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Indonesia and Singapore are teaming up to build Southeast Asia’s digital hub of the future

Introducing Nongsa D-Town

Nongsa Digital Park (NDP), a Batam-based collaborative community for tech and creative talents, was recently mentioned as part of Singapore’s investment budget over the next three years. Deputy PM Heng Swee Keat announced that Singapore will be allocating around $24 billion over the next three years to enhance its digital connectivity and global presence, a plan which includes cross-country investments like NDP and its next phase of development, Nongsa D-Town.

Located just 40 minutes by ferry from Singapore’s Harbourfront, the digital hub provides an opportunity for rising startups from both countries to collaborate within close physical proximity. It is designed from the ground-up as a “digital bridge between Indonesia and Singapore,” complete with co-living and co-working spaces, a tech campus, and a plaza.

Designed by award-winning Singaporean firm Surbana Jurong and developed by two of Indonesia’s largest conglomerates, Citramas and Sinarmas Land, the interconnected layout of D-Town includes a residential village, tech campuses, a town plaza, and a commercial centre and is set to house 8000 tech talents when completed. There are currently about 1000 tech talents at the existing NDP working for tech companies and startups from Singapore and Indonesia.

The economic ties that bind

Singapore and Indonesia are home to Southeast Asia’s most vibrant tech ecosystems. Eleven out of the thirteen tech unicorns operating in ASEAN are headquartered in either country, and seven out of those eleven are homegrown startups.

The two countries have produced companies that dominate the regional market by virtue of first-mover advantages over their neighbours through superior technology, as is the case with Singapore, and massive population size, as is the case with Indonesia. Their respective startup scenes share and compete with each other for talent, resources, and market share. Startups based in one country have often dipped their toes into another’s market, with the Gojek-Grab rivalry being the most famous regional example.

Also read: Empowering fintech and e-commerce through digital identity verification

Overlapping time zones between Indonesia and Singapore facilitate ease of work across borders. Due to the accelerated transition to digital within the last year, cross-border collaboration between remote teams has become a common occurrence. Despite Singapore’s technological advancement compared to its neighbours, it faces a shortage of tech talent. Nongsa D-Town will allow talent from Indonesia and Singapore to collaborate directly within the same area, providing a solution to the shortage while further tightening economic ties between the two nations.

At 270 million people, Indonesia is the largest market in ASEAN. Indonesians are notoriously early adopters of new technologies when given the chance, with 32% of the population keen to use new tech products as soon as they enter the market according to a YouGov survey conducted in 2020. The sheer volume of Indonesian consumers eager to try new technologies makes the country an ideal stepping stone for Singaporean startups that intend to scale regionally, often through Batam as a port of call.

From boomtown to digital hub: A short history of Batam’s economic growth

Batam has historically been designated as a Free Trade Zone by the Indonesian government due to the island’s strategic location off the coast of Singapore. Formerly an industrial boomtown populated by state-run oil and gas employees, the island’s population has exploded since it was designated as part of a Free Trade Zone, or FTZ, in 2006. Previous trade agreements between Singapore and Indonesia and special government incentives like the elimination of tariffs and VAT for goods traded between Batam and Singapore, make Batam an attractive location to do business.

Within the perimeter of the D-Town Masterplan that will be launched on March 2nd, there is Nongsa Digital Park (NDP), an initiative supported by both Indonesian and Singapore Governments which is frequently mentioned in high-level bilateral meetings between President Jokowi and Prime Minister Lee. D-Town leverages on the initial success of NDP that saw several international companies have already taken advantage of the access to talent and the economic incentives currently offered to set up in the digital downtown.

Also read: Why Disaster Tech in Asia holds great potential, and how to scale the field

Indonesia’s National Special Economic Zone Council, chaired by Coordinating Minister for Economic Affairs Airlangga Hartarto, announced on July 10th, 2020 that NDP has the potential to create employment and boost economic growth, hence it was recommended to President Jokowi to be confirmed as a new Special Economic Zone.

Current tenants include Glints, an online recruitment platform headquartered in Singapore; R/GA, an innovation consultancy with offices in 11 countries; and the Webimp Group, a Singaporean firm specialising in bespoke tech solutions for enterprises.”

Nongsa D-Town: a Digital Bridge between Indonesia and Singapore

From both a company and a talent perspective, D-Town is optimised for innovation.

