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COVID-19, the environment, and the tech ecosystem: what opportunity is available out there for us?

Entering 2021, despite challenges here and there, the world finds itself making an attempt to rise from the impact of COVID-19.

Industries that have been hit the hardest by the pandemic began to launch initiatives to recover. Take the example of the tourism industry in Singapore, which is working closely with tech startups to provide a safe travel experience for tourists. Or, closely related to the tourism industry is the MICE industry, that have conducted major events such as the World Economic Forum and RISE in Southeast Asia.

The questions that remain are mostly related to the environmental impact of the virus attack, and whether we are ready to recover from it.

In the early days of the arrival of COVID-19, there were reports about air and sound pollution decreasing in many places around the world. This is strongly related to the lockdown measures as implemented in many countries.

However, as lockdown measures starting to ease in countries that have been hit by the pandemic earlier, things are coming back to square one.

In June, National Geographic stated in its headline that COVID-19 will end up harming the environment. It detailed in its report that in countries such as China, pollution level has already started to return to pre-pandemic times as “factories pushed to make up for the lost time.”

The report also predicts “bolder” lobbying moves from businesses that have been known to be massive polluter such as coal.

Also Read: Making cross-border partnerships work within a COVID-19 reality

Where the focus should be

What has been done to tackle this issue? The answer might vary depending on which market you are focussing on.

The Platform Redesign 2020, an initiative that builds upon the 11th Petersberg Climate Dialogue and the UNFCCC’s June Momentum for Climate Change, showcases the range of policies that governments are doing to tackle the environmental impact of COVID-19. This includes initiatives from governments in Southeast Asian (SEA) countries such as Cambodia, Indonesia, and Singapore.

But on the ground, there is often a gap between the policy that has been proposed and its implementation.

In an interview with e27, Tiza Mafira, Executive Director at Gerakan Indonesia Diet Kantong Plastik (IDDKP), explains the rising environmental problems that are directly related to the pandemic. It includes the illegal dumping of medical waste from hospitals, which triggered by the sheer size of medical waste produced during the time.

There is also an uptick in plastic waste that is the result of increasing food delivery and online shopping activities.

“There is a perception [among F&B businesses] that the pandemic is an unusual time and they could get away with increasing use of plastic utensils for sanitary reasons. There is also a push from the plastic industry that plastics are the best to safeguard your safety and health; it succeeded in scaring people off, developing this paranoia,” she says.

Even when major food delivery platforms such as GrabFood or Go-Food have been providing options for users to opt-out of plastic cutleries, or to pay for their use, there is no enough awareness from merchants to actually use the feature.

“They could have just applied it universally,” Mafira stresses, calling out other e-commerce platforms to provide an option for plastic-free delivery packagings.

What the ecosystem can do

In tackling this issue, the private sector –as represented by the tech startup ecosystem– has an important role to play.

Also Read: Alienated-from-home: How to enhance corporate belonging in a post-COVID-19 world

In Indonesia, Mafira mentions that there are already startups building solutions to improve waste management. “In Jakarta alone, there are about five or six companies working in private waste management or collection. Some of them are using apps, technologically advanced, user-friendly methods.”

Academicians such as Tanjena Rume and S.M. Didar-Ul Islam of Jahangirnagar University, Bangladesh, have even proposed steps that can be taken in order to curb the environmental impact of the COVID-19 pandemic.

They included: Sustainable industrialisation, use of green and public transport, use of renewable energy, wastewater treatment and reuse, waste recycling and reuse, ecological restoration and eco-tourism, behavioural changes in daily life, and international cooperation.

From this list alone, we can see that the opportunity for tech startups to contribute is vast enough already. It provides rooms for startups in various verticals to innovate, from SaaS platforms to electric vehicles to waste management to even travel tech platforms.

And how can they make this contribution sustainable?

It has been said many times that the key to a startup’s success is finding that product-market fit. As elaborated in the popular business methodology Lean Startup, many startups fail simply because they never reach out to customers to find out if the solutions are really what the users need.

In the context of working to solve environmental challenges, startups can always work together with different parties to help them get a deeper understanding of the problem, the gap between policy and implementation, and a more holistic view of the existing opportunities.

The need for collaboration has become more urgent as vaccines become more widely available and safety measures are bein eased up in many countries –as the world is slowly returning to normal.

We are rushing with time to make sure that a solution is readily available when needed.

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Image Credit: Cate Bligh on Unsplash

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Deel, the global startup who reached unicorn status, enters APAC

MIT alumni Alex Bouaziz and Shuo Wang Co-Founded Deel in 2018

Deel, the international payroll company shattering hiring barriers worldwide, announced today that it has raised $156 million in Series C funding led by the YC Continuity Fund and has welcomed Ali Rowghani to its board. The round was co-led by existing investors Andreessen Horowitz and Spark Capital. Dara Khosrowshahi, Lachy Groom, Jeffrey Katzenberg, Jeff Wilke, and Anthony Schiller also participated in the round, among others. With a valuation of $1.25 billion, Deel has emerged as a market leader in the global payroll and compliance space.

