Author: Ruthc

Entrepreneurship is one of the most challenging career paths anyone can, and naturally, the journey is filled with challenges. Success is determined by the decisions you make as an entrepreneur and you need to strategize on how you will leverage your strengths to ensure that you propel your business forward.

In business, mistakes happen, but part of effective leadership during the organisational crisis is being able to prevent certain mistakes and focusing on growth. 

1. Making uninformed decisions

This is the worst mistake you can ever make because it can result in irrecoverable damage and loss of profits. With any decision or product change or investment, you need to ensure that you are taking the best course of action by conducting thorough research.

This particularly applies to the new entrepreneur who might still be caught up in the passion of a growing business and prone to making impulsive decisions.

Also Read: How Taiwan can boost your startup in unexpected ways

Any decision you make should be backed by the desire to learn the possible outcomes and how your business will benefit from the decision.

2. Attachment to ideas

As an entrepreneur, ideas will come and go and you need to get used to them going more than coming. Not every idea is a good one and we tend to get carried away with bad or impractical ideas that barely serve us in the long run. As a business person, you need to listen to those around you and present yourself as a receptive person to receive honest and productive feedback.

There is a theory that nothing is new under the sun. Therefore, it is highly likely that someone tried your idea before. Research, again, goes a long way in understanding the viability of a new idea. Before investing large amounts of money – some businesses develop a minimal viable product to test the market.

Becoming attached to your ideas can be dangerous and lead you holding on to and implementing a bad idea. Learn to let go of ideas, even those you are super passionate about.

3. Fear of getting your hands dirty

As the leader of a business, your involvement in the overall process allows you to understand how the daily operations of business work. As a business grows, the CEO may grow distant from operations leading to making decisions that may not be good for the business.

As your business grows, your engagement in daily activities is vital and this impacts the growth of your company. Your employees will also value you as an employer if you are invested in understanding their challenges from a practical standpoint.

Investors are also looking for someone who is not afraid to go the extra mile to improve their business and operations. 

4. Ignoring the financial aspect

Money is everything. In business. That is why you are in business: to make money. This is the number one reason why businesses fail within a short time. As the CEO, you need to keep up to date with every financial decision you make and how it will impact your company and its development.

Understand that nothing comes for free and that any business decision you make has a financial implication, whether immediate or delayed. As a business person, this means you should be well-versed in financial management.

Also Read: Is your entrepreneurial journey just another rat race? Here are 20 things that say it might just be so

You should also be able to group expenses according to needs for the business and ensure that you stick to your business plan. The idea is not to reduce your expenses to maximize your profits. 

5. Taking on too many things at once

The beauty of business is that you now own your time. Yay! However, you need to be careful not to fill it up with too many things that will distract you from your business.

Success in business is cultivated through focus and dedication to helping your business succeed. Be wary of starting something else on the side or adding to your range of products or services. The growth of your business is very important, and it needs a lot more attention than you might think. 

6. Not organizing your days

Being organized saves time. Keep a good diary and use different apps on your phone to ensure that you are on top of your tasks. As you grow as an entrepreneur, it does become demanding on your time. Keeping a solid list and commit yourself to complete tasks that grow your business daily.

A diary helps you to prioritize tasks as they come in and completing them in time to ensure that you are on track. If you are also working towards your degree, you can use the best essay writing service to assist you in completing coursework. 

7. Not seeing the bigger picture

Along the way, there will be failures and mishaps; however, these should not determine your overall path. As an entrepreneur, you will encounter mistakes, and they should form as part of a lesson in the bigger scheme of things.

A lot of the time, certain mistakes lead to a decrease in confidence and losing hope to the point of no confidence in oneself. This is detrimental to the growth of your business, and you need to take a knock but not stay down for long. Pick yourself up and keep moving. 

8. Having a DIY mentality

This is a great trait, but not always. As a business owner, delegation becomes more important with time. In reality, trying to do everything by yourself can lead to complete burnout.

Furthermore, as your business grows, you need more skilled labor to take on project management, financial management, and administration. Thus, you need to let go a little bit to make room for yourself to grow. 

9. Cutting corners

At first, this may seem like a good idea to save time or make a quick buck, but it is not a good business practice. Cutting corners can lead to things like diminishing the quality of your product or selling your product at a loss, which is simply bad for business. 