The settlement is built upon the three philosophical pillars of ecological, digital, and physical sustainability. Rather than the hyper-urban culture typical of many downtown tech hubs, life at D-town is designed to accommodate sustainable mobile work. This allows residents, tourists, and digital nomads alike the privilege to enjoy beaches, mangroves, rivers, and rolling hills while living in an area with well-developed digital infrastructure and high-speed internet.

Just as Batam has served as a physical and economic entrepot, D-Town will transform the island into a digital bridge between Indonesia and Singapore. Batam’s long history as a centre for cross-country collaboration will extend into the information age as the Nongsa SEZ opens a new chapter in the bilateral relationship between the two countries.

Also read: Get to know these 10 verified investors who are ready to connect today

The grand launch of Nongsa D-Town is scheduled for March 2nd, 2021, and is viewable via webinar. At the launch, audiences will be able to listen in to first-hand experiences from D-Town’s partners and tenants. Notable speakers will include Marco Bardelli, Senior Director of Nongsa Digital Park; Irawan Harahap, Chief of Digital Tech Ecosystem & Development at Sinar Mas Land; and Andrew Wee, Director of Design at Surbana Jurong.

RSVP to the grand launch by signing up through this link.

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This article is produced by the e27 team, sponsored by 
Nongsa

We can share your story at e27, too. Engage the Southeast Asian tech ecosystem by bringing your story to the world. Visit us at e27.co/advertise to get started.

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Ecosystem Roundup: Singapore gets new maritime startup fund, ZASH buys Lomotif, why Indonesia’s fintech scene is thriving

Singapore-based digital banking network Tyme raises US$110mn Series B; Backers are Apis Partners, Gokongwei family-led JG Summit Holdings; JG Summit and Tyme will apply for a digital bank license in Philippines; As per UnaFinancial, Philippines is one of the markets in Asia with huge potential for the growth of neobank. More here

Digital fundraising: Ask yourself these 5 questions before raising money in the new normal; In the first episode of e27‘s Fundraising Fundamentals webinar series, Minh Vu Hong of Qualgro Ventures discusses the key things to keep in mind before approaching an investor. More here

SEA offers targets ripe for SPAC mergers as startups seek capital; Even as SPACs have a patchy track record in the region so far, they are gaining prominence as they offer alternative listing proposition to startups; Global SPACs have raised as much as US$24.26bn in Jan 2021 alone. More here

After failed merger attempt, Tiki and Sendo chart own strategies to take on bigger rivals; The plan to join forces was seen an attempt by both to take on Shopee in Vietnam; Even if the merger was materialised, the combined entity would still have been too small compared to Shopee. More here

Indonesia’s Amartha bags US$50mn debt financing from US-based Lendable; Amartha is an online platform that connects female entrepreneurs seeking working capital to lenders; The firm claims it has channelled funding of over US$222K to over 600K women micro-entrepreneurs in Java, Sumatra and Sulawesi. More here

Hustle Fund hits US$33.6mn final close of second global pre-seed fund; Hustle Fund 2’s anchor LPS are US VC firm Foundry Group Next, Taiwan’s Far Eastern Group, LINE Ventures, and Shanda Group; It plans to deploy up to one-third of the fund in SEA companies in HK and Australia, among other places. More here

Next Gen, a 4-month-old plant-based meat startup, raises US$10mn seed funding; Investors are Temasek, K3 Ventures, the New Ventures arm of the Singapore’s EDB; The fund will be used to launch its plant-based chicken consumer brand TiNDLE, and for expansion across Asia and R&D for future products. More here

ZASH acquires Singapore’s TikTok-like video-sharing platform Lomotif; Lomotif claims it has grown its monthly community by over 400% since its launch and 740mn+ videos have been shared; Lomotif is growing fast platform in LatAm, Asia, Europe and West Africa, and ZASH expects this acquisition to put it at the top surpassing TikTok and Kuaishou. More here

OpEd
What to do when your unicorn loses its sheen; On the backdrop of the scandal involving Filipino propertytech unicorn Revolution Precrafted, the writer points out that while it’s not that the unicorns have never been involved in scandals of any kind, at some point, the gap between expectation and reality has to be closed. More here

Warung Pintar buys Bizzy Digital for US$45mn; Bizzy Digital is an integrated logistics and distribution supply chain B2B platform; The acquisition would give Warung Pintar access to a combined pool of 600 brands and serve 230K retailers in 65 cities across Indonesia. More here

