Key information about Southeast Asian (SEA) startup ecosystem:
The gravity wells of capital and talent created by unicorns in 2019 have become more widespread in 2021 as SEA’s startups discover how to “hyperjump” funding life cycles and more talent pours into the region’s ecosystem
The confluence of US and China spheres of innovation resulting from home market saturation and stricter regulations has brought in more talent and capital to SEA and opened up more opportunities for startups to go global
SEA’s innovation landscape is growing, and the velocity of this growth keeps pace with the activity within it so far. The VCs that fall behind are those that fail to ride these new waves
In July 2019, we published a short thought piece, The world is flat, Southeast Asia is a bowl, describing the region’s innovation landscape (vis-a-vis the flat or spiky landscape of the rest of the world) by capturing the creation of these talent (war chests and brand equity to hire top talent), capital (mega-rounds led by global investors), and even company (M&A deals with smaller companies) “gravity wells” by regional unicorns.
We concluded that while the gravitational pull of these unicorns would only increase moving forward, there remains a lot of space unaffected by the pull of these unicorns and the value of SEA’s innovation landscape for early-stage venture capital lies precisely in opportunities untouched by unicorns (e.g. Indonesia’s rural economy).
Then in November 2020, we wrote about the impact of the increasing bifurcation between the US and China spheres of innovation on SEA in another thought piece, Unifying The Two Spheres Of Global Innovation: The Role Of ASEANnovation On The World Stage, with tech companies and investors in the former finding green pastures in the latter amidst trade wars.
The main examples we gave then were the diversification of supply chains into Vietnam and the movement of headquarters and talent into Singapore.
This year, we’ve seen both frameworks we described in these two articles — the deepening gravity wells and the confluence of the US and China innovation in Southeast Asia —-not only evolve but also affect each other, with the pandemic as a catalyst.
In this article, we revisit these frameworks, develop them further given what has been happening this year thus far, and most importantly, outline the opportunities for early-stage venture capital and early-stage startup founders in the region offered by the developments in these frameworks.
Discovering how to “hyperjump” funding life cycles
Southeast Asia is a bowl framework 2019 version
We’ve seen how the gravitational pull in SEA created by the 2010s generation of tech unicorns has expanded to the war chests of other tech startups.
The valuation markups in 2019 that primarily affected the post-Series C rounds of unicorns have increasingly become more common in 2021, impacting even earlier stage rounds (seed to Series B), especially where US and global venture capital and private equity investors are involved.
This has largely been driven by public market activity becoming more pronounced in the region, from the 2020 performance of Sea Group on Wall Street to the movement of first-generation unicorns (i.e. PropertyGuru, Bukalapak, Traveloka, Grab, GoTo) to the public markets catalysed by the former, SEA-focused SPACs, and local bourses making more significant adjustments for tech companies.
To put it into the context of our 2019 discussion on unicorn gravity wells — a “spacetime warp” has been opened up from the private markets to the public markets.
That pathway has always been there (i.e. Sea went public in 2017), but the mass of the companies concentrating at the deep end of SEA’s gravity well had not been significant enough— until now.
This opening up of SEA’s bowl to the public markets has created that current of more capital to be committed to the region, where we see the likes of Hedosophia, QED, White Star Capital, Cathay Innovation, and Ribbit Capital coming in assigning or recruiting people to focus on early-stage deals Southeast Asia as it takes a more significant portion of these US and European firms’ investment interests.
The edges of the region’s bowl are also flattening with this diversification of capital sources, not just from global investors but also local funds.
We’ve seen the rapid deployment of the dry capital that was accumulated over 2019 as LPs hopped on the private market fundraise balloon in 2018, as well as the creation of smaller, more focused funds, usually tied to local family offices and conglomerates (especially in Thailand and the Philippines).
The vacuum created by the first generation of unicorns heading to the public markets is quickly filled up by local firms teeing up companies to global marquee investors presumably used to buying at higher prices in more mature markets.
This has ushered in the second generation of unicorns this year (e.g. Carro, Flash Express, Nium), many of whom achieved a billion-dollar valuation at a much faster pace than the first generation.
This means that we can expect this “spacetime warp” from the private to public markets to also create smaller warps across the funding life cycle, enabling startups in the region to rise bigger and faster.
Perhaps over the next few years, we may even see tech startups access the public markets even before becoming a unicorn if public market investor interest matches the enthusiasm of private market investors.
