AI is the talk of 2024, with ChatGPT, Claude, Perplexity and other tools taking centre stage, but how will this technology transform the very fabric of some vital industries that we rely on today?

The truth is that AI is evolving so fast it is difficult to predict the long-term impact. What is clear is that it is now a supportive tool within many organisations and is quickly becoming an integral part of how companies operate. 

As AI agents become more autonomous, it is crucial that we take a step back to understand where society can benefit most. According to Capgemini research, 82 per cent of organisations with over US$1 billion in revenue plan to integrate AI agents within the next one to three years. Companies will begin to trust them with tasks like email generation, coding, and data analysis. 

Today, let’s focus on one sector that is poised for a major transition: banking and finance. With profound implications for efficiency, personalisation, and security. As these agents start transacting with one another there are profound implications for personalisation and security in the entire financial services sector.

AI agents facilitating autonomous transactions

As AI agents become more capable, they will be able to conduct transactions and complex processes without the need for human intervention. However, it is important to put the right safeguards in place to ensure the right levels of accountability when it comes to AI decision making. According to Charles Dray, Founder of Resonance Security, 

“As of today, November 2024, AI requires a human operator. Without an operator confirming accuracy of replies, and continuous AI threat modeling which tests the AI to see how much it takes to make it provide an incorrect reply and correcting it, the AI can stray away from its expected behavior. 

AI  providing incorrect replies for financial services companies can be a major risk. Not only can it damage reputation, and feed incorrect actionable information, but it will reduce the personal touch customers love. On the other hand, deploying new technology helps technology scale, so it’s a matter of who wants to dive in first. Chances are we’ll learn a lot from early adopters “

You only have to consider the scenarios to see the risks. Imagine AI agents autonomously negotiating loans, executing trades, or even processing insurance claims between different banks or financial institutions. 

Also Read: 5 common mistakes in financial modelling during startup fundraising

The autonomous nature of these transactions will mean that banks and fintech companies will be able to execute real-time financial decisions. Whether it’s approving loans based on AI-verified data or negotiating cross-border payments, the speed and accuracy of these processes will be unparalleled.

Transforming customer engagement with hyper-personalisation

AI agents excel at analysing vast amounts of data, allowing them to tailor financial services to individual customers. These agents can interact naturally with both humans and other AI systems, enabling a new level of hyper-personalisation in banking. From personalised loan offers to real-time investment advice, AI agents can cater to the unique needs and preferences of each customer.

Chris Sotraidis of Autonomys, a decentralised network designed to enable secure, sovereign collaboration between humans and artificial intelligence, notes that AI agents are already dramatically enhancing customer service by providing personalised, human like support.

“The transition has happened rapidly and is already evident. Proactive customer support is the next evolution. Chatbots, and even real-time phone bots are in beta.”

A new era of hyper-personalisation is coming and will give customers more control over their finances, allowing personal AI agents to proactively manage their savings and optimise their investments. 

AI agents revolutionising fraud detection and risk management

Traditional fraud detection systems are often slow and reactive, identifying issues after the fact. In contrast, AI agents can autonomously analyse massive volumes of transactions, quickly identifying suspicious behaviours or fraudulent activities.

For instance, Mastercard has already begun using AI to double the speed of identifying potentially compromised cards while reducing false positives. This ability to detect anomalies instantaneously allows financial institutions to act before the fraud can escalate, protecting both institutions and customers.

Sotraidis cautions against relying AI models to execute all transactions autonomously speaking about the risk of adversarial attacks on AI models where data can be easily manipulated.

“This creates a need for new governance structures to manage accountability, especially in the case of incorrect or fraudulent transactions initiated by compromised agents. It will be essential for money managers to fully understand and trust the fidelity of their decision-making systems,” says Sotraidis.

Also Read: To Voice AI or not – The changing face of customer experience

The new frontier in finance with decentralised finance (DeFi)

One of the most exciting developments today is the potential of AI agents within DeFi. DeFi platforms allow peer-to-peer financial transactions without intermediaries, and AI agents can interact with these protocols, executing trades, loans, and asset management. This opens up a future where AI agents could manage entire portfolios.

In this scenario, AI agents could even cooperate across different blockchains, managing transactions, and ensuring compliance with complex regulatory frameworks. For example, an AI agent could autonomously navigate through the DeFi ecosystem, lending assets on one platform while borrowing on another, all while managing risk dynamically based on real-time market conditions.

AI agents driving financial inclusion

In many parts of the world, access to traditional financial services is limited due to lack of adequate infrastructure. As Sotraidis points out,

“AI-driven mobile banking solutions will expand access to professional services in remote regions where in-person advisory at traditional branches is impractical.”

