According to the Asia-Pacific Artificial Intelligence Market 2016-2022 report, the adoption of Artificial Intelligence (AI) in the Asia-Pacific region is estimated to grow by almost 47% between 2016 and 2022. Another research suggests that the Big Data market in APAC is likely to progress at a rate of 21.42% CAGR between 2019-2027.
Advanced tech disruptions are happening across all sectors today and innovations enabled by AI and Big Data are spearheading the 4.0 revolution making the on-demand software market even more robust as users get access to extremely personalised SaaS solutions — from online shopping to banking to ride-hailing and even to healthcare consultations. No wonder why the APAC SaaS market is expected to grow at a compound annual growth rate of 34.28% during the forecast period of 2018-2023.
While the entire world has been riding the tech wave with the APAC emerging as a hub for innovation and disruptions, 2020 has been a year of reality check highlighting infrastructural gaps and lack of digitalisation across different sectors. It has become clearer that to truly future-proof businesses across industries, there is a dire need to encourage founders that lead startups with innovation at the core and this is where venture capital firms like Qualgro are taking the lead.
Qualgro is a Venture Capital firm based in Singapore, investing mainly in B2B companies in Data, SaaS, and AI to support talented entrepreneurs with regional or global growth ambitions. Qualgro invests across Southeast Asia, Australia, and New Zealand, primarily focusing on Series A and B.
Despite the pandemic, they have been quite active, having made four investments across the region this year so far. This is followed by a significant exit they had last year as anchor investor with the acquisition of Wavecell by a US-listed company for US$125 million. This was voted ‘Exit of the Year 2019’ by the Singapore Venture Capital Association.
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We recently spoke to Minh Vu Hong to explore the emerging industry trends in the region and discuss Qulagro’s vision and plans ahead.
Empowering founders and enabling innovation
Hong shared, “We see a vast playground in Southeast Asia for B2B data, AI and SaaS companies to scale and become at least regional or even global players. With the increasing digitalisation of SMEs as well as large corporations across the region, we are looking forward to backing more founders who want to build regional or global winners, able to compete against US, China, or European companies.”
The team at Qualgro brings in a unique combination of entrepreneurship, business acumen, expertise in investments, and deep knowledge of technology as well as consulting experience to help founders navigate the world of B2B sales and international expansion.
Hong, for example, comes with a background in strategy consulting. “I used to help corporations work with startups (or try not to lose market shares to), so it is quite a natural move to now back founders who want to sell to or compete with these corporations,” he shared.
Key sectors and Vietnam as an emerging B2B market
Amidst the coronavirus crisis, as digital use is expedited, sectors like education and healthcare are clearly at the forefront of transformation. Recent deals and funding rounds are reflecting this trend. “In Vietnam, for example, dozens of companies have gained significant traction over the last six months in online education, test banks, digi-health, or drug delivery,” Hong said.
“How long will the momentum last is the big question as not all companies have the same angle or approach to their respective markets and some will have to emerge as winners at the expense of others,” he added.
While the pandemic has brought along some challenges like movement and travel restrictions, Qualgro’s vision remains the same with an even stronger focus on business fundamentals and the quality of the team.
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Qualgro is currently focusing on Vietnam by doubling down with its first investments in the last few months.
“While the ecosystem in Vietnam has been historically more centred around B2C startups, we are starting to see more and more quality companies and founders in B2B Data, AI, and SaaS with amazing opportunities to scale in the country and beyond. The talent pool in Vietnam with skilled software engineers, data scientists, and data engineers is also a competitive advantage of the country to nurture regional winners,” said Hong.
Challenges, opportunities, and growth
Hong shared that currently, the inability to travel is proving to be a major challenge. “Not being able to be on the ground to spend time with founders and their teams, requires a bit more “leap of faith” on both sides (founders as well as investors),” he explained. They are having to rely a bit more on the information available online via credible sources as well as external views of other founders and industry experts.
To be able to maintain a robust network while connecting with new people on an everyday basis and get access to reliable information related to the tech startup ecosystem of the region, Qualgro has decided to opt for an e27 Pro membership.
Hong shared, ”We have had a long-standing friendship with e27. We also participated in the Echelon Asia Summit and have been relying on e27 for news and networking. So, when we had the chance to be a part of the first “alpha-testers” of e27 Pro we didn’t think twice before accepting as we saw this membership as another step in the right direction to build a stronger ecosystem.”
Hong explained that the core features of the e27 Pro membership that they appreciate at Qualgro are the access to information and the inbound connection requests from startups. He shared, “The daily news digest helps us a lot in our news crawling internally. We are using it to augment our own research. Plus, the connection requests we received are from companies we had not heard of before, which is a great sign.”
Qualgro has had more inbound deals thanks to the connection requests and also the various e27 featured publications and webinars that helped promote the brand as highlighted by Hong. With ever-increasing digitalisation across all industries, Qualgro’s innovative vision, and support form the e27 Pro membership, the possibilities for the VC firm are endless.
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