In a way, it seems as though the region’s tech startup ecosystem has finally discovered how to “hyperjump” through the funding life cycle, and the “hyperjump technology” is no longer just available to unicorns as it was in 2019.
The short-term benefits of the global investor markups and early-stage funding diversification are obvious: more incentive for founders to build companies in the region, meaning more demand for venture capital and more demand for talent to grow these companies.
But then the biggest risk is when the fundraising valuation velocity outpaces the velocity of actual company growth and the velocity of SEA’s internet economy growth (oh no, a bubble!).
That said, we are still at a point where the region’s internet economy continues to grow at an increasingly rapid pace, and this is largely due to the momentum created by the first generation of unicorns amidst the pandemic, funnelling new online consumers and increasing confidence in businesses to adopt emerging digital platforms and solutions.
Some of the predictions made by everyone’s favourite report — SEAconomy by Google, Bain, and Temasek — are already being broken, and we can expect this to continue to 2025.
This points to the demand for digital solutions to keep up with investor interest, at least in the next five years. So in the meantime, a velocity equilibrium is being maintained despite the massive influx of capital this year.
Southeast Asia is a bowl framework 2021 version. Equilibrium is maintained so far as the influx of capital is balanced out by the continued growth of the internet economy.
Three opportunities for early-stage venture capital
Short-term benefits of bringing in global marquee follow-on investors that increase markups to offset or exceed the impact of dilution on returns, especially as they move in earlier rounds. Selling a buyers’ market can be lucrative but should also be strategic. This markup increase also increases the velocity of unicorn creation and the likelihood of earlier exits in the fund life, potentially increasing LP confidence in local funds and resulting in even more dry powder among local VCs. The risk here is that as global investors move earlier in the value chain, there will be more competitive pricing. Still, just as with local startups, local firms have an edge in terms of having more at stake in the region and a localization advantage in working with startups in the region.
More space for local VC firms to invest in a niche or emerging areas like crypto or agritech or femtech and sell these sectors and companies operating in these markets up the funding value chain. The risk is finding the right spaces that align with the investment thesis and balancing allocation against hotter sectors.
More pathways to exit and faster timelines to take advantage of the increase in velocity of unicorn creation and the ability of companies to exit earlier. The risk here is whether the company’s growth can actually keep pace with investor demand.
3 opportunities for early-stage startup founders in SEA
More sources of capital to access, and many who are willing to pay above market, but are they precious investors in the long run? And if they are leading the round, how committed are they to you as their portfolio company?
More attention is being given to industries and sectors that previously had no “gravitational pull” of their own in terms of venture capital. Underrated venture-backable spaces can be valuable blue oceans for startups.
More options to exit in the years to come, but figuring out which is best for the business ties directly to the vision and goal of the founders from day one.
US and China confluence opens up Southeast Asia influence
When we published the piece on the bifurcation, Joe Biden had just been elected president of the US, and China had just halted Ant Financial’s IPO in its tracks.
Since then, we’ve seen the Chinese government take even more decisive action to wield control over its technology ecosystem and also build a more self-reliant industry (e.g. semiconductors and chips), and in the US, regulatory scrutiny on tech companies has also intensified, more so on those coming from China looking to list on Wall Street.
What’s new in terms of this bifurcation and the resulting confluence of these spheres of innovation in Southeast Asia is that it is not just an influx of capital or investments but also of talent, thanks to healthy amounts of push incentives like an increasingly saturated market (more unicorns that came out of Southeast Asia than China this year, a new record) and pull incentives like the public market potential we discussed earlier.
The talent coming from China and the US takes the form of (1) investors setting up regional headquarters for their firms, (2) tech company executives relocating to expand their presence in the region, (3) HNWIs and family offices setting up Asia offices, (4) former founders, executives, or even employees of big tech companies looking to start new companies in Southeast Asia, and even (5) professionals (returnees among them) looking to be part of an emerging market venture.
As we described previously, each of these groups impacts the developments in Southeast Asia’s gravity wells and startup funding life cycle.
Investors leading Southeast Asia investment for global firms relocating to the region itself signifies direct contact and stronger commitment towards founders in the region, opening up more of these smaller “warps” for startups to “hyperjump” in their fundraising journey.
Apart from global investors setting up local headquarters to widen the competitive landscape for venture capital, the same trend is also happening in tech companies setting up Southeast Asia offices or moving their Asia headquarters to cities like Singapore. This presents welcome competition in the market and opens up opportunities for emerging tech startups to build adjacent to these global players, with the latter becoming customers or partners of the former.
