Thinking out loud: Are electric vehicles as sustainable as we believe? by Rachel Lau, Managing Partner at RHL Ventures

Although prices of batteries have significantly decreased, it has yet to reach the price-parity ratio suitable for mass adoption.

With the future of electrification on the horizon, existing traditional automotive manufacturers are converting and diverting resources to develop EVs. Together with new and upcoming companies that are either developing EVs and/or other related EV components such as battery swaps and charging stations, this space is heating up.

While Chinese EVs are focused on the hybrid model of battery swaps and charging stations, Tesla and other manufacturers in the West are adopting the Tesla model of building charging stations with high-powered piles.

How New Zealand-based Sustainable Foods is harnessing the power of hemp to produce meat products by Abhinav Mehra, VC and angel investor

Meanwhile, other proteins like pea, myco proteins, and lab-grown cultured meat are also showing growth in this region. To appeal to mainstream meat-eaters, plant-based meat products were developed to mimic favourite foods in familiar formats like burger patties and sausages.

However, as most of them remain processed packaged foods – questions are being raised on their nutritional value.One company in New Zealand, uses not only soy and pea but also hemp. The crop is rich in complex protein delivery and considered one of the most nutritionally complete food sources in the world.

Though Auckland-based Sustainable Foods is among the first to adopt it in the alternative meat industry.

Rise of fintech

Was 2020 the Amazon moment for fintech in Asia? by Sirish Kumar, founder and fintech expert

It is only a matter of time before mobile devices will become the default Point of Sale (POS) device for small business owners. The ubiquity of smartphones has expanded the ability to reach underserved communities easily. Today innovative embedded finance solutions offered by fintech that can leverage this mobile technology has eliminated the need for costly hardware and digitalise previously outdated payment acceptance points at a faster pace.

Fortunately, the transition is occurring at a time when moving online has never been easier. ASEAN governments have championed efforts to invest in core digital infrastructure in both rural as well as urban settings, where the vast majority of the region’s small and micro businesses are located.

From Dogecoin to Cardano: Should you take altcoins seriously? by Duckju Kang, CEO of ValueChampion

Just as there is a laundry list of cons, there are compelling arguments for bitcoin that institutions and everyday investors have been buying. The alternative to fiat, the bitcoin gold standard, and the potential to disrupt traditional banking services offer an attractive looking glass into the future.

So what about the almost 9,000 other altcoins out there?

New banking

Beyond marketplaces and motorcycles: Digital banks need to formalise ASEAN’s informal economies by Kaspar Situmorang, CEO, Bank BRI

Banks cannot rest on their laurels anymore and pretend their corporate and enterprise accounts will keep them afloat. No longer can they ignore microfinancing products due to high transaction costs. The super-apps are only a year into their digital banking war, but it won’t be long before they start sizing up bigger, more lucrative accounts.

Brick-and-mortar banks still have their legacy accounts and large, on-ground networks, as well as strong KYC experience to exploit. As licensed banks with high capital buffers to withstand economic shocks and decades of specialisation (as opposed to super-apps who roll out and shut down new verticals frequently), legacy banks have a lot of fight in them yet– if, and only if, they execute fully digital plays themselves.

Reimagining customer engagement for the AI bank of the future by Renny Thomas, Senior Partner at McKinsey & Company

To remain competitive, incumbent banks must become “AI-first” in vision and execution.

If fully integrated, these capabilities can strengthen engagement significantly, supporting customers’ financial activities across diverse online and physical contexts with intelligent, highly personalised solutions delivered through an interface that is intuitive, seamless, and fast.

These are the baseline expectations for an AI bank– specifically when it comes to customer engagement.

By reimagining customer engagement, banks can unlock new value through better efficiency, expanded market access, and greater customer lifetime value.

In a post-COVID-19 world, Vietnam is SEA’s latest hotspot for venture capital investment by Duyen Tran, Public Relations at Loship

Emerging from the pandemic while other countries are still in the midst of the crisis is giving Vietnam an advantage. The country’s startup ecosystem has been transformed from the second-least active to the third-most active among ASEAN countries, trailing only Indonesia and Singapore.

Also, profiles of investors making deals in Vietnam are increasingly diversified. If the majority of deals were from Singapore and Japan back in the 2017-2018 period, the market now is extremely vibrant with the participation of several investors from different parts of the world such as South Korea, China, even the Europe, Middle East, and Africa (EMEA) region. Many of them have made investments in Vietnam for the first time. Local investors are also active, participating in roughly 30 per cent of deals.

SME and startup growth

How tech can help smaller brands scale in SEA by helping them maintain customers’ loyalty by John Jess, CEO and founder of Stash

Tech innovations created to troubleshoot everything from labour-intensive marketing campaigns to the messiness behind multi-market rewards programs tend to not only be expensive but difficult to customise and manage as well. It is like handing an infantry soldier a tank and asking them to drive it into battle with no prior experience.

That is why tech tools need to evolve to keep up with the needs of smaller businesses. I am the founder of Stash, an incentive tech startup that’s changing the way businesses keep their customers loyal and committed.

We have been pioneering the forefront of the tech revolution with a suite of software products that include, among others a mobile-based platform that brings together over 1,000 reward partners onto a single screen.

How founder-CEOs can setup their startup for a successful IPO by Sophie Chiu, VC Investor, AppWorks

This piece of article is more written for growth stage founder-CEOs. However, if you’re an early-stage founder, I believe this article can also shed some light on what is ultimately valued the most in the sometimes arcane process of filing for an IPO.

Trust is what helps companies earn long-term loves in the public market. It’s a playing field with big guys that have already proved their sustainability, building layers upon layers of trust as each quarter passes.

Trust is cultivated not only through data (a result of management and operation), but also through market reaction. This means, executing a good or even strong IPO is indeed very important because the trust is then solidified from day one.

How diversification of business models is helping SMEs’ post-pandemic restructuring by Benjamin Wong, co-founder and CEO of Transwap

While globally it seemed to be that we were all in the same choppy seas, over the span of a few months, if not weeks, it was apparent that not all businesses were on board the same boat. The differences in the treatment to SMEs was glaring; Interest rates were slashed to new record lows with Central Banks channelling greater efforts into printing money.

The scale at which monetary interventions took place resulted in seemingly optimal financial conditions of the market and yet many companies are still suffering the repercussions of the whiplash brought about with the onset of the pandemic and. When it comes to funding, however, SMEs in the Southeast Asian region do not have access to the lion’s share but instead are at the mercy of the shorter end of the stick.

Building your startup culture

Startups should celebrate failures. This is how to keep the experimenting culture alive by Sagar Chaudhary, marketing and PR Manager at Chinaccelerator

In the startup world, things move at a rapid pace and ideas alone do not bring success. Success requires implementation and the right implementation process requires different business experiments in order to test and validate those ideas.

Experimentation can be as small as tweaking the font on a website or as big as pivoting the entire business, as long as these are steps towards a predetermined goal.

Why it is time to reinvent The Agile Manifesto to answer challenges of a remote team by Cliff Berg, founder of Agile 2

Organisations today have embraced agility as a strategic imperative. For many, the Agile Manifesto is one of the sources of guidance on how to achieve agility. Yet, the Agile philosophy strongly favours working with others in person. This manifests through the “Agile team room” and the preference for face-to-face communication.

But these preferences are not backed by any research or evidence: they are assumptions of those who crafted the original Agile ideas and the various practices that evolved from those ideas.

It turns out that collaboration in an Agile team room is actually less than in a more traditional setup.

Smaller brands should have that option too. That is why I’m highlighting some of the ways businesses can scale sustainably and intelligently in 2021, to make the most of their digital transformation.

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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.

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

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More than US$300 billion was raised through IPOs worldwide in 2020, including record numbers of issuances in the US last year despite a sharp economic downturn brought on by the pandemic. A large portion of such issuances was via special purpose acquisition companies (SPACs), which are publicly traded investment vehicles created to merge with an existing company to bring it public.

