The latest report from the Intergovernmental Panel on Climate Change (IPCC) presents a not-so-bright future for our planet. We are likely to reach or exceed 1.5 degrees C of warming, the ambitious limit set during the 2015 Paris Agreement. In fact, the current atmospheric concentration of carbon dioxide is 417 parts per million (ppm), almost double that of pre-industrial levels. 

There is little doubt that climate change is threatening city infrastructure, food production, and health. Unpredictable weather patterns, decreased harvests, and supply chain disruptions will drastically affect food security. Furthermore, higher temperatures increase the risk of illness and affect other aspects of health like air, water, and shelter.

But we can take steps to alleviate these harmful effects for ourselves and future generations, such as by harnessing the power of sustainable technology. Transformational changes are needed to make cities sustainable and resilient in the face of these challenges.

One such technology which has helped mitigate the negative effects of climate change is solar power, a much more environmentally friendly form of electricity compared to traditional sources like fossil fuels. In July, Singapore-based Sunseap Group announced a US$2 billion project to build the world’s largest floating solar farm and energy storage system in Indonesia. Other technologies like electric transport and sustainable buildings can also help upend some of the consequences of climate change.

TechInnovation, a premier technology-to-industry matching event, is back for the 10th edition

To help industries fully leverage sustainable technologies, Singapore-based innovation catalyst IPI is holding its tenth edition of TechInnovation, its yearly technology brokerage event, from 28 to 30 September 2021. In light of emerging climate change-related challenges, this year’s theme is ‘A Sustainable and Resilient Future’.

This theme was selected because of the new and emerging challenges that the world is facing, said Wong Lup Wai, chief executive officer at IPI.

“Climate change has created challenges on cities’ infrastructure, carbon footprint, food production, and health,” said Wong. 

TechInnovation is IPI’s flagship technology brokerage event. It will bring global technology providers and enterprises together to foster open collaboration and facilitate the commercialisation of emerging sustainable technologies.

During the event, attendees can hear from a variety of speakers and thought leaders, such as executive director of Energy Research Institute Prof Subodh Mhaisalkar and AgFunder’s Asia director John Friedman.

Also read: MaGIC graduate PABLO AIR — Leveraging drone technology for social impact

Attendees can also use TechInnovation to explore partnership collaborations with corporates crowdsourcing for new ideas and solutions, and discover technologies for commercialisation. The event is also a conducive platform for connecting with collaborators and mentors, allowing for one-to-one meetings through chat and video.

“What differentiates TechInnovation is that the organiser, IPI, actively matches the technology showcase providers with industry and participants that have indicated their needs to forge collaboration,” shared Wong. 

IPI’s role as a catalyst allows TechInnovation to serve as a springboard for enterprises to accelerate innovation, providing them access to the tools and insights necessary for ultimate business growth.

Key focus on sustainability, nutrition, and health

In this year’s edition, TechInnovation will focus on showcasing innovative technologies to achieve sustainability in the areas of resource consumption, food production, and healthcare provision. The topics are:

1. Green & Sustainable Future — Day 1 (28 September)
2. Sustainable Food & Nutrition — Day 2 (29 September)
3. Health & Wellness —  Day 3 (30 September)

On Day 1, sessions will revolve around the theme of ‘Green & Sustainable Future’. The event will start off with two keynote sessions, ‘Powering a Green and Sustainable Future’ and ‘Designing a Sustainable Future for Our Planet’, before diving deeper into three thematic sessions. In chronological order, these are ‘Crowdsourcing — Open Innovation Challenge’, ‘Smart and Sustainable Built Environment’, and ‘Sustainable Solutions in Recycling and Waste-To-Worth’. 

Moving on, Day 2 will look at sustainability in food and nutrition. The day will begin with two keynote sessions on the future of food, ‘What Will Be the Future of Food’ and ‘Digging Deep to Meet Our Future Food Needs’. After that, attendees can look forward to sessions like ‘Design Think Tank’, ‘Trash to Treasure — Upcycling Food Side Streams’, and ‘Innovations in Sustainable and Intensive Urban Farming’.