HNWIs and family offices, as we’ve covered in past articles like this one, are also looking to participate in the diversification of early-stage venture funding, either by becoming LPs, setting up their own venture capital funds, or participating directly in fundraising rounds.
Then there are also operators, especially from Chinese tech giants, looking at Southeast Asia to start new ventures. This is not a new phenomenon, but we can expect an increase of these types of founders to be pulled in by the region’s gravity well and offer their experience and built up the expertise to company building in the region. That said, local VCs are always cautious about funding these “tourist” founders unless they have local co-founders or members in their management team who can navigate the intricacies of Southeast Asia.
Finally, some professionals are simply drawn to working in Southeast Asia’s tech companies, whether as entry-level employees, remote workers, founding team members, or senior executives. These professionals could potentially upskill companies, especially if they come from a deep tech background — the kind of background that has traditionally been lacking in Southeast Asia.
We see more tech startups like fintech, for example, looking to hire AI experts, and so there’s increasing demand for operators who can lead technological innovation within a startup. With the trend of markups and larger funding rounds in the region, the startups with bigger gravity wells are more likely to bring in better talent.
This layer of talent influx on top of the capital influx means that the space occupied by Southeast Asia’s innovation landscape will inevitably grow bigger, ultimately creating a virtuous cycle of proportionally increasing demand for talent and capital.
The interesting effect of the confluence of these spheres of innovation is that local startups will also be more opportunities to go beyond the region itself, especially for startups that offer solutions that can be competitive on the global stage.
With more of the world participating in Southeast Asia, Southeast Asia can participate on the global stage.
It may not be an equal and opposite reaction, but with what Southeast Asia can take in, opportunities can be brought beyond the region.
Two Spheres of Innovation 2021 version
Three opportunities for early-stage venture capital
Local VC firms developing into or positioning themselves as platforms for their portfolio companies to leverage US and China confluence, from talent to follow-on capital. A data-driven tech stack will also have a large role in navigating the increasing noise in the region.
Local VC firms as platforms to help family offices and HNWIs invest in startups, either through their funds or directly as co-investors or follow-on investors.
More professional interest in venture capital as demand for capital increases and the critical mass of founders increases.
Three opportunities for early-stage founders
More expertise and professionals in areas that are not as populated in the region but whose applications are in high demand (e.g. AI and data analytics being an example).
Easier to sell to Chinese and US companies setting up HQs in Southeast Asia as customers, more opportunities for B2B or enterprise startups.
More capital and talent are available to support global-first growth trajectories.
SEA’s bowl is not cracking but growing bigger
It is worth noting that the entry of the US and China into Southeast Asia in terms of talent and capital is not new, nor has it always been successful.
A decade ago, some global marquee investors tried dipping their feet into the region, but the activity did not explode into the gold rush we see today.
That said, there will always be space for local VC firms and investors with long-term convictions and a compelling value proposition for founders in the region.
There may be less of an early-mover advantage for sectors already flush with capital, like generalist e-commerce. Still, one of the great things about being an investor, and more so a founder, in a fast-growing, diverse market like Southeast Asia, is that there are constantly new opportunities for ventures to build, not just locally but now globally as well.
Southeast Asia’s bowl is growing, and the velocity of this growth is keeping pace with the velocity of the activity within it so far, so the bowl will not crack anytime soon. The VCs that fall behind are those that fail to ride these new waves.
Startup Innovation life cycle from a VC perspective
Competition is not the limiting factor for venture capital in the region. One could even argue that there are not enough VC professionals in Southeast Asia — that’s why you have emerging programs like the Insignia Academy, a VC accelerator.
Rather, the limits investors need to look out for are their own investment strategies or theses and the socio-economic trends and behaviours around these markets.
In this regard, we see value in thesis-driven investing and focusing more on quality and performance rather than a spray-and-pray approach, which funds and firms with more dry powder and bigger operations would be better suited to compete on.
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The Sherpa Company, a subsidiary of Vietnamese retail giant Masan Group, has acquired a 70 per cent stake in lcoal mobile virtual network operator (MVNO) Mobicast for VN295.5 billion (US$12.96 million).
Under the new transaction, Mobicast, operating under the brand Reddi, will gain exclusive access to the group’s consumer base and physical and online contact points across the country.