According to Goldman Sachs, SPAC IPOs have raised a total of US$78 billion across 244 transactions globally in 2020. This represents a remarkable five-fold increase from the year before.

Closer to home, Southeast Asia’s most valuable startup Grab is also set to list on the Nasdaq via SPAC Altimeter Growth Corp at an estimated valuation of US$40 billion.

The sudden boom in SPAC IPOs was more notable given the tepid IPO markets in the years leading up to the pandemic. Companies were trying to stay private longer as venture capital and private equity money was abundant. The rapid renewal of interest in public equity capital raises the question of whether “staying private for longer” will become history.

Public valuations for startups, especially within the tech sector, is at a historic high with a median IPO priced at 24x sales in the year 2020 (a fourfold increase from the preceding twenty-year average).

Such lofty valuations are attractive for the typical SPAC target – young, loss-making, with no clear path to profitability, but are reminiscent of the dot-com bubble. The sustainability of these trends has major implications for the financial markets and thus warrants a more sobering view of SPACs.

Also Read: Ecosystem Roundup: Will SPACs sound the death knell for IPOs in SEA?

How it works

To evaluate the SPAC model, it pays to first understand how one works. A SPAC typically begins life as a team of experienced financiers (often referred to as sponsors). The sponsors leverage their reputation to raise cash in an IPO, then take up to two years in search of private companies to merge and bring public.

Along the way, it issues shares, warrants, and rights to parties that do not contribute cash to the eventual merger, thereby diluting the value of its shares. If investors eventually agree to a proposed merger, the SPAC redeems the majority of its shares from the public market, issues new shares to its sponsors or to third party private investors (PIPEs), and finally merges with the target company. The remaining public shareholders, sponsor(s), and PIPE investors all own a portion of the post-merger company’s equity.

A key risk of SPACs comes from a characteristic inherent to the design of SPACs: dilution. A recent Stanford study found that, on average, SPACs retained only 66.7 per cent of the cash they raised in the initial IPO at the time of merger, after compensating the sponsors and early investors.

Such common practices provide great returns for early investors but leave a gaping dilution hole which is proven to be correlated with poor post-merger performance. Few exceptions exist in the market, yet many SPACs are skyrocketing on the slightest rumours of a deal.

The enigmatic nature of SPACs and their targets’ ability to bypass rigorous IPO due diligence have helped them avoid public scrutiny and thrive in a market where behaviours depart from fundamentals and are driven by the fear of missing out. As market sentiments cool, and the crowd comes to realise the actual enterprise value of a SPAC, share prices typically plunge – posting negative returns.

Another danger stems from the first – the way in which the majority of SPACs are currently structured gives rise to two sets of non-overlapping investors with different, often opposing incentives. The ‘early’ investors who bought into the SPAC at the time of its IPO primarily hedge funds and some private equity firms tended to exit at the time of merger to lock in positive returns.

‘Later investors’ tended to hold shares through the merger and suffer from poor post-merger returns in the short and medium term. Of the 89 SPAC IPOs that have completed mergers between 2015 to June 2020, the median return was a disappointing -36.1 per cent compared to the average after-market IPO returns on the Nasdaq in the same period.

Also Read: Traveloka in talks for a merger with Peter Thiel’s SPAC to go public: Report

Why would anyone invest in a structure that collects cash, looks for a company to take public, and then allow those who invested the cash to exit?

Historically, sponsors have not been very influential in the growth of the post-merger company. If a target company is promising, why would sponsors and early investors not commit in the same way a private equity firm controls a portfolio company? Unlike in a successful traditional IPO where the majority of investors would hold a long position, most SPAC IPOs have a significant portion of investors who are looking for a quick return on their investments. This calls into question the notion of ‘targets benefitting from their sponsors’ experience and resources’ that many sponsors tout.

SPACs are not necessarily a ‘cheaper’ way to go public. If shareholders bear the full brunt of the dilution inherent to a  SPACs’ designs, the cost of raising funds through a SPAC would far exceed that of a traditional IPO, which includes a 4-8 per cent underwriting fee plus a price premium at public offering, which averaged 18 per cent in 2019.

Who is it for?

Dangers aside, SPACs can still be effective vehicles to raise capital for young and truly innovative companies that may otherwise be unable to scale and grow. The pandemic has ushered in the start of another tech revolution as multiple industries are forced to change. With VC funding reaching record levels in high growth areas such as healthcare, remote work, and e-commerce, the need for SPACs will continue to rise in the future.

In Southeast Asia where ECM/IPO activity has been slow, SPACs can lend credibility to regional startups to tap capital markets. The key to success lies in (1) high-quality sponsors and (2) sound governance – quality sponsors can provide the network, mentorship, and experience necessary for companies to reach their potential, while good governance ensures that a post-merger entity continues to thrive.

Take the Grab-Altimeter Growth Corp partnership as an example: the SPAC merger will give Grab’s founder Anthony Tan 60.4 per cent of voting rights with a mere 2.2 per cent financial stake.

The arrangement resembles that of such companies as Google and Facebook, where a dual-class share structure have allowed founders to continue driving their companies’ visions. While there are potential downsides, such efforts to align incentives are a welcome change in how SPACs operate.

Investors reacted to the early to mid-phase of the recent pandemic-driven exogenous shock in a predictable way. With levels of business uncertainty high and interest rate expectations low, the TINA (acronym for ‘There is no alternative’) effect took hold in financial markets.

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

Investors piled into crowded assets (typically growth stocks such as SPAC-mergers) irrespective of fundamentals because other asset classes offered worse risk-adjusted returns. However, with strong economic recovery in sight and interest/inflation expectations set to rise, the allure of the TINA trade is fading rapidly.

Investors now see opportunities in other parts of the market, and it is hard to believe that the enthusiasm for SPAC IPOs will remain. Without a fundamental shift in how SPACs operate – to align incentives and minimise dilution, SPACs will remain unattractive.

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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.

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

Image credit: Hans Eiskonen on Unsplash

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For LGBTQ+ professionals, the unfortunate reality is that the discrimination that they face in their personal lives can also be found in the workplace. This phenomenon — known as the “rainbow glass ceiling“– can prevent them from progressing in their career and realising their true potentials.

“Overt homophobia and indirect aggressions at the workplace do happen and the trickle-down effects are real,” Kennede Sng, co-host of Singapore-based LGTBTQ+ podcast series The SG Boys, tells e27.

“For one, identity self-censorship is something that LGBTQ+ persons struggle with. This refers to queer individuals hiding aspects of themselves, sometimes even going as far as presenting an untrue version of themselves out of fear of exclusion or being denied opportunities,” adds Sng.

Even in Thailand, a Southeast Asian country that is perceived as having a relatively open attitude for the community, LGBTQ+ professionals are going through a similar struggle.

In an interview with e27, Best Chitsanupong, founder/director of Chiang Mai-based youth organisation Young Pride Club, explains the barriers that LGBTQ+ fresh graduates faced when applying for jobs. She gives the examples of university students who were unable to wear clothes that reflect their gender identity in their transcript or certificates, making it harder for them to apply for internships or jobs.

“She applied for a job in several companies but received no replies. She assumed that this is probably because these companies may not be finding match between her application and identity. She eventually got rejected,” Chitsanupong explains.

According to her, this is in line with the findings of a UNDP study on discrimination and social attitudes towards LGBTQ+ people in Thailand.

“The survey revealed that non-LGBTQ+ respondents have favourable attitudes towards LGBTQ+ people and support equal right and equal access to services for LGBTQ+ community. This supports drop when it comes to accepting LGBTQ+ people as family members, fellow workers, students and social acquaintances,” the report reveals, citing both formal and informal discrimination faced by LGBTQ+ people in Thailand.

