Home / Business and Economy / Southeast Asia's Tech Funding Lags Global Boom, AI Startups Thrive
Southeast Asia's Tech Funding Lags Global Boom, AI Startups Thrive
11 Nov
Summary
- Private funding for Southeast Asia's internet economy grew 15% in 12 months to June 2025, lagging global growth of 25%
- AI startups attracted over $2.3 billion in funding, making up 32% of total investments
- Data center capacity in Southeast Asia expected to grow 2.8 times, outpacing Asia Pacific
In the 12 months leading up to June 2025, private funding for Southeast Asia's internet economy grew by 15%, a significant slowdown compared to the global growth rate of 25% for private equity and venture capital investments. The annual report, co-authored by Alphabet's Google, Singapore's Temasek Holdings, and global consultancy Bain & Company, found that the funding was about 70% below the record high of $27 billion reached in 2021.
Despite the funding chill, the region's AI startups continue to attract substantial investments, making up 32% of the total private funding raised in the first half of 2025, up from 30% in the second half of 2024. More than 680 AI startups in Southeast Asia attracted over $2.3 billion in the year to June 2025, with Singapore being home to more than 495 of these companies.
Alongside the growth in AI, the report also highlighted the region's rapid expansion of data center capacity. Once all planned projects are completed, data center capacity in Southeast Asia is expected to grow by 2.8 times, outpacing the rest of the Asia Pacific region, which is projected to grow by 2.2 times. This surge in data center capacity is being driven by strong demand for AI and other data-intensive technologies in the region.