This will decrease Reddi’s consumer acquisition costs considerably, allowing them to reinvest in developing innovative digital consumer products and a customer care experience platform.
Meanwhile, Masan will have the capacity to develop a sticky loyalty programme by unifying its consumer base via Reddi. The deal serves as a stepping stone for the retail group to digitalise its platforms and create a comprehensive off-to-online (O2O) products and services package – “Point of Life”.
Founded in 2016, Mobicast launched Reddi in 2019 as the country’s second full-service mobile virtual network operator (MNOV). The startup uses the mobile phone infrastructure of the State-owned Vietnam Posts and Telecommunications Group (VNPT).
Reddi focuses on providing digital services solutions for young and modern customers through the mobile app platform. It also aims to transform into a super app based on core services such as mobile telecommunications.
The company also boasts of employing the most up-to-date technologies such as 5G, IoT, e-sim, or mobile money to promote the freedom of users’ experience and personalisation.
MNOVs such as Reddi provide value-added wireless communication services without owning the cellular infrastructure. Traditional mobile network operators (MNOs) collaborate with MVNOs to deliver telecom services to customers using their radio spectrum-based transmissions and related wireless network equipment.
This is a win-win situation for both MNOs and MVNOs and a standard business model in the telecom space globally. MNOs gain from increased network capacity utilisation, while MVNOs benefit from an asset-light business model.
Masan claims to have a consumer ecosystem spanning grocery, financial and digital life, accounting for approximately 80 per cent of the consumer wallet.
In Vietnam, the group possesses an expansive offline distribution channel of more than 2,400 WinMart, WinMart+ retail stores (formed through 2019 merger of retail arms with Vietnam’s largest conglomerate Vingroup) and more than 300,000 general trade retailers.
According to the group’s statement, the deal marks Masan’s maiden investment and entry into the telecommunications industry.
Singapore-based logistics tech firm Ninja Van today announced that it has raised a US$578 million Series E funding round from existing investors Geopost/DPDgroup, B Capital Group, Monk’s Hill Ventures, and Zamrud, an entity linked to a Southeast Asian sovereign wealth fund.
The funding round also included the participation of new investor Alibaba Group which has previously invested in leading Southeast Asian e-commerce firms such as Lazada and Tokopedia.
It followed a US$274 million in Series D funding round that the company announced in May 2020.
In a press statement, Ninja Van said that the funding “will be allocated towards infrastructure and technology systems that will support a sustainable long-term cost structure, as well as the quality and consistency of Ninja Van’s operations.”
The company will also invest in its suite of micro-supply chain solutions to help Southeast Asian businesses optimise e-commerce opportunities.
“The quality of investors joining us in this round of investment is a clear signal that the market recognises the emerging opportunities for e-commerce logistics in SEA and how as an entrenched player in the region, Ninja Van is positioned to take a central role in meeting the shifting demands of both businesses and consumers,” said Lai Chang Wen, Co-founder and CEO of Ninja Van Group.
“We remain committed to the success of all our business partners as we move towards the next stages of sustainable growth and continued innovation. The support from our investors will enable us to continue to build upon the business momentum we have achieved.”
Founded in 2014, Ninja Van has a presence in major SEA markets such as Singapore, Malaysia, Indonesia, Thailand, Vietnam, and the Philippines.
The company said that it currently employs more than 61,000 staff and delivery personnels that support the delivery of around two million parcels a day throughout the region.
Last month, we published a listicle of startups in Singapore, Indonesia, and Malaysia that have made notable achievements in 2021. We decide to build upon this new tradition by publishing one for startups in the Philippines.
There were plenty of exciting developments in the country this year. In addition to funding announcements by companies in various verticals, from gaming to e-commerce to green tech, we also saw more Filipino startups getting into the prestigious Y Combinator programme.
We believe that these startups would not be the last to brighten up the local tech ecosystem, and are excited to see how the final quarter of 2021 will be like.
Here is the list of the startups, compiled for your reading convenience.
1. Mynt
Mynt, a fintech platform offering mobile payments and business loans, announced in January it has raised over US$175 million in fresh capital from ASP Philippines, a Limited Partnership fund managed by Bow Wave Capital Management.
The new funds will go towards growing its product offerings to “further spur” the growth of financial inclusion and digitisation of payments and financial services in the Philippines.
The financing was raised in multiple tranches, with the post-money valuation of the final tranches reaching close to US$1 billion.