Also read: Want to strengthen your communities? Facebook and e27 are here to help

A key highlight for the second day is IPHatch 2021, a programme challenge that matches technologies from MNCs with startups to give them a boost to accelerate their business. IPHatch empowers startups with deep tech in IoT, sustainable food production and agritech to bring about the social and economic impact in this sector.

Finally, Day 3 features a host of events surrounding the theme of healthcare, which is more important than ever with Covid-19. Like previous days, it will begin with two keynote sessions, ‘Healthcare Innovations in the New Norm’ and ‘Reimagining Health & Wellness Solutions Post-Pandemic’. The event will close off with two thematic sessions, ‘Non-invasive Diagnostics in Healthcare’ and ‘Evidence-based Traditional Herbal Medicine’.

IPI’s key partners will also be showcasing their technologies during TechInnovation 2021. These include organisations such as German Entrepreneurship Asia, Innovate UK, Japan Science and Technology Agency, and many more.

Creating opportunities, catalysing innovation

IPI is a subsidiary of Enterprise Singapore, a government agency geared at helping businesses develop and transform. Established in 2011, IPI provides companies with access to its global innovation ecosystem and has been bringing TechInnovation to the world for 10 years. 

Companies can tap on IPI’s multidisciplinary expertise and international network. On top of industry events like TechInnovation, IPI also facilitates companies’ innovation processes, such as by advising and supporting their commercialisation and go-to-market strategies. This accelerated innovation benefits enterprises, technology partners, and government agencies alike.

This year marks IPI’s tenth anniversary. Since its launch, IPI has engaged with enterprises via a variety of initiatives such as Open Innovation Services, Innovation Advisors Programme, Innovation Marketplace, and many more, helping them embark on their business transformation journeys.

Also read: 32 startups raise US$108M in 9Unicorns-VCats maiden Global Demo Day

For example, food commodities supplier Par International Holdings, for example, decided to participate in the Innovation Advisors Programme in order to tap into new expertise and technologies, like alternative proteins, and expand their business portfolio.

Hence, IPI linked them up with innovation advisor Dr Rebecca Lian, who advised Par International Holdings on how to upcycle spent grains into high-protein and high-fibre products. With Dr Lian’s expertise, the company has already conducted initial trials for the repurposing of spent grains with their food manufacturing partner. 

“This year, IPI celebrates a decade of impact, catalysing innovation for enterprises and partners across a wide spectrum of industries and covering different technical domains since its setup in 2011,” said Wong.

The tenth-year mark of IPI’s presence is crucial, as it signals the importance of constant innovation. By providing end-to-end support for enterprises and helping them grow beyond their boundaries, IPI’s role in helping enterprises innovate and boosting the industry ecosystem is an undeniably significant one.

For more information on TechInnovation and IPI’s other projects, visit https://www.ipi-singapore.org/.

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This article is produced by the e27 team, sponsored by IPI.

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

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Zipmex, a Singapore-headquartered digital assets exchange, has secured a US$41 million Series B round from a clutch of corporate investors and VCs.

Bank of Ayudhya’s corporate VC arm Krungsri Finnovate, leading Thai media giants Plan B Media and Master Ad (MACO), besides new and existing VCs, including MindWorks Capital and Jump Capital, participated.

With this, Zipmex’s total funding raised to date has touched US$52 million.

This deal marks Bank of Ayudhya’s — part of the Mitsubishi UFJ Financial Group — maiden investment in a digital asset platform in Southeast Asia.

Zipmex will use the new capital for product offerings and scaling its technology team to roll out new digital assets products in lending, payments and securities. 

The digital assets exchange will also deploy a new marketing campaign throughout the out-of-home media network of Plan B Media and MACO. This aims to foster the possibilities of access for all to the power of digital payments.

Also read: Pintu adds US$35M to its Series A kitty, aims to build Indonesia’s largest crypto exchange

As per a press statement, the company also plans to launch Zipmex Card, a Visa-backed payment card, and ZLaunch, a platform that gives users early access to new investment tokens.

Founded in 2018 by Marcus Lim and Akalarp Yimwilai, Zipmex offers educational features for new investors and serves high-net-worth individuals through two earning accounts (one flexible and one fixed-term), underpinned by its native ZMT token.