Jungle Ventures joins US digital workplace platform Saltmine’s US$20mn Series A; Other backers are JLL Spark and Xplorer Capital; Saltmine seeks to expand its portfolio of clients and accelerate growth in Asia Pacific, particularly in markets such as Australia, HK, India and Singapore. More here

FUNDtastic raises US$7.7mn in Series A to further develop, market its investment platform; Investors include Ascend Capital Group (lead) and Indivara Group; In Aug 2020, the Indonesian firm acquired mutual funds and securities platform Invisee for US$6.5mn. More here

Indonesia’s social commerce platform RateS raises Series A; Investors include Vertex Ventures and Genesis Alternative Ventures (co-lead); The startup has expanded to over 400 cities and more than tripled its growth in 2020 alone since its inception in 2016. More here

ErudiFi raises US$5mn Series A to grow its ‘study now, pay later’ model in Indonesia, Philippines; The round was co-led by Monk’s Hill Ventures and Qualgro; ErudiFi is a tech-enabled platform that helps financially underserved students get access to quality education centres. More here

Singapore’s fashion-tech startup Pixibo raises US$1.4mn from Atlas Venture; According to TechInAsia, the money will be used to further develop Pixibo Fit Centre, where customers can opt for Pixibo’s ‘Try Before You Buy’ service, and this new checkout feature enables shoppers to pay for their purchases only after they had tried them on. More here

SATURDAYS closes seed funding to scale its eyewear brand in Indonesia; Investors include Alpha JWC, Kynesis Group, Alto Partners; SATURDAYS’s eyeglasses are made in-house with premium materials like Italian acetate and ultra-lightweight Japanese titanium for consumers in Asia. More here

Meet the 8 embedded finance startups joining BRI Ventures’s new Sembrani Wira accelerator programme; GajiGesa, Biteship, MYCL, CookLab, Gredu, Restock.id, Minapoli, Tumbasin and Brick.io are the eight startups; Fazz Financials and Prasetia Dwidharma are the operating partners for the first batch. More here

Value proposition of SaaS for SMEs has to be clear from the beginning: Akshay Bhushan of Lightspeed; Despite the promising proposition, SaaS startups within Southeast Asia have not enjoyed as much success as their European and American counterparts; Compared to the West, success stories have been few and far between in the region. More here

Ovo’s CEO provides an insider’s look into Indonesia’s thriving fintech scene; Jason Thompson says the most distinctive characteristic of the Indonesia fintech industry is its proximity with the government and regulators; Customers are very forgiving, and they will engage with you, give you feedback and help you develop the product. More here

Philippine’s central bank BSP creates unit for physical money, digital payments ecosystem; The unit would consolidate existing currency and payment management units and would be responsible for producing banknotes, coins and securities documents, as well as refining gold, and the printing of the National ID cards. More here

Exploring SEA’s bustling seed-stage investment landscape; Some seed-stage investments in the region are capturing the interest of industry stakeholders such as B Capital, Jungle Ventures, and Qualgro VC; This new focus on early-stage startups is one of the most significant investment trends of 2021. More here

AR tech to boost Indonesia’s online personal care sector; Many e-commerce platforms of the sector have started providing virtual makeup try-on features years ago in Indonesia but user-adoption picked up during the COVID-19 lockdown as people were forced to stay at home. More here

Two Singapore startups join fourth EY incubator programme; Speech recognition software startup AI Communis and AI digital operations platform In-D will be part of the fourth EY Foundry, which has been extended to New Zealand, Indonesia, Philippines, Malaysia, and Sri Lanka from previously being run only in Sydney and Singapore. More here

StarHub and Software AG partner for new 5G IoT platform service; Under this deal, StarHub will offer 5G IoT platform service, a new one-stop solution that provides IoT connectivity including StarHub’s 5G, device management, professional services to integrate existing or new systems, and managed services to run the entire IoT environment for any organisation. More here

Photo by Josh Hildon Unsplash

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Pixibo raises US$1.4M to help fashion e-tailers reduce product return rates

Pixibo, a Singapore-based fashion-tech startup, has raised US$1.4 million in a Series A extension round from early-stage VC firm Atlas Ventures, reports TechInAsia, citing sources.

The startup will use the funds to enhance its service and hire for positions across sales and engineering teams.

Pixibo also plans to scale its retail store services by the end of 2021 to South Korea, Indonesia, Australia, and the Philippines, as per the TechInAsia report.

