This article first appeared on Tech in Asia, written by Terence Lee
Last week, a founder asked me over coffee: “How many profitable tech companies are there in Southeast Asia?”
I replied: “You could probably count them with your fingers.”
I’m exaggerating, of course, but the truth is that many of the headline-hogging, well-funded tech startups in the region are losing money.
This shouldn’t be surprising, however, as venture-backed startups are supposed to sacrifice short-term profit for long-term gain. The ecosystem is also young, so give it time, I say.
Recent events, though, could change things. We’re at the part of the economic cycle where venture capitalists aren’t preaching “growth at all costs” and boasting about investing in a stable of unicorns anymore. Instead, they’re pushing for sustainable growth and gathering a herd of rhinos.
Profitability is an advantage when VC funding is scarce: It gives startups more financing options, such as securing loans or reinvesting profits.
In times like these, it helps to keep stock of who’s already there, and who’s on the way.
Read the full article here.