Also Read: This gay founder is creating a safe media platform for LGBTQ community in SEA

Things are no different in other parts of SEA either; in Indonesia and the Philippines, LGBTQ+ professionals are also forced to hide their gender identities, and this practice has a profound impact on their career progression.

“In the Philippines, for instance, a number of companies require their trans employees to wear uniforms that match their assigned sex at birth, lest they lose their jobs. One of our employees shared her experience as a trans-person in her previous company. She received a memo for using the women’s comfort room. She was further asked to use the comfort room dedicated to people with disabilities instead,” says Victoria Alcachupas, Vice President of Business Development, People Branding, Marketing, and Communications, at TaskUs.

So what can businesses do to ensure that employees of all background can strive in a safe and supportive environment?

In this Pride Month Special series, e27 speaks to companies and NGOs about building Diversity & Inclusion (D&I) in the workplace, and what LGBTQ+ professionals need and how employers can meet that.

What D&I are made of

Before we get to the details of what a company that has successfully implemented D&I looks like, we can start by pointing the result that they can achieve by having an inclusive workplace.

GAYa NUSANTARA, an Indonesia-based NGO advocating for the LGBTQ+ community in the country, gives e27 the parameters of such an organisation.

“We strongly believe that a company that has successfully implemented D&I has a wide spectrum of diversity in its employee roster, which ranges from diversity in geographical presence, ethnicity, culture, gender and sexuality, religion, age as well as physical and mental disability,” says Purba Midnyana, Communications Officer at GAYa NUSANTARA.

“There should also be a high happiness index that leads to a lower turnover rate; this is due to a high sense of ownership in cultural and environmental aspect [of a workplace],” he continues, citing a 2018 report by McKinsey about diversity in the workplace.

Sng of The SG Boys shares the five traits of an inclusive workplace. These workplaces have:

1. An established code of conduct among employees that explicitly bans discrimination on the basis of sexuality and gender identity.

2. Employee networks or initiatives that allow LGBTQ+ persons and allies to connect — which is especially relevant for larger companies with existing D&I initiatives.

3. Continuous effort to reduce bias in performance reviews

4. A signal of allyship from senior management, which can start from something as simple as introducing themselves in preferred pronouns and inviting others to do so.

5. An internal channel to flag concerns as the standard HR avenues are often not enough to create a safe space for conversation.

In implementing D&I in the workplace, Sng puts emphasis on the importance of collaboration between LGBTQ+ professionals and allies which can be facilitated by the management.

Also Read: Riding the irony: Can Indonesian GO-JEK afford supporting LGBTQ rights in a country that condemns it?

“Speak to management on creating spaces where LGBTQ+ persons and allies can gather and share ideas. It truly takes a village. A ‘grassroots’ strategy will help to put initiatives into practice and can show how LGBTQ+ concerns are actively represented in the company,” he explains.

Getting it right

But today, especially in the SEA tech startup ecosystem, is there any example of companies that have done it right?

Singapore-based proptech startup 99.co is one that allows its employees to express their gender identities starting from the use of pronouns. While the company is yet to provide spouse benefits due to several constraints, it encourages employees to bring their partners and families, same-sex and otherwise, to company events.

“Every new LGBTQ+ employee that joins us is fully aware of our culture, hence it allows them to be at ease quickly and become comfortable with sharing their preferred pronouns with other colleagues during their first week at work. Once they have made it clear on their preferred pronouns, everyone plays a part in being conscious and correcting others when the wrong pronouns are used,” 99.co COO Yan Phun explains to e27.

“Our People/HR team also has an open-door policy for anyone who faces issues at work, including discrimination, and they can make a report anonymously should they feel uncomfortable to reveal their identities,” Phun adds.

The principles of D&I that the company is embracing can also be seen in the products and campaigns that they are launching for their customers. For example, 99.co runs an annual “Home for All Campaign” to raise awareness for the discrimination faced by LGBTQ+ individuals at home and in Singapore.

It also introduces features such as the “Diversity Friendly” tag in its property platform. The feature started out as the “All Races Welcome” tag in 2016; its creation was inspired by 99.co CEO Darius Cheung’s personal experience with racial discrimination from agents and landlords.

“As our company and audience base grew, we saw an increase in discrimination faced by other minority groups outside of race and felt that the tag needed to evolve as well to address these groups. Although this tag remains optional for agents and landlords and it is not a comprehensive solution to the larger issues, we felt that it was the least we can do to raise awareness and create a safer space,” Yan Phun elaborates.

“Hence, we decided to relaunch this tag under a new name and also include an info tip to the tag that explains what this tag stands for. There was no resistance within the team when we decided to roll this out and it was like a matter-of-fact that this should be done.”

Also Read: “Diversity and inclusion aren’t getting enough airtime in SEA’s workplaces”

TaskUs, a digital outsourcer, was one of the first companies in the Philippines to offer healthcare benefits to LGBTQ+ partners.

“During the time when this practice wasn’t common, we worked with our HMO partner to come up with a plan that would cater to our employee’s nominated beneficiaries regardless of the absence of a SOGIE law/ordinance,” Alcachupas explains.

Apart from that, the company also allows employees to use their pronouns in both formal and informal settings, and have even introduced gender-inclusive restrooms and sleeping quarters in their TaskUs Philippines sites.

It also has an employee resource groups (ERGs) called Unicorns@TaskUs, which consists of LGBTQIA+ employees and allies. The ERG creates programmes, organises events, and helps leadership craft policies on D&I.

“Each ERG has an executive sponsor that supports the initiatives of its members and puts it forward to the agenda of leadership teams. Apart from securing budget for ERG initiatives and projects, executive sponsors represent the group’s interest during the creation and review of company policies and activities,” says Alcachupas.

“By having executive sponsors, members of ERGs can be assured that they have someone at the table of decision-makers to empathise with their needs and to voice out their feedback and policy suggestions. As stakeholders, ERG members are also consulted on how these policies will be carried out throughout the organisation.”

For these companies, having an inclusive work environment does pay off.

“Having an inclusive environment definitely improves our employees’ productivity, as they are able to focus on their work and put in 100 per cent when they are being their authentic self. This also promotes transparency and eliminates unnecessary resistance caused by fear of being misgendered or misunderstood when it comes to cross-team projects,” says Yan Phun.

“As a company, this has also helped us attract various talents from the LGBTQ community who applied to work with us specifically because of our inclusive culture.”

After the rain

Certainly, this was only the beginning. While some companies in SEA have started to embrace D&I policies in their operations, there is still a need to continue the conversation about this issue.

It was still fresh in our mind when a Gojek executive received a backlash for speaking up about D&I practice in their company several years ago.

In building D&I, Alcachupas puts an emphasis on three things. Firstly, the initiative has to come from the top; secondly, the management should always do their best to listen to the employees; and lastly, as leaders they need to start the conversation.

“Apart from lending an ear, letting them know that they have a voice is vital in terms of helping them grow professionally and personally. This will also establish a safe and mentally healthy environment for your employees,” she stresses.

Also Read: How to use Maslow’s hierarchy of needs to drive resilient leadership in 2021

“Our difference makes us an asset, not an opportunity to meet a diversity quota. Ultimately, everyone wants to be recognised and valued for the skills they bring to the table. It is my hope that anyone who identifies with being on the LGBTQIA+ spectrum steps into their office feeling celebrated, not hindered, by their identity,” says Sng.

Ideally, as a champion for innovation and disruption, the tech startup ecosystem should in the forefront of this movement. As we continue to seek ways to improve the way we work –to realise the #futureofwork– D&I should be a key agenda for every business.

Especially as the pandemic provided us with the opportunity to look within and re-examine how we are doing things.

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Image Credit: Clem Onojeghuo on Unsplash

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Qlue, a smart city ecosystem provider in Indonesia, said today it has secured an undisclosed amount in Series B financing round, led by KDDI Open Innovation Fund III (KOIF III), a fund supported by Global Brain.

Other participating investors are local VC firm Telkomsel Mitra Inovasi (TMI) and ASLI RI (a biometric service provider), as per a press release.

