Temasek to invest US$740M deep-tech firms a year
Some of the industries that it will focus on include advanced manufacturing, disruptive materials, net-zero tech, life sciences, and foodtech; The government earlier pumped US$222M into the Startup SG Equity scheme specifically for deep-tech firms.

Carousell acquires Ox Street to double down on its re-commerce efforts in Greater SEA
Carousell intends to deepen Ox Street’s reach and scale to become a fashion and luxury goods market leader; Ox Street is an online marketplace for authenticated sneakers and streetwear and focuses on the 85M Gen Z and Y consumers in the region.

Why Vertex Holdings CEO is optimistic about the VC industry in SEA
With higher valuations, VCs may overpay slightly, but the returns will come back if it’s the right tech and right people; While VCs in Southeast Asia are just counting IPOs by the fingers now, the IPO bell should be ringing every day at some point in the future, says CEO Chua Kee Lock.

Singapore’s Coda Payments buys BAASH to further expand its gaming goods and solutions
BAASH allows users to create e-sports events, compete in contests, and discover a community of like-minded gaming fans; They include Codashop, a marketplace for digital game content, and Codashop Global Series, a free-for-all community e-sports tournament.

US-based Bow Wave Capital makes another close of PH-focused fund at US$68.6M
ASP Philippines participated in the US$175M funding round of local payment app Mynt in January; The deal was in line with the fund’s mandate to invest in global online and mobile payment ecosystem companies;  Last month, Bow Wave invested in Thailand’s digital payment company Ascend Money.

Malaysian F&B and retail tech solutions firm eatcosys raises US$2.4M via Fundnel
Over 90 investors from the retail, financial services and consumer sectors participated; eatcosys provides an integrated platform that works across three fundamental verticals: platform services, tech-enabled services, and fintech.

GoCement nets funding to address problems plaguing Indonesia’s construction industry using tech
Investors are Arise (a JV between MDI Ventures and Finch Capital), Beenext, and Ideosource; GoCement digitises the construction industry by creating a marketplace that utilises its decentralised building material distribution through cloud manufacturing.

How EngageRocket co-founders built a sustainable partnership
Finding a co-founder that shares your vision is a big challenge, but making the relationship work in the long run is a bigger one; Even if you’re one of the lucky few, who have found a co-founder that shares your vision and ambitions, sustaining this partnership for 1, 5, and 20 years down the road will pose a new set of dynamics to navigate.

Bangladesh Angels Network pumps US$1m in textile waste recycler Reverse Resources.
The SaaS platform maps, matches, and traces waste from textile factories, then helps fashion brands recycle them to achieve full circularity; Reverse Resources is working with 43 factories, 8 textile-to-textile recyclers, and has signed a contract with a global fashion brand to onboard the retailer’s first 100 factories.

SEA fintech opportunity pushes startup valuations further up
Despite currently lagging behind more developed markets like Australia, the US and the UK, the region is set to leapfrog in digital infrastructure and will see a slew of fintech-only unicorns being birthed within the next decade, says Golden Gate Ventures.

How startups can foster resilience and break barriers
With the unpredictability of markets and the ever-changing trends, startups that are not agile and resilient enough to adapt will eventually get left behind; Moreover, startups have to rise above challenges and realise their business goals in order to achieve long-term business sustainability and ultimately break barriers in the industry.

How Singapore is nurturing innovative startups
Enterprise Singapore (ESG), an agency under the Ministry of Trade and Industry, has been working to make it easier for startups to enter local and international markets raise funding and nurture talent; ESG is working with institutes like NUS to inculcate a sense of resilience among students at an early stage.

5 promising social commerce startups in Indonesia
The Indonesian social commerce scene is booming because its citizens are very active on social media; On average, they spend twice as long accessing the internet as Americans. However, there are still challenges when it comes to promoting goods and transacting on public platforms.

Singapore JV to offer green solutions to SMEs
CO2X is a JV formed by Singapore-based tech firms STACS, Ascent, and Evercomm; The JV will develop a platform that will provide local SMEs with accessible carbon tracking solutions and green financial services through a data-driven approach.

