven

Seed and angel rounds took a hit from last quarter, falling 23% to $1.6 billion—although that number actually is up 13% from the same quarter last year. While that may be a good sign, the amounts for such rounds are so small they do not really move the needle for overall funding in the region.

However, deal flow was down both from last quarter and year to year. Just more than 750 seed and angel deals were announced in Q3, a drop of 14% from last quarter and 23% from last year. It also is a far cry from the 1,174 deals announced in Q4 2021.

India crashes

So which countries in the region led to these numbers?

While nearly every major country saw their numbers fall, India took one of the most pronounced declines. Startups in the country raised only $2.9 billion in Q3, compared to $8.5 billion last quarter and $15.4 billion in Q3 2021.

Last year was a standout year for Indian startups, but this year tells a very different story.

China’s numbers also were down significantly quarter to quarter. Chinese startups saw only $9.6 invested last quarter, compared to $18.5 billion in the same quarter of 2021. The number also is down from the $9.8 billion invested in Q2 and a dramatic drop from the record $27.9 billion investors poured into startups in Q4 2021.


With the public markets wobbly nearly everywhere, Asia also did not see a robust IPO market. The biggest IPOs in the region involving VC-backed startups included two on the Shanghai Stock Exchange:

  • China-based health care solutions provider MGI Tech raised approximately $506 million in a September IPO.
  • China-based biotech firm InventisBio raised nearly $293 million in a July IPO.

M&A dealmaking was also down, as only about 60 deals involving VC-backed startups were announced—a decrease of about 25% from last quarter. The biggest deals announced in the third quarter in Asia were:


What more really needs to be said?

Venture and growth—especially late-stage growth—funding is down nearly everywhere. Tension between China and the U.S.and Europe likely did not help funding numbers in the region, nor did China’s continued regulation ramp-up on tech firms.

Mix into that the public market tumult and overall economic gloom, and you have a down market globally, as well as in North America, Europe and most certainly Asia. 

It is odd that India’s numbers dropped so far considering some signs indicate it has weathered the overall down global economy well. However, perhaps the venture numbers show that is changing.

Last year saw a record of more than $175 billion invested into startups in the region. That robust market seems much further away than just nine months ago.


The data contained in this report comes directly from Crunchbase, and is based on reported data. Data reported is as of Oct. 3, 2022.

Note that data lags are most pronounced at the earliest stages of venture activity, with seed funding amounts increasing significantly after the end of a quarter/year.

Please note that all funding values are given in U.S. dollars unless otherwise noted. Crunchbase converts foreign currencies to U.S. dollars at the prevailing spot rate from the date funding rounds, acquisitions, IPOs and other financial events are reported. Even if those events were added to Crunchbase long after the event was announced, foreign currency transactions are converted at the historic spot price.

Glossary of funding terms

Seed and angel consists of seed, pre-seed and angel rounds. Crunchbase also includes venture rounds of unknown series, equity crowdfunding and convertible notes at $3 million (USD or as-converted USD equivalent) or less.

Early stage consists of Series A and Series B rounds, as well as other round types. Crunchbase includes venture rounds of unknown series, corporate venture and other rounds above $3 million, and those less than or equal to $15 million.

Late stage consists of Series C, Series D, Series E and later-lettered venture rounds following the “Series [Letter]” naming convention. Also included are venture rounds of unknown series, corporate venture and other rounds above $15 million.

Technology growth is a private-equity round raised by a company that has previously raised a “venture” round. (So basically, any round from the previously defined stages.)

Illustration: Dom Guzman




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