The Jakarta-headquartered startup will use the capital for expansion into new markets in Asia and develop new solutions. The KDDI investment will help Qlue penetrate into markets such as Japan, Malaysia and the Philippines.

“With this investment, Qlue is equipped with more resources to implement smart city solutions as Indonesia is entering the 4.0 industry era,” said Qlue founder and CEO Rama Raditya.

Established in 2016, Qlue has built a platform cutting-edge technology products leveraging workforce management, Artificial Intelligence (AI), and Internet of Things (IoT).

Also Read: How the Internet of Things is making the world a safer haven

It has developed citizen reporting app QlueApp (for the government), in addition to QlueVision (computer vision technology), QlueWork (mobile workforce management), QlueDashboard (all-in-one platform for visualising data), and QlueSense (IoT-based technology).

The firm is working with the Jakarta government on its first smart city concept in Indonesia. Over the past four years, claims the firm, this partnership has helped in reducing potential flood points by 94 per cent and improving government performance by 61.4 per cent.

In the domestic market, Qlue will further expand into healthcare service, industrial area management, hospitality, property developers, and state-owned enterprises.

Currently, Qlue has more than 70 clients across government and private sectors. They include government institutions and agencies, disaster relief organisations, satellite cities, and private companies in various industries.

Its previous investors are Prasetia, MDI Ventures and GDP Ventures.

Director Indonesia Office Representative Global Brain Sho Ikeda said: “Qlue provides a smart city platform that enables one-stop centralised control of the detection, analysis, and solution of urban problems through advanced technologies such as AI and IoT. Qlue’s products, which provide a comprehensive approach to various issues, contribute to enhancing urban functions across Indonesia through collaboration with many local governments, ministries, and private companies, including the capital city of Jakarta.”

Also Read: This Singapore startup is set to turn Myanmar’s Yatai City to a blockchain-powered smart city

TMI CEO Andi Kristianto added: “Telkomsel consistently develops digital trifecta that embraces digital connectivity, digital platform, and digital services for inclusive and sustainable digital ecosystem. Our investment will improve people’s digital lifestyle experience and encourage cross-sector digitalisation through productivity improvement and higher efficiency, and open up wider innovation opportunities.”

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Image Credit: Qlue

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Nium to acquire London-based payments optimisation platform Ixaris

The story: Singapore-based B2B payments platform Nium has signed a definitive agreement to acquire Ixaris, a UK-based payments optimisation firm. The transaction is expected to close early in the third quarter of 2021, subject to customary closing conditions.

Also Read: BRI, Visa join remittance firm Nium’s Series C round to facilitate tuck-in acquisitions

Objetive: Temasek-backed Nium aims to provide one API integration to access the world’s payments infrastructure. Through the Nium platform, customers in a variety of sectors can quickly deploy new financial services from card issuance to cross-border payments.

About Ixaris: It provides flexible funding and payment methods that help airlines and online travel agents (OTAs) reduce surcharges, earn rebates, flatten FX fees, and streamline reconciliation.

Ixaris claims it have issued more than 10 million virtual cards in 2019. Since inception, it has processed 24 million transactions for 200+ customers in 40+ countries.

Former OneConnect CFO joins GoTo

In the new role: Working from its Jakarta office, Lo will lead GoTo’s finance function and teams across all areas including tax, treasury, financial planning, accounting and procurement.

Who is Lo: Lo was previously the CFO of OneConnect Financial Technology, a technology-as-a-service platform for financial institutions and an affiliate of Ping An Insurance of China, for which he led its New York Stock Exchange (NYSE) listing in 2019.

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

Before that, he was the CFO and Treasurer of Yum China Holdings, one of the largest restaurant companies in China, where he managed a finance team of over 600 employees and led the NYSE listing in 2016.

Lo worked for Ernst & Young for 15 years, including as a partner and deputy director in the Asia Pacific Capital Markets Center, at which he specialized in US SEC reporting and Sarbanes Oxley compliance requirements.

About GoTo: Formed on May 17 through the combination of Gojek and Tokopedia, GoTo is a technology company with the leading marketplace in Indonesia. The agreement was the largest ever business combination in Indonesia, the largest between two Asia-based internet media and services companies to date and created an ecosystem that combines e-commerce, on-demand and financial services.

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Image Credit: Nium

The post In brief: Nium to buy UK startup Ixaris; GoTo names Jacky Lo as CFO appeared first on e27.

Large scale economic shocks like those that preceded the Coronavirus pandemic of 2020 occur once every few generations, bringing about unforeseeable change that is both permanent and far-reaching in nature. In the race to curb mobility to contain the COVID-19 spread, the global economy had ground to a halt expeditiously.

Singapore’s GDP shrunk by 13.2 per cent prompting a reduction in the GDP growth forecast. Prior to co-founding TranSwap, I myself was no stranger to the implications of large-scale economic disruptions, having conceptualised this company during yet another relatively difficult period in Singapore: The Asian Financial Crisis of 1997.

Having already experienced turbulent financial circumstances, the COVID- 19 pandemic was like history repeating itself albeit on a much greater platform. The only variable that changed was that this time around, there was technology on our side to allow operations to resume. Sure, there were initial kinks, but technological advances sanctioned a relatively greater degree of control and flexibility than matters were back in 1997. For many people, the uncertainty and initial response to COVID-19’s changing landscape set precedence for their ability to cope.

While globally it seemed to be that we were all in the same choppy seas, over the span of a few months, if not weeks, it was apparent that not all businesses were on board the same boat. The differences in the treatment to SMEs was glaring; Interest rates were slashed to new record lows with Central Banks channelling greater efforts into printing money.

The scale at which monetary interventions took place resulted in seemingly optimal financial conditions of the market and yet many companies are still suffering the repercussions of the whiplash brought about with the onset of the pandemic and. When it comes to funding, however, SMEs in the Southeast Asian region do not have access to the lion’s share but instead are at the mercy of the shorter end of the stick.

Also Read: Mekari acquires Qontak to strengthen its end-to-end offering for SMEs in Indonesia

SMEs contribution to the economy

SMEs comprise the largest numbers of businesses globally and are paramount contributors to generating employment opportunities and advancing global economic development. They represent about 90 per cent of businesses and generate at least half the employment opportunities worldwide.

In emerging economies, national income (GDP) constitutes 40 per cent of earnings by SMEs. In Singapore itself, SMEs gives rise to approximately 48 per cent of Singapore’s GDP and employs about 65 per cent of its workforce despite their vulnerability to the ever-changing business climates.

Gaining strength from numbers, just in the last half of a decade, SMEs have provided employment opportunities to 70 per cent of the workforce, thus providing a source of income for the skilled, semi-skilled and even unskilled. At the very core of an SME operations, is its dispensability and the only way that can be defeated is through innovation.

The government, too, attempts to catalyse SME operations through various schemes, grants and incentives such as the Technology Adoption Program (TAP) and Startup SG Tech that allow for companies that showcase the potential to develop proprietary technology solutions and incorporate a scalable business model.

Speaking from first-hand experience as a pioneer figure in the fintech scene in Singapore, it is clear to me that In a rapidly evolving digital world, speed acts as the key determinant of success. With the provision of innovative lending models and scalable funding structure, it is imperative that small enterprises be assisted to stay afloat during the crisis to better be able to position themselves to be innovative.

Furthermore, the fintech industry has a lucrative future and potential alliances have the ability to benefit SMEs in the coming years. After all, when technology finally caught up to complement our vision for easy and safe FX transactions at low costs, we leapt at the opportunity to found TranSwap.

Today, TranSwap is the leading cross-border payment platform for businesses and everyday people in Singapore. With its convenient solution reducing FX costs and complexity, TranSwap empowers businesses to grow globally. TranSwap is fully regulated and licensed in Singapore, Hong Kong, and Indonesia and currently facilitates FX payments in more than 180 countries.