The company also provides digital asset payment solutions to businesses and claims to have facilitated several regional-firsts in luxury vehicles, art, and property transactions.

Recently, Zipmex announced a partnership with Major Cineplex Group, the largest operator of movie theatres in Thailand, and digital payment startup RapidZ, to allow some moviegoers to buy tickets with cryptocurrencies like Bitcoin.

Zipmex CEO Marcus Lim said: “A marriage of digital assets and traditional banking can provide new innovative use cases for money, which we have demonstrated through ZipWorld. Further, the use cases of Zlaunch and ZipNFT are just the starting point of where we can evolve to be banking forward, lifestyle-focused.”

Zipmex claims to have bagged one million clients and processed more than US$4 billion in gross transaction volume to date.

The global exchange is also slated to be licensed in Thailand while operating under regulatory supervision in Indonesia and Australia. 

In Singapore, Zipmex, through its subsidiary, is currently in the advanced stages of applying for a Major Payment Institution licence application with the Monetary Authority of Singapore (MAS) for digital payment token services.

 

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Image credit: Zipmex

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Intudo Ventures, an “Indonesia-only” VC firm, today announced the final close of its oversubscribed US$115-million third fund.

Intudo Ventures Fund III will invest in homegrown companies capitalising on the rapid growth of private consumption and rising middle-class.

The fund attracted commitments from institutions, funds, and family offices, spanning the US, Europe, and Asia. Notable Limited Partners include Black Kite Capital, the family office of Koh Boon Hwee; Wasson Enterprises, the family office of former Walgreens CEO Gregory Wasson; PIDC, the investment arm of Taiwanese international F&B and retail conglomerate Uni-President Enterprises.

In addition, over 20 leading global funds and managing partners, including seven international Midas List investors, over ten tech unicorn founders, and 30 of the most prolific families and their associated conglomerates in the archipelago, also invested.

Also Read: Yummy Corp secures US$ 7.75M in Series A from SMDV, Intudo, others

Intudo is investing in industries poised to define the future of Indonesia, driven by the dual economic engines of private consumption and digitisation.

The oversubscribed fund brings Intudo’s total assets under management to approximately US$200 million.

The firm will commit initial check sizes ranging from US$1 million to US$10 million.

The third fund will seek opportunities in agriculture, B2B & enterprise, education, finance & insurance, healthcare, logistics, and new retail & entertainment, constructing a concentrated portfolio of 12-14 homegrown companies.

Launched in June 2017, Intudo works both hyper-locally and globally with a physical presence in Indonesia and Silicon Valley. It works closely with global investors through its Indonesia Beachhead Strategy as an in-country partner for Indonesia exposure, providing access, risk mitigation, and 24/7 on-call first responder support.

Also Read: Intudo Ventures closes US$50M “Indonesia-only” second fund

The firm is active in the US through Intudo’s Pulkam S.E.A. Turtle Fellowship, closely mentoring aspiring Indonesian founders, sponsoring and hosting major university and industry events. The events include the annual Harvard Asia Business Conference, MIT Asia Business Conference, Southeast Asia MBA Weekend, weekly discussions with Indonesian professional and student associations, and visits with Indonesians at top tech companies in Silicon Valley.

“What was once a ‘nice-to-have in-country investors have become essential for Indonesian companies to thrive, providing hyper-local support and deliverables. Acting as an in-country shepherd, Intudo supports our founders through a blend of hyper-local and global best practices, allowing us to create more favourable outcomes for our founders consistently,” said Patrick Yip, Founding Partner at Intudo Ventures. “Witnessing the resilience and growth of our founders, we are more bullish on Indonesia than ever before and are excited to work with the next generation of Indonesian entrepreneurs.”

In February 2019, Intudo closed a US$50 million fund, following its debut fund of US$20 million announced a year earlier. So far, it has backed a number of startups. Prominent among them are  Xendit, Halodoc, TaniHub Group, Pintu, Kargo, PasarPolis, BeliMobilGue, and Yummy Corp.