Launched in 2016, the startup aims to help fashion e-tailers reduce their product returns by increasing their conversion rates and average order values through machine learning and data-driven solutions.

Online shoppers face one major plight which is receiving clothes that don’t actually fit them.

What makes the process of finding the right fit even harder is that different brands generally have different sizes for their products. For example, what could be a size EU 32 for someone wearing Nike can be a size EU 28 for the same person wearing Zara.

Also Read: Looking past the pandemic: The future of fashion retail in Southeast Asia

To solve this problem, Pixibo has created “Find Your Fit”, an AI size recommendation solution that gives shoppers personalised real-time size advice for every product.

The way it works is that the Pixibo algorithm asks the shopper for their height, weight, and age, information that the customer has to fill only once. After the input, the algorithm recommends the right fit for the user.

Its solution is being used by fashion marketplaces such as Zalora, FashionValet, MAP and Shinsegae, among others.

The company also told TiA that over 30 online fashion brands have signed up for its ‘Try Before You Buy’ service since launch and that it is on track to add 50 retailers by March 2021 and 100 more retailers by June this year.

Aside from its online service Pixibo also has an offline store called The Pixibo Fit Centre in Somerset Mall, Singapore, which sublets space to online fashion brands so that they can showcase their products.

The company has also expressed plans to launch automated kiosks, with attached fitting rooms so that customers can immediately try on the clothes they bought from online stores and not pay for the product if it doesn’t fit.

In January 2019, Pixibo raised US$1.1 million from Prasetia Dwidharma and EverHaus in a Series A round, according to DealstreetAsia. Before that, it has secured an undisclosed seven-figure funding from Start Today Ventures.

Image Credit:  Charles Deluvio

 

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In brief: Grab to create 350 new jobs in Singapore; Battery Smart raises capital

Battery Smart

The co-founders of Battery Smart

Grab partners with IMDA, DISG to strengthen Singapore’s tech ecosystem

How it plans to do it: The partnership will see Grab work with Infocomm Media Development Authority (IMDA) and Digital Industry Singapore (DISG) to grow its product and engineering teams’ capabilities through the support of talent development programmes such as the TechSkills Accelerator (TeSA).

As part of its regional hiring efforts, Grab expects to create around 350 new jobs in Singapore this year.

Roles Grab is hiring in: Some of these hires will come from fields including AI, cybersecurity, data science, software engineering, as well as product management and design. Besides tech roles, Grab will be offering new employment opportunities in areas such as finance, operations, legal, public affairs and business development.

Bukku raises US$173k seed round

What will the funding be used for: The fresh funds, raised from six undisclosed private investors, will be used to expand its team and enter the Malaysian market.

About Bukku: Launched in 2020, the Malaysia-based startup provides cloud-based accounting software for small and medium-sized enterprises (SMEs). Besides, the company partners with dozens of accounting firms across the country, providing accounting services including company incorporation, company secretary, accounting & bookkeeping, auditing, and tax services.

Battery Smart raises seed round

Investors: The round was led by Orios Venture Partners, with participation by angel investment platform Faad Network.

What will the funding be used for: The fresh financing will go towards Battery Smart’s plans to construct 300 battery swapping stations in Delhi-NCR by the year-end and onboard 5,000 E-rickshaw drivers on its platform within the next 10 months.

Also Read: ‘Singapore isn’t ready for mass adoption of EVs yet; hybrid may be better for the present’

About Battery Smart: The Indian company provides advanced Li-ion batteries to e-rickshaws on a membership basis where the driver can stop at any of the company’s partner swapping stations and get a fully charged battery exchanged for a discharged battery.

Blueshift Raises US$30M Series C to scale customer data platform

Investors: The round was co-led by Fort Ross Ventures and Avatar Growth Capital. Existing investors including Softbank Ventures Asia, Storm Ventures, Conductive Ventures and Nexus Venture Partners also participated.

What will the funding be used for: Blueshift will use the proceeds from this latest funding round to further accelerate its global growth, as part of efforts to “cement” its leadership position in the customer data platform space.

About Blueshift: Blueshift is an AI marketing platform that leverages customer data to help brands deliver “relevant and connected experiences”.

More about the story: The Series C funding brings the total amount raised by the US-based startup to $65 million. Ratan Singh of Fort Ross Ventures will join Blueshift’s Board of Directors.

