Investment in Asian startups sank to a multiyear low in the first half of 2025, according to Crunchbase data, though the second quarter saw a modest rebound. Startups in the region collectively raised a subdued amount in reported seed through growth-stage funding across the opening two quarters, marking a decline of roughly a third compared to the same period last year. Deal volume dropped across every investment stage, emphasizing broad caution among venture investors across Asia.
China registered the largest decline in the region, securing only a minimal amount of reported funding for the second quarter—a 13 percent drop quarter over quarter, and 34 percent year over year. The prolonged slump is attributed to a dearth of IPO and M&A exits, tighter government oversight, and broader economic headwinds. Despite this, notable rounds included investments in artificial intelligence chip startup Biren Technology and ride-hailing operator SAIC Mobility. By contrast, India´s funding environment remained relatively stable, with the second quarter showing sequential improvement even if yearly totals retreated. Leading Indian deals occurred in logistics and delivery, spotlighting GreenLine and Porter. Meanwhile, Israel stood out for bucking the downtrend: funding in its startup sector soared to a two-year high in the second quarter, underpinned by cybersecurity and artificial intelligence ventures such as Cato Networks and AI21 Labs. Additionally, Japan and Singapore experienced sequential gains in funding.
On the stage-specific front, late- and growth-stage funding in Asia inched up slightly in the second quarter but remained among the weakest on record. A mild uptick in deal numbers—155 in reported rounds during the quarter—did little to offset the region´s broader decline. Early-stage investment figures were flat, with minor growth in deal count, while seed-stage deal volume slipped, evidenced by an estimated 827 transactions but lower disclosed capital. The report highlights the region´s continued untapped potential, given that Asia accounts for around 60 percent of the world’s population. Both China and India are seen as underfunded relative to their high population density and robust pools of technology talent. Observers are watching closely to see if this gap narrows as investor sentiment evolves in future quarters.