10. Not saving money

Yes, saving is difficult, but in business, it is vital to actively improve your trade and ensuring that if everything falls apart, there is a way out. If you have an emergency, you should be able to tackle it and resolve issues without having to compromise on your business.

Conclusion 

In any business venture, mistakes are common, but they do not define the rest of your path. You need to be aware of your mistakes and correct them immediately. The best way to correct your mistakes is by preventing them from happening in the first place.

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Image Credit:  Thomas Drouault

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PwC Malaysia and the Malaysia Digital Economy Corporation (MDEC) on Wednesday celebrated the graduation of three startups from their PwC-MDEC Immersion programme, a six-month mentoring programme with partners PwC’s Assurance, Deals and Tax practice.

The Immersion programme is a two-way mentoring programme with the goal to “immerse, exchange ideas and discover new paradigms for businesses in the digital world.”

“We would like to congratulate the startups for completing this mentoring journey. They have demonstrated commitment and tenacity in learning and exchanging knowledge with the PwC partners they were paired with. The insights they brought to our partners in the programme were invaluable to PwC as it deepens our understanding of the investments they have made in digitising their organisations and their approach in disrupting the business,” said Sridharan (Sri) Nair, PwC Malaysia Managing Partner, in a press statement.

Through the Immersion programme, the startups had access to PwC’s network through sharing sessions on selected topics such as funding and raising an IPO, as well as access to thought leadership.

They also attended PwC’s Building Trust Awards 2019, a flagship initiative under PwC’s Building Trust programme.

Also Read: Meet the 5 regional finalists of Alibaba-MDEC Jumpstarter 2020 competition

Those startups are:

Supahands
CEO and Co-Founder: Mark Koh

Supahands is a platform that connects companies to a remote workforce called SupaAgents, based around Southeast Asia. SupaAgents specialise in working with large volumes of data, helping businesses scale projects and processes accurately on demand while reducing fixed overheads by up to 75 per cent.

Koh was paired up with PwC Malaysia Tax Partner Yap Sau Shiung for the Immersion programme.

Dropee
CEO and Co-Founder: 
Lennise Ng

Dropee is a B2B marketplace that brings together suppliers and retailers. It aims to help small- and medium-sized retailers such as convenient stores and F&B outlets source for products directly from qualified wholesalers, manufacturers and brand owners at a faster, cheaper and more reliable way.

Ng and Aizat Rahim, COO and Co-founder of Dropee, were paired up with PwC Malaysia Deals Partner Yennie Tan for the Immersion programme.

Involve Asia

CEO and Founder: Jimmy How

Involve Asia is a performance marketing company delivering affiliate marketing and digital advertising solutions for brands around the Asian region. The company’s ‘Involve’ platform is recognised as a well-established network for advertisers and publishers to connect for marketing campaigns, performance and results.

How was paired up with PwC Malaysia Assurance Partner Kelvin Lee for the Immersion programme.

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Image Credit: PwC-MDEC

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I filled in many forms. I spent days understanding the terms. I waited for approval. But I failed.

That is a typical cycle of a layman applying for a loan. If there is one time when you really dislike banks is while applying for a loan or even worse trying to understand how it will work. Bringing Scandinavian chic to Fintech in Asia, Lendela is introducing its lending platform in Southeast Asia.

It is a consumer-centric online lending platform, a “first” in this part of the world. Founder and CEO Nima Karimi has spent over two decades in the Nordic banking and finance industry with platforms like Zmarta and Lendo, building them up from scratch. And hopes to bring his expertise to become the “most reliable lending space” in Asia.

“Europe is a fairly mature market and Africa is too slow and after experimenting with the model in Brazil, Southeast Asia seemed exciting,” said Karimi. With Cocoon capital as lead investors and IMO, Lendela started in Singapore in July last year. It has since entered Thailand, Malaysia and Hong Kong with local teams lead by country managers.

Playing cupid

Karimi told me it was simply the dissatisfaction on one’s face while chasing a loan that led him to build this. Loans are a unique product and probably the only one where the seller can deny it. It also lacks transparency as the seller (banks) have a lot of information about the consumers (loan applicant) but not vice versa, necessarily. “That’s what Lendela wants to change,” added Karimi.

Almost as if matchmaking, Lendela works with the consumer right from the start of the loan application to disbursement. “Borrowers don’t know where to find a loan, so at Lendela they just fill in one form and we match them to the right loan partner,” said Karimi. For now, Lendela is focussed on consumer loans like auto, home, etc.

