The startup ecosystem in China and Southeast Asia (SEA) is closely related in its own unique ways. It is often said that whatever trend arising in China at the moment will give us a preview of what might happen in SEA in the next few years. The two markets impact each other both directly and indirectly.

Within the last five years, we have seen Chinese investment in the region intensified. It reached a momentum with Alibaba’s investments in regional e-commerce giants Lazada and Tokopedia; its rival Tencent had also made its mark through investments in gojek, Sea Group, and VNG, among the few.

This year, despite setbacks and challenges caused by the outbreak that must not be named, we saw significant moves from these Chinese tech giants. There was the iflix acquisition by Tencent, as part of the effort to expand its streaming platform WeTV.

And finally, here comes the IPO announcement from Alibaba’s Ant Group.

Kickstarting the big moves

On Monday, Ant Group announced that it has commenced the process of a concurrent IPO on the Shanghai Stock Exchange’s STAR board (SSE STAR) and The Stock Exchange of Hong Kong Limited (SEHK).

While the company did not state further details about the IPO, including when it is set to happen, Reuters reported that Ant Group targets a valuation of over US$200 billion.

Also Read: Ant Financial to infuse US$73.5M into Myanmar’s Wave Money

Possibly one of the biggest IPOs of the year, South China Morning Post writes that Ant Group’s decision to list in Hong Kong and Shanghai, instead of New York City, “illustrates a shift in the balance of financial power eastward as more of China’s leading technology companies raise capital in markets closer to their users.”

Naturally, this will create a ripple effect on the industry.

For the startup ecosystem in China, the IPO can possibly trigger more Chinese startups to go public, especially as it coincides with the country’s recovery post-COVID-19 crisis.

“Everyone … wants to strike now while the iron is hot,” Brock Silvers of Adamas Asset Management told Dealstreet Asia.

For Southeast Asia, this upcoming IPO will trigger even tighter competitions among local e-payments companies, especially those with ties to Chinese tech giants.

The battleground

Last month, two major Indonesian digital payments platform OVO and Dana were reported to have agreed to merge.

Both platforms are already the top three most popular digital wallets in the country. This move will lead to the rise of a mega-player in the local market, which has begun to embrace digital payments on an unprecedented scale.

It is important to note that Dana is the result of a joint venture between Ant Group and local media and tech giant Emtek Group.

Also Read: Today’s top tech news: Ant Financial seeks digital banking license, Ctrip discusses new listing in Hong Kong bourse

Ant Group is making big moves in foreign markets such as Indonesia, and it is almost natural to link this upcoming IPO as fuel to these moves. Especially since the company itself named “develop global markets with partners and expand investment in technology and innovation” in its official statement for the IPO.

Certainly, its competitors in the market are not going to take this lightly. And we will start to see moves as early as today.

Yesterday, KrAsia reported that gojek and Grab are competing to invest in LinkAja, a digital payments platform that counted state-owned mobile operator Telkomsel as a backer. For Gojek, this move is aimed to secure GoPay’s position as a leading e-wallet player in the arena, in the face of OVO-Dana merger threat.

For Grab, who is tied to OVO, this an opportunity for them to further strengthen their position.

That was the case with big markets such as Indonesia. Ant Group’s move is certainly not limited to those; even in emerging markets such as Myanmar, it has announced plans to invest more than US$70 million in local fintech company Digital Money Myanmar (Wave Money).

As the major players consolidate with mergers and acquisitions, the junior ones will need to consider their moves more carefully. They may follow suit with another merger, but they might also come out with something entirely different which might surprise us.

One thing we know for sure is that China is moving –and we willingly follow them.

