Despite a raging pandemic, the internet economy in Southeast Asia (SEA) continued to grow at an exciting pace. In the latest edition of their joint report, Google, Temasek and Bain & Company expected it to hit the US$100 billion mark and triple to US$300 billion by 2025.

It is no wonder that everybody wants a piece of the cake. But in order to be able to seize this opportunity, companies need to come out with new, creative offerings for potential customers.

This is what Clonet is trying to give to the region through their expansion plan from their home country South Korea.

As a mobile commerce platform, it aims to provide an easy and quick way for brands to produce high-quality short videos –that will eventually enable fun and different shopping experience for customers.

The startup claims that brands can produce “eye-catching” short videos at 20 per cent of the cost and 15 per cent of the time compared to the industry average. Customers can buy the products showcased in the videos “with just a single swipe” –without the need for different stages as currently offered by leading social media platforms such as Instagram or YouTube.

In fact, the startup said that it will take only 10 seconds to purchase a product from its platform, instead of the usual three minutes on other platforms.

Also Read: 15 South Korean startups set to pursue the Southeast Asian market

In an interview with e27, Clonet CEO Eric Cha explains that the app is targeting Gen-Z customers who are used to shop products through visual representation. Outside of its domestic market, it is aiming for customers of the same segment who are fans of K-beauty and fashion products.

In his time as a fashion content manager at TikTok, Cha has developed a pool of 800 influencers –including a group of so-called “super influencers” with more than one million followers– and up to 50 per cent of the followers are based in SEA.

“What I understand from my days at TikTok … users in SEA are rapidly growing and I often received queries about K-beauty and other K-products. It encouraged me to explore this further,” he says.

Clonet said it currently hosts more than 300 sales host and influencers. Within just six months since its launch, it recorded 14 per cent sales conversion rate which is said to be 3.5 times higher than that of traditional mobile commerce.

The startup also said that over the past three months, more than 250 brands in their platform have generated over 15,000 videos.

Riding the K-wave

It is no secret that Korean Wave –the flood of products and services from South Korea as triggered by the popularity of the country’s entertainment industry– has hit the SEA region hard.

According to Jang Won-ho, Dean at the University of Seoul’s College of Urban Sciences and Director at the Centre of Global Culture and Social Empathy, as reported by The Jakarta Post, the number of Korean content exports to ASEAN countries had increased from US$800 million in 2015 to US$1.3 billion in 2017.

Also Read: 15 early-stage startups from South Korea to showcase tech at Gitex Technology Week in Dubai

There is no sign of this momentum slowing down just yet, and this is the opportunity that Clonet is seizing.

As part of its expansion plan to SEA, the company started off by setting up an entity in Singapore. But their main plan is to begin by entering the Philippines.

As part of its entry to the Philippines, Clonet introduces a new service called VDVIA which combines Clonet service for fashion products and The Klippers service for beauty products.

It also set up a joint venture with Korean medical beauty company ZISHEL Group and retail giant E-Land Group to support its expansion plan.

Targetting two million downloads in the first year, Clonet also receives support from government agencies such as the Korea Institute of Design Promotion (KIDP) in its expansion plan.

“The support came in the form of extensive research, redesigning, and redevelopment of UI/UX,” Cha explains.

What is next?

In its home market, Clonet aims to widen its offering beyond fashion by including beauty, golf and luxury services. Starting in 2021, it will also include pet and food sectors as well.

Cha also stated that the company is currently fundraising.

“We want to work with VCs with an interest in K-beauty and fashion content and short-form media who can help us hire [talents], increase sales conversion rates,” he closes.

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Image Credit: Clonet

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Indonesian e-commerce giant Tokopedia announced it has engaged Morgan Stanley and Citigroup as advisors as part of plans to accelerate its public listing.

In an official statement responding to a recent report by Bloomberg Quint on their exit plan, a Tokopedia spokesperson wrote:

“Market adoption is accelerating business growth since the pandemic. We are considering to accelerate our plan to go public and we have appointed Morgan Stanley and Citi to be our advisors. We have not decided yet which market and method, and still considering options.”