Its a win-win as for lenders or banks it saves user acquisition cost, the effort, and process to screen applicants and processes. They have about 18 lending partners in the region and 30 in the Nordics. This increases the chances of loan approval as consumers have a wide range to match with. Karimi added that the model works effectively when they have a great variety of banking partners. Lendela works on a commission basis with banking partners as they “want to share the risks and success of the business”.

To Asia with love

“In the Nordics, it is hard to sign banks as compared to Southeast Asia,” said Karimi. Since it is not a very widely used concept and not all loans are formalised via banking in this region getting both consumers and partners can be a challenge sometimes.

Also, each country in the region is different and so are their regulations but the market is ripe and there is a thirst for innovation. For eg: In Singapore, banks can market loans but money lenders can’t. In Thailand, credit reports are generated manually by non-banking institutions only.

The Hong Kong lending market is regulated through HKMA which set in motion the Open Banking initiative last year that enables fintech firms to connect to banks via APIs and over time enable users to manage more of their traditional banking services, including loan applications, via connected platforms.

So governments in Southeast Asia are adapting to fintech friendly regulation with the likes of Singapore’s MAS Sandbox and Thailand’s digital identity (NDID). Hence Karimi feels his “timing is right”.

Karimi believes the novelty of Lendela’s platform, its product-driven approach, and Nordic-inspired UX will work to their advantage to attract consumers in Southeast Asia.

Also read: Cocoon Capital announces US$22M second fund to invest in enterprise tech startups

Let’s take a microscopic look at how it is faring in some of its Asian markets:

Thailand: It launched in May this year and signed an exclusive partnership with Kaidee- Thailand’s largest online marketplace. This enables Kaidee’s customers to apply for loans and compare loan offers online at Lendela.th and has been a huge success for both parties so far said Lendela country manager Jear Worrawut.

It is very complicated for consumers to understand where they can find the best loan offer and the level of financial education in Thailand is low. The process of applying for a loan is rarely digital. It is very common that consumers have to visit a bank branch to be able to sign the loan. So there is potential for Lendela to help customers.

Hong Kong: It is a market with over 160 banks and 2,000 money lenders that fiercely compete for the attention of intending borrowers. With Lendela, each lender can reduce their customer acquisition cost, the marketing risk of acquiring those customers, and overall reduce administrative tasks related to each loan application. Consequently, resources at banks and lenders will be freed up to focus on core business activities such as underwriting, expanding product offering and customer monitoring.

“In Hong Kong, there are some bad connotations with lending money, including companies that act as agents, third parties or intermediaries to banks and lenders so we spend a lot of our time explaining how we are different, and how we are empowering consumers,” said Peter Edsinger, General Manager Lendela Hong Kong.

Malaysia: The Malaysian economy is expected to grow at a slightly faster pace in 2020 according to the Economic Outlook 2020. The government’s plans to implement the ‘Shared Prosperity Vision 2030’ which aims to raise the living standards of all Malaysians to a decent level by 2030, may also increase spending over the next 10 years. For individual retail clients, the loan landscape in Malaysia is a very tricky to navigate due to non-standardised rates and processes of all loan providers (both banks or lenders); the availability and aggressiveness of unlicensed lenders; level of the Malaysian public’s financial awareness on their own credit score or financial status and their eligibility status.

“The Malaysian public may not be completely open and trusting of an online platform which deals with helping them find loans, simply because of the many unlicensed moneylenders that are available. Clarity, transparency, and security on that will have to be assured by us at Lendela, that we only partner with licensed and registered loan providers,” said Firdaus Nejim Al-Asedi, country manager, Lendela Malaysia.

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Grab just launched online motorbike ride in Malaysia [Katadata]

Despite being established in 2012, decacorn Grab just announced that it finally kicked off the online motorbike ride operation, or known as ojek. The announcement came with the recent move by Gojek that also applies for operation permits in Malaysia.

Earlier this month, according to Katadata, Malaysian government announces the proof of concept stage for online motorbike ride operation in the country. The program will be done in Lembah Klang, Malaysia for six months before the operation commences in 2020.

The company said that the ride-hailing service will also cover food delivery, known as GrabFood.

