JP Morgan Private Bank has released its inaugural Asia Pacific (APAC)-focused Top 100 Women-Powered, High-Growth Business report in conjunction with International Women’s Day (IWD) on March 8 this year.
The new study analyses women’s representation in the high-growth businesses segment for the region based on key factors including revenue, employee, total funding size since company inception, investor confidence and proportion by industry sector.
The report follows JP Morgan’s inaugural and now annual UK-focused women-powered business report, which was first launched in 2021, and celebrates women business leaders who have made it to the Top 100 list of women-powered, high-growth businesses in APAC.
It was produced using proprietary methodology designed by Ernst and Young (EY) with distinct weightage on funding — combining the ability and the frequency to raise capital and investments and the measure of investor confidence in the assessment of the companies for the ranking.
According to JP Morgan, the top 10 companies reflect the report analysis and findings on sector beneficiaries of the current fundraising landscape, the geographical market breakdown of high-growth companies and other factors such as environmental, social and governance (ESG) considerations.
Consistent with the dominance of Chinese players in the geographical market breakdown, the top 10 ranking features five companies headquartered across various cities in China. This includes top-ranked Airwallex, an international payments technology and platform enterprise based in Hong Kong.
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Meanwhile, three Southeast Asian companies also placed in the top 10: Thailand’s aCommerce as well as FinTech unicorns Xendit, a simplified payment solutions company for business across Southeast Asia, and Ajaib, an online brokerage trading platform for equity products targeting Gen-Z and Millennials from Indonesia.
Despite the impact of Covid-19, the report found that 2021 was a record fundraising year for the 848 women-powered, high-growth businesses in APAC. They collectively raised a total of US$12 billion ($16.27 billion) in 2021 alone, accounting for 32% of total funds raised by these companies since incorporation.
Although the average size of each funding round declined by 35% from 2018 to 2019, this was reversed with a 147% increase from 2020 to 2021. JP Morgan notes that this decline observed in the pre-Covid period is consistent with the global decline in overall private equity and private debt fundraising environment.
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However, looking across the five years spanning from 2017 to 2021, the cumulative data on the average size of each investment round saw that women-powered businesses attracted some US$41 million per round in 2021, a significant four-fold increase from the US$10 million per round recorded in 2017.
The top five markets with the most funds raised by women-powered businesses in the report are China, Singapore, Australia, Indonesia and South Korea. China led the region with outsized inflows of US$27 billion, accounting for 72% of funds raised, with the next four markets collectively achieving US$7.1 billion of investments.
While fundraising has made progress, the study also showed that out of the region’s 15,000 high-growth private businesses across 12 APAC markets, no more than 5.7% are founded, co-founded, led or managed by women. This represents 848 companies — indicating that the number of women-powered, high-growth businesses has remained relatively flat over the past five-year period, says JP Morgan.
The sectors with the highest proportion of women-powered businesses in the high growth segment were technology at 22%, consumer goods and retail at 19% and healthcare at 16% respectively. These top three sectors also received the most funding and investment flows.
Given the velocity of successful fundraising by women-powered businesses to support their growth, companies in APAC may benefit from greater representation of women in business leadership, the private bank adds.
“There is a clear correlation with successful organisations that have a diverse workforce. Over a long period, as a firm, we’ve directly benefitted greatly from being inclusive and promoting diversity,” says Kam Shing Kwang, CEO of JP Morgan Private Bank Asia. “Many of the interviews with the women from our Top 100 list highlighted their persistent challenges in effective network building and strengthening their presence in the investor landscape.”
She adds: “This report seeks to augment the ongoing efforts and create industry-leading networking opportunities to bring together like-minded women and those with a shared vision to exchange ideas."
