Temasek to Invest in Fintech Firms and Aspiring Unicorns
Even though the US-China trade war has created a lot of unrest in the overall global economy, the internet economy of Southeast Asia is flourishing undoubtedly. As per reports, Temasek Holdings, the state investor of Singapore, has announced its plans to actively focus on the “aspiring unicorns” that are outside South-East Asia.
The Senior Executive of Temasek confirmed that the firm is expecting to announce a couple of deals that are in the pipeline in the next few months.
The annual e-Conomy SEA 2019 report by Google, Temasek and new partner Bain & Company made a prediction of the region’s growth from earlier set $240 billion to $300 billion by 2025. The report stated that the increasing tensions between the US and China have further dampened demand leading to reduction in trade flows which have affected the investment spending and amped up the risk of recession. The report clearly stated that the spill over effect to funding in the internet economy can be clearly seen.
The original Google Temasek report estimated the requirement of nearly US$40 billion to US$50 billion in funding to create a US$200 billion internet economy by 2025.
The increased usage of internet by users almost everywhere and the growth of online industry in the South East Asian region has largely benefited internet industry in the past few years. People do everything on their phones starting from banking, gaming, socialising and even purchasing travel tickets.
As said by the investment head of Temasek, Rohit Sipahimalani, more than 70 aspiring unicorns in South-East Asia are valued between US$100 million and US$1 billion. He added, Temasek is “very focused on this segment”.
He said in order to scale up in the market, the aspiring unicorns need more late-stage financing via investments ranging from US$25 million to US$100 million. Having a good experience of the industry, Rohit said that in the current situation there is less competition in this area.
Also, making its first direct investment in a US based real estate investment bank, Eastdil Secured, Temasek has marked its position in the industry yet again. The New York based bank recently completed its split from Wells Fargo after being backed by Singapore sovereign wealth fund Temasek.
Speaking about the upcoming advancements in the internet field in South East Asia, Rohit Sipahimalani emphasised that mobile technology is changing the way in which South East Asians work and live, giving them open access to new opportunities and markets. He added, “Together with businesses, governments and communities, we are committed to helping create a better, smarter, and more sustainable Southeast Asia.”
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