Malaysian private investment firm RHL Ventures launches accelerator programme, to identify, scale Malaysian businesses [Press Release]

Malaysia-based private investment firm RHL Ventures announces that it has launched an accelerator programme with the mission to identify and scale Malaysian business.

“Our new accelerator programme underlines our firm’s stronger refocusing of efforts to grow Malaysia’s entrepreneurial and investment ecosystem along more sustainable lines,” said Rachel Lau, Managing Partner of RHL Ventures.

Also Read: Insurtech NTUC Income joins hand with Chinese insurer ZhongAn for Singapore scaleup

“With Malaysia’s innovation landscape now being more vibrant and dynamic than ever before, we are looking forward to identifying and work with the country’s best and most forward-thinking businesses – helping them to scale their innovations and grow them to become local and global champions.” Lau continued.

RHL Ventures earlier this year announced that it would raise a US$24 million fund to support the growth of local SMEs. The company also has several homegrown technology firms in its investment portfolio; including healthcare software company HealthMetrics, healthy snacks e-commerce platform Signature Market, and online interior design marketplace Atap.co.

WeWork expands to Vietnam, opening two new locations in Ho Chi Minh City [Press Release]

Global co-working space and startup community network WeWork announces the upcoming opening of its second and third locations in Ho Chi Minh City, Vietnam, respectively at Sonatus, opening in November 2019, and Lim Tower 3, opening in February 2020.

Branching out from E.Town Central, WeWork’s first location in District 4, the two new WeWork locations are located in District 1, HCMC’s central district. Sonatus is situated downtown at 15 Lê Thánh Tôn, Bến Nghé Ward, while Lim Tower 3 is at 29A Nguyễn Đình Chiểu in the hip Da Kao Ward.

WeWork has established a strong presence in Southeast Asia over the past two years, since opening its first location in Singapore in 2017. It now boasts footprints in Vietnam, Singapore, Indonesia, Malaysia, Thailand, and the Philippines.

Carro partners NTUC Income, launching on-demand driving insurance [Press Release]

Carro, Southeast Asia’s automotive marketplace, partners with NTUC Income to enhance the company’s car subscription service. The new usage-based car insurance between Carro and NTUC Income is via a ‘pay-as-you-drive’ model that is based on how much the user drives the car; the less they drive, the less they pay.

From November 28 this year, all Carro car subscription customers will benefit from insurance savings via subscription credits based on how much they drive. Carro’s subscription packages include 1,500 kilometres of mileage per month for every standard subscriber. With this usage-based insurance scheme, subscribers will get charged only for the kilometres driven each month, and the rebates for the un-driven distance will be used to offset the subscription fees for the next month. Rebates for un-driven distance can be as high as over US$800 per annum.

Also Read: Automotive marketplace Carro adds US$30M to Series B round; acquires Indonesia’s Jualo.com

The new insurance service uses Vehicular Telematics to assess how much each of their cars is driven in a single month. This data accurately determines the exact premiums, down to the kilometres driven and charges the customers accordingly for the month.

Carro’s subscription model offers all-in flat monthly charges starting at US$1,024 that covers insurance, road tax, regular maintenance, and 24-hour assistance.
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Shanghai-based SOSV Chinaccelerator has announced nine startups to present their businesses on its 16th Demo Day. Chinaccelerator is the accelerator from China that aims to bridge China and the rest of the world, especially Southeast Asia, through sharing entrepreneurship and innovation lessons learned from the China market and bringing International methodology and best practices to China.

The accelerator claims that it has invested in over 150 startups from over 25 countries, which among many are from Southeast Asia and still running their business well in the region.

Among 9 startups in this batch, 4 startups are located in Southeast Asia or targeting Southeast Asia and two AI startups are from Hong Kong. Here are six out of the nine startups:

1. Angat, a tech remote hiring startup that enables companies to source, hire, and manage tech talent via remote tech hubs location in countries with strong, untapped IT talent such as the Philippines. The startup is based in the Philippines.

2. viAct.ai, a Hong Kong-based computer vision-powered startup that automates the real-time monitoring of construction and manufacturing sites to increase productivity and safety.

3. HomeCrowd, Malaysia-based digital mortgage crowdlending platform that uses a holistic credit scoring system to help underserved populations get access to mortgage and debt consolidation loans. HomeCrowd is the first company in Malaysia to be licensed for mortgage and consumer lending by the Housing Ministry.