He explains that this helps to reduce the cost of delivering services and also enables institutions to provide tailored financial products to underbanked populations. By interacting with local economies and learning from local data, these agents can offer financial products tailored to specific needs.

It is clear that AI is continuing to play a growing role in our everyday lives and transforming traditional industries in ways that are unprecedented. However, as we embrace this new era, challenges around data privacy, transparency, and bias in AI decision-making must be addressed to ensure that these systems serve everyone fairly and responsibly.

Using decentralised finance to add a layer of transparency and immutability makes sense as we begin to allow these autonomous agents to act on our behalf.

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Vietnamese B2B food supply e-commerce platform Kamereo has secured US$7.8 million in Series B funding.

Sumitomo Corporation, Inspire Co, SMBC Venture Capital, Mitsubishi UFJ Capital, and Reazon Holdings co-led the round, which also saw unnamed investors’ participation.

This round brings the startup’s total funding to over US$15 million.

Kamereo plans to use the new capital to expand across Vietnam, starting with Hanoi. This follows its expansion into Ho Chi Minh City (HCMC), which together account for over 50 per cent of Vietnam’s GDP.

Kamereo is a wholesale food supply e-commerce firm that owns vegetable and fruit collection centres and works directly with its partners and contract farmers.

Also Read: Multifaceted effects on Vietnam’s e-commerce: A near-term potential to break through in the Asian market

The company’s marketplace business connects producers and manufacturers with its existing network of over 3,000 customers, primarily in the HORECA (hotels, restaurants, and cafes) sector. This allows suppliers to expand their sales without the need for significant upfront investments in logistics and operations. Its customer base includes restaurants, supermarkets, convenience stores, factories, schools, and hospitals.

The company has established a daily refrigerated transport network connecting the north and south. It aims to set up operations in central Vietnam to cater to the growing demand from customers beyond the two major cities.

Beyond geographical expansion, Kamereo will also focus on product diversification, introducing new services like a marketplace model and enhancing its product features.

The firm’s recent partnership with GYOMU JAPAN, the operator of Gyomu Super in Vietnam, brings approximately 450 Gyomu Super products onto the platform.

The company also plans to further develop its private label strategy, focusing on two key areas:

• Development and sale of pre-cut fruits and vegetables for supermarkets and convenience stores: This caters to the growing trend of modern trade in urban Vietnam, emphasising food safety, traceability, and health consciousness.
• Private labelling of consumables to enhance brand awareness and price competitiveness: Kamereo aims to leverage Vietnam’s OEM manufacturing capabilities to produce high-quality products at competitive prices.

Early this year, Kamereo raised US$2.1 million in a funding round co-led by Reazon Holdings, Quest Ventures, and Thoru Yamamoto (CEO of Japanese B2B seafood supply chain company FOODISON).

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Climate Tech: Seizing Opportunities in an Emerging Ecosystem

At Echelon Philippines 2024, a panel discussion titled ‘Climate Tech: Seizing Opportunities in an Emerging Ecosystem’ brought together key voices in the climate tech space to explore innovations, funding opportunities, and strategies for navigating regulatory landscapes.

Moderated by Katherine Khoo, Lead, Social Impact and Equity Action from Ayala Corporation, the panel featured insights from AC Alyzsa Dy, Head of Incubation and Venture Support at Villgro Philippines; Enzo Pinga, Head of Business Development at Humble Sustainability; and Zachary Lee, Venture Partner at The Radical Fund.

The conversation delved into critical areas of climate tech innovation, including renewable energy, sustainable agriculture, and carbon reduction technologies. Pinga shared Humble Sustainability’s circular economy model, which repurposes IT equipment to reduce e-waste. Dy highlighted Villgro Philippines’ focus on renewable energy, electric mobility, and nature-based solutions. Lee emphasised the increasing capital flow into electric vehicles while stressing the importance of concessionary capital to support early-stage startups.

Also Read: Echelon Philippines 2024: The funding landscape for Filipino startups

The panelists also addressed challenges in the sector, such as climate anxiety and the complexities of navigating carbon credit markets. They stressed the importance of inclusive climate solutions, particularly for rural communities, and the urgent need to build a robust talent pool for green jobs.

For aspiring entrepreneurs, the speakers offered valuable advice: focus on creating solutions that are not only sustainable but also commercially viable. The panel concluded with a call for collaboration across sectors to scale climate tech innovations and maximise their impact.

This discussion highlighted the growing opportunities in the climate tech ecosystem and underscored its potential to drive meaningful change in the Philippines and beyond.

Watch the session video above to learn more about these insights and the strategies shaping the future of entrepreneurship.

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Generative AI (GenAI) is reshaping industries worldwide, and ASEAN is emerging as a hotbed of innovation in this space. However, while the region’s startups are making strides in developing cutting-edge solutions, the journey from idea to market remains a formidable challenge. The ASEAN GenAI Startup Report 2024 sheds light on the unique hurdles these startups face and the strategies that can help them succeed.