“SPAC is a potential option that we could consider but that we have not committed to anything at the moment.”

Bridgetown Holdings is a blank-check company backed by billionaires Peter Thiel and Richard Li. Published on December 15, the report stated that it is mulling a potential merger with the Jakarta-based e-commerce company.

Dealstreet Asia wrote that though a sale to a SPAC represents a faster route to a US listing, Tokopedia Co-Founder and CEO William Tanuwijaya had previously expressed his desire for a dual listing to ensure local employees and Indonesians can own shares of the firm.

Also Read: What does Peter Thiel-backed Bridgetown’s IPO mean for SEA’s startup ecosystem?

Tokopedia has raised US$2.80 billion in funding till date from investors including SoftBank, Alibaba and Temasek Holdings, making it the second-highest valued startup in Indonesia after gojek.

According to reports, Tokopedia could be valued up to US$10 billion.

Bridgetown itself has raised US$550 million in a US IPO in October. In an interview with e27, experts commented that the SPAC model that the company is implementing can be “an alternative” way to fundraise for startups in SEA.

“Having seen the more than 100 SPACs emerge in North America earlier this year, we are not surprised to see this new SPAC coming out to focus on Southeast Asia. We welcome this initiative, which will provide an alternative path to liquidity and access to public markets for one or more rising tech, financial services or media company in the region,” said Sanjay Zimmermann, Senior Associate at White Star Capital.

This is especially relevant since Bridgetown has announced that it “plans on targeting a company in Southeast Asia with operations or prospective operations in the technology, financial services, or media sectors”.

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Image Credit: Tokopedia

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In the past decade, the blockchain sector has emerged as a formidable element of the digital economy. This has led to a race by governments, institutions and businesses to incorporate the appropriate elements of these new technologies into their operations, to streamline performance and increase efficiency, as well as attract additional business opportunities. 

In 2020 and 2021, Singapore looks set to become one of the world’s largest digital asset hubs as a result of progressive government regulations such as the Payment Services Act—which has attracted large crypto businesses such as Binance into the country, as well as rumours of traditional institutions such as DBS implementing an exchange for digital assets.

However, a recent study showed that Singapore, alongside the US and UK, had the largest number of virtual asset service providers with weak ‘Know your Customer’ (KYC) processes—making it easier for nefarious actors to launder money. 

KYC processes are not only a legal requirement, but serve to allow organisations to detect and prevent criminal activities around the globe including money laundering and the financing of terrorism.

The importance of KYC is highlighted by the expense which financial institutions go to fund appropriate measurements each year—with approximately US$25 billion spent every year on financial crime risk management—the majority of this budget going to KYC processes. 

It comes as no surprise that upholding KYC best practices is necessary for both the nascent digital assets industry and the traditional financial sector at large. This is especially important for a country like Singapore that is known for its progressive policies that allow institutions to explore innovations within the financial sector ranging from asset tokenisation to Central Bank Digital Currency (CBDC).

Also Read: Legaltech on blockchain is set to be the next hot investment sector. Here’s why

‘Know your issues’ — The existing challenges in KYC processes

Despite the critical importance of KYC, current KYC methods are inefficient and plagued with manual, labour-intensive processes, thereby increasing the risks of duplication, human errors, and fraud. In fact, according to KMPG, it is estimated that up to 80 per cent of the efforts associated with KYC are dedicated to information gathering and processing, with only 20 per cent allocated to assessing and monitoring information for key insights. 

On the receiving end, prospective customers are often frustrated by the sheer amount of back and forth, repetitive questioning, and lengthy processing times which KYC entails. Onboarding new customers to buy, sell, and trade crypto is crucial for the budding digital asset industry to further develop, but inefficient KYC processes have the potential to chase prospects away as a result of drawn-out approval times and endless back and forth on paperwork. 

The good news is that emerging technologies such as permissioned enterprise blockchain platforms have the ability to solve existing KYC challenges not just for the digital asset space, but for the wider financial industry in Singapore. 