Indonesia to issue digital currency 

The story: The Governor of Bank Indonesia Perry Warjiyo, said that the central bank will issue a digital currency. This development was reported by CNBC Indonesia

More about the story: “We formulate the Central Bank Digital Currency, which BI will issue and circulate with banks and fintech on a whole shale and retail basis,” he told CNBC Indonesia.

Warjiyo also said that while the nation wants to introduce digital money, bitcoin will not be legal. 

Image Credit: Battery Smart

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Skype co-founder invests in Vietnam’s e-commerce delivery-cum-podcast platform Loship

Loship

Loship CEO Trung Hoang Nguyen

Loship, a Vietnamese one-hour-delivery e-commerce startup, announced it has received an undisclosed investment from Skype co-founder Jaan Tallinn, who participated through his investment vehicle MetaPlanet Holdings.

Loship is MetaPlanet’s debut investment in Southeast Asia.

The latest funding, which is part of Loship’s Series C round, comes four months after its undisclosed bridge round led by Vulpes Investment Management.

According to Loship, the new capital would go towards upgrading its platform, increasing technological capabilities, and doubling down on marketing to strengthen its foothold in existing markets.

Loship shared Tallinn was introduced to the company through Vinnie Lauria, Founding Partner of Golden Gate Ventures, an investor since its seed financing round in 2015.

“It didn’t take me very long to realise Loship was on to something. MetaPlanet is planning to pay more attention to the rapidly growing economies in Southeast Asia. I’m delighted to be off to a strong start in Vietnam by adding Loship as our first portfolio company there,” said Tallinn.

Also Read: How Loship gives its rivals a run for their money in Vietnam with a unique combination of food delivery and podcasting

“MetaPlanet’s investment will help us build a much stronger image. The competition will be much steeper in the long term, and we hope to pick up deep tech insights from Jaan Tallinn that can be applied to the Vietnam market,” opined Trung Hoang Nguyen, CEO of Loship.

“We already have a winning playbook, and we look to expand it to more markets. We know what we want to do with our product. So, a huge portion of the funding will be poured into upgrading our app and increasing our tech capability. Also, we will ramp up marketing strategies to strengthen our foothold in the existing markets,” stated the CEO.

Founded in 2017, Loship traces its roots back to Lozi, a review app allowing users to find food, beverage, and coffee shops, before transitioning into a one-hour-delivery services platform.

Loship had earlier closed its Series A and B rounds from several investors, including South Korea’s Smilegate Investment, Hana Financial Group, and Golden Gate Ventures, before announcing its Vulpes Investment Management-led bridge round in October 2020.

Image Credit: Loship

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[Updated]ZASH acquires Singapore’s video-sharing platform Lomotif to take on TikTok

Updated: This article has been updated with details on the deal details

Global media and entertainment company ZASH has announced the acquisition of 80 per cent stake in Singapore-based video-sharing platform Lomotif.

The financial details remain undisclosed.

The Lomotif deal will be closed concurrently with the closing of ZASH’s merger with Nasdaq-listed Vinco Ventures, a merger and acquisition company focused on digital commerce and consumer brands.

Founder Paul Yang will continue to lead Lomotif upon the completion of the deal.

“As an emerging player in user-generated video creation, we are excited to be part of ZASH’s overall content and distribution plans and strategies and are looking forward to accelerating growth and adoption of Lomotif worldwide,” Yang said.

ZASH believes that Lomotif is one of the fastest-growing video-sharing platforms in Latin America, Asia, Europe and West Africa, and its acquisition can put ZASH at the top surpassing TikTok and Kuaishou.

Also Read: From our community: Making the internet safer by TikTok’s Director of Safety, lessons on financial inclusion by APAC head of AWS and more;

The video-sharing platform claims to have increased its average monthly community by over 400 per cent since its launch in 2014. Over 740 million videos on the platform have been shared on this platform since then.

“Lomotif is a global platform with a tremendous following in Latin America and Asia. Together with ZASH, it will replicate that success in the US and other markets,” said ZASH co-founder Jaeson Ma.

“In today’s world of mass consumption of short-form content, we see Lomotif’s addition to the ZASH family as an incredible opportunity to leverage our content in all formats and broaden our distribution platform worldwide,” he continued.

Short-form video sharing apps are very popular among teenagers and millennials, globally. While TikTok started the trend, many other similar apps have acquired a significant share of customers like Instagram Reels, Dubsmash and more.