Deel allows businesses to hire anyone, anywhere, in a compliant manner. Hiring and onboarding international employees or contractors takes under 5 minutes, with no local entity required. Paying them in 120+ currencies takes just a click.

Addressing pandemic pain points

Deel was co-founded in 2018 by MIT alumni Alex Bouaziz and Shuo Wang. Deel was already focused on this pain point when the pandemic hit, putting the startup in a prime position to help companies adjust to the dramatic shift in working and hiring norms.

“We built Deel to be the solution for companies wanting to hire anywhere around the world, from Argentina to Zambia,” said Deel CEO Alex Bouaziz. “We set out to solve a problem that the majority of businesses found inherently daunting. With Deel, we were able to consolidate everything into a product people trust and enjoy using to hire, to pay, and to give their global team members the best experience possible. Now with this third sizable investment, we can’t wait to open even more doors for businesses, employees, and contractors around the world.”

In 2020, Deel grew by 20X in revenue and now supports over 1,800 businesses worldwide. Deel’s explosive growth led to back-to-back funding rounds, totalling $206 million in under a year. With this Series C financing, Deel plans to continue international expansion by tapping into new markets and setting up 80 new Deel-owned entities across the world in 2021. Deel also plans to grow its team by hiring exceptional talent across the globe. Additionally, Deel will continue to improve, build, and grow their product offerings across the board by focusing on features such as employee equity and an open API.

Charging the lead towards the new normal

“The way people work is fundamentally changing and Deel is leading the way,” said Ali Rowghani, from YC Continuity. “Deel was at the forefront of remote work pre-pandemic, and it will be long after. The team is uniquely equipped to remove the obstacles of remote work so companies hire the best talent in the world, instead of only those nearest to them.”

“I’m excited to be investing in Deel the platform, which streamlines the complex minutiae of payments and compliance, removing the obstacles so that companies worldwide can go ahead and hire the best talent anywhere, instead of just the nearest talent to them,” said Dara Khosrowshahi, Uber CEO.

Deel’s team is entirely remote, and has grown from 7 employees to over 120 across 26 countries since January 2020. CB Insights projects the industry for virtual HR software will grow to $43 billion by 2026 as technology platforms like Deel help businesses make the transition to remote-first work.

Strengthening the APAC connection

While this is Deel’s official splash into the APAC scene, their roots in the region have long been cultivated.
For one, almost half of the contractors hired via Deel are based in APAC. For another, they have partnered with Singapore-incorporated NIUM to power their Deel Card. NIUM, the startup formerly known as Instarem, is a major payment institution regulated by the Monetary Authority of Singapore. The VISA program they are approved to operate manages the Deel Card.

Apart from growing its team by hiring exceptional talent across the globe, Deel will continue to improve their product offerings across the board by focusing on features such as employee equity and an open API.

About Deel

Deel is a global compliance and payroll solution that helps businesses hire anyone, anywhere. Using a tech-enabled self serve process, businesses can now hire independent contractors and full-time employees in over 150 countries, compliantly and in minutes. With more than 250 legal, accounting, mobility and tax experts as partners, Deel enables any business to compliantly create, sign and send localised contracts from a library of templates. Deel automates the process of collecting country-specific documents like tax documents from contractors and employees, to ensure they’re correctly set up. The platform also allows companies to pay international contractors and employees in more than 120 currencies with just a few clicks.

Learn more about Deel here.

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

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Play Ventures buys stake in LuneX Ventures to launch blockchain gaming fund

Play Ventures, a Singapore-based VC firm focused on funding gaming startups, has entered into an agreement with Golden Gate Ventures to acquire a stake in its spin-off LuneX Ventures.

Further details of the deal were not disclosed.

The plan is to launch a new dedicated blockchain gaming fund.

As part of the deal, LunX General Partner Kenrick Drijkoningen will move to Play Ventures, while continuing to head LuneX.

Also Read: Play Ventures closes US$135M fund targeting gaming startups

GGV and Play Ventures look forward to further collaboration across the digital assets and gaming industries.

LuneX currently holds investments in a number of blockchain-enabled startups and tokens.

“By combining our gaming and digital asset expertise, we will be able to occupy a unique position in these converging industries and have a real edge in the market,” said Drijkoningen.

GGV Partner Michael Lints said: “Over the past years crypto and blockchain have made a significant impact on the financial ecosystem and we were fortunate to play a part in that development with Lunex. Now that crypto is widely known and new trends are evolving quickly it makes sense that Kenrick wants to specialize and hone in on his specialty.”