Also Read: How to start a business in China as a foreigner

4. Neufast, Hong Kong-based startup that utilises AI technology to help hiring managers reduce time-to-hire, eliminate unconscious bias, and evaluate job fit scientifically, by providing companies with personalised question-answer interview bots and video-based psychometric assessments.

5. Tourplus, Malaysia-based online travel marketplace that connects travelers with thousands of local guides in Southeast Asia. Tourplus’ platform offers personal itineraries with local guides and transportation in real-time.

6. TravelFlan, Hong Kong-based AI-enabled platform that helps companies to sell travel services. TravelFlan unlocks flight, air, hotel, and experience booking revenue for super apps through its personalised chatbot travel engine targeted at customers in China, Japan, Korea, and Southeast Asia.

7. Travelright, a travel tech startup that provides an intelligent flight compensation solution for Chinese travelers to quickly and easily claim owed by airlines for flight delays and cancellations.

8. GetKno, a real-time analytics platform for brands, factories, and workers that allows brands and factories to scale ethical manufacturing and increase productivity.

9. Voilà!, a social commerce platform enabling US fashion KOLs and micro-influencers to monetise through e-commerce personalized with Voilà!’s visual search engine and product recommendation algorithm.

Also Read: Why China should be the next market for your startup or scaleup

Chinaccelerator is operated by the venture fund SOSV, which operates seven global accelerators. Chinaccelerator offers three months of guidance, training, and resources from mentors, partners, and investors with access to supportive alumni network

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Photo by Adi Constantin on Unsplash

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Last year, the Asian mobile gaming market hit a revenue mark of over USD$41.5 billion. Japan, for instance, emerged among the top 3 digital gaming markets globally with revenue of over USD$19.2B in 2018.

According to Cam Pham, a blockchain researcher, 2020 could just be as lucrative especially thanks to blockchain technology.

With the planned inclusion of eSports into the 2022 Asian Games, the gaming boom in Asia is set to increase especially with blockchain capacity to enable fungibility of virtual gaming items.

Yat Siu, the co-founder, and chairman of Animoca Brands believes that the mass adoption of the blockchain industry will come through games.

In his opinion, “gaming has been an industry that has pushed forward technology in general.”

South Korea

Perhaps nowhere else in the world is a blockchain gaming set to succeed more than in South Korea.

Also Read: Singapores gaming chairs startup Secretlab gets funding from Temasek’s Heliconia Capital

With only 1 per cent of the global population, the country boasts of upwards of 30 per cent of the world’s cryptocurrency trading platforms.

What’s more, in 2018, the Korean government legitimized the blockchain and cryptocurrency industry with a move to draft industry classification standards that “recognizes crypto exchanges as regulated financial institutions.”

On this backdrop, giant South Korean tech companies have established platforms such as ONEStore that offer users access to decentralized blockchain-based applications like BUSKON.

However, despite last year’s move, the stance of the South Korean government on blockchain and cryptocurrencies is still unknown.

Just recently, the South Korean regulators, banned Infinity Star (a game that uses an Ethereum ERC721 token). Although the regulatory body insisted that the decision was not a total ban on games that use blockchain technology, onlookers and industry insiders believe that the move could spell doom for the industry.

Japan

In Japan, regulation seems to be taking a blockchain-friendly turn. The Japan Cryptocurrency Business Association (JCBA), a self-regulatory organization, last month released guidance for cryptocurrency custody operators. 

The guidelines stipulated the various responsibilities of cryptocurrency custodians and also suggested a virtual currency ranking that would ensure the safe handling of cryptocurrencies based on their specific characteristics.

According to Tran Ngoc Son, the CEO of Tomochain in Japan, “ownership and liquidity of virtual items are the current problems” facing blockchain gaming. 

With the new guideline, developers will now be able to comply with regulations while coming up with blockchain-based games that allow players to have greater control of in-game assets. 

With a revenue of $19.2B in the digital gaming market, Japan stands as one of the leading blockchain gaming markets with apps like My Crypto Heros (MCH) boasting the largest number of users in the world.

According to Kazuhisa Inoue, the CEO of Good Luck 3, “gaming and gaming economies offer a perfect fit for the circulation of tokens.” Inoue is the game maker behind CryptOink,  a blockchain-based game with crypto piggies that recently attracted 20,000 gamers. It is similar to Cryptokitties, but with more racing options, ie. gamers race, bet, breed pigs and compete in challenges. 

