Singapore’s early-stage emerging tech startups saw its total funding raised dip 8 percent to $371 million in 2024 from $402 million in 2023, SGInnovate‘s report showed Tuesday.
According to the report, overall growth in deal activity rising from 49 deals in 2023 to 56 in 2024.
Funding activity once again favored early-stage dealmaking, as venture capitals likely sought earlier opportunities less exposed to economic volatility.
The report highlighted a 56 percent rise in the number of intermediate funding rounds (Seed+/Pre-A/A+) raised in 2024 (14) compared to 2023 (9).
As tentative market conditions persisted, more founders likely opted for bridging rounds to better navigate mixed economic signals, or to extend their capital runways ahead of subsequent institutional funding rounds.
Meanwhile, the number of emerging tech startups identified within their year of incorporation remained relatively consistent between 2023 (25) and 2024 (27).
The largest changes around incorporations were seen in the Health and Biomedical Sciences and Agrifood verticals, the former seeing a 44 percent increase in new companies while the latter registered a sharp 83 percent decline.
However, as observed in the previous edition of the report, the final number of 2024 incorporations is likely to grow as more startups minted last year become visible.
“Singapore’s early-stage emerging tech startup ecosystem has demonstrated resilience amidst continued global market uncertainties,
“Given the sustained global discourse surrounding trade, technological sovereignty, energy security and climate change, it was expected that the advanced manufacturing and sustainability sectors have attracted strong investor interest over the past year,” said Tong Hsien-Hui, Executive Director – Investments at SGInnovate.
According to the report, 2024 proved to be a positive year for early-stage startups in Singapore’s advanced manufacturing and sustainability spaces, propelled by global demand for higher computing power to support advancements in artificial intelligence (AI), and for decarbonization solutions to meet both national and corporate sustainability goals.
The advanced manufacturing space—encompassing areas such as additive manufacturing, advanced materials, automation, sensors and electronics, and space tech saw a total of 14 deals in 2024, reversing a three-year downtrend that had been attributed to a shift in investor preferences towards digital startups.
The sensors and electronics space led this resurgence, attracting half of the sector’s total 2024 deal count.
At the same time, the sustainability sector attracted the most deals among the four main verticals for the second consecutive year, while continuing an upward trend in startup incorporations over a five-year rolling basis.
The decarbonization space alone raised 70 percent of the vertical’s total funding value in 2024, which could also be due to the larger up-front investments required for infrastructure development.
Meanwhile, young companies in the health and biomedical sciences space appear to be benefiting from a maturing local ecosystem, which is offering increasingly robust support and attracting further investor interest.
However, perennial challenges including high capital expenditure and a lack of skilled late-stage translational talent remain, likely explaining the sector’s high strike-off rate.
Similarly, the agrifood sector was constrained by extant scaling hurdles such as unit economics and high production costs.
The sector also saw a high number of funding rounds that were either undisclosed or comprised purely of existing investors – highlighting a trend of market consolidation that has reduced the pool of capital available to new entrants.
In a new, SGInnovate also highlighted that buoyed by healthy investor interest and expanded government support, 68 new cybersecurity product startups were incorporated in Singapore between 2020 and 2024, with incorporations holding steady at an average of 13 per year — suggesting that the local pipeline of Cybersecurity companies is on a positive overall trajectory.
In terms of funding, 42 percent of the 68 startups had successfully fundraised, taking an average of one year to secure their first institutional capital.
In 2024 alone, Singapore’s early-stage cybersecurity startup ecosystem saw one acquisition, and raised a cumulative $42.5 million across ten deals.
Half of these transactions came from the security operations and governance, risk and compliance sub-verticals – reflecting the need for organizations to adopt solutions that help them navigate the complexities of these specific domains.
However, the ecosystem still has considerable room for growth, as indicated by mean Seed ($1.8 million) and Series A ($11.3 million) round sizes which lagged global averages ($3.3 million and $13.6 million respectively).
Notably, the report observed that most investors in local cybersecurity startups had invested in only one company, with few being repeat investors.
As more private sector and cybersecurity-focused investors enter the space over time, the investment landscape could see a shift from a more opportunistic approach to one centred around long-term portfolio building, in turn leading to a more consistent pipeline of new cybersecurity startups.
Looking ahead, private markets are likely to remain cautious due to the ongoing impact of trade and geopolitical uncertainty, said the report.
Yet, these conditions could catalyze innovation particularly in areas such as photonics and semiconductors, where Singapore possesses deep, well-established capabilities and expertise.
Intensifying interest and competition in these areas is likely to drive ecosystem activity, and discussions around talent and infrastructure.
At the same time, advancements in computing are propelling demand from both public and private sectors for reliable renewable energy solutions, according to the report.
With growing global commitments to hydrogen and renewed interest around the potential of nuclear technologies, Singapore’s emerging tech ecosystem may see increased translational activity in these domains.
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