2. Podcast Network Asia (PNA)
Podcast Network Asia (PNA), a podcast network agency, announced in early 2021 that it has raised US$750,000 in seed funding. Local VC firm Foxmont Capital and Jakarta-headquartered Venturra Discovery joined Lisa Gokongwei, President of Summit Media, in the investment round. Kumu, a local live-streaming platform, also participated.
Launched in August 2019, PNA provides podcast creators with access to production support and monetisation opportunities. It claims it has since grown its roster to 415 podcasts, with over 10 million listeners by the time this funding was announced.
3. Expedock
Expedock, an Artificial Intelligence startup working with supply chain companies, announced in February that it has landed US$4 million in seed funding.
The round was led by a US$2.5 million investment by Ali Partovi, who had previously backed notable startups including Airbnb, Dropbox and Facebook.
Additional investors include executives from global tech companies and startups including eBay, Salesforce, LinkedIn and Instagram.
4. Mosaic Solutions
Mosaic Solutions, a startup offering cloud-based management software for F&B and hospitality companies, announced in February that it has raised an additional US$1 million in a pre-Series A preferred equity offering.
The fresh funds were provided by Gentree.
Mosaic had recently announced a US$1.5 million pre-Series A round in September 2020 from a slew of investors including Australian early-stage VC firm Investible, IdeaSpace (a non-profit which recently launched Opportunity Fund out of Manila), KMC Founders Fund, and JC Capital.
Fintech startup Ayannah announced in February that it is seeking to raise Series B round of funding to fuel its future expansion into Vietnam and India, its founder and CEO Mikko Perez.
To date, the company has raised over US$9 million from two funding rounds — seed in 2013 and Series A in 2015.
6. Avion School
Avion School, an edutech startup focusing on software development education, announced that it has secured funding from Y Combinator after being accepted into the global technology accelerator programme.
Launched in 2020 by Victor Rivera and John Young, Avion is an online school that teaches Filipinos to become remote software engineers globally. Students can sign up for a 12-week course that teaches them the engineering stack and skills required by software developer roles.
7. NextPay
NextPay, a digital banking platform for small businesses and entrepreneurs, announced in March that it has secured US$125,000 in pre-seed funding from Y Combinator (YC).
NextPay becomes the fifth local tech startup to be backed and selected by YC after Kalibrr (2013), PayMongo (2019), Avion School (2021), and Dashlabs.ai (2021).
8. Kraver’s Canteen
Cloud kitchen startup Kraver’s Canteen announced in April that it has secured US$1.5 million in a seed round led by Foxmont Capital.
Angel investors participating in the round include Lance Gokongwei (Chairman of JG Summit, Robinsons, Cebu Pacific), Brian Cu (co-founder of Grab PH, gojek, Zalora), and Paulo Campos III (co-founder of Zalora).
The fresh funds will go towards expanding its operations by building 100 kitchens across the Philippines and investing heavily in regional metropolis hubs like Cebu, Iloilo, and Davao.
9. Uploan
Uploan, a fintech company providing payroll financial services, announced that it has raised a senior secured loan of up to US$15 million from debt financer Lendable.
Uploan is Lendable’s first client in the Philippines. The long-term facility will allow Uploan to grow its loan book, redeploy Lendable’s capital and hold more exposure on-balance sheet.
10. Tier One Entertainment
Tier One Entertainment, a gaming and e-sports entertainment startup, announced an undisclosed amount of pre-Series A round of funding in April. Led by Gobi Partners, the round also included the participation from Warner Music Group, Octava, KAYAC, and Atlas Ventures.
The proceeds will also be utilised to hire back-end teams that will further support their talents, expand its e-sports operations in Blacklist International (Tier One’s e-sports team), and set up its first content creation hub in the Philippines.
Tier One was founded in 2017 by e-sports veteran Tryke Gutierrez, cosplay and gaming superstar Alodia Gosiengfiao, and seasoned entrepreneur Brian Lim.
Filipino neobank Tonik raised US$17 million in a pre-Series B funding round led by iGlobe Partner in May.
Existing investors Sequoia India, Altara Ventures and Insignia Venture Partners also participated. They were joined by Citius and Baring Vostok Capital Partners, besides several unnamed Philippine family offices.
Tonik plans to accelerate its growth, as well as invest aggressively in product development with the funding.
