The party's over, folks. But the time of free money is over. Endless venture capital and sky-high valuations for every SaaS startup are done. And for Asian SaaS founders, the hangover is going to be even worse.

Funding's Vanished, Get Real Fast

Let’s be frank, that Series A you’ve been banking on isn’t coming in anytime soon. If it does come through, get ready for strings attached that will have you crying into your ramen. VCs are terrified. Looking back at that 40% decrease in funding for Series As compared to 2023. In Asia, it feels even worse. The reality is that many investors were singed pursuing one of those “next unicorns” and are now nursing their wounds. They’re seeking out strong, profitable businesses—not hockey-stick growth driven by untenable go-to-market burn.

Think of it like this: imagine the Squid Game arena, but instead of children's games, it's a pitch competition. The prize isn't immortality, but survival.

Profitability Is The Only King

“Growth at any cost” was never a safe wager, but during the ZIRP years, one which was allowed, and indeed, lauded. Now? It's a death sentence. I’ve witnessed far too many Asian SaaS companies, decked out by cheap capital, going after vanity metrics. They poured money down the bottomless well of customer acquisition. Then they found out that their churn rate was reaching new heights, greater than those of a Himalayan mountain. Profitability is no longer something you wake up and decide not to worry about.

Take that little local e-commerce firm that was giving you those crazy discounts, just to acquire market share. They're gone. You know that ride-hailing app that offered subsidized rides to establish a user base? Gone. The lesson? Create a company that generates real profits, not a company that has an attractive pro-forma on a pitch deck.

Your Valuation's An Anchor

Your bloated valuation is not a feather in your cap. It's an albatross about your throat. It's a constant reminder of the unrealistic expectations you set and the pressure to justify a number that probably wasn't based on anything real.

Think about it: you’re sitting on a valuation that's 5x revenue, but your growth has stalled, and your burn rate is still astronomical. That valuation has turned into a liability. It compounds the challenges to raising their own additional funding, attracting the right talent, and making long-term strategic decisions.

Asia Isn't Silicon Valley 2.0

Stop trying to copy-paste Western SaaS strategies. They don't always work here. Asia is a vibrant palette of cultures, languages, and business practices. What’s a hit in San Francisco could totally bomb out in Jakarta or Ho Chi Minh City.

I've seen companies spend fortunes on marketing campaigns that completely missed the mark because they didn't understand the local nuances. Think about how annoying it would be with that AI assistant that didn’t speak anything but English. Or the CRM software that couldn’t connect to any of our local payment gateways? Don't make those mistakes. Get to know your market, localize your product, and create a strategy that works FOR Asia.

Government Support: New Best Friend

Your new best friend is the government. Governments from Tokyo to Singapore are devoting more resources than ever toward building technology ecosystems, with cash grants, tax breaks and other incentives to foster startups in the region.

  • Singapore: Known for its pro-business environment and generous grant programs.
  • South Korea: Heavily invests in R&D, particularly in semiconductors and AI.
  • China: Offers significant support for companies developing key technologies.

Find out how to break through the bureaucracy, establish key relationships with government officials and make the most of these opportunities. It’s not as sexy as a VC investment, but it is the lifeline your company may need.

Foundational Tech, The New Black

The future is not about revolutionary apps, it’s about evolutionary technologies. Fortify this with ideas such as AI, semiconductors, green energy and advanced manufacturing. SaaS companies that are able to interface with or bolster these technologies will be well-poised.

Consider this: Instead of building another marketing automation platform, could you build a tool that helps companies optimize their energy consumption? Rather than building the next TikTok alternative, how about an AI-based tool to catch fraud in credit card transactions?

Adapt Your Product, or Fade Away

The market has changed. The needs of your customers have changed. Your product needs to be able to change, or it’s going to be outdated. This is not optional. It's existential. Look at the companies that have successfully pivoted:

  • Slack: Started as a gaming company, but pivoted to workplace communication.
  • Shopify: Started as an online snowboard shop, but pivoted to e-commerce platform.

Don't be afraid to kill your darlings. If your marketing product is a flop, don’t double down on a bad strategy. So get real with yourself, pay attention to your customers, and be prepared to make some radical changes to your business.

The post-ZIRP world is a harsh one, but it's an opportunity. It’s an opportunity to create deeper, broader, longer lasting businesses, more committed to real value and real impact. The Asian SaaS founders that accept these harsh realities will not only make it, but come out of this period even more lethal.