China 

While the rest of Asia embraces the gaming boom, the Chinese government is putting in place so-called “game-changing” laws that target more than 170 million minors online. 

The new law restricts playtime and instils spending limits for the country’s 20 per cent of its online users aged between 8 and 16 years old.

This comes at a time when Reality Gaming Group, a London-based blockchain, and AR gaming startup, plans to accelerate the development of its platform as well as other blockchain and AR games after signing a Memorandum of Understanding that gives it access to the Chinese market.

Although China is known for its harsh stance on cryptocurrencies, recent comments from Chinese President Xi Jinping show a blockchain-friendly viewpoint. 

In an article published last month, Chinese President Xi Jinping said that “major countries are stepping up their efforts to plan the development of blockchain technology.” 

He further added that China should put in “greater effort to strengthen basic research in the field and boost innovation.”

Hong Kong

In Hong Kong, political unrest is fuelling the popularity of an Ethereum-based game called Gods Unchained.

The popularity of the blockchain-based card trading game spiked after revealing its stance on Chinese censorship when Blizzard (the company behind Hearthstone) expelled a gamer who showed support for the  Hong Kong protests in an interview.

Although Blizzard later reduced its punishment on Chung Ng Wai (Blitzchung), Gods Unchained moved quickly to speak against Blizzard’s actions even promising to refund Blitzchung all his rescinded earning from Hearthstone.

Also Read: 3 top mobile gaming trends by Outblazes Yat Siu

With Hong Kong as the centre of pro-democracy protests, the popularity of God’s unchained increased to an extent where the transfer count of its token peaked past the previous high set by Cryptokitties.

Looking forward and beyond

Not only are there more people engaging with digital games, but gaming in Asia is also educating more people about the value of virtual assets and the power of blockchain technology.

Blockchain technology is solving the problem of scarcity of in-game items making gaming even more lucrative in the long run. However, it’s not all smooth sailing in Asia. Despite the positive stance that countries like Japan show towards blockchain and cryptocurrency, the volatile nature of regulation persists in places like South Korea and China.

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Editor’s note: e27 publishes relevant guest contributions from the community. Share your honest opinions and expert knowledge by submitting your content here.

Join our e27 Telegram group here, or our e27 contributor Facebook page here.

 Image Credit:  Florian Olivo

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E-commerce companies Shopee and Lazada are competing for the top spots in the Southeast Asian (SEA) market, according to the new The Map of Southeast Asian E-Commerce – Q3 2019 report.

Published as a result of a collaboration between iPrice Group, App Annie, and Similar Web, the report saw the two companies vying for the top spot in different categories.

Both companies top the category of mobile apps with the highest number of monthly active users (MAUs) in Q3 2019, where Lazada ranks first in four out of the six SEA countries that are being researched: Malaysia, the Philippines, Singapore, and Thailand. Shopee itself tops the list in Indonesia and Vietnam.

Another top player in the region that made it to the list was Tokopedia, which followed Lazada and Shopee in categories such as mobile apps with most MAUs and downloads.

In its home market Indonesia, Tokopedia is the most visited e-commerce websites in Q3 2019 at 25 per cent of web traffic market share. In this segment, Tokopedia is followed by Shopee at 22 per cent.

Also Read: Singapore: The new “place to be” for e-commerce in Asia?

What we learned this quarter

The report also offered insights into trends that are displayed by e-commerce companies in SEA in Q3 2019.

It said that nine out of 10 applications with the highest number of MAUs offer products in multiple different categories, instead of just focussing on one vertical such as fashion or electronics.

“This shows that multiple-category marketplace platforms may be the future of Southeast Asian e-commerce due to convenience and their strong financial backing,” the report elaborates.

Another trend that the report pointed out is the rise of “shoppertainment” –a concept that includes the addition of features such as live streaming events and in-app games to increase user engagement.

Another interesting development in Q3 2019 is the apperance of newcomer Wish in the main categories.

A cross-border commerce app, Wish made it to the top five most downloaded mobile apps for the first time. According to the report, this indicated the platform’s serious foray into the Southeast Asian market.