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Image Credit: Temasek

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Singapore-headquartered advanced aerial mobility company, H3 Dynamics Holdings, has completed its US$26 million Series B investment round led by Japan’s SPARX Mirai Creation Fund (backed by Toyota Motor and SMBC).

Singapore’s EDBI, ACA investors, Capital Management Group, the Grosvenor Group, Audacy Ventures, Ascent Hydrogen Fund, and French strategic investors ATEQ also joined the round.

“Our investors recognise that this is a long journey and that we must first address our immediate markets while solving key technical and regulatory challenges before adding more complexity,” said H3 Dynamics founder and CEO Taras Wankewycz.

In June 2019, e27 reported that the startup was in the process of closing a US$16 million Series B round, led by SPARX Mirai Creation Fund.

Also Read: Drone deployment from anywhere brings completely new possibilities: H3 Dynamics CEO Taras Wankewycz

Founded H3 Dynamics in 2015 by Wankewycz with a mission to decarbonise the world, H3 Dynamics focuses on hydrogen propulsion, aerial systems automation and software service sales. It aims to create a scalable path to low-carbon hydrogen-powered flight in three development phases — drones, cargo, and passengers.

Initially, the company started building an autonomous charging infrastructure for battery drones and a range of maintenance and monitoring services. It then applied the same infrastructure to support much longer-range, unmanned systems capable of flying for hours using hydrogen technology. This opened up possibilities in the autonomous, zero-emissions cargo for the company.

H3 Dynamics has a three-phase roadmap. In the first phase, it focuses on supplying autonomous inspection and incident response solutions powered by drones. It has built and commercialised a proprietary, all-digital inspection and rectification automation software, starting with smart-city applications such as high-rise façade maintenance. Started in Singapore three years ago, it has now been expanded globally and across industries.

The drone venture is also releasing an advanced autonomous drone nesting station. These cloud-connected vertiports for industrial drones can send data through 5G, become visible in real-time in the national airspace, with permanent set-ups on rooftops or remote industrial sites.

It has partnered with air traffic control major Thales Group to build an autonomous urban air mobility infrastructure, starting with tiny camera drones, with plans to evolve towards larger, unmanned cargo. The next step is to enable cargo flights of up to 400km or even 800km.

In the second phase, the company will expand its first-phase revenue streams to ensure an optimal path to profit. It will build on this first success to introduce longer-range hydrogen-powered aircraft that can carry more and more weight in the mid-mile, beyond the visual line of sight parcel and cargo operations sector.

In its final phase, H3 Dynamics plans to shift from unmanned cargo to manned hydrogen aircraft, including passengers.

Also Read: FROGS wants to become the first startup in SEA to fly passenger drones

David Wu, President at Ascent Hydrogen Fund, commented: “Air mobility is one of the hardest yet most important industries to decarbonise. H3 Dynamics is ideally placed to overcome this challenge. It is already generating revenue with a clear path to profit using a scalable SaaS model while benefiting from two decades of ultra-light hydrogen fuel cell system development.”

The company intends to expand its engineering and sales teams in Austin/Texas — where it currently produces and ships complete hydrogen drones, integrated aerial fuel cell propulsion and refuelling units. I will also hire people for its operations in Toulouse/France, where it develops larger hydrogen systems, works on hydrogen aircraft integration, and carries out test flights.

H3 Dynamics was the winner of e27’s Echelon Asia Summit 2019.

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Image Credit: H3 Dynamics

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Vonage, a New Jersey-headquartered global cloud communications company, has acquired Singapore’s omnichannel conversational commerce startup Jumper.ai.

Transaction details haven’t been disclosed. 

Under the transaction, Vonage could employ Jumper.ai’s technical- and developer-focused talent pool to complement its Vonage Communications Platform and broad API portfolio’s capabilities in conversational commerce.

The acquisition will also expand Vonage’s total addressable market with Jumper.ai’s packaged AI-enabled conversational commerce offering.