Greater customer experience through efficiency

Blockchain, originally known as the underlying technology for bitcoin and other cryptocurrencies, reduces exponentially the amount of manual data processing necessary for accurate and reliable KYC. Instead, it allows financial institutions to access real-time, up-to-date customer information through a platform that is transparent, secure and immutable. 

As the labour-intensive and time-consuming process of acquiring KYC information is reduced, financial institutions will benefit from increased operational efficiency, and resultantly become more profitable as manpower costs are reduced. A report by Goldman Sachs echoes this sentiment—stating that the banking sector can achieve a 10 per cent headcount reduction with the introduction of blockchain to KYC procedures.

Speeding up the customer onboarding process in a manner that is seamless and hassle-free also translates to a greater customer experience and satisfaction—as lengthy processing times become an issue of the past. 

Also Read: Blockchain for dummies: A 101 guide to the next hot fintech trend

Blockchain technology also allows financial organisations to put customer KYC details on a shared distributed ledger which can then be used by other accredited organisations—meaning customers will not have to start the KYC process from scratch when dealing with other financial companies.

As data stored on the blockchain is irreversible, transparent and secure, it would provide a single source of truth—reducing inefficiencies, errors and duplication of effort in information gathering between any financial organisations, as well as streamlining data gathering processes and providing relevant parties with secure access to customer data that is being updated in real-time. 

Privacy concerns

While customers may have concerns over their information being shared through a platform with other financial institutions with which they do not have a relationship, certain blockchain platforms—such as permissioned blockchain platforms—enable the sharing of information in a private manner on a need-to-know basis. 

With the increasing number of data hacks in Singapore in recent years—including local organisations such Singapore Red Cross, HIV registry, and SingHealth— it comes as no surprise that customers may have privacy concerns about the sharing of their personal and financial data. 

Permissioned blockchain platforms are ideal for such purposes as they allow organisations to transact directly and privately, with strict authentication requirements to access private information—dis-intermediating and decentralising information without sacrificing privacy or security. Its popularity is evident with even central banks such as the Hong Kong Monetary Authority opting to use a permissioned blockchain platform, like R3’s Corda, as it enables enterprises to reap all the benefits of blockchain technology, while allowing transactions to remain private and only available to permissioned parties.  

The future of KYC

As KYC forms the backbone of the financial industry’s anti-money-laundering efforts, it is evident that blockchain will lead us to reimagine KYC processes as we know them—offering businesses increased operational efficiencies and reduced costs, and customers smooth onboarding procedures and secure transfer of data. 

At the same time, a blockchain-based KYC system could offer regulators greater clarity and understanding of how customers have been onboarded and the application of underlying KYC information—contributing to the development and legitimacy of the digital assets industry as it gains popularity.

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Image credit: Arlington Research on Unsplash

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Let’s face it. It has not been an easy or “normal” year at all. But let’s close 2020 with a bang! How so? By sharing your rants, thoughts, observations, or even predictions on what will come (apart from the vaccine, of course) on tech, business, startups and the SEA ecosystem.

We are all ears and the e27 Contributor Programme will make it super easy for you to do so. Become a thought leader in the community and share your opinions or ideas and earn a byline by submitting a post.

Sharing some great ones from our community in the past week. While fintech trends rule the roost, we also have ideas on HR for 2021 and how to enhance “stickiness” on your app/web apps.

Happy reading.

Rise of the SOE: Why startup M&A is a key part of a state-owned digital ecosystem by Sandhy Widyasthana, COO / Portfolio Director at MDI Ventures

“For years, state-owned enterprises (SOEs) around the world have undeservedly been branded as inefficient, with a variety of loss-making business units hampering core revenue drivers. But as the SOE landscape in China has shown, this has not been the case in recent years– not only have profits and revenues increased across the board, but China’s largest SOEs have become key dealmakers in the global acquisitions space.

In SEA, the outsized influence of SOEs has had varying effects on the aggregate productivity of the region’s ten economies.