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Consumer credit has not been popular in Vietnam, given such a large unbanked population and extended life perspective of debt avoidance. However, with an emerging wave of young and online-oriented generation, this will soon change in the 2020s decade, already backed by the rapid growth of e-commerce and e-wallet in recent years.

Buy now, pay later (BNPL) works by splitting customers’ payments into instalments with or without interest while paying providers a total amount upfront. First of all, let’s look at BNPL models and analyse their market entries. Many models of BNPL can be categorised into two verticals: card-linked offerings and non-card-linked offerings.

Of the latter vertical, an integrated shopping app is the most prevalent one at the moment. Most prominent players in the field fall right into this category: Klarna with a valuation of US$46 billion as of June 2021, or Affirm valued at US$24 billion in January 2021, etc.

This model started by offering an alternative payment method in on and offline stores. It is now well on its way to support BNPL issuers’ target much further: become a “super app” that provides access to several services on a single platform from a marketplace to financial services.

After years of improvement, a customer journey of borrowing from a BNPL app is more seamless than ever: shop, register with self-identification, then check out.

BNPL has been known for its quick processing right at the point of sale (POS), which completely changes the perception of traditional credit of credit history checking and regulations. Other new channels of instalments include prepurchase and postpurchase.

Traditional banks are believed to utilise these new channels to catch up on the race of acquiring young and new potential credit users and leverage their large customer base via card-linked instalments. Customers who own credit cards still claim to prefer BNPL as it offers a lower annual percentage rate on purchases and a more flexible payment due date.

Also Read: Akulaku CEO William Li: Asia’s BNPL sector has great potential compared to Europe

On a horizontal scale, BNPL issuers are usually categorised by the ticket size of consumers’ baskets and their targeted types of goods and services. Started with all kinds of small- to medium-sized basket of purchases, BNPL has captured a loyal base of young customers, who with thin files of credit are not qualified to purchase relatively valuable items like laptops, luxury cosmetics in one payment, not considering its appealing feature of zero per cent interest.

Recently, more focused issuers have targeted large-ticket transactions type and specified services, such as health care or home improvement.

Why say BNPL will change Vietnam’s payment landscape in this decade?

Firstly, the rapid growth of e-commerce in recent years, amplified by the pandemic, has boosted the scale of its other supporting platforms, especially payment systems. According to JP Morgan, Vietnam has a predicted growth rate for e-commerce, up to 19 per cent year-over-year increase to 2021.

In 2017 alone, this number was 36.6 per cent. This sector as a whole is valued at US$6.2 billion in Vietnam and is projected to increase rapidly over time. The potential is yet to reveal when brick-and-mortar retail is dominant entirely, and e-commerce is expected to account for only 5 per cent of total retail in Vietnam.

Given this steadily increasing number of transactions, maintaining a smooth and fast checkout system with supporting features will be a key for differentiation.

Vietnamese banks have been struggling to digitalise their systems over the years, and global banks have lost their first-move advantage acquiring new and young online customers to their credit collection. Come in BNPL platforms as tech companies with sophisticated technological systems, catering for online shopping platforms with advanced consumer-service features.

These are well on their way to becoming head-to-head competitors with traditional banks if the whole banking model is simplified to a large customer base and transactions. For Klarna’s case, with several 14 million customers active within 90 million ones registered and an average of 1 million transactions per month, it already launched many other features of financial services to target much further than just a BNPL platform: a neobank.

Coming back to digital payment, where checkout experience plays an essential role in differentiating a marketplace, a feature of BNPL allows users to split costs into smaller amounts right at purchase seamlessly, without much regulatory scrutiny.

Considering most purchased items in Vietnam online baskets, with electronics and travel being the first and second correspondingly, sooner or later, BNPL will prove its ease of usage by breaking up these mid-sized purchases, letting young online shoppers achieve a more flexible financial plan.

Also Read: Is Southeast Asia ready to buy now, pay later? 

This has proven to be the case of success in SEA countries: PayLater in Indonesia, Atome and Hoolah across Hongkong, Singapore and Malaysia.