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Image Credit: Hanny Naibaho on Unsplash

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Singapore’s multichannel growth management platform Insider raises US$32M Series C led by Riverwood Capital; Total funding raised to date is US$47M; The firm serves 800 global enterprise brands and has 550 people across 24 countries. e27

gojek names Severan Rault as new CTO; He previously held leadership roles at Amazon and Microsoft; Rault is also a serial entrepreneur and founded a wireless solutions startup Kikker Interactive (acquired by Microsoft in 2008); Rault has replaced Ajey Gore, who departed gojek last month. e27

Indonesia’s AwanTunai raises US$20M debt funding led by Accial Capital; The fintech firm provides micro-merchants access to supply chain financing services; AwanTunai serves underserved micro-SMEs with inventory ordering, digital payments, and low cost-inventory purchase financing. e27

Singapore’s smart surgical robots firm NDR Medical raises US$5.8M led by Microport; NDR will form a JV in China with MicroPort Urocare, expand to the US; NDR’s solution can be applied to biopsy, ablations and other surgical procedures that require precision. e27

Can SEA’s proptech come back to its pre-COVID-19 glory? Experts say the industry is still small and in its infancy; In FY2019-20, more than US$202M VC money was invested in the industry across 25 deals; During April-June 2020, US$25M+ was invested across six deals. e27

Singapore’s Percipient raises US$5M from Stat Zero; The digital banking startup is developing a solution called TWINNTM, which will help banks to “rapidly create a lightweight, enhanced and API-ready representation of enterprise data and processes”. Finextra

Fave raises funding from Indian fintech unicorn Pine Labs; Fave provides QR payments and loyalty cashback to restaurant and retailers; Fave’s QR code will become interoperable and integrated with Pine Lab’s terminals. e27

How can Singapore benefit from the US-China trade war?; The city-state is well known to be an open economy and highly dependent on international trade; Geographically, Singapore is strategically located as it is at the crossroads of major air and sea routes within APAC and the Indian subcontinent. e27

eBay launches e-commerce accelerator in Singapore; The Global 24/7 programme provides startup tools, trainings, and assistance for business owners to tap into eBay’s global marketplace of over 174M buyers; The programme commenced on July 1 and will end Dec 31 2020. e27

How startups can aid SEA’s Open Banking landscape; In the region, it is still in a nascent stage with regulators opting for a ‘market-driven’ approach; Open Banking can bring about many benefits that are met with today’s financial system, including improving customers’ financial health by allowing them to view their financials in one place, to make payments efficiently from one place. e27

Singapore’s e-commerce market is set to double this year; During 2015-2019, the CAGR was 15.4%, bringing the market to a US$6.2B value; This growth is looking likely to double and hit over US$9.5B by the year-end. Tech Collective

How looking into Vietnam can help startups save development costs; It is one of the 30 countries that have zero cases of COVID-19 death; Its GDP growth record is brimming with an average 6% rate, which is fastest compared to Indonesia, Thailand, Malaysia. e27

Singapore businesses avoid massive layoffs, move toward cautious hiring; A survey says 89% of firms are planning for different working models, such as an increase in permanently remote employees and more flexible working hours; However, the percentage of participants that confirmed layoffs rose slightly to 15% in the June survey from 13% in May and only 4% in April. HR Asia

Razer’s digital bank proposition aims to dazzle the global youth; Should they be granted a license, the Razer consortium plans to create the world’s first global youth bank; It will operate an asset-light model which will result in significant cost efficiencies as compared to a traditional bank. Singapore Business Review

Singapore’s co-living startup Hmlet appoints Pramodh Rai as CTO, Rajive Keshup as CFO; Both were Sr. VPs in the company before the promotion; The firm has pivoted into an asset-light model, and aims to bring more landlords onto its platform to diversify its offerings and scale; It aims to serve over 5K members in APAC by the year-end. The Business Times

Elon Musk is hiring people for Tesla Singapore; The positions are Parts Advisor, Service Advisor, Service Manager, Vehicle Readiness Specialist, and Vehicle Service Technician; Tesla’s parent is worth nearly US$304.6B. e27

Vietnam’s tech skills set ranks 2nd in APAC; A Coursera study says the nation outperformed Japan, Australia to finish in second place; Vietnam’s strongest skill is OS (Android, iOS) development at competitive level; Vietnam scooped 22nd place in the global ranking. VNExpress

New Google initiatives to benefit 3K job seekers in Singapore; One of these programmes will put focus on providing on-the-job training opportunities for up to 600 applicants; During the training, each participant will also receive a monthly training allowance of ~US$1.1K. HRAsia