Henric and Harri from Play Ventures added: “Mobile phones revolutionised how gaming can be enjoyed by billions of people. Blockchain is now doing the same to digital rights, payments and marketplaces. We believe that the intersection of both gaming and blockchain will create the ultimate metaverse where people meet, play and trade; a true trillion-dollar opportunity.

Also Read: Charting the rise of hyper casual gaming: An insight into the massive mobile industry

Launched in 2018, LuneX Ventures invests in rapidly-growing blockchain and digital asset industry. The fund has invested in over 20 companies and token projects, primarily seed stage with a focus on Singapore.

Play Ventures invests in early-stage gaming companies. Since December 2018, it has invested in 24 companies across 10-plus different countries.

Earlier this month, Play announced the closing of its second fund worth US$135 million. With Fund II, Play Ventures’s total assets under management is now US$175 million across Fund I and Fund II.

Image Credit: LuneX Ventures

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Accelerating digital transformation in air traffic management through open collaborations

The adoption of advanced technologies such as Artificial Intelligence (AI), Machine Learning (ML), Big Data, and the Internet of Things (IoT) has accelerated in the past few years across many sectors and organisations – both large and small – have seen the potential benefits that could be brought to bear by these technologies. This is evident even more so in recent times where Covid-19 restricted how businesses could normally conduct their day-to-day operations and the adoption of advanced technologies has allowed them to stay relevant amidst the challenges.

While the rate of advanced technology adoption varies across industry sectors, French tech giant Thales Group and the Civil Aviation Authority of Singapore (CAAS) saw the need to leverage co-innovation to accelerate the adoption of advanced technologies in Air Traffic Management (ATM).

In November 2019, CAAS and Thales established the Aviation Innovation Research (AIR) Lab. The joint lab brings together multiple stakeholders in the ATM value chain – from air traffic controllers to AI experts and local start-ups, all supported by expert ATM engineers and software engineers specializing in latest technologies – creating a veritable ‘sandbox’ where the diverse team can experiment and co-create the future ATM capabilities, leveraging technologies such as Cloud native frameworks, DevOps CI/CD automation, big data, AI / ML etc.

The multi-disciplinary team adopts an agile ‘build-test-and-learn’ methodology, working in short sprints that enable Minimum Viable Proof-of-Concepts (MVPs) to be co-developed in a shorter time frame.

One concept which motivated the conception of AIR Lab is the core belief that diversity in perspectives combined with the latest open technologies can precipitate out-of-the-box solutions which will be key enablers for future ATM systems. It is not just traditional ATM engineers who are involved, but also the operational air traffic control users and the “young” tech talent of innovative start-ups and enterprising developers who can envision a digital ATM future that is both technically advanced and ready to meet the many challenges of the aviation sector such as eco-friendly “green” operational concepts to address carbon emission objectives.

Leveraging data for innovation: AIR Lab’s Open ATM Architecture and APIs

AIR Lab’s first priority since its inception was to develop an Open ATM architecture.

The adoption of open, standard technologies on an Open ATM platform will benefit the entire ATM ecosystem by reducing the ‘build-test-learn’ MVP life-cycle. With the shortened lifecycle, smarter, safer, more efficient and secured airspace management capabilities can be made available earlier.

The MVP approach adopted for the AIR Lab’s Open ATM architecture programme uses Scrum practices and the Agile framework. These practices and the use of open technologies including public APIs for service access align with the latest IT industry trends, thus enabling collaborations with the broader IT / start-up ecosystem as well as the nurturing of the next-generation talent for the ATM industry.

Also read: Solving multiple medtech problems with a single device powered by AI

An Open ATM platform will also enable data and service exchanges at the B2B / enterprise level, allowing multiple stakeholders to provide and consume data/services on the platform.

Imagine the potential applications that can be co-created when Air Navigation Service Providers (ANSPs), airlines and airports share data related to operations such as flight trajectories, weather, planning constraints, connecting passengers/cargo amongst many others, and share common optimization objectives which can benefit all stakeholders in the aerospace value chain.

Safe and Secure Data Management

The work in AIR Lab also involves ensuring data is shared in a safe and secured manner. AIR Lab’s Chief Product Owner Mr Hugh Rodrick, said, “A common misconception is that Agile, Scrum and MVP are equivalent to throwing the systems engineering rule book away. This is not the case. Setting out a solution and design which appropriately addresses the needs whilst respecting the system constraints, (e.g. safety, security, quality, maintainability, etc.) remains paramount.”

“One key need of AIR Lab’s Open ATM platform is to enable access to ATM services using public (secured) APIs based on open technologies, whilst allowing integration of third-party capabilities as services,” he added.

When the Open ATM platform is connected to an operational ATM system (such as the Thales LORADS III that is currently operating at the Singapore Air Traffic Control Centre), such systems constraints must be respected as we allow for real air traffic control data to be shared with trusted collaboration partners. The entire process must adhere highest levels of cybersecurity measures which limit access and ensure potential “attack-surfaces” are identified and minimised – all of which are built into the Open ATM platform using the latest web security features.

