With its young population and growing middle-class sector, Southeast Asia is one of the hotspots for any startup looking to expand into other markets. In fact, tech startups from the region attracted investments totalling US$8.2 billion in 2020. This is a mere 3.5 per cent dip from pre-pandemic levels in 2019, compared to drops of 31 and 38 per cent in India and Africa respectively.

The region’s transformation into a tech hub is partly aided by a large, untapped consumer base. Covid-19 spurred digital adoption among the population, with 70 per cent of Southeast Asia — 400 million people — now online thanks to the pandemic, according to research by Google, Temasek, and Bain & Company.

Southeast Asia’s diversity and tech capabilities make it a lucrative market for tech startups that want to go global. It is home to an incredibly diverse and young population, with more than 30 per cent of the population aged between 15 and 34. Both the supply of talent and demand for digital products and services are growing.

Furthermore, the market is also maturing at a rapid rate, with homegrown startups expanding throughout the region and some even venturing beyond.

Seven of Southeast Asia’s most important digital sectors — e-commerce, online media, transport and food, travel, financial services, healthtech, and edtech — are projected to grow to more than US$300 billion in gross merchandise volume in 2025. Some of the region’s startups have also made headlines on the international stage. Singapore’s Sea, for example, became the world’s best performing stock.

For startups looking to expand in Southeast Asia, Malaysia is a perfect entry point

Malaysia is currently ranked the 11th emerging startup destination in the world. Startup hotbeds like Kuala Lumpur, its capital city, Penang, and Selangor boast low costs and a wealth of talent. Strong government support, through initiatives such as the Technology Start-ups Funding Relief Facility and the PENJANA Fund, also make Malaysia an ideal choice for any startup seeking to establish their presence in Southeast Asia.

Also read: Fundraising masterclass for founders with Founders Grindstone

Geographically, Malaysia is located in the heart of ASEAN. Its immediate neighbours are Thailand, Indonesia, and Singapore, which are also three burgeoning tech hubs, making Malaysia perfect for startups seeking cross-country collaboration. Malaysia’s conducive startup environment is thus great for startups who want to understand Southeast Asia’s culture, consumer behaviour, and country regulations.

With its balanced mix of languages, people, and industries, Malaysia is truly a microcosm of Southeast Asia’s buzzing tech startup ecosystem.

Revolutionising the F&B industry through Slurp!

One particular stand-out homegrown startup is Slurp!, a company whose main objective is to deliver cloud-based point-of-sale (POS) system solutions for food and beverage retailers across Malaysia.

Its flagship product, Slurp! POS, is an iPad-based POS system specially developed with the food and beverage industry in mind. By tapping on cloud technology and remote support capabilities and consolidating them in a stack that consists of both hardware and software, Slurp! aims to help businesses enhance their efficiency and customer experience.

“When we started in 2014 the F&B merchants were still using something built in the 90s to run their business, the system obviously had outdated UI/UX and tech stack so they had difficulty from even extracting the simplest of data from their POS,” explained co-founder and chief executive officer, Reza Razali.

Also read: The future of mobile: how did mobile apps fare in 2020?

In 2018, they saw a similar pain point in the fuel retail industry and decided to focus their efforts there.

Even old legacy systems can benefit from Slurp!’s innovative solutions. Their products and services lower both hardware and support cost, as the hardware does not need to be custom-built and its preventive maintenance system can spot and resolve problems remotely before they occur.

Furthermore, Slurp’s products enhance customer experience and engagement. “Our solution is able to integrate to other business systems a lot faster, while delivering real-time data, than legacy solutions,” said Razali.

This allows new solutions to be delivered to customers in a shorter span of time, he added.

What makes Slurp! unique is that the company is still majority founder-owned. “Founders still own more than 90 per cent of the company,” said Razali. “We like that as it gives us a lot of flexibility in running the business.”

Surpassing challenges and roadblocks

Exploring a brand new market despite the similar pain points they saw in the industry was no easy task.