WhatsApp launches training programme to help 3,600 Indonesian SMEs to go digital; The tech giant is partnering with UKM Indonesia to roll out the programme; Participants will learn about using WhatsApp for Business, digital safety such as fraud prevention, content creation and financial planning. The Jakarta Post

Vertex Growth, Kuok Group fund lead US$30M in agtech firm Taranis; The US startup uses high-resolution drone images with AI to identify and analyse crop threats such as insect infestation, weeds, and nutrient deficiencies; Backed by Temasek, Vertex Growth closed its first vehicle at US$290M in September 2019. DealStreetAsia

SEA’s shiny future as a digital gold haven; Indonesia has a growing demand for digital gold, Singapore has reputation as a safe-haven storage location, and Thailand is becoming the third-largest gold trading hub in Asia; Blockchain has played an active role in developing the digital gold industry. Tech Collective

Telkom Indonesia sets out on steep road as ‘telco-tech hybrid‘; The state-owned telco has begun a quest for new sources of growth, as intensifying competition erodes its revenue and local dominance; Netflix deal is part of this plan; The firm’s big new theme is a transformation into a “digital telco”. Nikkei Asian Review

How future-ready schools create immersive learning experience; VR is set to become a common teaching method in the near future; Within SEA, Malaysia is looking into using VR for employee training as part of the Skills 2.0 campaign to help citizens maintain awareness of tech advances. GovInsider

Government subsidies via blockchain launched in Korea; Key primary uses for the system will be to speed up subsidy issuance for AI-based companies and those using smart contracts in order to receive mobile subsidies cards and use electronic wallets; The platform will also share data on illegal use of subsidies between institutions in real time. The News Asia

Facebook’s Internet infrastructure to bring up to US$300M to Cambodia; In the nation, Facebook’s connectivity infrastructure includes local servers or edge networks, which support economic development, allowing local ISPs to access its content at locations closer to their own networks. Geeks In Cambodia

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Sega Cheng was pursuing an Engineering Degree at Stanford University 15 years ago when he watched how an Artificial Intelligence-powered, self-driving car roamed around his campus one day.

“That was wild to me back then because I thought if one could do something as complex as driving a car with just a machine, imagine what other things you could solve with the same application,” he recalled.

“And that set the tone for my entrepreneurial journey. I wanted to build something just like that,” he said about that defining moment. “That’s when I realised that AI can really help people in many ways.”

Just like any aspiring engineer would do to kickstart a career, Cheng joined Google Taiwan where he built Google Maps (specifically Google Transit in Taiwan) working with a dedicated software engineering team.

And then in 2012, he left the tech behemoth to build something that “I would imagine would be irreplaceable just like Google”.

And that led him to start iKala.

AI competence in enterprises

iKala’s mission is to enable AI competence in enterprises. The company seeks to boost customer acquisition capability as well as its lifetime value by providing AI-driven digital transformation solutions.

Also Read: 2019: A hell of a year for marketers with chat and voice bots

The firm offers three solutions:

• iKala Cloud: The cloud service enables enterprises to get access to cloud infrastructure through GCP, G Suite as productivity solution, iKala CDP as a customer data platform, Straas that provides AI-enabled video streaming, and Picaas for AI image optimisation.
• KOL Radar: A performance-based influencers marketing service that helps businesses match with the right influencers. The service is currently available in Taiwan, Hong Kong, and Malaysia, with more than 50,000 influencers available to work with through social media channels such as Facebook, YouTube, Instagram, and the latest one, TikTok.
• Shoplus: A social selling platform that seeks to connect to businesses’ fan page and turn it into a webstore. It offers features such as AI live sell for FB live streaming buyers, that allows users to capture buying intent automatically from comments and messages and contact the buyers simultaneously while doing live sales. It also provides AI chatbot feature for FB post buyers and AI messenger plug-in for buyers who reach users through messenger inbox that help capture customer shipping information automatically from the chatting content and create orders and send the bill to the buyers directly while communicating with them in the messenger.

iKala also has a new division called iKala commerce, which consolidated KOL Radar and Shoplus to become a sales channel, where merchants and advertisers can expand their territory using its AI-powered tools.