Also read: TuringCerts combats fraud with blockchain-powered certificate validation

The Open ATM platform’s public API gateway limits access through the use of authorisation keys and is prepared for role-based credentialed access. It is also designed to allow Open ATM system services to have multiple “personalities” such as a privileged API set that is only accessible by clients who connect from within a defined IT domain, such as a CAAS facility.

This subsequently allows sensitive air traffic control data to be leveraged from within air navigation service providers such as CAAS, but excluded from the data provided to the public API personality.
Safety is also addressed through such cybersecurity measures. By effectively isolating the operational ATM system and the Open ATM platform network domains using best practice cybersecurity architecture, the safety-certified status of the operational ATM system is not impacted.

Hear more from the AIR Lab Team

On the experience and benefits of the ‘build-test-learn’ MVP approach employed in AIR Lab, one of the lead developers from the AIR Lab team, Lee Yan Shen said, “Coming from years of traditional software engineering practice, working with the agile process adopted in AIR Lab has been both a refreshing and enlightening experience”.

“The lean organisation, together with the open and transparent culture that we developed along the way, and the direct access to end-users create a perfect environment to reap all the benefits of agile development.”

“The short iterations with regular open and honest discussions and reviews builds strong camaraderie between team members, allowing us to actively learn from each other and rapidly build up our knowledge in both business and technical domains,” Lee added.

Also read: Nongsa D-town: bridging the digital talents of Southeast Asia

The open ATM platform also allows easier data sharing and service exchanges. Kevin Tan, an executive engineer from CAAS working in the AIR Lab, highlighted how CAAS’ engineering team and other R&D partners will be able to experiment and validate their R&D concepts easily with the integration to the Open ATM platform and its data via the APIs.

“This will help significantly reduce the time for innovative explorations and implementations. CAAS can build up the local aviation ecosystem by inviting start-ups and local SMEs to explore the use of the APIs for integration and adaptation of their technological products into the aviation domain. CAAS will also be able to make use of the Open ATM platform and its APIs in AIR Lab as means to build up the engineering competency in CAAS,” Tan added.

Collaborative ecosystem for a better tomorrow

The ATM sector has different moving parts and as such, the approach for innovation cannot be one-dimensional. A collaborative environment where different problem-solvers come together, can accelerate innovation and the digital transformation of this unique and complex sector.

Multiple reports and studies advocate the ethos of collaboration and this is more pertinent now than ever when industries across the Asia Pacific and the entire world are accelerating digital transformation in anticipation for the post-pandemic future. With the expertise in the latest technologies, like machine learning, AI, big data and IoT, of the various stakeholders coming together, the aviation sector can look forward to a more creative, efficient and resilient future.

Innovative start-ups have a unique opportunity with next-gen open platforms like AIR Lab’s Open ATM architecture to pioneer innovation in the ATM industry. Through AIR Lab, CAAS and Thales seek to increase investments into ATM-related research in Singapore by bringing in ATM domain experts and hiring the right local talent.

Interested start-ups, universities, and developers can view the Open ATM’s public APIs here. Those who want to take it a step further and trial the Open ATM services or even build solutions in partnership with AIR Lab are welcome to email the team at contact@airlab.aero.

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

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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Democratising ownership through crowdfunding has its challenges: Daniel Lin of FundedHere

FundedHere

Daniel Lin, co-founder and CEO of FundedHere

Today, everyone wants to be a startup investor.

From Coinbase’s IPO to Grab’s SPAC merger, startups are dominating the market headlines. Undeterred by the high-risk nature of venture investing, individual investors are hungry for the chance to invest in startups.

In the name of democratising ownership, startups themselves are becoming more receptive towards equity crowdfunding campaigns. Last month, US-based Gumroad, a startup that helps creators sell their works, allocated US$5 million of its funding round to anyone who was willing to invest a minimum amount of US$100.

However, Daniel Lin, co-founder and CEO of FundedHere, a Singapore-based licensed private equity and lending-based crowdfunding platform, is quick to point out that such a model could easily burn the pockets of retail investors.

“The idea of democratising ownership is a beautiful thing but we must also be equally aware that investing requires a healthy combination of discipline and knowledge,” he told e27.

Below are edited excerpts of the interview.

What are the key challenges for individuals looking to invest directly into startups? How does transacting through a crowdfunding platform solve these?

There are three main challenges for individuals who are professional investors.

Firstly, individuals do not know where to look for these promising startups as they are not in the industry.

Secondly, conducting due diligence on these startups is difficult, as founders are unlikely to entertain individuals who only put in smaller amounts, compared to ultra-high net worth individuals and institutional investors.

Lastly, the expected investment quantum is usually at least S$50,000 (US$37,500). This is largely too high for most professional investors and hence prices them out of good opportunities.