With the influx of both private local wealth and foreign venture capital into ASEAN’s startup communities, the region’s SOEs have taken notice of this growth sector. In Singapore and Thailand, corporate venture capital (CVC) arms of SOEs like Singtel, Siam Cement Group, and Singapore Press Holdings have become major, active players in early- and growth-stage funding rounds of local startups.”

The world of fintech

3 reasons to rethink your payments strategy in 2021 by Siamac Rezaiezadeh, director of Product Marketing at GoCardless

“A recent Forrester report commissioned by GoCardless reveals some of the most common pain points businesses face when it comes to collecting payments – pain points that have become top of mind during COVID-19. Some key findings highlight the connection between failed payments and negative business impacts that have long-lasting ramifications on both a business’ bottom line and its customers.

Moreover, as payment woes come to the forefront, we are also seeing a rise in the subscription economy, with research by Zuora indicating that 70 per cent of firms in Australia and New Zealand plan to shift to a subscription model within the next two to three years. To reap the benefits of a subscription economy, however, businesses need the right payments infrastructure to support it.

Addressing both of these issues comes down to implementing a strong payments strategy.”

Cooperation will be the shortcut to recovery for financial services in Singapore and beyond by Jonas Thuerig, head of F10 Incubator and Accelerator

“It is the development of monopolies that ultimately chokes innovation. Mega-conglomerates can strangle small businesses and push them out of the market. When one company dominates a sector, they no longer have the need to improve, which limits their growth potential.

For a sustainable market, we need to invest in the infrastructure that enables innovation, whether that is the ecosystem builders or the digital networks that connect services and products to end-users.”

Reimagining anti-money laundering processes with blockchain technology by Indra Suppiah, APAC lead for government relations in R3, an enterprise blockchain software firm

“In 2020 and 2021, Singapore looks set to become one of the world’s largest digital asset hubs as a result of progressive government regulations such as the Payment Services Act—which has attracted large crypto businesses such as Binance into the country, as well as rumours of traditional institutions such as DBS implementing an exchange for digital assets.

However, a recent study showed that Singapore, alongside the US and UK, had the largest number of virtual asset service providers with weak ‘Know your Customer’ (KYC) processes—making it easier for nefarious actors to launder money.

It comes as no surprise that upholding KYC best practices is necessary for both the nascent digital assets industry and the traditional financial sector at large. This is especially important for a country like Singapore that is known for its progressive policies that allow institutions to explore innovations within the financial sector ranging from asset tokenisation to Central Bank Digital Currency (CBDC).”

Managing people in and out of the organisation

Transformation tenet: The digital customer experience is key to “stickiness” by Jim Cavanaugh, President, APJC at AppDynamics, a Cisco company

“Indeed, this year marked what must be the greatest acceleration of industrial transformation ever, as companies across all sectors migrated in their droves to digital and online environments. A deployment that would typically take place over the course of months, if not years, had suddenly sprung into action in a matter of weeks.

And all in a bid to maintain business continuity and ensure organisations could cope with unprecedented digital demands – from both customers and employees.

However, perhaps what is more important to note is that a whopping 91 per cent of these new users said that they planned to continue using at least one digital service post-pandemic. Which stands to reason: are we really all going to go back to the office full-time? Schools? How about ordering our groceries online, and spending an evening at home with our favourite streaming platforms?”

Looking beyond the crisis: Top 5 trends that will characterise work-life in 2021 by Leong Chee Tung, CEO at EngageRocket

“Lessons from the pandemic remain as pertinent as ever, informing the way forward for years to come. It has changed what an employee expects from the workplace, also rejigging the definition of “good” performance and productivity. In this climate, it is clear that we cannot take employee engagement for granted.

In 2021, could we expect a swift return to BAU? Or, should HR practitioners treat the pandemic as a watershed period, completely reshaping the future of work? Industry experts suggest that the answer – without a doubt – is the latter. Here are five ways the changes brought on by COVID-19 will determine the future of work.”

Coming up

How my entrepreneurial failures led me to rethink learning and upskilling by Japhet Lim, edutech entrepreneur

“Learning is a forever journey and not something that should be halted or resumed as and when it is seemingly needed. From children requiring tuition in addition to classroom education, or adults in need of self-improvement courses, education has become a necessity.