Currently, iKala has operations in Taiwan, Singapore, Japan, Hong Kong, the Philippines, Thailand, and Vietnam.

iKala.tv’s pivot

iKala was originally started in 2012 as an online streaming video service. 

“We started as an online video karaoke platform. But that was costly because of the royalty fees needed to be paid to record companies,” Cheng recalled. 

“It did never have a business model that could cover what we had, even though we once had over three million active users. The business model was not correct and investors were questioning if it was a viable business because we were burning a lot of money,” he recalled.

So the iKala team took a step back to understand how it could be turned into something more scalable and still solving problems.

“The pivot didn’t happen instantly, we carefully assessed everything before focussing our products on what now would be KOL Radar and Shoplus,” he shared.

How COVID-19 affects AI

While the firm has a variety of products catering to different types of customers across seven countries, including those with physical stores, iKala is not immune to the COVID-19 pandemic.

“There’s a paradigm shift in the digital world and the physical world. Most businesses lose all of their sales channels, with stores closing with limited to no physical business at all. Sales channels are being shifted online, that’s for starters,” he said.

“What makes it hard for those who didn’t have AI tools in their disposal is that brands and advertisers are getting wiser and wiser in the allocation of their advertising budget since the pandemic. They’re not just throwing out money to test out which channels work best, but they now go for a performance-based marketing solution, which is measurable in each campaign with AI,” he continued.

Also Read: Singapore’s startup Wiz.ai nabs US$6M pre-Series A funding led by GGV Capital

Cheng then pulled out an example of one of its customers in Thailand who is using Shoplus to sell gold. 

“This guy managed to boost his sales up to 61 per cent between March and April this year without any additional investment in his company,” Cheng boasted.

He claims it proves his point that AI is increasingly moving from a “nice to have” tech into a “must-have tech” after the pandemic. “Previously, not many people understood the AI world and how it can benefit their business, and now, the paradigm shift allows people to embrace AI and make it applicative in their day-to-day lives, with advertising adjusting fast pursuing this AI commerce,” Cheng said.

The learning

Being in the business of AI, it’s easy to get all technical and just stay focussed on tech improvements. AI allows limitless possibilities and innovation, and iKala is on board with that, he says.

“We initially took pride in being a product company, but along the way, we evolved to become more and more customer-centric, and now we call ourselves a customer company,” he smiled.

The reason is that iKala has found out that what matters is not whether the product is the best in the world, but if it can solve the customers’ problems. “If we can satisfy customers’ needs, then we’re successful. This is especially true for AI adoption because everyone is using AI in different domains to satisfy their needs.”

“We’ve come a long way to use the right technology and methodology. We should put humans at the centre of AI adoption. We put AI behind the scene as the application for the human. Human and machine should not overwhelm each other but should work in favour of each other,” he added.

AI is happening now

With its ongoing mission of putting human-centric AI for customer acquisition through conversational AI, Cheng shared that in Thailand alone, more than 200 billion valuable conversations are happening every day.

“These conversations happen in a big social market in Thailand, which is worth about US$10 million in a year. There are conversations on social platforms happening in Southeast Asia now, and there’s a real business value generated from this conversation,” said Cheng. “I believe moving forward, conversational AI is a way to go for Southeast Asia.”

Right now, the company is actively approaching investors from the Southeast Asia region, he said. “We’re prepared to expand to Indonesia and also Malaysia.

The company also recently hired former Google Managing Director Dr Lee-Feng Chien (known to be the prominent figure behind the establishment of Google and its data centres in Taiwan) to its board.

“We imagine a future where every business can do e-commerce or social commerce just by talking on the phone, which can help them start an e-commerce business with minimum spending. That’s the goal and that is a highly viable business,” Cheng said.

“We hope that iKala commerce can handle all channels, social platforms, stores, all kinds of e-commerce platforms you have in your hand. That’s the direction that we’re going,” Cheng signed off.

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Picture Credit: iKala

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Updates: The article has been updated to include information about co-founder Lingga Madu’s departure.