Also Read: 3 ways startups should assess different financing options

A crowdfunding platform can help professional investors overcome these three challenges.

A platform that is licensed would have the capability to conduct due diligence to ensure that only the most promising startups are featured. With the use of technology, platforms could provide a seamless investment process that involves discovering the startups, completing transactional documents and transferring the investment funds.

The biggest advantage is that investors can now directly invest in a startup at a lower investment size. This is important as it provides an opportunity for younger professional investors to gain access to interesting opportunities without being overweight in a high-risk high-return asset class such as startup investing.

How does a due diligence process for a startup looking to crowdfund on FundedHere look like? What are the key metrics you focus on?

We start the process by getting startup founders to fill up a scorecard. This scorecard takes into account 20 variables that would inform the platform on whether the startup is within the ballpark of being investment grade.

For successful startups that clear the scorecard requirements, they will usually go through a consultancy phase called the “Discovery Phase”, where our team will work closely with the founder to equip them with three crucial documents essential for fundraising.

This includes a comprehensive valuation report with stress-tested underlying financial assumptions, a fully verified online data room with due diligence conducted and to be made available to prospective investors, and an investor memorandum to summarise the unique selling points of the startup.

Also Read: ‘Due diligence is like dating before the long-term marriage’: Accion Venture Lab’s Paolo Limcaoco

Thereafter, we will conduct an onboarding assessment by incorporating comments and views from industry experts covering business, tech and commercial factors.

The potential to scale, the competitive advantage that a startup has, the competency and experience of the founder and his team, and the valuation of the startup are key factors we look at when deciding when to run a fundraising campaign.

How do you consistently source for startups to be listed on the platform? On average, how many crowdfunding campaigns do you run in a month?

We have spent the last five years building a thriving ecosystem out of Singapore. This includes partners such as Institutes of Higher Learning (IHLs), syndication platforms, angel investment networks globally and mentors and investors — each of them providing an extensive pipe of potential startups.

We also engage the community through mentorship, startup competitions and conversations with entrepreneurs so that we become the go-to partner for fundraising.

On average, we try not to run more than three campaigns in a month so that investors do not have to choose between startups. We ensure that startups running their campaigns concurrently are not within the same sector to ensure compatibility and a better selection for our investors.

Do you see crowdfunding extending past the seed/Series A rounds and catering to Series B and above financings? 

Rounds after the Series A round usually require institutional funding as the quantum of fundraising is usually much larger. Unpacking the complex nature of multiple revenue streams across multiple geographies becomes a more challenging endeavour.

Crowdfunding platforms in countries with a larger population could provide access into Series A rounds and beyond if they have a vibrant retail investor ecosystem but this would be more of an exception than the rule.

FundedHere focuses on startups in their seed round and pre-series A round. The key to our value proposition is providing access to non-accredited investors to fund rounds that are up to US$1 million as it can be done in a swift and systematic manner.

How has investor behaviour/preferences changed in light of the pandemic and its economic challenges? What are some metrics investors are paying more attention to?

The pandemic has built a large amount of uncertainty in the markets and the natural reaction is for investors to shore up cash. However, sophisticated investors see this as an opportunity and are still on the lookout for good deals. Investors tend to look at how a founder manages its cash flow, how he responds to crises and how adaptable he and the startup can be.

Also Read: The lure of the orient: How retail investors are being drawn to Asian investment markets

Valuation tends to be more modest to account for a more conservative outlook and founders who are able to price that into the valuation tend to receive the funding they need.

Gumroad, a US-based startup, recently announced it was looking to raise money from unaccredited investors as part of a crowdfunding campaign. Could you see this funding model be replicated within Southeast Asia? 

Yes definitely, but it does not come without challenges. The idea of democratising ownership is a beautiful thing but we must also be equally aware that investing requires a healthy combination of discipline and knowledge.

The traditional benchmark of requiring a certain amount of affluence before investing in alternative products is increasingly less relevant as the investment sizes are now significantly smaller.

We can still apply the same principle of investor protection by capping the amount that each non-accredited investor makes and that not more than a fixed percentage of his or her annual income is invested in the alternatives so that the investor’s risk-reward investment portfolio is still properly managed.

At FundedHere, while we are able to raise funds from retail investors, we have opted to keep the minimum investment quantum to S$5,000 (US$3,800) and make it accessible only to investors who earn in excess of S$100,000 (US$75,000) per annum.

The underlying hypothesis is that this provides a fair balance of ensuring that the investor is protected and yet at the same time, has access to these interesting opportunities.

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Image Credit: FundedHere

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A sneak peek into 8 Singapore startups joining Big Idea Ventures’s New Protein programme

Global VC firm Big Idea Ventures (BIV) has unveiled the eight Singaporean startups selected for its New Protein accelerator programme.

This cohort comprises 15 early-stage ventures, of which seven are from New York.

The programme runs for five months and invests up to US$200,000 each in startups.