“Two years ago we started building a Point of Sale for the fuel retail industry and our solutions are currently used by the largest fuel retailer in Malaysia, Petronas,” Razali explained. “Our solution is designed to lower the total cost of ownership for a fuel retail point of sale by delivering cloud access, remote support capabilities bundled in a superior hardware and software stack,” he said.

Despite challenges and roadblocks, Slurp!’s vision and determination to explore important collaborative opportunities with pioneers in the industry landed them this partnership, and the company is now actively looking for partners in several southeast Asian countries as they plan to scale beyond Malaysia.

Also read: MaGIC kicks off Malaysia Startup Hub for regional expansion

One of the steps they have made is participating in a go-to-market programme organised by MaGIC for startups looking at the European market. Despite travel restrictions, the programme gave them a comprehensive understanding of how to expand beyond Malaysia and what the complexities are of exploring unique markets.

“MaGIC has given us exposure to various programmes they ran in its early days, including the e@Stanford programme, which was useful in giving us the exposure to go global,” said Razali.

With all the tools and key insights that the company has gained over the years, from providing solutions to the F&B industry, to exploring the world of retail fuel, and now to taking on the global stage, the future is looking bright for Slurp!

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

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Singapore is leading in banking-as-a-service (BaaS) adoption globally, according to a new survey by UK-based fintech company Finastra.

Almost half of the respondents surveyed (47 per cent) said they have deployed or improved their BaaS capabilities in the last year, said the ‘Financial Services: State of the Nation Survey 2021’. A similar proportion (45 per cent) are looking to do so in the next 12 months, which is higher than in any other market surveyed.

This investment activity is accompanied by some of the highest confidence globally in BaaS, with 87 per cent of those surveyed expecting to see benefits in the coming year.

The survey further finds that Open Banking has become important to 97 per cent of Singapore respondents’ businesses, with over half (56 per cent) calling it a “must have”. For the city-state’s audience, Open Banking has provided a number of benefits to their organisation, including improving the customer experience (79 per cent), delivering new services (93 per cent), and improving internal systems (57 per cent).

Also Read: Fairbanc raises funding to help Indonesian SMEs get credit access sans loan application, smartphones

In addition to helping to attract new customers (71 per cent), Open Banking has also helped Singapore finance professionals to attract different types of customers (64 per cent). Only less than two per cent of respondents in the island state now think that Open Banking will not have any impact.

The research was conducted in March 2021 amongst 785 professionals at banks and financial institutions across Singapore, Hong Kong, the US, the UK, France, Germany and the UAE. It explores the Open Banking and finance landscape, the technology and initiatives set to make an impact in financial services over the next year, and also how COVID-19 has impacted the sector.

Almost 90 per cent of those surveyed in Singapore agreed that adoption and integration of technology and innovation should be at the forefront of the financial services sector.

However, a number of key barriers to innovation persist, showing little change compared to Finastra’s 2020 survey:

• 56 per cent said management or decision makers are stuck in old ways of thinking (vs 58 per cent in 2020)
• 53 per cent said regulations are too tight (vs 56 per cent in 2020)
• 44 per cent said there is not enough industry or government support to foster innovation (no change from 2020)
• 56 per cent cited the cost of development/expense of R&D (vs 51 per cent in 2020) COVID-19 response

In line with the rapid shift towards digital services last year, nine in 10 (87 per cent) of those surveyed said the pandemic had accelerated the integration of new technology and innovation.

In Singapore, this translated into the largest average increase in digital banking investment of any market (25 per cent) and the highest proportion of respondents globally saying their bank increased overall investment/budgets in response to the pandemic (84 per cent).

Also Read: RootAnt lands US$1.46M to expand its banking-as-a-service solutions in SEA, Japan

In fact, adapting to the challenges brought by the pandemic was the third biggest driver of the adoption of technology (47 per cent), just behind cost cutting and efficiency (54 per cent) and business growth (48 per cent).