Indonesia’s fashion e-commerce platform Sorabel is confirmed to be shutting down by the end of this month, joining the list of startups that were forced to end their operations due to the COVID-19 pandemic.

In an internal email to its employees (a copy of which is in the possession of DailySocial), Sorabel explained that it did its best to save the business, but had had to go through liquidation.

The liquidation process includes the disbandment of the organisation by a liquidator followed by debt collection and asset distributions to claimants.

“Due to this liquidation process, we have to terminate employment contracts with no exception, effective July 30. I am certain that no one would ever expect this to happen,” the letter stated.

The management stated its commitment to ensuring that all employees’ rights are being fulfilled during the process, including religious holiday support. It is also committed to abiding by all the regulations and decisions of the liquidators.

Also Read: How Sorabel was able to push for growth after rebranding

Employees are expected to return the assets of the company, which will be resold and processed by liquidators. The management also promised to help them find a new job from the investors’ network of more than 100 companies.

“This might be the end of our journey with Sorabel. I hope that we can keep the good memories that we have had together in this place … The company expresses its deepest gratitude to you for fighting until the very end,” read the letter .

Before this development, Sorabel had announced in February on social media the shutdown of its Philippines unit, Yabel.

The journey of Sorabel

The company was started in 2014 as Sale Stock before rebranding itself to Sorabel. Throughout its journey, it introduced several innovations, including the ‘try-first-pay-later’ feature.

The firm had also laid off around 200 of its employees in 2016. Despite this, it successfully closed a Series B+ funding round, led by Meranti ASEAN Growth Fund.

Sorabel Co-founder Lingga Madu once stated that its business model was the healthiest when compared to other e-commerce platforms in Indonesia.

In 2018, Madu claimed the company had achieved break-even and was ready to make a profit. Back then, he compared Sorabel’s unit economics to that of global fashion e-commerce players such as Asos and Revolve.

Also Read: Indonesian fashion e-commerce site Sale Stock changes its name to Sorabel

Sorabel became more aggressive following the rebranding in the beginning of last year. It began its expansion to realise its ambition to provide “quality and affordable fashion items” for the “next billion users.”

Yabel had even announced plans to expand to the Middle East.

In its final interview with DailySocial, Sorabel announced that it was closing a Series C funding round from investors, including Kejora Ventures, Ncore Ventures, OpenSpace, Shift, Gobi Partners, MNC Media Investment, SMDV, Golden Equator Capital, and Convergence Ventures.

In a message to e27, Madu stated that he and co-founder Ariza Novianti had left the company in October 2019.

He declined to comment on the liquidation of the company.

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The article Sorabel Tutup Operasional Akhir Juli 2020 was written in Bahasa Indonesia by Marsya Nabila for DailySocial. English translation and editing by e27.

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Vulpes invests in Hiip

The story: Singapore-based influencer platform Hiip has secured an undisclosed sum in a bridge round of funding.

Investors: Vulpes Special Opportunities Fund (lead) and other unnamed investors.

Plans with the money: To take advantage of potential acquisition opportunities that have arisen as a result of COVID-19.

What is Hiip?: It is an influencer platform in Southeast Asia that claims to be helping 500 brands to connect and work with more than 10,000 social influencers based on Big Data and Artificial Intelligence. The company has offices in Vietnam, Indonesia and Thailand.

According to the firm, its revenue in June 2020 was double that of June 2019.

Grab, gojek competing to invest in LinkAja

The story: KrAsia has reported, citing unnamed sources that gojek and Grab are in a close race to become an investor in the Indonesian digital payment platform.

Why: For gojek it’s about beating Grab. If Ovo and Dana merge, they will be in a strong position against GoPay, said one source to KrAsia.

LinkAja is currently in the process of raising US$200 million Series B funding.

13 startups selected for YSI SEA-Temasek’s programme

The story: 23 young entrepreneurs from 13 startups from Southeast Asia will showcase their innovative solutions to address pressing sustainability challenges, at Youth Sustainable Impact Southeast Asia (YSI SEA) and Temasek Foundation’s Virtual Demo Day 2020 on 23 July 2020.