Understanding the challenges

For ASEAN’s GenAI startups, particularly those focusing on B2B solutions (92 per cent of the ecosystem), the path to market is often riddled with obstacles.

Slow enterprise onboarding

Startups targeting enterprises often encounter lengthy and complex sales cycles. The process of securing contracts, which may involve tenders, validation, and Request-for-Proposal (RFP) submissions, can take months. Many enterprises require startups to demonstrate a proven operational history—an expectation difficult for younger startups to meet, especially given the nascent nature of GenAI technologies.

Cash flow constraints

Limited funding exacerbates the challenge of protracted sales cycles. According to the report, nearly half (49 per cent) of GenAI startups are bootstrapped or rely on angel funding, with only 16 per cent reporting profitability. Startups often depend on paid pilots to validate their solutions, but even when successful, payment delays of 60 to 90 days can strain their operations.

Cultural and workforce sensitivities

In ASEAN, workforce-related concerns often slow the adoption of GenAI solutions. Organisations may hesitate to embrace technologies perceived as threatening jobs. Furthermore, poorly executed proof-of-concept (POC) projects—due to misaligned expectations or inadequate data—can deter enterprises from moving forward.

Despite these challenges, ASEAN startups demonstrate remarkable adaptability. The report highlights that 75 per cent of surveyed startups have pivoted their strategies at least once to stay aligned with market demands.

Also Read: From innovation to impact: Key sectors driving GenAI adoption in ASEAN

Strategies for overcoming barriers

To navigate the GTM landscape, ASEAN GenAI startups can adopt innovative strategies that leverage their unique strengths while addressing market complexities.

Focus on niche applications

Specialisation is a key differentiator for startups in a competitive environment. By developing tailored solutions for specific industries or markets, startups can create defensible positions. For instance, Vietnam’s Mesolitica builds fine-tuned language models that cater to the linguistic and cultural needs of Southeast Asia, setting it apart from global competitors.

Build strategic partnerships

Collaborations with established players, such as cloud providers and enterprises, can accelerate a startup’s path to market. Partnerships are the most effective customer acquisition channel for ASEAN GenAI startups, with 74 per cent citing them as a critical strategy.

Cloud providers like AWS, Google Cloud, and Microsoft Azure play a vital role in supporting startups through credits, technical resources, and GTM programs. For example, ArcanicAI in Vietnam leverages AWS’s GenAI Accelerator Program to secure POCs and gain exposure to enterprise clients. These partnerships help startups overcome resource limitations and establish credibility.

Adopt a regional GTM approach

ASEAN’s diversity presents a challenge for startups but also an opportunity to expand into broader markets. By building region-specific partnerships and customising solutions for different cultural contexts, startups can scale effectively. For instance, Indonesia’s Lexilaw.ai is already running POCs across ASEAN and beyond, demonstrating how cross-border collaboration can unlock new opportunities.

Also Read: Report: New fintech talents emerge as GenAI becomes increasingly popular in Singapore

Support from the ecosystem

Governments, investors, and accelerators have a crucial role in helping ASEAN GenAI startups overcome GTM challenges.

Government-led initiatives

Policymakers across the region are launching programs to foster innovation. Singapore’s Productivity Solutions Grant and Vietnam’s National Innovation Center are examples of initiatives that provide financial support, access to resources, and opportunities for startups to showcase their capabilities.

Accelerators and cloud providers

Accelerator programs, such as AWS’s GenAI Spotlight and Google’s AI Accelerator, offer startups not only technical expertise but also market exposure and funding opportunities. These initiatives enhance startups’ ability to develop products and secure enterprise clients.

Corporate mergers and acquisitions (M&As)

As GenAI adoption grows, enterprises are increasingly interested in acquiring startups to integrate AI capabilities into their operations. Startups that align their solutions with enterprise needs are better positioned for partnerships or acquisitions.

The way forward

The GTM journey for ASEAN GenAI startups is challenging, but it is also filled with opportunities. By focusing on niche applications, forging strategic partnerships, and expanding regionally, startups can overcome barriers and achieve sustainable growth.

The role of the ecosystem—governments, accelerators, and cloud providers—is equally critical in enabling startups to thrive. With targeted support and collaborative efforts, ASEAN’s GenAI startups can establish themselves as global leaders in AI innovation.

In the fast-evolving world of GenAI, success will come to those who adapt, innovate, and leverage the collective strength of the ecosystem. The journey is complex, but for ASEAN’s startups, the rewards are worth the effort.

