The global economic slowdown in recent months has not left Southeast Asia’s start-ups untouched, with hundreds of employees being laid off by some of the region’s biggest young companies.
At least six tech companies have laid off employees, including Singapore- and NYSE-listed Sea Limited, owner of e-commerce site Shopee, NBC Finance Channel report.
Tech investors say this is just the start of more layoffs in the region’s tech sector. With interest rates rising and economic uncertainty looming, companies are now forced to focus on profitability rather than growing as fast as possible.
Cheap venture capital drying up
On top of that, the cheap venture capital that once flooded the market and allowed companies to grow at all costs has become rarer as investors become increasingly wary of potential returns.
Shopee has laid off employees in its food delivery and payments divisions, as well as teams in Argentina, Chile and Mexico, according to CEO Chris Feng.
Other startups that terminated jobs included Singapore-based digital wealth management firm StashAway, which laid off 14% of its roughly 220 employees in late May and June, according to a spokesman.
Layoffs in Malaysia, Indonesia
Malaysian online shopping platform iPrice laid off a fifth of its staff in June. The company said it had 250 employees before the layoffs. Meanwhile, Indonesian education technology company Zenius said in a statement that it had laid off more than 200 employees.
Singapore-based digital currency exchange Crypto.com also laid off 260 jobs, or 5% of its workforce, the report said. Jobs were cut in Asia Pacific, EMEA and the Americas.
JD.com, the Indonesian arm of Chinese e-commerce site JD.com, has also cut jobs to “maintain the company’s competitiveness in Indonesia’s competitive e-commerce market,” a company official said.
Other Indonesian start-ups, including e-commerce promoter Lummo and digital payments provider LinkAja, have also reportedly laid off dozens of workers.
Investing in a bear market
Still, there is hope for the storm in the market. Most investors agree that Southeast Asia remains the fundamentals for startups, largely due to the region’s growing middle-class population, high internet usage and increasing numbers of repeat entrepreneurs.
Some say the current downturn could be a good time to pick companies that are actually doing well and invest when their valuations drop, in order to make a profitable exit when the market recovers — and most believe it will.
The global economic slowdown in recent months has not left Southeast Asia’s start-ups untouched, with hundreds of employees being laid off by some of the region’s biggest young companies. At least six tech companies have laid off employees, including Singapore- and New York Stock Exchange-listed Sea Limited, owner of e-commerce site Shopee, CNBC reported. Tech investors say this is just the start of more layoffs in the region’s tech sector. With interest rates rising and economic uncertainty looming, companies are now forced to focus on profitability rather than growing as fast as possible. Cheap venture capital is drying up…
The global economic slowdown in recent months has not left Southeast Asia’s start-ups untouched, with hundreds of employees being laid off by some of the region’s biggest young companies.
At least six tech companies have laid off employees, including Singapore- and NYSE-listed Sea Limited, owner of e-commerce site Shopee, NBC Finance Channel report.
Tech investors say this is just the start of more layoffs in the region’s tech sector. With interest rates rising and economic uncertainty looming, companies are now forced to focus on profitability rather than growing as fast as possible.
Cheap venture capital drying up
On top of that, the cheap venture capital that once flooded the market and allowed companies to grow at all costs has become rarer as investors become increasingly wary of potential returns.
Shopee has laid off employees in its food delivery and payments divisions, as well as teams in Argentina, Chile and Mexico, according to CEO Chris Feng.
Other startups that terminated jobs included Singapore-based digital wealth management firm StashAway, which laid off 14% of its roughly 220 employees in late May and June, according to a spokesman.
Layoffs in Malaysia, Indonesia
Malaysian online shopping platform iPrice laid off a fifth of its staff in June. The company said it had 250 employees before the layoffs. Meanwhile, Indonesian education technology company Zenius said in a statement that it had laid off more than 200 employees.
Singapore-based digital currency exchange Crypto.com also laid off 260 jobs, or 5% of its workforce, the report said. Jobs were cut in Asia Pacific, EMEA and the Americas.
JD.com, the Indonesian arm of Chinese e-commerce site JD.com, has also cut jobs to “maintain the company’s competitiveness in Indonesia’s competitive e-commerce market,” a company official said.
Other Indonesian start-ups, including e-commerce promoter Lummo and digital payments provider LinkAja, have also reportedly laid off dozens of workers.
Investing in a bear market
Still, there is hope for the storm in the market. Most investors agree that Southeast Asia remains the fundamentals for startups, largely due to the region’s growing middle-class population, high internet usage and increasing numbers of repeat entrepreneurs.
Some say the current downturn could be a good time to pick companies that are actually doing well and invest when their valuations drop, in order to make a profitable exit when the market recovers — and most believe it will.