This situation has been further exacerbated by the COVID-19 pandemic threatening jobs in almost every industry, leading to the need to re-skill and upskill.

However, courses, whether academic or non-academic, have become more and more expensive over the years. Many of them charge exorbitant fees but do not impart lasting impact, knowledge, or significant skills to their students. In the end, students often walk away from these courses feeling disappointed and harbouring a recurring question: What have I learnt from this?”

How can India leapfrog into the league of the most innovative countries within the next five years? by Ravi Narayan, CEO of T-Hub

“India’s position as the third-largest startup economy with around 50,000 startups — and counting—is a good indicator that we are progressing in the right direction.

Undoubtedly, in recent years, we have made significant headways in the overall development trajectory to support and foster India’s innovation story.

However, the larger question remains: how can India leapfrog into the league of the top ten most innovative countries within the next five years? The improvement in the GII ranking should inspire the nation to work towards creating a robust, sustainable, and inclusive innovation ecosystem that encourages innovators to create new categories of solutions to address the existing innovation gap.”

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Editor’s note: e27 aims to foster thought leadership by publishing contributions from the community. Become a thought leader in the community and share your opinions or ideas and earn a byline by submitting a post.

Join our e27 Telegram group, or like the e27 Facebook page

The post From our community: The rising glory of state-owned startups by MDI Ventures COO and more… appeared first on e27.

It is projected that the senior population of Thailand will reach 20 million by 2050, accounting for 35.8 percent of the country’s total population. With these estimates serving as proof that the country is entering the era of an aging society, coupled with the emergence of a global health crisis in the form of the COVID-19, the country’s healthtech sector is accelerating its plans to position Thailand as Asia’s medical hub.

Mr. Phongchai Petsanghan, Vice President of Thai Health Tech Association and CEO and Co-founder of Telehealth Platform, Dietz.asia, spoke about the overall Thai health tech in 2020, saying this year posed great challenges to the growth of Thai health tech startups. Some of them grew by leaps and bounds, such as telepharmacies, while others saw negative growth. “All in all, this year’s growth in the sector was a little bit sluggish,” he said.

However, there have been clear developments in several other healthtech sectors since the start of lockdown during which people were restricted from traveling to see doctors. Apart from the telepharmacy segment with exponentially growing businesses such as Pharmcare and Arincare, we also saw spurring growth in the telemedicine segment such as Chiiwii, OOca, doctor A to Z, the remote public health segment such as Dietz.asia, and the medical education segment such as Medic.

On the other hand, the battered health tech businesses such as private hospitals unable to cater to foreign customers due to state-enforced restrictions. Health tech businesses with corporate clients also had a hard time during the pandemic due to their clients’ delayed buying decisions.

Challenges in accelerating the country’s healthtech

 “The Thai startups’ technologies and business models as well as the size of the Thai market are second to none in Southeast Asia,” explained Petsanghan, however, he underscored that there are still important obstacles that need to be circumvented.

One key challenge is the limited access to capital for market expansion and less investments funneling in when compared with other countries. Petsanghan suggests that the Thai government needs to be more proactive in providing better investment support, such as by shortening the time it takes to process or assistance for the health tech startups.

Moreover, the Thai public sector needs to work with Thai startups more often. The problem is, based on Petsanghan’s observations, Thai organisations would rather create their own teams and technologies while their foreign counterparts tend to do otherwise.

At present, regulations or operational guidelines are also not yet conducive to development. For example, there are insufficient regulations on telemedicine, reimbursement, data integration, and disclosure of information. Petsanghan believes that “the Thai government should make more amendments to such regulations particularly concerning the issues of anonymous access to public health information, fund mobilisation, and the creation of an environment suitable for sandboxes.” He added, “lastly, Thai health tech startups still have a shortage of programmers or data scientists. Computer scientists and related occupations should therefore be promoted by the government to meet the demand of the startups.”