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Image Credit: Markus Spiske on Unsplash

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Everyone is talking about neobanks (alternatively known as hybrid banks or in the UK, challenger banks). In 2018 alone, consumers saved USD$5 billion by using neobanks rather than going through traditional avenues. That’s a lot of cash. Sure, neobanks are seen as “disruptors,” but they also may help with business growth and individual finance. The question is, are they the future of banking? 

Traditional banking route

Going through the traditional lending process has historically been the only route for small business owners and individuals to obtain a loan. There has been limited competition and let’s face it, slow processes that seemed to be accepted because it was simply the way things were done. 

For the bigger banks themselves, lending to small businesses especially was tough. Smaller loans, yet the same amount of paperwork and manual processes required for bigger-value loans. The smaller ones seemed unprofitable and perhaps that’s why neobanks have seen such a recent surge over the past 3 years.

Introducing neobanks

To date, Americans have opened approximately 3.25 million accounts with US-based neobanks. Just under USD$1.7 billion is held in these accounts. This equates to around 0.014 per cent of all deposits held in US banks. While this may not seem like a large disruption to the traditional bank route, they are definitely making waves. 

Also Read: Fintech and banks: collaboration or competition?

Neobanks tend to share a few characteristics such as offering microloans and fast digital customer experience. Their low-cost structure minimizes overdraft and monthly fees. However, as a result, customers tend not to earn that much interest on their deposits. And finally, for the budget-conscious customers, there are often budgeting and savings tools built into accounts so consumers can automate their financial transactions, which leads to better savings habits. 

Neobanks is definitely surging in popularity, and are certainly making headlines. In fact, in 2018, neobanks in America received four times as much funding as they did in 2017 and ten times as much funding than in 2015. While neobanks first found their home in the UK, mainly because the UK market isn’t as saturated with big banks like the US, they are popping up worldwide. So why are they gaining popularity at such speed?

The neobank success

For starters, unlike traditional banks, neobanks aren’t burdened by cumbersome systems and organizational structures. As well as this, because they tend to offer niche services, and certainly don’t provide the full banking experience, there are fewer regulatory requirements. 

For many neobanks, it’s about helping consumers lead healthy financial lives by providing helpful products and services with fewer fees. Banking is quick and simple. There’s no need to book an appointment at a banking branch and no need to fill out lengthy forms to set up an account. 

For the customer, there’s a seamless and useable platform to use and are changing the way people save and spend their money, with real-time updates on spending, transfers and incoming money, and the ability to send money through to friends using merely their names or contact numbers. 

Another bonus that comes with neobanks is the ability to save in a smarter, more user-friendly way. For example, many platforms will allow you to partition your savings into specific buckets that are kept separate, so if you’re saving for a holiday or a house deposit, you can allocate your funds accordingly. 

It’s a handy feature for the younger generation, and as an added bonus, it helps keep track of where the money is going. However, the traditional banks are taking notice, and some are even adopting the same techniques in order to retain their customers and encourage new ones. 

Some of the bigger banks are launching side projects of their own. One notable example is Goldman Sachs which launched a digital retail offering called Marcus by Goldman Sachs. 

JP Morgan is also chasing the neobank tail with Finn by Chase which is a completely digital bank, targeting the younger generation and those who live in areas of the US with a shortage of physical bank branches.

Will they last?

Sure, neobanks are shining at the moment, but not all shiny things last. They’re on the rise but it’s questionable whether they will fully overtake traditional banks, especially anytime soon. 

The traditional sector connotes a kind of trust that newer, challenger and neobanks simply don’t have at the moment. Second, the traditional banks offer a full-service model, whereas many neobanks rely on one particular niche area of service, such as debit cards. 

Also Read: Threat or opportunity? boosting digital banking in Asia

Most neobanks are enjoying success with the younger generation. Yet it may be too soon to tell whether the millennial customer base will remain with a digital-only bank. Are neobanks offering enough to take their younger demographic into their middle and older years? 

Neobanks are certainly transforming consumer banking and small business lending, it may be too early to tell whether they’ll survive. 

While people are certainly turning to neobanks to help them save, avoid fees and enjoy quick and simple banking, perhaps there’s still room for both traditional and challenger banks in our future.  

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AppWorks, Taiwan-based startup community that claims to be the region’s longest-running accelerator, announces 18 startups joining its 19th Demo Day. With a focus on AI and blockchain, the 18 founders that will pitch in the Demo Day today demonstrated experiments in the AI, IoT, and Blockchain frontiers.