“With conversational commerce capabilities, we are meeting new and existing customer needs, providing businesses with embedded commerce capabilities to simplify the way they serve, connect with, and sell to their own customers from anywhere, on any channel,” said Rory Read, CEO of Vonage.

According to an April 2021 Conversational Commerce forecast by Juniper Research, the total addressable market in this space will be worth US$27 billion by 2025.

Also read: Is omnichannel commerce a fairy tale for SMEs in Singapore?

Founded in 2020, Jumper.ai creates omnichannel, messaging-first customer engagement and shopping journeys across social, messaging, and web.

It allows businesses to turn shoppers’ conversations into richer AI-enabled customer experiences with rapid service and sales follow-through.

Social messaging on platforms such as Facebook Messenger, WhatsApp and Instagram, has become a trend in the in-demand retail space where people prefer a seamless shopping experience. 

“It [Jumper.ai] transforms customer interactions from notifications and simple communications to conversations across the spectrum of customer engagement points,” Read stated.

Meanwhile, Vonage’s Communications Platform includes programmable unified communications and contact centre applications. It allows companies to integrate video, voice, chat, messaging and verification into existing products, workflows and systems.

“The addition of Jumper.ai’s conversational commerce and omnichannel capabilities fits perfectly into Vonage’s strategy and is a natural extension of Vonage’s offerings,” added Read.

Vonage counts brands such as L’oreal, Kiehl’s, Disney, Axe, Dove, Ben & Jerry’s and Burger King among its existing customers.

“Combining our market-leading technologies presents an opportunity to create new, amazing customer experiences, leveraging Jumper.ai technology and the global reach of Vonage,” said Yash Kotak, CEO and Co-founder of Jumper.ai.

In 2019, the US-based firm acquired Tel Aviv-based conversational AI startup Over.ai’s team and intellectual property. This is among Vonage’s seven deals that are worth US$884 million in total, according to data recorded on Tracxn. Its sectors of interest include customer service software, speech and voice recognition and more.

According to Statista’s data, over 3.6 billion people were using social media worldwide in 2020, with the global social media usage rate standing at 49 per cent. Forbes’s recent research also found that about two-thirds of shoppers employ social media in their shopping journey.

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Being part of disruptive industries should be the headline of Igloo Insurance Chief Commercial Officer Raunak Mehta’s resume. Prior to insurtech, Raunak honed his skills in e-commerce which, as everyone knows, has changed the retail industry for the better.

“The journey started when I joined Flipkart in 2011 — pioneer of India’s e-commerce and startup landscape. The objective was to be part of an idea to revolutionise the retail industry to bring greater value to both existing and new consumers,” he shared with e27.

At first glance then, switching to the insurance industry seemed like a 180-degree shift from e-commerce. After Flipkart and prior to Igloo, Raunak had worked at a Southeast Asian fashion e-commerce company, Zalora. “Fashion is glamorous, provides instant gratification. More often than not, it’s an extension of one’s personality,” he said. “Insurance on the other hand, while necessary, does not have that pull associated with it. At best, it provides peace of mind and provides monetary support in the unlikely occurrence of an unfortunate event,” Raunak noted.

“Selling and marketing insurance is hence driven by completely different supply-demand dynamics compared to most other industries, especially fashion,” he added.

The insurance industry is more complex in the face of heavy regulation and incumbents are unable to address the needs of today’s consumers. Raunak has experienced many brands in fashion that have run aground due to their inability to keep up with consumer trends and he believes the insurance industry is at that inflexion point.

Seizing opportunities to disrupt

The opportunity for disruption in a 300-year-old industry that is still finding it difficult to make its core products and services accessible and affordable is a key reason why Raunak decided to shift lanes to insurtech in 2018 to drive Igloo’s business and insurance partnerships. The Singapore-based regional insurtech player has the mission of making “insurance accessible and affordable using data and technology”.