Another factor that will contribute significantly to the growth of BNPL is young population, given that the average age in Vietnam is 30.4 years old. Just like how strongly this generation has supported online shopping, internet penetration is expected at 49.7 per cent while 37.1 per cent of the population has shopped online, the same will be applied to BNPL.

Not just from the consumers’ side, banks and BNPL platforms will not wait to grasp a share in this market, with its promising impact on the banking and payment landscape.

SEA remains a sizeable unbanked population over the years. Only 27 per cent of the 670-million-people population in the region has bank accounts; that leaves hundreds of millions of people not having a bank account, not even considering a credit line.

Recorded in Indonesia, many people used BNPL before even having a bank account. For cautious buyers, the idea of creating credit without interest does not sound much like debt, especially where their money is not exposed to the risk of delay refunding.

Therefore, promoting BNPL will be a helpful channel for implementing credit ideas and building a foundation of a credit scoring system through online users’ behaviour.

The enthusiasm for BNPL of tech companies soon to be seen in Vietnam can be explained by its high engagement from customers and profound revelation of daily users’ purchasing history, not just significant acquisitions like borrowing from banks, which is much relevant in depicting customers’ creditworthiness.

Banks have started entering this new field, “super apps”, third payment channels such as Paypal and MasterCard, all coming in the same space have proved the rise of BNPL. The race in Vietnam has started with e-wallets, startups and incoming banks, who will be the final winner in this payment landscape transformation. With nearly a quarter of Vietnam’s population aged 14 and under, there are millions of new potential online consumers.

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The virtual kitchen industry is relatively nascent in Malaysia. Currently, only a few players exist, and there is only a limited footprint compared to neighbouring Indonesia or Singapore.

However, COVID-19 is turning out to be a boon for the industry and accelerates its growth. With the emergence of the pandemic, which is forcing a shift in customer behaviour, Malaysia has witnessed the sprouting of virtual kitchens, aka cloud kitchens, ghost kitchens, or dark kitchens.

As per a survey, 58 per cent of Malaysians have admitted to using more food delivery apps during the pandemic. “Since the movement control order of March 2020, there has been a rise in the awareness and acceptance of food deliveries among Malaysians. More Malaysians are now open to the idea of food delivery — be it from a restaurant, cloud kitchen or a home kitchen,” according to Nicholas Ou, co-founder and CEO of Loop Foods.

Virtual kitchens were first introduced in Malaysia by delivery platforms. They invited brands to locations with predicted high demand and rented a building, and designed multiple kitchen spaces for different brands.

Also Read: How millennials and the pandemic are driving the growth of cloud kitchens in Indonesia

Sensing an opportunity here, many traditional F&B players have turned to cloud kitchens to save operational costs. Some of them opened their own cloud kitchens—for example, MyeongDong and KyoChon. Even some landlords are turning their empty spaces into cloud kitchens.

On a growth path

Virtual kitchens come in two models. The first model works like a co-working space where the operator rents out the space to tenants. In the second model, the cloud kitchen operator owns and runs all the brands.

Less than ten cloud kitchen companies are currently operating in Malaysia across these two models. They are Foodpanda, CookHouse, COOX, Loop Foods, Pop Meals, KitchenConnect, and Aliments. Most of these have one to two outlets in the country. Each of them looks to tap into the growing consumers using digital platforms/apps for food delivery.

According to Yiping Goh, Partner at Quest Ventures, Malaysia’s cloud kitchen industry is growing fast — initially dominated by Grab and Foodpanda and B2C player Pop Meals (erstwhile dahmakan).

“With multiple lockdowns permanently disrupting retail F&B entrepreneurs, more sustainable models like cloud kitchen operations are being adopted at a rapid pace,” she added. “We still see lots of fragmented B2C players and believe that stronger B2B/B2B2C players will emerge to serve brands that are well established but severely impacted in ways they operate in this endemic.”

The online food delivery market in Malaysia has grown considerably throughout 2021. The market was about US$66.3 million in 2017 and US$192 million in 2020. This figure is expected to hit US$319 million by 2026.

“Throughout the last few decades, the F&B industry’s business model has involved prime real estate that could attract customers. But with fast internet and mobile penetration, consumers’ behaviour is changing,” Ou explained.