The size of the global online video platform in the media and entertainment segment was US$218 million in 2016 and is projected to reach US$915 million by 2025.

Image Credit: Unsplash

 

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Meet the 8 embedded finance startups joining BRI Ventures’s new Sembrani Wira accelerator programme

BRI

BRI Ventures, the corporate venture capital arm of Indonesia-based BRI Group, has announced the launch of a new accelerator programme, called Sembrani Wira, for embedded finance startups in Indonesia.

Fazz Financials (parent of fintech platform Payfazz) and local venture capital firm Prasetia Dwidharma are the operating partners for the first batch of the 8-week-long programme.

GajiGesa, Biteship, MYCL, CookLab, Gredu, Restock.id, Minapoli, Tumbasin and Brick.io are the eight startups comprising the first batch, where they will work with mentors and a network of investors under BRI Ventures’s new fund, Dana Ventura Sembrani Nusantara.

While all activities for the programme will be virtual, participating startups can engage in hybrid one-on-one meetings with mentors and investors from Singapore, Australia and the US.

In addition, participating startups will also get legal service assistance through digital legal platform Kontrak Hukum and other benefits including Amazon Web Services (AWS) credits.

At the opening event of Sembrani Wira, CEO of BRI Ventures Nicko Widjaja said: “Over the last decade, Indonesia’s startup ecosystem is growing even bigger, better and more sustainable despite the crisis of 2020.”

Also Read: How fintech can help reach the unbanked and underbanked in Southeast Asia

“The tech sector is the clear winner despite many industry downturns all over the world. Today’s founders are very much different from execution level to mindset level,” he added.

DailySocial is the media partner and provider for the accelerator platform.

“One of the important things on our agenda is to help founders not only to get product-market-fit but also go beyond. So we will discuss with the founders to see what is their goal and help them to draw back on what they have to do to reach that goal,” Widjaja added.

“This is the best time to run the accelerator programme. We saw during the pandemic, new accelerated sectors have emerged, such as embedded finance, logistics, new retail, and education. With the experience we have had for the last 10 years, we believe that we are ready to create new digital leaders for Indonesia,” opined William Gozali, Chief of Investment at BRI Ventures.

Image Credit: BRI

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Digital fundraising: Ask yourself these 5 questions before raising money in the new normal

Minh Vu Hong, investment manager at Qualgro

With the world yet to get out of the grip of COVID-19 and with travel restrictions yet to be eased, fundraising continues to be a challenge for startups. This is because VCs are unable to perform physical due diligence, an important part of the whole investment process. This is why many VCs have taken the ‘virtual route‘ to perform due diligence.

But is it easy to raise funding in the new normal? What you need to take into account while fundraising digitally?

In an attempt to get down to the nitty gritty of ‘digital fundraising’ in the new normal, e27 recently launched a new webinar series, titled ‘Fundraising Fundamentals (FF)’.

The first episode of the FF series featured Minh Vu Hong, an investment manager at Qualgro Ventures. Based in Singapore, Qualgro invests mainly in B2B companies in Big Data, SaaS and Artificial Intelligence to support talented entrepreneurs with regional or global growth ambitions.

In this article, Minh discusses the five most important questions founders should ask themselves before raising money in the new normal:

Why do I need external funding?

Before even starting, you should ask yourself: ‘why does your business need external fundraising? What are the key milestones that you are trying to achieve with extra capital, particularly with the VC support’.

Asking yourself these questions will allow you to take a step back and not necessarily rush into fundraising.

Also Read: Qualgro Partners: Southeast Asia is home to the next big B2B tech companies

First of all, ask yourself ‘do I want to accelerate on the existing business’, ‘do I want to expand to a new country’, or ‘do I just need capital in the beginning because I need to hire people to build my team’?

All these are good reasons to raise external money. But having them clear in your mind is the best way to set you on fire for fundraising.

When to start fundraising?

The timing is actually important for fundraising. People will tell you ‘you should not raise too late or not too early’. But usually a rule of thumb is that if you have capital left to run the business only for six months, you have to start the fundraising process now, before you run out of cash, because the process takes time.

It takes time to network to get to know investors to pitch your ideas. Investors take time to understand your business and analyse the financials.

So, six months is a good timeframe to start fundraising.

Of course, you will always hear stories of companies who have raised funding, say, in two weeks. They pitch their company today and get term-sheet in 48 hours, and then two weeks later, they get the money. This happens, it’s true. On the other side of the spectrum, sometimes it takes six months, if not more.