“Our research uncovered an overwhelming recognition in Singapore that BaaS has the potential to help financial institutions grow their business, bring new services to market faster and streamline company operations. The level of BaaS deployment in the last year shows that Singapore’s financial services sector is living up to its progressive reputation when it comes to technology,” said Luc Hovhannessian, Managing Director of APAC at Finastra.

“Through initiatives like BaaS and Open Banking, financial institutions in Singapore are laying the foundations for truly Open Finance, enabling banks to level up their technology capabilities like never before and provide ever more innovative and competitive services,” Hovhannessian added.

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Image Credit: Finastra

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On Friday, June 25, Singapore-based wealthtech platform Gotrade announced a US$7 million funding round led by LocalGlobe. In this funding round, Gojek Co-Founder and CEO Kevin Aluwi also participated as an angel investor.

Indonesia-based venture capital (VC) firms were also involved in the funding round, including Amand Ventures, Prasetia Dwidharma, and Brama One Ventures, a Surabaya-based VC firm that has invested in a number of startups such as Ayoconnect, Halodoc, and NalaGenetics.

Gotrade offers ease and convenience in buying and trading stocks for US-listed companies. The service is currently available for a limited number of users in Indonesia on a by-invitation basis. This model requires a new user to receive an invitation from an existing one as the app is still in its early stage. According to statistics, Gotrade has secured more than 100,000 users only 13 weeks since its launch.

The startup was founded in 2019 by David Grant, Norman Wanto, and Rohit Mulani. It is also part of the Y Combinator (YC) accelerator programme with YC as its early investor.

Also Read: Gojek, Tokopedia confirm merger with the launch of GoTo Group

One of the value propositions that Gotrade offers is that the platform eliminates geographical barriers to investing by cutting down on commission fee and minimum transaction. Users in 150 countries can buy stocks listed on Dow Jones, S&P 500, and NASDAQ starting from only US$1.

Wealthtech platforms have been gaining popularity in Indonesia with the rising demands for platforms that meet the needs of younger investors, particularly Millennials and Gen-Zs. Local startups that are developing similar services have also been receiving investors’ attention. This list includes Ajaib which has announced a US$65 million Series A funding round in March, followed by another round by Sequoia in May.

There are also platforms that offer investments in other forms. One that gives access to US stock exchanges is Pluang, though it is only limited to companies listed on S&P 500. The startup also counted Go-Ventures as an investor and is now integrated into the Gojek platform.

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Tha article Kevin Aluwi dan Sejumlah VC Lokal Turut Terlibat dalam Pendanaan Awal Gotrade was written in Bahasa Indonesia by Randi Eka Yonida for DailySocial. English translation and editing by e27.

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Prudence Foundation names Singapore’s EcoWorth Tech, Stimson Center as winners of its D-Tech Awards

The story: The Prudence Foundation has named EcoWorth Tech (Singapore) and  Stimson Center (US) the winners of the D-Tech Awards. The companies will receive US$200,000 each in financial grant along with networking opportunities with humanitarian experts, VC fund managers, fellow tech entrepreneurs, and social enterprise developers.

About EcoWorth Tech: A cleantech company that specialises in transforming waste materials into reusable products that deliver both social and environmental benefits.

The company’s Carbon Fibre Aerogel (CFA) sponge, made of low-cost natural materials such as waste biomass, renewable cotton, or wastepaper, is capable of cleaning waters following an oil spill.

EcoWorth Tech’s reusable, environmentally-friendly CFA sponge can absorb oil of up to 190 times its own weight, mitigating the environmental impact of polluting industries.

India’s NIRAMAI raises funding for COVID screening solution

Investors: CDC-UK, a development finance institution.

What the funding will be used for: The development of FeverTest, a screening solution that can screen COVID-19 symptoms in public areas. FeverTest is also able to recognise and detect non-compliance to mask-wearing guidelines.

About NIRAMAI Health Analytix: A deeptech startup that aims to provide automated solutions for critical healthcare problems. Its flagship product is a radiation-free, non-invasive, non-touch, breast cancer screening solution for hospitals and diagnostic centers.

