Natthawut Pheungjaroenphong, founder and chief executive officer of Ookbee Co Ltd and operator of 500 TukTuks Fund, said that in the past six months there have been significantly fewer investments in new startup companies.
“Most investments that we saw were in existing companies that have established markets,” he said. “New startups are having trouble getting funded due to absence of foreign investors and the fund operators are being more cautious during the Covid-19 crisis. This has resulted in many startups having to reduce cost by laying off employees or restructure their business models.
“The most affected startups are those in tourism, as the sector is heavily suffering from decreasing customers due to borders being shut down,” he added.
“Furthermore, new investors from overseas who have never invested in startups before will face obstacles in passing the due diligence check, which often takes longer when everything has to be done via teleconferencing.”
Oranuch Lertsuwankit, co-founder and CEO of Techsauce Media Ltd, said that in the past six months the total amount of investment in startups had increased thanks to SYNQA (formerly Omise Holding) that received series C investment from SPARX Group at $80 million (Bt320 million). “However, small and medium startups are still suffering from lack of overseas investment,” she added.
“We estimate that overall startup investment in 2020 will decrease by 30 per cent year on year.
“In the second half of the year, startups in 5G, AI, e-commerce, medical technology, food technology and finance should be able to attract more investors,” she added. “There could be new startups in emerging sectors such as telemedicine and education technology thanks to the new normal brought about by Covid-19.”
Published : July 16, 2020
By : THE NATION