Also Read: Everything from soup to nuts: Meet the 27 ghost kitchen startups in Southeast Asia

Loop Foods is a Sunway iLabs-backed cloud kitchen player that serves multiple in-house ‘virtual restaurant’ brands for online orders and delivery.

“When considering being delivery-first, the necessity for prime real estate is suddenly eliminated. Also, we’re rethinking how to utilise kitchens better. One kitchen serving one restaurant is no longer seen as the most efficient way. That’s where the concept of a multi-brand cloud kitchen comes into play,” Ou shared.

Challenges galore

Despite vast growth potential, Malaysia’s dark kitchen industry as a whole is facing several challenges.

The first challenge is in making changes to operations.

“Joining a cloud kitchen requires a shift from the typical running of a brick-and-mortar store,” says Lim Hui Ru, General Manager at Kitchen Connect. “Traditional restaurants need to rework operational flow, team size, equipment layout, delivery menu, food and packing, materials storage. This complete shift takes time to adjust.”

Quality control is the second challenge. In a typical restaurant, food goes directly from the kitchen to the customer. However, in a food delivery business, the food moves from the kitchen to the delivery partner and then to the customer.

In addition, it is also dependent on external forces such as rain and traffic, which could delay the delivery and food quality.

The third big challenge is digital marketing. As the bulk of orders in a delivery kitchen are online, operators need to be savvy in digital marketing, observe online trends and apply that back to the business.
Small delivery orders is another challenge. A small order makes it harder for a delivery to be economically viable, both for the food delivery platform and the restaurant/kitchen.

“The aggregation of several kitchens in a single location provides more efficiency and economies of scale for both restaurants and delivery partners. Consumers can also order from multiple restaurants at one go with minimal delivery charges,” according to Ru.

A comparison with Indonesia, Singapore

Malaysia’s internet economy has more than tripled in size since 2015 at an average growth rate of 49 per cent a year. It has given rise to a new generation of tech-savvy, mobile-first consumers who are open to digital-first F&B brands.

Loop Foods’s Ou says that even legacy F&B brands are exploring cloud kitchen models to increase their reach to newer customers and expand their service coverage.

“In Indonesia, we will only be seeing it in major cities where their density is much higher than Malaysia’s key cities. As a result, they are likely to experience better outcomes than Malaysia, but of course, we will see more players fighting for a space in the market, too,” said Lee Teng, COO of Aliments.

In his view, Singapore will be a relatively smaller market, but with a high density and higher usage of online food ordering. And due to the market size of Singapore, cloud kitchens may not need to focus too much on expanding to different locations to expand coverage. “Still, they would need to focus on marketing to create more demands strategically,” added Teng.

Also Read: How Philippine cloud kitchen industry is piggybacking on the country’s unique food culture, shifting customer behaviour

Aliments is a data-driven food ordering platform that claims to have grown its business about 400 per cent over the last six-plus months. The firm hopes to expand nationwide and regionally by 2022.

Despite the massive potential, the amount of investment pumped into the sector has been insignificant.

However, Hui Ru of Kitchen Connect foresees investors will inject into the market in the coming years. “With several new players coming on board into the Malaysia market, we anticipate more investors pumping in investment to sustain the business long term. And with the pandemic becoming endemic, consumer behaviour shifts (more open to food delivery and online payment), more delivery-only kitchens will bloom, attracting more funding.”

Experts believe that virtual kitchens will stay here even post-pandemic and become a part of the new norm like online/contactless ordering. Bringing the best experience with technology solutions is the key to striving in this current and future market.

“Overall, the pandemic has boosted the growth of cloud kitchens. The question is whether this will be a temporary trend or will it continue post-pandemic. The answer is that it all depends on the product’s characteristics, how well cloud kitchen operators leverage the available technology and demographic of the target consumer,” Aliments’s Lee Teng shared.

“But similar to all other trends, it will go into a consolidation period. Only those that grasp the key elements (product, marketing, tech) of running a cloud kitchen will remain and thrive,” Lee concluded.

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Image Credit: CookHouse

 

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