The funding environment continues to be dull with investment funds treading a cautious approach in the backdrop of macroeconomic conditions. Venture capital (VC) deals in the Asia-Pacific (APAC) region suffered a decline of 16.5 per cent year-over-year in the first half of 2024.

A total of 2,082 VC deals with disclosed funding rounds were announced during this period, compared to 2,492 deals in the same period last year.

The APAC VC market in the first half of 2024 reflected a cautious investment climate, with a focus on early-stage ventures and a decline in deal volume across most funding stages.

Despite the decline, early-stage funding rounds dominated the APAC VC landscape, accounting for 74.3 p.c. of all deals. As many as 1,546 early-stage deals, including 576 seed rounds and 970 Series-A rounds, were sealed during the period. This trend aligns with global patterns, where investors have preferred earlier-stage ventures, according to research firm GlobalData

However, even these early-stage deals experienced an 18.9 per cent year-on-year (YoY) decline compared with the first half of 2023.

Aurojyoti Bose, Lead Analyst at GlobalData, attributed the decline in VC activity to macroeconomic challenges and geopolitical tensions, which have dampened investor confidence. “The decline is in line with the global trend,” he said.

While most funding rounds saw a decrease in volume, Series E funding rounds were a notable exception, showing improvement despite the overall downward trend. This suggests that investors are still willing to support later-stage companies with strong growth potential.

Growth, expansion, and late-stage funding rounds collectively accounted for 25.7 p.er c.ent of total VC deals in APAC during the first half of 2024. However, this segment also experienced an 8.5 p.er cent year-on-year decline, with 536 deals announced compared to 586 deals in the same period last year.

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