If you’re lucky, you’ll be in the first category. However, the vast majority of investments take at least two three months. So, giving yourself enough buffer to not run into a cash crunch is something quite important to keep in mind.

How much money do I want to raise?

Interestingly, a question which is not always well-addressed by founders is: ‘how much money do you want to raise and how much should I give away’

Of course, the valuation of the company is important. I have seen many companies reaching out to us for fundraising, who will have a range of US$1-2 million in mind.

It is okay  to have a range. But it cannot be too wide. The reason is for investors, it gives a signal of how much you know about your business and how much you know about your requirement, because raising money is about fuelling your business for success.

So if you tell me ‘I need to raise, maybe, between US$3 million and US$6 million’, it basically implies that you have only a rough idea of how much you need.

In my opinion, if you know your business well, giving a ballpark range to test the market is not a good signal.

Then, the second sub-question is ‘how much you’re ready to give away’. Let’s say, if it’s a US$1 million round and you give me 10 per cent equity, this means that your company is worth US$10 million.

So the shareholding that you give away to the investors — VCs, family offices, or even friends and families — is important to know because that is going to drive directly the valuation of your business.

Investors, of course, have other ways to evaluate your business and how much shareholding you’re ready to give away.

When you go into a pitch with a VC, you’re ready to negotiate but you should have a clear idea of how much holding you’re ready to give away against a certain amount of money.

And prepare yourself because as investors we usually do the math quite quickly and we know how much we want and you should be quite clear on the target that you’re trying to achieve.

Who to raise funding from?

There are two different types of ‘who’s in this case? One is, ‘what type of investor you want to raise money from?’ ‘Do you need VC money or angel money’, or ‘do you need debt from banks or venture capital?’

All of these types of fundings are going to bring money to your business and all of these factors are going to help you scale your company.

However, not every dollar is the same. Raising venture debt, for instance, is very different from raising VC money because in VC investment, investors take equity/shareholding of your company.

If you raise venture debt, you don’t give away the shareholding of your company. But you’re under the obligation of paying back your lender.

So it’s two different mindsets in the relationship that you’re going to have with whoever’s giving you money. Also different obligations that are going to follow up.

So you need to think what type of capital you want to raise. It will allow you to identify and narrow down the type of funding that you’re looking for.

As for the second type of ‘who’: let’s say you want to raise money from a VC fund. Not every VC is the same. Every VC fund has its own investment thesis. At Qualgro, for instance, we specialise in B2B software, AI and data. Then, there are VCs who are focusing on the B2C industry, consumer goods, or purely healthcare companies, so on and so forth.

And there are some who invest only in pre-Series A to Series B stages, while there are some who only invest at seed stage. There are also late-stage investors.

So all of these type of segmentation of funds you should be aware of because, depending on what stage you are in and what vertical and what type of business you are building, you can choose the investor you want to take money from.

Since fundraising is a very tiring process for founders, you need to focus on identifying the right funds that are going to understand your business faster. You should know who can support you to bring your business with more relevancy because they know the industry, have the right geographical coverage. All these things will save you a lot of time.

How do I approach investors?

This needs some planning. Having a clear plan on how you want to reach out to is crucial. Is it through a warm intro, or do you know some founders while reading their portfolio? Have you attended one of their sessions and then reached out to them as a follow-up?

Also Read: Get to know these 10 verified investors who are ready to connect today

The tactics of reaching out to investors is something that needs to be clearly planned, so that you don’t waste your time and energy sending cold e-mails. And even though we try to answer every single cold email, as you can imagine, we receive hundreds, if not thousands, on a yearly basis.

So having a clear plan to approach this is something that you want to take some time to think about.

Regarding the second type of ‘how’. Let’s assume you secured a meeting with an investor. Now, how will you drive the meetings? What type of information you want to share in the first meeting, second meeting and the third one? What do you want to show during the meeting?

There is little room for improvisation because usually VCs know quite clearly what they are looking for in the first meeting, then in the second one, and then in the third one.

Preparing yourself for each meeting by getting feedback from other founders who have pitched to the same firm or who have been through the fundraising process is going to help you a lot to prepare yourself for the meetings and to prepare the material and then to handle the whole process in relationship with the different visits. And, again, every visit is different.