The entrepreneurs will pitch to an online audience comprising more than 150 high profile investors, incubators and businesses, in order to secure opportunities to further develop and bring their solutions to the marketplace.

The entrepreneurs, who are between the age of 18 and 35, are selected from a field of more than 1,100 applicants to participate in an online five-month-long Innovative Programme since March 2020.

What is Innovation Programme?: It is a platform to build capacity among the youths to innovate for sustainability, share fundamental sustainability knowledge to spur sustainable entrepreneurial activity, and enable impactful solutions to grow with tools, networks and opportunities.

This year’s Innovation Programme focuses on sustainable solutions for the circular economy, food and agriculture, and energy.

Which are the startups?

Archi: Converting biomaterial from coffee ground waste and other agricultural waste to consumer products such as cups and mugs

Bali Recycle Up: Recycling floral waste into organic incense

The Bamboo Company: Aiming to put bamboo in all parts of one’s life, from houses to products, from food to furniture

Cinemawithoutwall: Creating interactive visual data storytelling for better and faster decision-making, through a multimedia crowdsourcing hub

Circular Blueprint: Upcycling plastic wastes into eco-building materials to make housing more affordable, safer and better

Datanam: Enabling precision vertical farming that is optimised with data

Frescue: Connecting excess food supply with the unmet food demands by redistributing edible but unconsumed food to people and organisations

Hidragro: Providing hydroponic and aquaponic solutions along with training and education to farmers to provide healthier, tech-driven ways of growing and consuming food produce

Leaf.ly: Using Artificial Intelligence to reduce farm expenses by shortening the waiting time and optimising fertiliser input

Light of Hope: Providing clean, renewable energy by incorporating circular economy principles of recycling plastic bottles and using ‘Internet of Things’ for smart monitoring of energy consumption

Phytopia: Horizontally integrating the supply chain that connects farmers with agritech and students with affordable and healthier food in the form of a salad bowl

Rectyic: Converting plastic waste into functional lifestyle items

Solytair: Providing renewable energy powered outdoor cooling systems that help cities and businesses improve the health and well-being of the public on a large scale

Food Asia Award 2020 announces 11 finalists

The story: Singapore’s Future Food Asia (FFA) has revealed the 11 startup finalists competing for its US$100,000 Food Asia Award 2020.

When: The event will take place from 21-25 September 2020. The conference will allow all 11 finalists to present their innovation in front of investors, industry leaders and domain experts.

Who are the finalists?:

AgNext (India): Provides a technology platform for rapid commodity assessment solutions across procurement, trade, production and consumption of food and agriculture value chains.

Agrisea (US): Has developed a way to grow crops in high salt conditions such as salt soils or coastal ocean waters.

Aqua Development (South Korea): Develops and implements nature- inspired aquaculture system KAMI SYS, which it claims achieves 10x higher productivity, zeero antibiotics and chemicals, zero water exchange, competitive production costs.

Crowde (Indonesia): An agriculture-focused fintech startup that puts in touch investors with farmers that are looking for capital to grow business, create employment, and support local communities.

Flurosat (Australia): A full crop cycle analytics provider that delivers proactive reports and alerts on crop performance, stress, nutrient requirements, and sustainable management practices to crop advisors and agronomists in 14 countries.

Fyto Foods: Its plant-based meats resemble uncut real meats and when sliced or diced, would look, cook and taste like real meats with real nutrition

Marine Innovation (South Korea): Goes green and replaces the plastics with its seaweed-based products.

ProAgni (Australia): Develops and commercialises animal nutrition products which improve farm economics and address global challenges, such as food security, antimicrobial resistance, and emissions.

Soos (Israel):  Its solution uses sound waves to transform male embryos into egg-laying females, thereby increasing production capacity in commercial hatcheries.

TartanSense (India): Addresses the problem of weed management for cotton farmers in India through its flagship technology Brijbot.

TerraQuanta (China): Focuses on large-scale application of satellite remote sensing imagery and AI-based data processing technologies to provide insightful data service to fields such as agriculture, forestry, as well as environment protection.

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Image Credit: Hiip

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