“A rigid product-based approach catering to downside protection has resulted in unmet demands. A wide swath of the population is uninsured and underinsured in Asia-Pacific,” Raunak pointed out. “There seems to be a generational gap between the customers’ problems and the solutions being offered today in the insurance marketplace and this is where companies like Igloo step in to transition the industry to a more proactive platform, one that is more customer-centric and goal-based, less cookie-cutter.”

Also read: Why startups should invest in interns hungry to change the world

Raunak’s swapping of fashion with insurance has a personal side to it as well. “As you move up the career ladder, the potential impact that you can have on society could be quite significant. I find it surprising that even with aggregated household wealth slated to become the highest in the world, insurance is still not mainstream for most of the Asian countries,” Raunak noted. Insurance has the power to grant people peace of mind as discretionary spending increase in asset (house, automobile, gadgets) acquisition, and as longer life expectancy and health take centre stage.

Be it fashion e-commerce or insurtech, Raunak has applied a founder’s mentality — built around bias for action, customer advocacy, and cash management — throughout his career. Raunak can lay claim to taking Flipkart Logistics to more than 100 cities In India, and at Zalora, expanding the fashion category to over $100 million in a short span. ”Growth, when built on first principles and aided by technology, is never short-term nor unsustainable,” says Raunak. 

From fashion to insurance, the basics remain but with better tech

Naturally, technology became one of the elements Raunak was keen to carry over from fashion to the insurance industry. Since it relies on forecasting trends, fashion has become a pioneering industry in its use of data and technology. Insurance is at the beginning of using data beyond assessing risks. “Insurance always had a rich pool of data which had not been utilised in the best way to bring the right set of products and services to the market. There are green shoots in the auto and health space and Igloo is at the frontlines of these changes,” he pointed out.

With Raunak at the helm, Igloo has expanded its operations exponentially. From just a handful of employees and operations in Indonesia and Singapore, Igloo now has commercial, product, marketing, operations, and customer service teams spread across six markets and an engineering hub in Chengdu. The company has grown its employee base by five times since 2018.

It currently works with over 30 partners across Indonesia, the Philippines, China, Singapore, Thailand, Vietnam, Malaysia, and Australia in the e-commerce, telecommunications, banking,  and lifestyle industries to deliver more than 10 product lines to the region. To date, it has facilitated over 100 million policies across Southeast Asia.

Also read: Explore cutting-edge cybersecurity tech at SINCON 2021

Leadership skills are even more critical for Raunak as he leads Igloo. Other than his responsibilities as CCO, Raunak now has the expanded responsibilities of running the day-to-day business as well as managing investors.

“Ownership and accountability are important, as is inculcating an entrepreneurial mindset within the organisation. These serve as foundations for a performance-oriented culture,” he noted, adding that empathy has become key in managing an organisation spread across multiple countries, cultures, functional domains and skill-sets, especially during the pandemic which saw various members on frontline teams get impacted.

At the same time, for people interested in insurtech as a career or investment opportunity, Raunak has advice, “Unlike e-commerce, ride-hailing or any consumer-focused industry, insurance, being one of the oldest, would take longer to disrupt but has profound societal impact compared to others.” Hence, only by having a strategic mindset and ability to chart and support a long term vision would there be a requisite return on effort and investment. “Insurance is not a fad. Insurance is eternal.”

Accelerated adoption rate amidst COVID-19

According to Raunak, the COVID-19 pandemic has also woken people up to the importance of having insurance. This is an encouraging sign for Igloo, who looks to plug the gap in insurance products for low and middle-income households – segments which traditional insurers shy away from due to higher risks.

Another underserved segment of the market is micro, small, and medium enterprises (MSMEs), besides independent workers who are more vulnerable to economic shocks given their reliance on informal labour with inadequate social safety nets. Igloo offers insurance products for the gig economy and MSMEs across Singapore, Vietnam, Thailand, and the Philippines and plans to double down over the next 3-6 months. He said, “We practice what we preach. We are the only insurtech in the region that gets deep into insurance product design to offer what is really needed and our product portfolio reflects this approach”.