Also Read: KoinWorks hits profitability, securing 100k SMEs as early adopters for its NEO product

Problems in SME Funding

One of the greatest challenges faced by SME when competing for funding resources, however, is the tendency to fall behind due to its limitations in size and the lack of reliability. As a result, SMEs across the region are not equipped with the necessary means to maintain or retrieve further finances. In addition, Southeast Asian financing is met with one of the most notorious financial inclusion in the world.

It is estimated that seven in 10 adults either have no access to long-term saving plans or credit cards and are underbanked or do not even have access to bank accounts.

Technology can bridge the gap between access to finance and business development. Fintech solutions are all about keeping up with the changing times and they have made it possible for people to make digital transactions a more mainstream method and the ease with which this can be done enables stronger insights into creditworthiness and better access to vital finance.

Why do some industries do better than others?

Due to the responsibility of SMEs to drive an economy forward, their operations cannot be left to chance and requires detailed and sound plans to be more aware of strategic operations and at a time like this, to make compelling financial decisions.

The lack of effective communication is a major determinant of SMEs failing post-COVID-19 pandemic as employee engagement took a nosedive. In a study conducted by McKinsey, it was found that 70 per cent of employees attach their sense of purpose to the work that they are required to do.

Companies that have failed to acknowledge the efforts of individuals in their workforce are jeopardising themselves as COVID-19 has subsequently caused members of the workforce to reflect on their purpose in life. The lack of purpose has led to reconsiderations of the kind of work they do, thereby compromising engagement and productivity, leading to further internal changes within the company.

To remain afloat, companies today have to channel efforts into appeasing their stakeholders. While certain industries such as Food & Beverage have flourished, others haven’t been quite as lucky. Global manufacturing has further declined, border controls and logistic service disruptions have dampened operations of international supply chains.

Furthermore, tourism and related businesses have been directly impacted by border closures and quarantine requirements, and some businesses will not survive this period without public support- financial or otherwise. An icon in itself, Singapore Airlines (SQ) has taken a reduction of 99 per cent of its passenger traffic due to COVID-19, efforts have fully throttled to maintain its responsibilities to stakeholders and employees alike; whether it’s engaging stewardesses as safe distance ambassadors or emulating in-flight experiences while grounded, sentiments of locals, staff and the government alike towards to SQ are highly positive.

Also Read: Post-pandemic, we are going to see a slim unicorn

The repercussions of COVID 19 is a healthcare-driven shock in which none of us are immune until everyone is immune. Industries engaging in myopic inertia instead of adopting more agile practices are more likely to compromise their operations. Stimulus packages encourage companies to simultaneously stay afloat and make necessary changes within the optimal span of time.

However, some SMEs have translated the stimulus package support into winding up businesses too quickly or expanding even faster than necessary, resulting in unsustainable growth. Companies need to maintain the balance between being realistic and optimistic as once there is a solution to curb the spread of COVID, the economy can move quickly.

Considerations to include in business models to reduce vulnerability

It is of vital importance that companies recognise whether they need to be focusing on measures to tackle temporary efforts or engage in stringent tactics to induce structural changes. Now, more than ever, making the right decision at the right time is highly warranted. Good decisions are fundamentally rooted in good decisions and despite uncertainties about what the future holds, businesses have to consider what the future could potentially look like.

TranSwap is experiencing this second wave of demand for business-focused solutions, as we are finding it easier to convince businesses to use our services as compared to the past when businesses would question if they can trust such platforms with their money.

Now, the businesses that we work with have made us an integral part of their payments system, incorporating 120 different currencies globally. This did not happen overnight but took a while for us to facilitate trusting relations with clients who appreciate knowing their money is in good hands.

Preparing for recovery allows for business leaders to systematically think through various possibilities and how their business could be affected by the onset of COVID 19 and the threats faced by the organisation in light of potential further deterioration. One of the most glaring disadvantage SMEs have when pitted against MNCs is the lack of data available.

Systematic planning allows greater insights into operations and better allocation of resources to be more informed of strategic decisions their businesses ought to adopt in order to successfully mitigate risks.

Also Read: Future-proofing Singaporean SMEs for a stronger digital future

Furthermore, being vocal about social impacts and honest engagement with stakeholders allows for all parties involved to be aware of the implications of business decisions, i.e investment and public policy.

This allows for businesses to have greater communication with their customers whose acknowledgement of responsibility towards their stakeholders can aid in making fruitful decisions while simultaneously tapping into a new market. This also shows the firm’s willingness and ability to adopt technologies and business models that are needed to be successful in the post-pandemic world.

Lastly, it is imperative to design frameworks that allow the monitoring and where necessary, the reviewing of programmes to ensure they continue delivering and achieving the intended income. Demonstrating an enthusiastic approach towards measuring and improving on impact is crucial for investors to garner the necessary confidence required to maintain investment levels.

While government initiatives are praiseworthy, some businesses also rely on non-governmental organisations who are often faced with challenging opportunity costs and adopting a far-sighted approach and identifying ineffective measures could be a critical element to boost investor confidence.

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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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From instantaneous translation to conversational interfaces, AI technologies are making ever more evident impacts on our lives. This is particularly true in the financial-services sector, where challengers are already launching disruptive AI-powered innovations.

To remain competitive, incumbent banks must become “AI first” in vision and execution.

If fully integrated, these capabilities can strengthen engagement significantly, supporting customers’ financial activities across diverse online and physical contexts with intelligent, highly personalised solutions delivered through an interface that is intuitive, seamless, and fast.

These are the baseline expectations for an AI bank– specifically when it comes to customer engagement.

By reimagining customer engagement, banks can unlock new value through better efficiency, expanded market access, and greater customer lifetime value.

Despite big investments, banks still lag behind

In recent years, many financial institutions have devoted significant capital to digital-and-analytics transformations, aiming to improve customer journeys across mobile and web channels.

Despite these big investments, most banks still lag well behind consumer-tech companies in their efforts to engage customers with superior service and experiences. The prevailing models for bank customer acquisition and service delivery are beset by missed cues: incumbents often fail to recognise and decipher the signals customers leave behind in their digital journeys.

Across sectors, however, leaders in delivering positive experiences are not just making their journeys easy to access and use but also personalising core journeys to match an individual’s present context, direction of movement, and aspiration.

Creating a superior experience can generate significant value. A McKinsey survey of US retail banking customers found that at the banks with the highest degree of reported customer satisfaction, deposits grew 84 per cent faster than at the banks with the lowest satisfaction ratings.

Also Read: Beyond marketplaces and motorcycles: Digital banks need to formalise ASEAN’s informal economies

Rising customer expectations

Accustomed to the service standards set by consumer internet companies, today’s customers have come to expect the same degree of consistency, convenience, and personalisation from their financial-services institutions.

For example, Netflix has been able to raise the bar in customer experience by doing well on three crucial attributes: consistency of experience across channels (mobile app, laptop, TV), convenient access to a vast reserve of content with a single click, and recommendations finely tailored to each profile within a single account.

Improving websites and online portals for a seamless experience is one of the top three areas where customers desire support from banks. Innovation leaders are already executing transactions and loan approvals and resolving service inquiries in near real time.

Non-bank disintermediation

Non-bank providers are dis intermediating banks from the most valuable services, leaving less profitable links in the value chain to traditional banks. Big-tech companies are providing access to financial products within their non-banking ecosystems.

Messaging app WeChat allows users in China to make a payment within the chat window. Google has partnered with eight US banks to offer cobranded accounts that will be mobile first and focus on creating an intuitive user experience and new ways to manage money with financial insights and budgeting tools.

Beyond access, non-bank innovators are also dis intermediating parts of the value chain that were once considered core capabilities of financial institutions, including underwriting. Indian agtech company Cropin uses advanced analytics and machine learning to analyse historical data on crop performance, weather patterns, land usage, and more to develop underwriting models that predict a customer’s creditworthiness much more accurately than traditional risk models.