As per its website, a follow-on investment of US$3.5 million will also be made in the top 20 per cent companies that successfully complete the programme.

Non-financial support includes mentorship and connections with industry experts that can help scale the startup’s products.

“This group of startups has been incredible to work with in the New Protein Fund,” said Andrew D. Ive, founder of Big Idea Ventures. “All of these companies are addressing real-world challenges and represent some of the most promising innovations in the food and agriculture sectors.”

BIV’s New Protein Fund, a US$50-million fund, is dedicated to seed and early-stage investments in plant-based and cell-based food, ingredient and technology companies.

Also Read: Bühler invests in Big Idea Ventures’s New Protein Fund; to invest in up to 100 plant- and cell-based firms

Here is snapshot of the eight Singaporean startups:

Angie’s Tempeh: Tempeh fermentation technology to create protein-rich foods.

Animal Alternative Technologies: Cell-based meat services including bioreactors and software.

[Stealth Mode]: B2B ingredients company developing sustainable alternatives to tropical oils and animal fats.

GreenGourmet Foods: Plant-based dairy.

Haofood: Alternative chicken protein from peanut focused on the Asian market.

MAD Foods: Plant-based beverage.

Hybrid Accelerator (participants in both Singapore and New York)

Wellme: Plant-based yogurt.

Meat. The End: Production technique to replicate meat-like mouthfeel and taste.

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Image Credit: Big Idea Ventures

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STACS bags US$3.6M pre-Series A to expand its fintech blockchain platform

STACS

Ray Ferguson, Chairman of STACS

STACS, a Singapore-based fintech startup providing blockchain technologies for financial services, has raised US$3.6 million in pre-Series A funding.

This round brings its total funding raised to date to more than US$6 million.

Led by Wavemaker Partners, the latest funding is a ‘prelude’ to its Series A round, which STACS said will commence on a larger scale later this year.

Government-backed blockchain accelerator Tribe, besides Stellar Partners, also participated.

STACS was a graduate of Tribe’s third accelerator batch last year.

As per a press release, STACS will use the fresh fund to ‘expand its ecosystem of global financial institutions on its Environmental, Social and Governance (ESG)-enabling technology infrastructure.’

Founded in 2019, STAC’s Distributed Ledger Technology (DLT) platforms support the effective lifecycle management of securities and ESG financing dimensions, encompassing green and sustainability-linked bonds and loans.

STACS aims to digitalise assets, processes and documents using its patent-pending STACS Blockchain technology.

Its clients and partners include global banks, national stock exchanges,and asset managers.

Having implemented its real-time trade processing platform live with Eastspring Investments and BNP Paribas Securities Services in 2020, STACS claims it successfully reduced trade breaks for both institutions by more than 90 per cent.

The company has since leveraged its same core patent-pending blockchain technology to launch GreenSTACS, an industry-wide ESG financing technology infrastructure that supports effective green and sustainability-linked loans and bonds.

Also Read: How blockchain-powered fintech services can improve financial inclusion

“Since the 1970s, the capital markets have been fragmented, with institutions operating on different systems and ledgers, and going through a linearly-dependent process which has led to a situation whereby US$800 billion of capital is being locked up every single day in the international clearing system,” shared Ray Ferguson, Chairman at STACS, said:

“Due to multiple layers of processing, nearly US$300 billion is being spent on transaction costs in a model that one would be hard-pressed to argue is efficient. This is all wastage — wasted time, wasted money, wasted carbon footprints — that we at STACS are committed to addressing through our distributed ledger technology. Innovating our way out of these problems is vital if we are to deliver a green and sustainable future for financial services,” Ferguson added.

“There is an immense opportunity to help financial institutions process large volumes of trades more quickly, securely and accurately while reducing costs and illiquid capital. As an enterprise distributed ledger technology provider, STACS has productized a secure layer that can be deployed instantly above existing infrastructure,” said Gavin Lee, General Partner at Wavemaker Partners.

“Enterprise sales is never easy for young companies, but Benjamin (co-founder and Managing Director of STACS) is a convincing and seasoned serial entrepreneur who has secured numerous leading financial institutions as key clients. We are excited to be part of the future digitalization of capital markets,” Lee added.

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Image Credit: STACS

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1337 Ventures, FWD Insurance partner to launch pre-accelerator programme for Malaysian fintech, insurtech startups

1337 Ventures Team

Malaysian early-stage VC firm 1337 Ventures and pan-Asian insurance firm FWD Insurance have joined hands to launch a bi-annual pre-accelerator programme.

Called Alpha Startups, the 4-week programme is specifically targeted at early-stage startups in the fintech and insurance industry based in Malaysia.

The programme will offer services such as entrepreneurship modules and access to mentors, tools and technology for founders to be able to bring their ideas to reality.

After the first round, the top 10 startups will undergo a further mentorship programme, where they will be able to further refine their business models in anticipation of the demo day.