Also read: How startups can foster resilience and break barriers

The future of Igloo Insure

Raunak is also excited to see developments in insurance related to cybersecurity threats, considering that Asia is 80% more likely to be targeted by hackers compared to the rest of the world due to the speed and scope of the digital transformation. He said that Igloo in collaboration with its reinsurance partners has come up with modular products that give coverage to victims of cybercrime. 

And Igloo has been busy pumping out new products to meet market needs. With new partnerships and product launches happening nearly every other week, Raunak noted, “We are probably the only player in the region that can have such expedited go-to-market timelines. And we will continue to bring to market innovative distribution models, at pace, to realise  Igloo’s vision of ‘Insurance For All’.”

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This article is produced by the e27 team in partnership with Igloo Insure.

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A Cap (Capitalisation) Table, at the most fundamental level, is a record of all the equity that is owned by various entities (founders, employees, consultants, investors etc) in the company.

It is very important that you keep an accurate record of the equity ownership by various entities at all times. Most investors will ask for a cap table when you go to seek funding and it will determine the per-share price that will be used in the financing.

Note that in calculating your ownership in the company, you should do so on a “fully diluted basis” i.e. taking into account your option pool as well as any warrants that have been issued.

The share price for any financing will also be calculated by dividing the pre-money valuation by the fully diluted number of shares.

An entrepreneur’s journey

To understand how cap tables work, let’s follow the funding journey of a hypothetical company, ABC, Inc started by John and Jane Doe from seed funding through Series A funding. When John and Jane start the company, they decide to split their stake 50/50.

In addition, they set aside an option pool of 20 per cent for their employees. They also decided to set up the company with a total of 10 million shares with a par value of $0.001 per share which is pretty typical. The cap table will now look as follows:

• John Doe: 4,000,000 shares (40 per cent)
• Jane Doe: 4,000,000 shares (40 per cent)
• Option Pool: 2,000,000 shares (20 per cent)

Seed Round

Now let’s say the company raises a Seed round of S$500,000 from a seed VC firm Vista Capital as a convertible note with a valuation cap of S$4,000,000 and a 20 per cent discount to the next round.

This means that when the company raises a Series A, the valuation that the angel investors will get for their shares will be the lower of $4,000,000 or 80 per cent of the share price paid by the Series A investors.

Since no new shares were issued at this stage, the Cap table remains the same.

Series A funding

Now imagine that the company is doing well and has reached a milestone of S$1 million ARR (Annual Recurring Revenues). This is typically the milestone that most VCs will consider funding a company.

The company gets a term sheet from Sunrise Venture Capital to fund the company with S$6 million in funding at a pre-money valuation of S$24 million. The term sheet also stipulates an employee option pool of 20 per cent post-funding.

Also read: Future Flow’s cap table helps founders easily monitor the evolution of their stake, equity dilution

Since the term sheet requires an employee option pool of 20 per cent post-funding, the Employee option pool will need to be increased by another 1.0 million shares. This results in a total number of shares of 11 million prior to funding.

The share price for the Seed investor will be calculated as S$4,000,000/11 million shares = S$0.36 since they have a S$4,000,000 valuation cap which is lower than 80 per cent of S$24 million.

On the other hand, the share price for the Series A investor will be calculated as S$24 million/11 million shares = $2.18. The resulting cap table looks as follows:

• John Doe: 4,000,000 shares (26 per cent)
• Jane Does: 4,000,000 shares (26 per cent)
• Option Pool: 3,017,026 (20 per cent)
• Vista Capital: 1.377,128 share (9 per cent)
• Sunrise Venture Capital: 2,754,256 shares (18 per cent)

Post funding, the Company will need to do a 409A valuation to determine a new valuation of the common shares. The common shares will have a value that will be significantly less than that of the preferred shares issued to investors since they have many preferences and rights that the common shareholders don’t have.

For example, they typically have a liquidation preference where they get their money first in the event of a sale and if the sale price is not high enough there may be no distribution to common shareholders.

There are many tools available like Carta and Capshare to manage your equity. However, in the initial stages, it will be sufficient to manage your cap table using a simple spreadsheet.

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