12. Great Deals E-Commerce Corporation
E-commerce enabler company Great Deals E-Commerce Corporation raised US$30 million in Series B funding round led by local logistics major Fast Group.
The round was joined by private equity firm CVC Capital Partners, besides existing investor Navegar. It comes almost a year and a half after Great Deals secured US$12 million Series A from Navegar in January 2020.
13. Fortuna Cools
Fortuna Cools, a startup seeking to find an alternative to plastics, secured a seed funding round led by ADB Ventures and Katapult Ocean Fund. Pasudeco Development Corporation, the Manila Angel Investors Network, she1k, and Nardo Holdings, also joined the round.
The company will use the capital to grow its sales and engineering teams, as well as finance its higher production volumes to reduce unit costs and benefit more farmers.
14. zennya
zennya, a mobile healthcare and medical last-mile logistics startup, secured US$1.2 million in a funding round led by Foxmont Capital Partners, Ignite House of Innovation, and DayOne Capital Ventures in May. The round also saw participation from several prominent families and angels from the Philippines and Thailand.
The funding will be used to expand zennya’s service to all major cities in the Philippines.
15. Kumu
Live-streaming app Kumu raised an undisclosed Series B funding round co-led by SIG, who is also a shareholder in ByteDance, and Openspace Ventures.
The funding round included existing investors Summit Media, Kickstart Ventures, Foxmont Capital Partners, and Gobi-Core Philippine Fund. It also introduced new investors Gentree Fund, the venture vehicle of HM Investment Management, and Endeavor Catalyst Fund by the global non-profit Endeavor.
The startup said that it has experienced “tremendous growth” over the past year when it topped the Google Play rankings in the Philippines, with users spending almost an hour per day on the app.
16. GrowSari
GrowSari, a B2B platform that helps small convenient stores, raised an undisclosed amount in Series B funding round.
Investors that are involved include Robinsons Retail Holdings, JG Digital Equity Ventures, and Wavemaker Partners, besides Tencent, Pavilion Capital, International Finance Corporation, ICCP SBI Venture Partners, and Saison Capital.
This round brings GrowSari’s total funds raised to date to over US$30 million.
17. Voyager Innovations
Voyager Innovations, the digital services arm of Philippine telco giant PLDT, raised US$167 million in a new funding round for its fintech unit PayMaya.
Existing shareholders such as KKR and Tencent also joined the round, along with new investor IFC Financial Institutions Growth Fund.
This investment includes US$121 million in fresh funding and US$46 million from previously committed funds.
Alternative Housing Group (AHG), a real-estate tech startup and proptech incubator, secured PHP55 million (US$1.1 million) in seed funding. The round was led by Foxmont Capital Partners, a local VC fund and investor in homegrown startups such as Kumu, Edukasyon.ph, and Booky.
Real estate mogul David Leechiu, entrepreneur Melissa Limcaoco, and Magsaysay family also joined.
The startup plans to fuel its upcoming projects that they have prepared and lined up in the coming years.
19. edamama
edamama, a new e-commerce platform designed for mothers, announced a US$5 million pre-Series A round from investors.
Investors include Gentree Fund, Robinsons Retail Holdings, and Kickstart Ventures, who are the affiliates of SM Investments Corporation, JG Summit, and Ayala Corporation, respectively. The round also saw participation from Foxmont Capital Partners, an early-stage VC firm based in the Philippines, besides unnamed Filipino and global angel investors.
20. NextPay
Digital financial solutions platform NextPay raised US$1.6 million in seed funding co-led by Golden Gate Ventures, and Gentree Fund, a private investment vehicle of the Sy Family, which owns Filipino conglomerate SM Group.
Other investors are Tribe Capital, Broadhaven Ventures, 1982 Ventures, Saison Capital, and Razorpay, besides Rohit Mulani of GoTrade and Abhinay Peddisetty and Chinmay Chauhan of BukuWarung.
Goodwater Capital also co-invested, along with local VCs such as Kickstart Ventures (Ayala Group), Foxmont Capital, and First Asia Ventures, as well as angel investor Lisa Gokongwei of JG Summit also joined.
The funding will be used to grow NextPay’s suite of services, expand its customer base, and introduce new digital banking solutions to micro, small, and medium enterprises (MSMEs).
21. Yield Guild Games (YGG)
Blockchain gaming startup Yield Guild Games (YGG) said in a blog post that it sold 25 million of its native YGG cryptocurrency tokens in just 31 seconds and raised about US$12.5 million in USD Coin.