Image Credit: Qualgro Ventures

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Warung Pintar buys Bizzy Digital for US$45M to create full-stack supply chain platform for Indonesia’s mom-and-pop stores

Warung Pintar

Indonesia’s micro-retail tech startup Warung Pintar announced today it has acquired Bizzy Digital, an integrated logistics and distribution supply chain B2B platform, for US$45 million.

This is part of Warung Pintar’s push to solidify its position in Indonesia’s B2B e-commerce market, which it says is expected to grow to become at least thrice the size of its B2C cousin.

As per a press note, Bizzy Digital will still remain a separate entity as a brand and organisation.

Warung Pintar noted that the acquisition would give it access to a combined pool of 600 brands and serve 230,000 retailers in 65 cities across the archipelago. The combined companies would also boast a larger shareholder foundation to support growth going forward.

With Warung Pintar’s expertise residing in the demand side of micro retailers, its partnership with Bizzy Digital will enable it to tap on the latter’s supply side capabilities and create a full-stack supply chain platform that can tackle the large and fragmented FMCG market in Indonesia.

Last month, the micro-retail tech company launched an online platform for owners of mom-and-pop stores (knows as warungs) to conduct bulk shopping from distributors for supplies.

Also Read: Warung Pintar CEO: How my grandmother inspired our vision for Indonesian mom-and-pop shops

“Through this acquisition, we are hoping to change the digital distribution approach on the ground, which is historically heavily driven by promotions and discounts as a customer acquisition strategy, which is deeply opposed by many of our FMCG partners,” said Agung Bezharie, co-founder and CEO of Warung Pintar.

“Having Bizzy Digital as part of the bigger Warung Pintar ecosystem will enable us to guarantee product reliability, availability and fair pricing by working hand-in-hand with the brands’ distributors,” he added.

“As Bizzy Digital becomes part of Warung Pintar, there will be no other player as integrated up and down the supply chain. This combination will enable us to serve brands and distributors with unprecedented value-added, data-driven strategy at scale,” said Andrew Mawikere, CEO of Bizzy Digital.

“As a common shareholder in both companies, we find strong synergy and efficiency by combining the two companies. Warung Pintar comes from a demand-side platform and Bizzy Digital comes from a supply-side platform. Combined they will be able to serve both consumers, retailers and brands in the most effective way,” said Willson Cuaca, Co-founder of East Ventures.

Image Credit: East Ventures

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Next Gen, a 4-month-old plant-based meat startup, raises US$10M in one of the largest seed rounds

Next Gen

Next Gen, a Singapore-headquartered plant-based foodtech startup, announced today it has closed a US$10 million seed round from a clutch of investors, including Temasek and K3 Ventures.

The New Ventures arm of the Singapore Economic Development Board, NX Food, FEBE Ventures, and Blue Horizon also participated.

According to data from Pitchbook, this deal marks the largest-ever seed round raised for a plant-based foodtech company.

According to Next Gen, the fresh financing will be used for the global launch of its plant-based chicken consumer brand TiNDLE in Singapore, scheduled for March 2021. A portion of the capital will also go towards fuelling expansion efforts across Asia and supporting R&D of new plant-based products.

Next Gen was co-founded by Timo Recker and Andre Menezes in October 2020. The duo personally invested US$2.2 million into the company from the get-go. Recker is the founder and former CEO of German plant-based meat company LikeMeat while Menezes was the General Manager of Country Foods Singapore.

Also Read: Conscious consumption is driving the trend in foodtech: Study

The company said that roadmap for the next two years include raising Series A funding, diversifying its products and expanding into Europe and the US. It is already laying the groundwork in the latter by recruiting a Growth Director who will build a network of distributors, restaurants and chefs.

Next Gen’s first consumer product is TiNDLE Thy, a plant-based alternative to a chicken thigh. The startup claims the product has been created directly with chefs, offering high protein, high fibre and low carb. It is also free of genetically modified organisms (GMO) and natural cholesterol.

Plant-based meat has seen strong demand in the West and is now also gaining momentum in Asia. Alternative protein startups within the region raised US$230 million in 2020 alone, close to 4 times the amount raised in the preceding three years combined.

Last year, local cell-based crustacean meat company, Shiok Meats, raised US$12.6 million in its Series A round to build a first-of-its-kind commercial pilot plant, from which it plans to launch its minced shrimp product in 2022. Meanwhile, TurtleTree Labs closed its US$6.2 million pre-Series A round to accelerate the R&D of its cell-based human milk.

Image Credit: Next Gen

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