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This article is the third in a series from the ASEAN GenAI Startup Report 2024. GenAI Fund invests in early-stage GenAI startups across Southeast Asia, focusing on growth strategies and exit opportunities. Stay updated with new articles in this series by subscribing and following us on our channels. For more articles, visit: https://e27.co/category/reports/.

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The 2024 Olympic Games in Paris had long been acknowledged as a potential watershed moment for Airbnb (NASDAQ:ABNB). But did the homestay giant miss its opportunity to cement its position as a travel and tourism market leader? 

Airbnb’s strategy was clear, and advertising campaigns aimed to underline the firm’s USP as a provider of unique experiences that can’t be replicated elsewhere in the hospitality industry, with the tagline: ‘Why stay in a hotel on the touristy side of Paris, when you could stay in an Airbnb on the Paris-y side of Paris?’

However, one month before the Olympic Games, The Connexion reported that falling demand for Airbnb properties saw the average rate per unit drop by 32 per cent between April and June 2024. 

These falling prices come off the back of a surge in listings throughout the city, with more than 15,000 extra properties made available on short-term rental websites in the Paris area since March. 

The overall volume of visitors to Paris during the Olympic Games reached 11.2 million, but not to be outdone by Airbnb, many hotels in the city sought to drop their prices to avoid losing business. 

Airbnb’s stock slipped 16.37 per cent in Q3 2024 at a time when investors would’ve expected more optimism sparked by the games. Now, with insider sell-offs and issues with falling demand, could the Airbnb boom be facing its biggest challenge yet? 

Weaker profit as demand falls

One major contributing factor to Airbnb’s Q3 slide was the company’s weakening profit margins of US$555 million during the previous quarter compared to the $650 million reported over the same period in the year prior. 

The weakening trend saw shares in ABNB slip 12 per cent after the bell, with the company blaming a weakening market amid economic uncertainty and New York’s crackdown on homestays. 

With more Airbnb hosts implementing strict rules and higher hidden fees, the stock may have lost some of its advantages over traditional hotels, which could see more unwanted competition emerge. 

Insider sell-offs

Although insider selling isn’t necessarily a cause for concern, it’s worth noting that Airbnb insiders were net sellers over the last year. 

Airbnb co-founder Brian Chesky made the biggest insider sale within the last 12 months in a single transaction worth US$17 million. 

In total, Chesky sold 307,690 shares over the past year with the average share price weighing in at US$143. 

Also Read: ‘AIR’ review: 3 lessons for dealmaking and entrepreneurship

In October, Aristotle Balogh, the chief technology officer of Airbnb, sold 600 shares worth US$81,198 while retaining ownership of 192,244 shares in the company. 

Although insider sell-offs aren’t necessarily a sign of a struggling company, they can sometimes point to weakening confidence among stakeholders in a firm’s short-term performance. 

Add to this the recent news that Mn Services Vermogensbeheer BV opted to lessen its holdings in Airbnb by 4.5 per cent during the third quarter and a trend of sell-offs appears to be forming both inside and outside the company. Should investors be concerned?

Airbnb remains a revenue machine

Despite its short-term concerns, Airbnb remains a highly profitable innovator in the travel and tourism industry. 

“The Airbnb business model has proven extremely profitable, with the firm generating US$9.9 billion in sales in 2023, more than double its 2019 revenue before the pandemic,” highlights Maxim Manturov, head of investment research at Freedom24. 

“The company sees significant growth potential, especially in the extended stay market, where stays of 28 days or more accounted for 17 per cent of booked nights in the first quarter, likely driven by flexible work schedules in the wake of the pandemic.”

Investors can also find hope in Airbnb’s high potential ‘Experiences’ feature, which offers an entirely unique holiday experience for users that traditional hospitality firms are currently unable to emulate at scale. However, expectations have so far been tempered by the company’s inability to work out how to sell the feature on its platform. 

Also Read: HD, the Airbnb for surgeries in SEA, secures US$6M funding  

With Airbnb’s profit-to-earnings ratio expected to fall as low as 14 from current levels by the end of 2027, the prospect of adding an underpriced innovative stock is likely to attract a number of institutional and retail investors alike. 

While sell-offs have been a concern, Citi has maintained a more positive stance on Airbnb, placing a Buy rating on the stock and a price target of US$135.00. 

Life after the Olympics

Although Airbnb may have anticipated a higher pace of bookings during the Paris Olympics, there’s plenty of optimism for the homestay stock that suggests its boom period is far from over. 

Despite weakening demand and price competition from hotels, Airbnb’s revenues and innovative experience-focused pipeline suggest that the future remains bright for the stock. If ABNB remains under $150 over the short term, we may see more investors tempted to add the travel and tourism giant to their portfolios.

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Editor’s note: e27 aims to foster thought leadership by publishing views from the community. Share your opinion by submitting an article, video, podcast, or infographic.

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