Increasingly human-like formats

Conversational interfaces are becoming the new standard for customer engagement. With approximately one third of adult Americans owning a smart speaker, voice commands are gaining traction, and adoption of both voice and video interfaces will likely expand as in-person interactions continue to decline. Several banks have already launched voice-activated assistants, including Bank of America with Erica and ICICI bank in India with iPal.

If reimagined customer engagement is properly aligned with the other layers of the AI-and-analytics capability stack, it can strengthen a bank’s competitive position and financial performance by increasing efficiency, access and scale, and customer lifetime value.

Also read: AI and data will be the future of the M&A banking industry (Why I decided to merge with Finquest)

Successful integration across customer touch points

For banks, successfully integrating core personalisation elements across the range of touch points with customers will be critical to delivering a superior experience and better outcomes.

The reimagined engagement layer should provide the AI bank with a deeper and more accurate understanding of each customer’s context, behaviour, needs, and preferences. This understanding, in turn, enables the bank to craft an intelligent, personalised offering.

To craft and deliver intelligent propositions, banks must take an entirely new approach to innovation. First and foremost, they need to free themselves from a product-centric view, where they develop new products and features and “push” them to customers through product bundles and discounted pricing. Instead, they should adopt a customer-centric view, which starts with understanding customer needs.

Achieving this close alignment between bank capabilities and customer needs requires time and capital to develop a realistic, evidence-based understanding of actual customers’ time-critical needs.

The capability to gauge customers’ expressed needs and anticipate latent needs in real time requires that AI and analytics capabilities be integrated with diverse core systems and delivery platforms across the enterprise.

Customer propositions can no longer be one-size-fits-all

These days, customer propositions should be intelligent and tailored, and go beyond banking to address customer needs that may involve both banking and non-banking products and services.

The full report, Reimagining customer engagement for the AI bank of the future, demonstrates how a combination of intelligent propositions, seamless embedding within partner ecosystems, and smart servicing and experiences underpins an overall experience that sets the AI bank apart from traditional incumbents.

Also Read: How Bangkok Bank worked with Pand.ai to develop a conversational AI engine to better service customers

There are five capabilities that banks will need to develop in order to design and implement their customer engagement layer to become AI-first, so read on to learn more.

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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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The age-old adage, ‘if at first, you don’t succeed, try again’ is applicable to countless scenarios. However, in the startup world, trying new things until becoming successful is only half the story.

In the startup world, things move at a rapid pace and ideas alone do not bring success. Success requires implementation and the right implementation process requires different business experiments in order to test and validate those ideas.

Experimentation can be as small as tweaking the font on a website or as big as pivoting the entire business, as long as these are steps towards a predetermined goal.

As Dr. Bechara Saab, CEO and co-founder of Mobio Interactive, a digital therapeutics company, rightly puts it, “Ultimately, the truth is very powerful. And experimentation helps you identify what is most likely to be the truth.” The truth is indeed very powerful from any way that you think about it, but particularly in terms of understanding how the business will succeed.

Greig Charlton, CEO of 247, a Shanghai-based lifestyle company that uses data to make it easier and cheaper for consumers to purchase products and experiences in China, believes that experimentation is a privilege that startups have that corporations do not.

Most corporates are fettered by layers of bureaucracy as everything needs to be signed off at several levels. Speaking from his own corporate experience, he mentions how anything he wanted to get done required approval from the manager, and then the manager of the manager.

Startups are lean and can test things faster, which allows them to be able to find the right market fit much quicker than it would take an average corporate.

Also Read: A sneak-peek at the 28 startups joining Block7’s SEA Booster Programme

However, just understanding the fact that experimenting with new ideas is important is not enough. This begs the question, how do decide what experiments to run and what needs to be considered before experimenting?

Segment your audience

One of the keys to conducting a successful experiment is segmenting the audience. For a company that is just starting up, it makes sense to test out new features or tactics on the entire user base but as the numbers grow, it is pertinent that they segment the target group so as to avoid losing clients or customers if the experiment does not work out.

Woovly, a lifestyle shop that connects beauty, fashion and wellness brands to their customers, started out as a wishlist aggregator in the travel industry with 900,000 users before the pandemic hit.

As travel was one of the most affected areas, Woovly decided to move into the lifestyle segment but that would risk losing their existing customer base since they signed up for something completely different.

Venkat J, CEO and co-founder, explains that the company segmented the user base, applied several experiments to understand the user behaviour, and ran experiments on partitioned groups until the new market fit was achieved.

As a result of this mindful practice, Woovly now has over three million registered users – a growth rate of more than 200 per cent in just nine months.

Small tweaks can have a colossal impact

Experiments don’t always have to be big and in scale. Sometimes the smallest experiments can bring the biggest of impacts.

Understanding that brand mentions play a significant role in a brand’s value in the lifestyle industry, Woovly first experimented with their content creation platform by providing users with a new feature to add brand names to their content.

Also Read: These 9 famous startup failures have a lesson for you

This experiment saw successful results with almost 77 per cent of the users that tried the new feature. Next, they built on this experiment with better UI/UX, and within seven months, they managed to generate 750,000 brand-tagged user-generated content.

Have a good system in place

Trying and testing out new ideas does not guarantee success, but experimentation does minimise the probability of big failure. However, this is only true if the experiments are logically designed. Misguided (or even incomplete) experiments will often generate misleading results.

Indian healthtech startup Phable’s co-founder and CEO, Sumit Sinha, shares his experience wherein skipping some experimentation steps proved catastrophic for the company (but also a good lesson for future experiments). As the demand for teleconsultations rose during the COVID-19 pandemic, Phable experimented with this new feature offline first.

However, they made the mistake of moving quickly to bringing out to the public without getting any conclusive results from the experiment. Eventually, the company could not retain the new customers it had onboarded, which is why Sumit stressed having a good system in place and making sure all steps of the experimentation process are followed.

But the entire experiment was not a failure – ultimately the company is stronger as they realised where they went wrong and made the necessary changes.

247tickets conducted several experiments from the get-go. As Charlton mentions, they used to simply run experiments without any process in place. If the experiments didn’t work, they just forgot about them and if they did work, the team would double down on them.

Now, they have a “project brief template” which is essentially a procedure to define what the project will be. The person running the experiment fills out all the details including the hypothesis, budget, user groups, target users among other information which allows them to get a holistic view of the process. Having the right tools allows them to use the resources in a more optimal way.

Matthew Spriegel, CEO of Atiom – a mobile-first plug and play technology that elevates learning and engagement across organisations, also believes that experimentation is the key to figuring out how to generate leads.

Atiom uses a demo walkthrough that they send out to clients. This allows them to see how individual users interact differently with the walkthrough and make changes as required. 

Also Read: 5 ways for venture builders to reduce startup failures

Experimenting without a system in place, hence, is as good as trying to hit the bullseye with a blindfold in place: you are shooting your arrows, but you have no idea where they are going.

Don’t experiment only when things go wrong

Experimentation is not a quick fix or stopgap. Successful entrepreneurs continue to innovate to stay competitive. While it is pertinent to conduct experiments and try new options when things do not go your way, this isn’t the only time experimentation is valuable.

Charlton believes that the best thing to do is to experiment when things are going well because that gives you an added advantage. Unlike corporates who may be content with just growing 1 per cent or 5 per cent each year, startups do not have that luxury.

The startup ecosystem is extremely competitive and sometimes having a growth rate in higher two-digits also may not be enough. The only way to stay ahead of the curve is to think differently, run as many experiments as you can, and find the best growth techniques versus the number of resources or money spent. Experimenting only when things aren’t working will ultimately slow the company down.

Matthew also has a similar opinion, where he believes founders must definitely not break things that are working. It is good to reflect and make changes. Everything the company does must reflect the evolution of its products or services.