With the token sale concluded, YGG will start to establish its decentralised autonomous organisation (DAO).
DAO, also known as decentralised autonomous corporation, is an organization represented by rules encoded as a computer programme that is transparent, controlled by the organisation members, and not influenced by a central government.
22. Etaily
E-commerce enabler platform Etaily secured US$1.6 million in seed funding from Ayala Ventures, Foxmont Capital Partners, Magsaysay Shipping & Logistics, the Boston Consulting Group, and unnamed angels.
Launched in March 2020, Etaily provides brands with a one-stop, omnichannel solution to help them sell virtually. From content production and channel creation to warehousing and fulfilment, it offers a full suite of services encompassing anything brands would need to attract consumers, transact online, and deliver their products.
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Etaily claims it has generated more than one million transactions and made more than 50,000 unique products available in countries such as the Philippines, Malaysia, Indonesia, and Singapore.
23. The Philippine Digital Asset Exchange (PDAX)
The Philippine Digital Asset Exchange (PDAX) announced a US$12.5 million funding round led by an unknown VC firm based in the UK, with participation from Hong Kong-listed fintech company BC Group.
Most of PDAX’s existing investors, including Beenext and CMT Digital, besides Ripple and several prominent family offices in the country, also joined the round.
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The marketplace is going digital. From being a “nice-to-have” to graduating to a “solid addition”, online avenues have now become mainstream. This is especially true in the Asia Pacific where, as per Statista, approximately 2.15 billion people used e-commerce in 2020, and by 2025, this number is estimated to increase to 3.13 billion people. In Singapore alone, on just one single app Shopee, during the very recent 9.9 sale people purchased 45 million items within the first 99 minutes!
Customers rule this digital marketplace. A McKinsey report says “Technology has handed customers unprecedented power to dictate the rules in purchasing goods and services.” This means that winning over the modern customer takes experiences that are unforgettable, convenient, and digital.
In fact, some of the world’s most popular brands, including Byju’s, PhonePe, 7eleven, Zalora, and Booktopia credit their success to the digital reinvention of CX. Recently, CX leaders from these brands came together at RE:SOLVE by Freshworks– one of Asia’s biggest summits on digital-first CX to reveal how they drive customer loyalty and business growth with technology solutions like AI and more.
Freshworks, the company behind this summit, is a leading provider of modern SaaS solutions that empower businesses to delight customers.
Bringing world leaders together to create a learning opportunity on digital-first CX
RE:SOLVE by Freshworks offered an unmissable opportunity for CX leaders, founders, marketers and innovators to learn the art of delighting the modern customer with digital CX from some of the most popular and successful brands in the world. get in-depth insights directly from leading brands into unlocking business growth by leveraging the power of CX. The summit brought together leaders from different industries, including e-Commerce, edtech, retail, ride-hailing, food delivery and more to help both digital disruptors and novices learn the art of delighting the modern customer with digital CX by getting inspiration from some of the most popular and successful brands in the world.
Participating brands spanned a wide range of industries including e-commerce, edtech, retail, ride-hailing, food delivery and more. They included 7-Eleven- an international convenience store chain, online fashion platform Zalora, the world’s most valuable edtech company Byju’s, PhonePe- Asia’s fastest-growing fintech firm, Australia’s leading online bookstore Booktopia and Africa’s leading entertainment company Multichoice.
As the go-to event for everything digital-first CX, RE:SOLVE also featured curated masterclasses to help attendees get started with actionable takeaways on building a bot decision tree, calculating the ROI of customer service and getting started with WhatsApp business API.
Key takeaways and lessons shared during RE:SOLVE 2021
Today, customers expect real-time responses to their enquiries. A recent surveyof 2,760 professionals across nine markets in APAC, including China, Singapore, Malaysia, Indonesia, Taiwan, South Korea, Thailand, Vietnam and the Philippines revealed that social media platforms are emerging as the preferred channel for customer support, as consumers perceive them to be faster and more convenient.
At RESOLVE, Balaji Muthukrishnan, Sr Manager Partnerships at Freshworks reinforced that messaging is crucial for better customer engagement and retention.
He shared that proprietary research showed that customers expect instant services and immediate replies. Research also found that around 77 per cent of customers keep their notifications on for messaging apps with 90 per cent of texts being read within 3 seconds of receipt.
“In fact, speed is one of the key metrics based on which customers make purchasing decisions. They not only expect complete but quick responses- as early as within 8 seconds,” he added.