Also read: Thailand’s National Innovation Agency to gather support for Thai startups

Optimistic outlook

Despite the doom and gloom this year, 2021 is expected to be a good year for Thai health tech startups with growth projection of no less than 20%, all due to COVID-19 which has prompted changes in regulations as well as the recent easing of restrictions.

Apart from the pandemic, the key factors contributing to the growth of Thai health tech startups include the adoption of technology by the private and public sector with their medical services as they need to offset revenue loss with staffing cuts. The second key factor that benefits Thai health tech startups is the Medical Council of Thailand’s latest announcement on telemedicine, the Comptroller’s General Department’s announcement on civil servants’ medical expense reimbursement and private companies’ health insurances that provide higher coverage for online medical services. The third factor is the increase in health tech use by people in the working-age population and the senior citizens. Another factor is private businesses’ reduced subsidies for their employees’ medical bills with the use of medical service technology.

There have also been several developments in the funding space such as the case for Arincare, a provider of drugstore management systems and telepharmacy which has made it to Series A. Around two or three Thai health tech startups are also preparing to enter the Series A fund mobilisation, while some Thai health tech startups, such as Raksa, Doctor Anywhere, and Honestdoc have expanded their businesses by partnering with startups from Singapore and Indonesia.

Sparking innovations

 We have seen some successes not only in terms of general business growth and funding, but also when it comes to innovations both in tech as well as general system overhauls with the help of public sectors.

In the deep tech segment, more successful use cases have occurred, including Perceptra’s use of AI to help physicians read X-ray images of patients with lung inflammation. The company’s solution is an innovation developed by Thai people with the potential to compete in the global market. Another successful case is PharmaSee’s use of AI to recognise different type of medications using images as well as its face recognition system for hospitals.

In addition, we have seen more cooperation between large organisations, the government, and startups such as partnerships between IBM, CAT, and CovidTracker.asia to facilitate Alternative State Quarantine facilities in Thailand, a telehealth against Covid-19 project by the Thai health tech association with support from the National Innovation Agency (NIA), cooperation between Pharma Safe and Phayathai Hospitals Group, and the project ‘Journey to Success 2020’ by the Thailand Center of Excellence for Life Sciences (TCELs) — all to promote Thai health startups and improve the overall healthcare outlook for the country, among others.

Also read: Startup Thailand x Innovation Thailand Expo 2020: a catalyst for innovation

Onward to the future of healthtech

On the future of Thai health tech startups, Petsanghan said: “We will see Thai health tech startups join hands with large corporations such as listed companies, banks, and hospitals to further develop or expand their services. Over the past 2-3 years, large corporations proved that innovating something by themselves resulted in slow growth due to a trial and error process and the employees’ lack of a sense of ownership.”

While discussing the importance of cross-sector partnerships, he added “when large corporations work with startups which have their own products, services, and markets, having learned lessons from trial and error, there will be more collaborations at the international level. Thailand is also Southeast Asia’s hub of smart city. More takeovers and mergers could be on the horizon. Technology-wise, we will see higher adoption of deep tech with the use of AI in various fields and development of a system based on standardised data sets.”

Albeit the better outlook for Thai health tech startups next year, they still need assistance from the government on many aspects. As the vice chairman of the Thai health tech association, Petsanghan emphasised the need to develop new deep tech digital services based on medical data and the use of Thailand’s strengths such as herbal products and medicines, medical cannabis, Thai food, and healthy food.

Presently, there are around 56 Thai health tech startups in the ecosystem with the establishment of the Thai Health tech association and activities to promote entrepreneurs and networking of stakeholders. The development of systems and strategies for Thai health tech startups is expected to take place in 2021. Petsanghan urges the government to act as a bridge to connect foreign investors with the Thai startups, expand domestic and international markets and promote the strengthening of health and medical startup networks in Southeast Asia.

To view the live programme of the Startup Thailand Marketplace, you may visit the official site here or watch on the official Facebook page of Startup Thailand.

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This article is produced by the e27 team, sponsored by the National Innovation Agency of Thailand.

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