During the demo day, the top two startups will receive an investment of US$36,443 from 1337 Ventures and FWD, in addition to US$29,513 worth of infrastructure credits for their cloud infrastructure, recruitment, marketing and payment gateway needs.

Investees also stand a chance to receive further funding for their seed to pre-series A round.

Also Read: 1337 Ventures partners with Malaysia’s central bank to launch fintech accelerator programme

Bikesh Lakhmichand, CEO of 1337 Ventures, said, “We always wanted to see the private sector step up and play a more long term role in building the fintech and insurtech scene in Malaysia compared to the touch-and-go approach we have seen other players take.”

“FWD Start-up Studio’s approach is a game-changer with not just its long-term commitment to early-stage funding across multiple intakes but also through Alpha Startup’s programmatic approach to provide start-ups with insights, paid POCs (proof of concept) and access to markets,” he added.

Applications for the programme are open and set to run until 25 startups are selected.

Founded in 2012, Kuala Lumpur-based 1337 Ventures also runs accelerator programmes for MNCs and GLCs, such as Bank Negara Malaysia, Khazanah Nasional, Telekom, Digi, MDEC, CIMB and Maybank, amongst others. Notable graduates include Funding Societies, Parkeasy, Senang and Coins.ph.

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AI-powered decision-making for the banks of the future

AI in banking McKinsey

The ongoing transition to digital channels creates an opportunity for banks to serve more customers, expand market share, and increase revenue at lower cost.

Crucially, banks that pursue this opportunity also can access the bigger, richer data sets required to fuel advanced-analytics (AA) and ML decision engines.

Deployed at scale, these decision-making capabilities powered by AI can give the bank a decisive competitive edge by generating significant incremental value for customers, partners, and the bank.

Banks that aim to compete in global and regional markets increasingly influenced by digital ecosystems will need a well-rounded AI-and-analytics capability stack comprising four main layers: reimagined engagement, AI-powered decision making, core technology and data infrastructure, and a leading-edge operating model.

The layers of the AI-bank capability stack are interdependent and must work in unison to deliver value, as discussed in the first article in our series on the AI bank of the future. In our second article, we examined how AI-first banks are reimagining customer engagement to provide superior experiences across diverse bank platforms and partner ecosystems.

Also Read: gojek’s Bank Jago unveils financial services app that centres around users’ daily life

In the current article, we focus on the primary AA/ML decision-making capabilities required to understand and respond to customers’ fast-evolving needs with precision, speed, and efficiency.

Banks that leverage machine-learning models to determine in (near) real-time the best way to engage with each customer have the potential to increase value in four ways:

  • Stronger customer acquisition. Banks gain an edge by creating superior customer experiences with end-to-end automation and using advanced analytics to craft highly personalised messages at each step of the customer acquisition journey.
  • Higher customer lifetime value. Banks can increase the lifetime value of customers by engaging with them continuously and intelligently to strengthen each relationship across diverse products and services.
  • Lower operating costs. Banks can lower costs by automating as fully as possible document processing, review, and decision making, particularly in acquisition and servicing.
  • Lower credit risk. To lower credit risks, banks can adopt a more sophisticated screening of prospective customers and early detection of behaviours that signal a higher risk of default and fraud.

As banks think about how to design and build a highly flexible and fully automated decision-making layer of the AI-bank capability stack, they can benefit from organising their efforts around four interdependent elements:

  • Leveraging AA/ML models for automated, personalised decisions across the customer life cycle
  • Building and deploying AA/ML models at scale
  • Augmenting AA/ML models with what we call “edge” capabilities to reduce costs, streamline customer journeys, and enhance the overall experience
  • Building an enterprise-wide digital-marketing engine to translate insights generated in the decision-making layer into a set of coordinated messages delivered through the bank’s engagement layer

In the full report, AI powered decision making for the bank of the future, we examine each of these interdependent elements and their applications in detail.

The rapid improvement of AI-powered technologies spurs competition on speed, cost, experience, and intelligent propositions. To remain competitive, banks must engage customers with highly personalised and timely content to build loyalty.

Also Read: How startups can aid Southeast Asia’s Open Banking landscape

Personalised offers with tailored communication delivered at the right time through the customer’s preferred channel can help banks maximise the lifetime value of each customer relationship and reinforce the organisation’s market leadership.

To achieve these benefits, banks must build AI-powered decision-making capabilities fuelled by a rich mixture of internal and external data and augmented by edge technologies.

The core technology and data infrastructure required to collect and curate increasingly diverse and voluminous data sets is the topic of the next article in our series on the AI-bank capability stack.

Special thanks to Akshat Agarwal, Bangalore-based McKinsey associate partner, and Charu Singhal Mumbai-based McKinsey consultant, for co-authoring this report, as well as Milan Mitra and Yihong Wu for their contributions to this article.