During a fireside chat on the topic of “Modern CX for the modern shopper” Mustehsan Siddiqui- Manager of Digital Operations CX at Landmark Group emphasised the importance of customer-centricity. Landmark has a solid presence across a diverse market, including the Gulf countries as well as the APAC region, and they have managed to set a benchmark for consistent customer-centric CX across all markets.
“We ensure that we are engaging our customers not only with sales and services but also serving them based on changing behaviour and trends. We keep customers at the centre of everything and take feedback very seriously,” said Mustehsan. Landmark has an O2O2O model- online to offline to online and hence, it becomes key to maintain consistent experiences. “Omnichannel used to be a buzzword, but today it is a mandate all over the world. The pandemic has elevated customer expectations,” he added. Today, every customer is a VIP and brands need to leverage digitalization to treat them that way.
It takes only one bad experience to lose around 68 per cent of customers- expectations are high not only for purchases but for resolving issues as well, Mustehsan explained.
Reducing purchase friction and increasing conversion rates
Purchase friction or simply ‘friction’ is a term used to describe anything inhibiting a seamless sales and purchase lifecycle in the business world. According to a 2019 study, ‘friction’ could be costing APAC businesses $325 billion per year. So, this is arguably one of the biggest challenges faced by small and big companies in the region. Mili Semlani and Anand Venkatraman (VP and GM) from Freshworks explored this further with Zalora’s Kanan Rajaratnam.
Kanan shared that amidst the pandemic a lot of new customers have embarked on the journey of online shopping. One of the key expectations from this new set of customers is a seamless and smooth experience.
“Merchants around the world have big shoes to fill. At Zalora, we believe that communication is key. With every second or minute of delay in responding to a customer, businesses are losing trust,” said Kanan. “We monitor every single customer interaction and look at every raised ticket very minutely. We flag delays, analyse why they happened and make sure the gaps are eliminated,” he added.
Freshworks works with a wide range of eCommerce players from all over the world. Anand from Freshworks added that these days people are constantly online on multiple channels and that the journey to purchase isn’t predictable.
“They are interacting with brands 24X7 and expect the brands to be available all the time. Around 61 per cent of our customers start from one channel and end up making the purchase at another channel,” he said. Another important thing Anand added is that today customers expect brands to recognise them across channels- they expect personalization to an extent that they don’t want to repeat information on all channels.
An Accenture study revealed that more than nine of 10 consumers say they are more likely to shop with brands that provide offers and recommendations that are personally relevant to them. This is seconded by Freshworks findings too. “48 per cent of our customers have left brands where they felt personalization was lacking,” Anand said.
In another fireside chat during RE:SOLVE, Mohnish Jaiswal, VP of Operations at Byju’s spoke on re-inventing CX from sales to support and elaborated on how Byju’s support ensures user retention and engagement at all levels. He said no business can work in silos within a digital ecosystem. “All user touchpoints need to have an exceptionally seamless experience- from sales to supply chains and operations to student or customer support. Collaboration is key for friction-free seamless CX.” He added that given the current climate where teams are split across remote and in-office, fostering a more collaborative ecosystem that is not location-dependent but digital-first has become an inevitable need.
Inspiring emerging innovators and entrepreneurs
In addition to game-changing chats with CX leaders, RESOLVE also aimed to deliver holistic inspiration, in the form of keynote sessions with cricket icon Adam Gilchrist and technologist-activist Shiza Shahid.
Speaking with Freshworks Co-Founder and CEO Girish Mathrubootham, Adam Gilchrist said, “Winning is the byproduct of the desire to learn, evolve and disrupt. Just knowing that you really have the hunger and the winning mentality is important.”
Technologist-activist Shiza Shahid said empathising with customers is important. “Ownership and connection on both sides are crucial. If one of our customer’s orders is delayed, I see my customer representatives caring deeply about the issue. They want to drive across the state and deliver the product. And, this is what separates us. When it stops being about the numbers and becomes more about being empathetic- that’s when it really starts to matter.”
Overall, it can be said that offering seamless digital CX will be key not only for surviving the new normal where online is mainstream but will also help businesses become future-proof. Mapping customer journeys, riding the mobile-first wave, creating seamless messaging bots and understanding the importance of customer-centric business models will be some of the most vital trends for businesses in APAC.
This article is produced by the e27 team, sponsored by Freshworks
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