In 2023, the combined valuation of the SEA tech market was at $359 billion, as per reports from the London Stock Exchange. The last decade has been nothing short of magnificent for tech companies spread across the region. But, in 2024 many things are set to change, for better or worse.
However, one thing will still remain certain and that is the relevance of SEA in the global tech industry. And the changes that are about to unfold will most likely reinforce this certainty.
So, let’s dive into some of the key market trends that will drive the SEA tech industry for the remainder of this year.
Cross-border Cooperation Will Grow
One of the primary issues that investors faced while entering the SEA segment was the diversity in regulatory frameworks and other nuances. However, both companies and governments have realized the need of the hour and are working on creating a more favourable environment.
From the establishment of ASEAN, a conglomerate of stock exchanges belonging to various countries, to the linking of payment systems between Singapore, Indonesia, Malaysia, Philippines, and Thailand; there has been a continued sense of unity within the SEA countries.
It can be expected that more such steps will be taken to enhance regional cooperation.
Brand Consolidation will be Key Towards Success
This is best exemplified by the consolidation of two of Indonesia’s biggest tech names, Gojek and Tokopedia. The former, a ride-hailing app, and the latter, a marketplace, combined to form GoTo.
GoTo now holds a massive 70% market share in the country’s household consumption segment, and this is an example that many brands in the region are taking inspiration from. Considering the various pressures that have been placed on the market, consolidating brands from connected sectors is a great way for entrepreneurs to survive the global recession period.
Real-world Problem Solvers will Take Center Stage
Theoretical innovations have had their time in the sun, but now, companies dealing in sectors such as Deeptech and healthcare tech will become key targets for investors. Most global investors want short-term returns from startups, and thus innovating solutions that can be immediately deployed will be the primary focus for most tech developers.
Even fintech and SaaS companies will consider aiming at creating solution-oriented technology. It is expected that companies dealing in speculative ventures will secure the bottom tier of available investments.
A Global Market Recovery is in Action
While not largely visible yet, analysts claim that by the end of 2024, most of the global market will have normalized. The trends in the SEA tech segment will be largely driving the stabilization of the industry, and with investor activity still aplenty in the region, the future does not look bleak.
There are still certain issues that will need to be considered, such as political instability and policy changes. But overall, the SEA tech market is in for another good year.
Additional Trends to Consider:
The E-commerce Boom Continues: E-commerce is expected to maintain its growth trajectory in SEA, driven by factors like rising internet penetration and increasing smartphone adoption. Look for figures on e-commerce market size and growth rates to strengthen this point.
The Rise of the Super Apps: Super apps, offering a multitude of services within a single platform, are gaining popularity. Data on the user base and market share of prominent super apps in the region would be valuable additions.
By staying attuned to these evolving trends, Southeast Asia’s tech industry is well-positioned to maintain its dominance and emerge even stronger in the years to come.
