Southeast Asia’s digital economy is large enough to demand discipline. The region is on track to surpass US$300 billion in gross merchandise value in 2025, according to Google, Temasek, and Bain. This has been the prediction for a while, as growth stays strong according to the research.

That sort of scale changes how customers buy. Many now want vendors who reduce risk, shorten timelines, and meet compliance requirements without drama. Even in a cautious funding market, the infrastructure and systems that keep economies running still get a budget. Private funding for Southeast Asia’s internet economy increased 15% to US$7.7 billion in the 12 months to June 2025, falling short of the 2021 peak, with investors focusing on later-stage deals.

Here are 6 ways Southeast Asian startups weathered 2025’s funding squeeze and what lies ahead

This is why these five industries stand out in 2026. Each sits on hard constraints and real procurement. Each offers clear paths to revenue for founders who sell outcomes, not features.

AI growth is pushing data centres into overdrive

AI needs chips, power, and physical facilities that can run continuously. That demand is reshaping where money flows, especially into data centres. Once the planned projects are completed, Southeast Asia’s data centre capacity is expected to grow 2.8 times, with 4,620 MW of new capacity announced across the region.

Malaysia is the centre of gravity. Reuters reported 2,415 MW of planned new capacity in Malaysia, more than half the regional total, with investment interest tied to land and electricity costs and rising AI-driven demand.

For founders, the opportunity is rarely “build a data centre”. It is to reduce cost and risk for operators and their tenants. Cooling optimisation, energy management, water monitoring, physical security operations, and audit-ready reporting all sit in the line of spend that operators cannot cut.

Expect tighter oversight as the state of Johor has tightened its approvals amid water concerns and is pushing stricter standards. If your product helps meet those standards, you become easier to buy.

Energy transition meets a grid reality check

More data centres and more electrification raise the floor for power demand. At the same time, ASEAN governments are raising their targets for renewables and efficiency.

The ASEAN Plan of Action for Energy Cooperation 2026 to 2030 sets aspirational targets of a 45% share of renewables in installed power capacity by 2030, a 30% share of renewables in total primary energy supply, and a 40% reduction in energy intensity from 2005 levels.

These targets matter because they influence project pipelines, incentives, and procurement priorities. They also expose the next constraint. The grid. Solar and wind add variability, so grids need flexibility to stay reliable. Flexibility is the ability to balance supply and demand quickly through tools like batteries and demand response.

This is a good founder market because it rewards measurement. If you can forecast load, detect faults earlier, verify energy savings, or improve battery performance, you can tie your pricing to outcomes that buyers already understand.

The hard part is sales cycles. Utilities and state-linked developers move slowly. Many founders will do better selling first to commercial and industrial customers, then partnering into larger grid programmes once they have proof and references.

EVs shift from a consumer story to an operator story

Electric vehicles in Southeast Asia now look less like a lifestyle niche and more like an industrial transition. Thailand is a key signal. Thailand has attracted over US$4 billion in EV-related investments and has adjusted its incentive policy to encourage exports and avoid domestic oversupply, including counting export production towards local production requirements.

Indonesia is a second signal, especially for production and supply chains. In December 2025, VinFast planned to increase its investment in Indonesia to up to US$1 billion, with a plant in Subang, West Java, and a stated aim to scale capacity over time.

This is where founders should reframe the opportunity. The money is not only in vehicles. It is in uptime and total cost of ownership for fleets, plus the services that make EV operations predictable.

Charging reliability is still a gap in many cities. Software that manages charger uptime, pricing, queuing, and maintenance can win, especially if it integrates with fleet scheduling and payments. Used EVs will also become a larger market, which creates demand for inspection, battery health scoring, warranties, and resale financing. Recycling and second-life battery systems will follow as volumes rise, but they need strong partnerships with industrial players.

The key risk is margin pressure. Price competition can be brutal, and policy can change when inventories build up. Founders should build unit economics that work without assuming subsidies stay constant.

Instant payments start to cross borders, and so do the opportunities

Domestic instant payments are already changing how people pay. The next step is cross-border interoperability. Project Nexus, led by the BIS Innovation Hub, aims to connect instant payment systems using common standards so participants do not need separate bilateral links for every corridor. The BIS says connected systems can enable cross-border payments from sender to recipient within 60 seconds in most cases.

This matters to founders because faster settlement changes business workflows. SMEs can shorten cash conversion cycles. Platforms can reduce reconciliation time and disputes. Cross-border merchants can reduce payment friction if fees and FX are clear.

The strongest products will sit inside business processes. Invoicing, payouts, payroll, procurement, refunds, and dispute handling. Identity and compliance tools matter here, too. Know-your-customer checks, meaning the processes that confirm who a user is, become more important as money moves faster and across borders.

Interoperability also increases the blast radius of mistakes and fraud. Shared rails need strong security controls, clear dispute rules, and accountability. Founders should treat this as a product requirement, not a legal footnote. It is also a moat if you do it well.

Food systems become a technology market again

Food inflation and climate volatility have brought food systems back to the centre of policy and business planning. ASEAN’s Food, Agriculture and Forestry Sectoral Plan 2026 to 2030 sets a regional agenda that includes farmer livelihoods, environmental safeguards, and climate adaptation and mitigation. Capital is also flowing into the theme. In May 2025, the Asian Development Bank plans to bring total support for food and nutrition security in Asia and the Pacific to US$40 billion over 2022 to 2030.

Founders should expect a messy market with fragmented data. Margins are thin at the farm level and distribution determines whether you scale. This pushes founders toward a practical approach.

Sell first to buyers with a budget and clear pain, focusing on processors, exporters, large retailers, and input suppliers. Build around measurable loss and compliance. Cold chain monitoring that reduces spoilage. Traceability that proves origin and sustainability claims. Forecasting that helps buyers plan inventory and contracts.

Insurance can work too, but only with strong data partners and simple triggers. Parametric insurance, which pays out when a measurable threshold is met, can shorten payout timelines. It can also fail if the trigger does not match real losses, so product design must be careful.