Editor’s note: e27 aims to foster thought leadership by publishing contributions from the community. This season we are seeking op-eds, analysis and articles on food tech and sustainability. Share your opinion and earn a byline by submitting a post.

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What I learned about entrepreneurship through my journey as Coinhako co-founder

crypto startup founder

The truth is I never planned on starting a crypto trading platform. I became inspired to do so about seven years ago after recognising that there was a gap —and significant opportunity— in Singapore’s financial services space.

At that time Gerry Eng, Coinhako’s co-founder and current CTO, and I wanted to buy and trade bitcoin but found no platforms in Singapore that were simple enough for non-technical users. And so we launched our brainchild, Coinhako, in 2014, with the aim of being the simplest way to purchase bitcoin in Asia.

Our early years and big break

When Coinhako was launched, cryptocurrencies were still largely an unfamiliar piece of technology in Asia. Surrounded by novelty and unfamiliarity, securing interest from investors in Singapore and Asia proved to be a really tough challenge. Eng and I realised that we had to look outside of Asia to build the momentum we needed to catapult our startup.

We made a bold move and headed to the Silicon Valley and became the first Asian Bitcoin startup to get accepted into Boost VC’s accelerator programme – a three-month programme helping early-stage startups with networking, mentorship and growth opportunities.

This was a massive opportunity for Coinhako as Boost VC’s programme was the only Bitcoin-focused accelerator back in the day, and indeed, it really paid off as we earned personal investments from venture capitalists Tim Draper and Josh Jones.

With that experience and financing, we returned to Singapore full of confidence and ready to work on our long-term vision of building Coinhako into the go-to platform for the masses in Asia to access cryptocurrencies.

Myself, Tim Draper and Gerry Eng (Cofounder & CTO)

The first few years were challenging as the crypto market faced very low interest from the general public. We had to rely on tight financing and management of resources to tide us through. The 2017 bull run, on the other hand, ushered in huge changes in crypto trading and proved to be a big break for us.

Also Read: Today’s top tech news, January 9: Coinhako to offer 100 fiat-crypto pairings, SoftBank will no longer take controlling stake in WeWork

As Bitcoin touched US$20,000 in 2017, Coinhako’s trading volume increased year-over-year (YOY) by 1,000 per cent. The boom was on!

Growing from strength to strength

We have come a long way from a team of just two in 2014.

Today, Coinhako employs over 70 people across the region, with plans to double our headcount in 2021. In addition to our headquarters in Singapore, we are also present in Vietnam which acts as our technological hub and employs some 40 members of our team.

Today, we have over 200,000 users trading crypto with us, just in Singapore, and thousands more in Vietnam, a strong affirmation that our infrastructure and technology enable them to access crypto easily.

We firmly believe that we can make greater leaps in 2021 as it is shaping up to be an exciting year for us. With the boom in the crypto market, we are seeing record high monthly account opening numbers and trading volumes on our platform.

Most notable about 2021’s bull run is the increased interest from institutional investors and also the presence of a live licensing framework for crypto businesses in Singapore.

I believe that these factors will continue to grow public confidence in blockchain technologies and this will help to further increase interest and demand for cryptocurrencies throughout the year.

What I’ve learned as a CEO of a crypto startup

I have closely observed the crypto space over the years, experiencing its ups and downs, particularly in Asia. I have seen crypto trading evolve from an unfamiliar and niche financial service to a legitimate disruptor in the financial industry disruptor. Today cryptocurrencies, especially bitcoin, are as solid as any other mainstream high-risk, high-value asset.

Also read: Ethereum Co-founder Joseph Lubin on why the crypto platform is headed for a grand future

While I have watched companies come out stronger from 2017’s crypto bull run, I have also witnessed businesses fold during the 2018 crypto winter. This taught me that any business in this space needs to achieve a good balance of conviction, perseverance, and agility to survive and thrive.

There are a few things I have also learnt from my entrepreneurial journey over the past seven years that budding entrepreneurs should keep in mind. I have condensed them into three main takeaways:

First, don’t be distracted by shiny objects —new, trendy ideas are easy distractions; remember to stay focused on your goals. Second, take risks and don’t be afraid of failure; but avoid making the same mistake twice. And third, hire people who are smarter than you. Let them handle tasks you aren’t an expert at, then focus on your strengths.

We prepare for and face adversity every day at startups. It is commonplace for any business to face disruptions and situations that do not go according to plan.

At Coinhako, we push hard as a team to overcome the challenges that come our way, and we also grow as a team. This is the fundamental formula for the success of Coinhako today.

With a strong team behind Eng and me, we are excited to scale the next new heights and spearhead growth in the regional crypto scene.

Editor’s note: e27 aims to foster thought leadership by publishing contributions from the community. This season we are seeking op-eds, analysis and articles on food tech and sustainability. Share your opinion and earn a byline by submitting a post.

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