Dr Saab does not see any reason a company should stop experimentation either. Perfection does not exist and so from that perspective, there’s always room to grow and improve. If founders stop experimenting, then the competition may very well pass them. The only way to maintain the business and continue growth or even to stay the same size is to continue to experiment.

Build an environment that fosters proactiveness

Conducting experiments and trying new things at a frequent pace is taxing. A founder will undoubtedly have more drive and motivation to see the company succeed than the employees. This means it is critical to make sure that employees are as involved as possible. 

Mobio Interactive has a very “simple” approach to solving this – control the culture. All the founders put in a lot of time thinking about a unique corporate culture for their business that structurally ensures company-wide involvement and supports an idea-meritocracy.

Even before they hire somebody, they have that individual examine their corporate culture document and highlight what they feel are its strengths and weaknesses.

Also Read: Here are the most promising startups in the 5G space

This allows the founders to understand how to improve the culture, while also ensuring that every new member of the team buys into the culture, understands why it is the way it is, and knows what will be expected of them – before they join the company. 

Dr. Saab adds, “To run experiments and fail, is something we see as an opportunity. It is, because of its failure, in truth a success because we’re learning. So, our employees, for that reason, are not demotivated when an experiment fails, or when a favourite hypothesis proves wrong.

It is fully understood that the important thing is that we grow, and we can grow faster by focusing on our weaknesses. Weaknesses, after all, almost always represent our biggest potential to actually make a difference.”

Charlton believes in transparency to create a more conducive work environment. “If people see other people failing, and not getting into trouble, and in fact being celebrated, then it’s a really good way of inspiring people to be okay with failing. That’s probably the biggest thing that we try and do.

We’re not great at it, but we try to instill that transparency and make sure that everyone can see. In fact, I’ve run experiments before where we fail, and it’s about celebrating that failure. It’s about saying okay, here’s what we did, and it didn’t work, but what we’re going to do next time is this, and it’s going to work, and then maybe it fails again, and then we try again.”

This type of transparent culture reduces fear and lets everyone thrive.

Experimentation is not easy and is critical to every startup’s success. As Dr. Saab puts it, “If you’re not prepared to continue to fail and to learn and to be open to it with yourself and to be bold, then you’re going to have a real hard time. And if you’ve already taken the risk to start a company in the first place, then not taking additional risks becomes your biggest risk at all.”

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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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The core of modern civilisation lies in our mobility. Mobility impacts many aspects of life and as our lives grow more individual, it helps us in reaching towards the indispensable.

The next generation will see a transformative shift towards electrification in automobiles, moving away from internal combustion engines (ICE) that will likely be phased out.

The global electric vehicle (EV) market was valued at US$162 billion in 2019 and is projected to be valued at US$1,212 billion by 2027. An increase in demand for fuel-efficient, high-performance, and low-emission vehicles along with stringent government rules and regulations toward vehicle emission will supplement the growth of the electric vehicle market.

EV batteries remain the main barrier in the conversion to electric vehicles. Once only seen fit to power small consumer electronic goods such as alarm clocks and laptops, batteries are now moving upstream to power larger appliances from e-bikes to vehicles. Driving the move towards electrification is the rapid development of lithium-ion batteries.

The International Energy Agency (IEA) in its 2020 Global EV Outlook highlighted that sales of EVs in 2019 grew by 2.1 million worldwide. This boosted total stock in the market to 7.2 million from 5.1 million in 2018.

Electric cars in 2019 registered a 40 per cent year-on-year increase, accounting for 2.6 per cent of global car sales – roughly one per cent of global car stock. The rise and adoption of EVs are a sharp contrast to 2010 where only about 17,000 electric cars were on the road.

As countries try to reduce their carbon emissions and footprint in line with The Paris Agreement, EVs and batteries will play a crucial role moving forward.

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

An EV battery presently accounts for almost 30 per cent of the total cost of an electric vehicle. Thus lies the main pain point faced by battery manufacturers and automotive OEMs – the cost to manufacture these batteries.

Developments in battery technology and manufacturing capabilities have driven prices of lithium-ion batteries down from US$1,000 a kilowatt-hour in 2010 to an average of US$156 per kilowatt-hour as of the end of 2019.

Although prices of batteries have significantly decreased, it has yet to reach the price-parity ratio suitable for mass adoption.

With the future of electrification on the horizon, existing traditional automotive manufacturers are converting and diverting resources to develop EVs. Together with new and upcoming companies that are either developing EVs and/or other related EV components such as battery swaps and charging stations, this space is heating up.

While Chinese EVs are focused on the hybrid model of battery swaps and charging stations, Tesla and other manufacturers in the West are adopting the Tesla model of building charging stations with high-powered piles.

Chinese EV maker Nio pioneered battery swapping technology in 2014. It has surpassed two million battery swaps and has over 190 Power Swap Stations in 59 Chinese cities. Nio’s battery swapping station only requires three-minutes to swap a depleted battery with a fully charged battery.

In addition to the battery swapping stations, Nio provides charging stations similar to Tesla’s fast chargers dubbed “Power Chargers” – currently the world’s slimmest and takes half an hour to charge to 80 per cent from 20 per cent.

The biggest advantage of battery swapping is the reduction in costs and thus prices of cars.

Also Read: Grab, Hyundai launches their first electric vehicle service in Indonesia

That said, many battery experts argue that battery swaps only serve as a transitional solution for consumer vehicles at this point and may face scalability issues for large commercial vehicles.

Challenges remain in the production of lithium-ion batteries despite the drop in production costs as it is still in its infancy and many variables remain uncertain.

Production of lithium-ion batteries face environmental and structural issues and continue to fuel debate. Extraction of lithium results in energy and water wastage, with long term impact found in the surrounding soil and water quality.

On average, producing an EV contributes twice as much to its Global Warming Potential (GWP) and uses double the amount of energy compared to a standard combustion engine. The fabrication of an EV battery accounts for 70 per cent of the EV GWP and is likely to result in emissions of more than eight tonnes of carbon dioxide.

The world’s biggest EV battery maker Contemporary Amperex Technology Ltd (CATL) has invested in overseas plants in Germany and Indonesia. Growing appetite for batteries has led to higher demand for cobalt and other critical minerals important to battery manufacturing.

In a bid to fulfil the surge in demand and to reduce dependency on critical minerals, cobalt which was once seen as the heart of lithium-ion batteries is being steadily reduced in content.

This was in part due to the negative connotation attached to it. Cobalt comes predominantly from the Democratic Republic of Congo where workers exposed to terrible conditions mine and extract the mineral, earning it a nickname as “Blood Cobalt”.

Looking beyond the limitations of lithium-ion batteries, the commercial use of solid-state lithium-ion in EVs would mitigate a majority of the current issues faced and could fundamentally change the perception of EVs with the general public.

Also Read: ION Mobility secures US$3.3M to drive SEA’s 200M motorcycle users to use EVs, starting with Indonesia

A key concern with consumers is the range and distance at which the cars can travel. The Tesla Model S Long Range currently holds the longest range, going a maximum of 600km under ideal situations.

A recent study by Castrol noted that  469km is the minimum range an EV needs to cover to ensure the occupants does not succumb to range anxiety under daily operations.

The long-term future of EVs lies in the development of solid-state batteries. Solid-state batteries will be able to provide for a smaller battery pack, increase safety, and for higher energy density allowing EVs to travel further on a single charge.

Right now, only a single EV manufacturer has released a fully commercial EV with a solid-state battery. The Nio ET7 boast a solid-state battery capable of achieving a range of over 1,000km. QuantumScope and Toyota have already committed to developing solid-state batteries too.

Given the current technology and price of a full EV battery, it seems likely that automotive OEMs will continue to develop batteries with hybrid models instead of a full transition to EV. A full conversion towards EVs will gradually happen in time but is still a long road ahead.

Traditional automotive OEMs are simply not ready with the inherent transitionary risk especially when it comes to production, assembly, and roll out of EVs. Furthermore, majority of countries and cities lack the infrastructure to serve and maintain EVs.