More about the story: FeverTest is currently being used by corporate sites of Morgan Stanley, Kotak Bank, and multiple corporate parks across India.

Also Read: Ecosystem Roundup: New blockchain gaming fund+ Halodoc and Ruangguru’s big fundraise

Gaming solutions startup Mobius raises funding

Investors: Naresh Naik (founder of IREP Credit Capital), Kishore Ganji (founder of Astir IT Solutions), Rajesh Manthena (Chairman at AOI Hyderabad).

What the funding will be used for: Product enhancement, hiring, and customer acquisition.

About Mobius: A Bangalore-India-based tech product company that develops gaming solutions in India. The startup claims to have over 500 thousand registered users on the platform and plans on surpassing 10 million users in the next two years

More about the story: In the first year of business, Mobius generated over US$3 million in transactions on its gaming platform 777Games.

Thunes, SCB partner to provide cross border transfer services

The story: Singaporean B2B cross-border payments company Thunes has partnered with Siam Commercial Bank (SCB) to allow consumers and businesses overseas to send funds to Thailand faster, cheaper, and with higher transaction limits.

More about the story: Along with consumer remittances, SCB will also be able to facilitate B2B transactions, such as mass payouts in Thailand on behalf of enterprises based in other parts of the world.

“Partnering with Thunes, we are putting into action our mission that aims to respond to the rapidly evolving financial services industry, which is being reshaped by digital technology, regulatory change, and new consumer behaviour,” said Sirote Vichayabhai, Vice President of SCB.

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Singapore’s leading online classifieds company Carousell is mulling public listing in the US via merger with a special purpose acquisition company (SPAC), says a Bloomberg report, citing undisclosed sources.

The transaction could value the tech company at about US$1.5 billion, the report added. It is already working with an adviser on the potential deal.

Also Read: Carousell inches closer to unicorn status with a US$80M investment round led by Naver

The listing could occur as soon as the end of this year.

Launched in August 2012, Carousell began in Singapore and now has a presence in eight markets across Asia. As of last September, the firm is said to have over 250 million listings across Southeast Asia, Taiwan and Hong Kong.

The marketplace has a diverse range of products across a variety of categories, including cars, lifestyle, gadgets and fashion accessories. It also owns and operates Cho Tot (Vietnam), Mudah (Malaysia), OneKyat (Myanmar), and Revo Financial (Singapore).

Since inception, Carousell has raised over US$260 million across several rounds of funding, including an US$80 million fundraise from a consortium of companies, and a US$56 million from OLX Group in April 2019. Carosell’s other investors include Telenor Group, Rakuten Ventures, Sequoia India and Naspers.

Also Read: Is everything hunky-dory with public listing via SPACs?

In 2019, it made a series of acquisitions to accelerate leadership in Malaysia, Vietnam and the Philippines, including 701Search, the classifieds firm owned by Norwegian telco Telenor Group, and OLX Philippines.

Of late, listing via a blank-cheque company or SPAC has caught the imagination of Southeast Asia’s startup industry. In the recent past, many companies have disclosed plans to list via SPAC merger. The list includes Grab,  Malaysia’s Carsome, and Indonesia’s Tiket.com.

According to experts, SPAC listing in general does carry higher risk, but sometimes it can also generate a potential higher return if the company outperforms the prediction, similar to late-stage startup investing.

One of the differences between SPAC and traditional IPO is the baseline revenue that is used to value the company. In a traditional IPO, a company cannot use projections to justify its valuation, whereas SPAC allows a company to use projected revenue to justify a higher valuation.

Also Read: The hidden danger in SPACs. Is the hype worth the risk?

“Therefore, the risk/reward is tied to the projection versus the actual realised numbers. Also, the sponsors of a SPAC usually are able to obtain ownership at a discounted price when the SPAC makes an acquisition (this is called D-SPAC),” according to Carman Chan, founder and Managing Partner of Click Ventures.

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Image Credit: Carousell

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