Encouraging policy responses by the government is a way forward and can help with achieving a conducive ecosystem for EVs. The US recently unveiled a US$2 trillion infrastructure plan aimed at encouraging Americans to switch their gasoline powered vehicles to electric ones and called for a national network of half a million electric vehicle chargers within the decade.

Also Read: Indian electric vehicle makers need to improve the perception on quality — Ather Energy CEO Tarun Mehta

Meanwhile, in Norway, where EV sales accounted for 42 per cent of the market in 2019, favourable policies and progressive policies such as the elimination of annual road tax, purchase or import tax, and reduced parking fees has proven successful in encouraging consumers.

It is inevitable that 10 to 20 years from now a car we own will be in some way or form largely electric. But for now, it is unlikely for electric cars to take the market by storm in light of all these kinks that need to be smoothened out.

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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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The world has been wracked by a still-ongoing worldwide pandemic. It’s hard to make plans for the future, or even think about the prospect of growth when most businesses are already struggling to stay above the red line.

Yet, digital evolution is necessary for businesses to survive especially now when the way we live and do business has changed almost entirely beyond recognition. 

Despite Singapore’s renewed emphasis on digitalisation, it seems to be taking a much longer time for smaller businesses to catch up. Just last year, the Association of Small Medium Enterprises and Microsoft reported that up to 54 per cent of Singapore’s SMEs said that COVID-19 had set back their digital transformation, with over 84 per cent intentionally delaying plans for overseas growth. 

You cannot blame them. Tech innovations created to troubleshoot everything from labour-intensive marketing campaigns to the messiness behind multi-market rewards programs tend to not only be expensive but difficult to customise and manage as well. It is like handing an infantry soldier a tank and asking them to drive it into battle with no prior experience.

That is why tech tools need to evolve to keep up with the needs of smaller businesses. I am the founder of Stash, an incentive tech startup that’s changing the way businesses keep their customers loyal and committed.

We have been pioneering the forefront of the tech revolution with a suite of software products that include, among others a mobile-based platform that brings together over 1,000 reward partners onto a single screen. 

Smaller brands should have that option too. That is why I’m highlighting some of the ways businesses can scale sustainably and intelligently in 2021, to make the most of their digital transformation. 

Also Read: Tech for good: How Ula aims to facilitate the needs of small businesses in emerging market

Keeping customers in your funnel

Contrary to popular belief, it is just as important to secure new customers as it is to keep your old customers satisfied. Despite this fact, many businesses continue funnelling the lion’s share of their marketing dollar towards customer acquisition campaigns, creating new product and service offerings, or even amending existing operational structures to adapt to larger demographics. 

But the costs of acquiring new customers are high and the cost of losing loyal customers even higher. Studies have shown that the costs of acquiring new customers can cost up to five times more than the cost of retaining an existing customer.

In addition, building customer loyalty pays off– existing customers are five times more likely to procure your service or product, and increasing customer retention by five per cent can even increase your profits from 25-95 per cent.

Building a structured customer incentive programme, a system that rewards loyalty and repurchases to keep new customers in your sales funnel, also allows you to retain newly acquired demographics without experiencing a “customer drain”.

The problem is, it’s harder than ever to keep your customers in the loop with the massive variety of consumer choices that are now available online. Spoilt by the new generation of digital retail experiences, consumers have become less forgiving and more demanding of brands, with over 78 per cent of consumers changing their favourite brands during the pandemic last year.

Higher expectations for products and services have led to brands actively finding new ways to spice up their customers’ retail experience: from omni-channel retail, next-gen payment technologies, to on-demand same-day shipping. 

So how should brands today ensure that they have the correct systems in place to keep their demographics happy and engaged?

Also Read: What are the best marketing tools for early-stage tech startups?

Appeal to universal customer incentives

The trick is to build for your market. 

This is an especially important strategy for small businesses located in SEA given the massive cultural and geographical diversity of markets across the region. SEA is a hotspot for businesses right now and Singapore has recently been touted as the “next Silicon Valley of Asia,” a prime location for commerce, investment and expansion.

This news is all the more welcome for local SMEs which are in a naturally advantageous position to penetrate the neighbouring cities across shared waters. 

The problem is that it is difficult to penetrate new markets with a marketing strategy that’s flexible enough to target different demographics, yet robust enough to manage the scale of the operation.

From basic differences in national languages to nuances in customer behaviour and preferences for particular ad-types, the variations in market preferences have to be catered to for businesses looking to expand regionally.

Luckily, some similarities do exist among SEA countries. One of them is a clear shift towards mobile-first usage and a marked increase in mobile-first penetration in the region.

The pandemic has inadvertently created a “forced adoption” of digital platforms for more than 90 per cent of shoppers, and nowhere has that trend leaned more heavily towards mobile adoption than in Asia, where five of the world’s top ten countries with the highest smartphone penetration rates are located. The smartphone is where it’s at, and brands would do well to build marketing and sales channels that cater to the mobile-based preferences of those living in the region. 

The other similarities are universally appealing sets of customer incentives that can help you build customer loyalty. One such incentive comes in the form of customer rewards, such as gift vouchers, freebies, loyalty points and membership perks.

Regardless of the time or the place, it’s hard to argue against the power of a freely proffered gift, which is why so many of Stash’s partners have jumped aboard our Stash Connect incentives suite, where customers can pick and choose from incentives on merchants like Grab, Lazada and Dairy Farm.

Also Read: microLEAP raises US$3.3M to help small businesses raise funds via Shariah-compliant means in Malaysia

It’s all about automation

Building a marketing campaign that is specific and general at the same time seems impossible. How can we create campaigns that can target individuals, while running them across multiple markets? It sounds like a logistical and operational nightmare.

The trick is to adopt tech that can help you to automate individual marketing channels and support large-scale marketing outreach. Automation allows us to do everything, from issuing reward vouchers, collecting delivery addresses, managing customer profiles and more  with a speed and ease that would be otherwise impossible using purely human-managed operators and systems. 

For example, most tech platforms have in-built market localisations that can be turned on from a central system. Currently, Stash offers a range of more than seven language selections across 14 different markets, which can be adapted for the market preferences of your specific campaigns.

That means that there’s no need to hire translators or redo marketing materials to cater to different markets– the option is already there for you to instantly translate your value offerings to your intended audiences. 

Tech providers are also offering unprecedented autonomy for brands, with a range of back end services that allow you to do everything from create different customer tiers, manage reward redemptions and even collect and analyse customer behavioural data.

This allows you to build marketing campaigns that are not only customised for your desired audience, but to also extract the results of your efforts, analyse the data, and formulate next-steps to further optimise your marketing and sales strategies.

For example, you may find that customers aren’t responding well to the rollout of your incentive campaign – but a tiny demographic of particularly tech-savvy Gen Z audiences have consistently been using QR codes as payment channels to claim their rewards and make purchases on your store.

By leveraging that insider data and streamlining your QR code payment channels, you can use the data consolidated from online activity to rapidly respond to customer behaviour, staying one step ahead of your followers and competition. 

Also Read: 5 ways that will help SMEs scale even amidst a pandemic

Fighting for the underdogs

It has not been easy to stay ahead of the curve, even for major brands. That is why Asia’s biggest players brands like Amex, HP, Prudential, Microsoft and Simply Energy have become far more discerning with their choice of tech tools.

Our partners have elected for Stash’s suite of services because we offer a service that allows companies to have full control over their multi-market incentive campaigns while keeping their customers in the loop. 

At the same time, I personally hope to see more small businesses follow suit. Asia is a market with high potential for growth, and small businesses are as much a part of the race as their larger brothers.

By investing into tech tools strategically, in a way that can actively allow them to capture, retain and expand market share at an unprecedented pace, small businesses, which are built to be lean, quick and flexible, can not only hope to catch up with – but even overtake titans of industry.

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