The Ai-powered industries include real estate, finance, and medical science, with a total of 14 AI, IoT startups and four blockchain startups. Six of the founders featured are from Taiwan, and the other 12 come from around the world and Greater Southeast Asia (GSEA), with half of the founders are serial entrepreneurs, bringing backgrounds in tech companies like Google, Qualcomm, Samsung, MediaTek, Agoda, IBM Watson, Initium Media, and PepsiCo.

After spending four months development in Taiwan, the pitching by founders only will happen in front of the investors and potential corporate partners from Taiwan and Southeast Asia, including investment professionals and executives from Fubon Financial Holdings, Taiwan Mobile, Cathay Life Insurance, Wistron Corporation, Hungtai Group, UDN, FarEasTone, as well as Taiwan’s National Development Council, and more, seeking an opportunity for investment and business collaboration for these founders.

Also Read: E-scooter-sharing platform Telepod raises funding led by SMRT’s corporate VC and incubator

With Taiwan as a launchpad, the products from these 18 startups are ready to be pushed into new markets for potential accelerated growth throughout the region.

• Telepod, an EV smart mobility startup based in Singapore with a mission to bring transport efficiency and climate harm reduction to cities in developing Southeast Asia markets. The startup was founded by Jin-Ni Gan, who claimed that it has shipped her EV smart mobility devices and battery kiosks to seven markets.
• Matters, a Hong Kong blockchain startup that enables content providers to be paid for their content, rather than to have their content and revenue opportunities that are often dependant on advertising algorithms and walled social media. The startup was founded by Annie Zhang that claimed to have scaled to over 20,000 customers during the accelerator session.
• Beseye, a startup that provides wifi-managed AI cameras allows the scanning of the movement of people near railway tracks to prevent accidents. The startup was founded by Shaq Tu, claimed to have already booked giant Tokyo Railways as a client.
• SELF TOKEN, Taiwan-based blockchain digital assets through Ethereum Smart Contracts that’s committed to creating an ecosystem of immersive entertainment experiences. Founder Jack Hsu also directed “The Last Thieves”, the world’s first film based on Blockchain.
• WeavAir, sensors and analytics company started by Singularity University graduate Dr. Natalia Mykhalova. The company uses AI and IoT sensors to build a recurring revenue business model that helps developers and landlords pinpoint trouble spots in their building control systems.
• Arical, a startup that’s co-founded by San Wong and Clement Tien from Hong Kong, is a platform that plans to “unlock the potential of property development.” Their 3-D AI envisioning tool enables clients like Henderson Land to spend only a few hours to map out hundreds of possibilities for designing buildings, as they have done recently in a project in Manila, the Philippines.
• Fourcons, Indonesia-based construction equipment platform started by founder Felix Hartantio. Fourcons provides an AI-driven platform for finding, verifying, and managing construction equipment.
• Blyng, an AI virtual assistant in real estate created by co-founder Julien Priour. It helps agencies cut down on missed opportunities in qualifying inbound leads.
• OnMyGrad, a career development, and workforce transition co-founded by Clement Tien and Anthony So, from Hong Kong. It works with recruiters to help students prepare for roles in several industries.
• KaChick, a platform for sourcing authentic photography from over 1,500 amateur and professional photographers, and have taken steps to pair those media assets with brands in the hospitality and entertainment space to drive more engaging marketing and branding campaigns at lower margin cost. The startup’s co-founders Peggy Cheung and Larry Lam.
• Dent & Co, a medical services AI chatbot created by dentist Steve Chu.
• Fluv, a pet care platform for local pet parents and sitters, is being demonstrated by former PepsiCo marketing staffer Candace Chen.
• Mellow, an app to help young people and families manage finances created by first-time founders Chester Szeen and Teresa Chan from Hong Kong. It enables children to use their “first money” through debit card usage and parent-regulated accounting.
• Dapp Pocket, a crypto wallet app created by Anderson Chen that’s in the vertical of payments.
• Portto, a blockchain startup created by three former members of the crypto company Cobinhood promises to make the KYC and onboarding process for using Blockchain simpler.
• Whoopee Robot, an AI/IoT startup created by founder Morris Lu, is now operating in five local shops and has served over 10,000 cups of robotically-delivered espresso beverages.
• SparkAmplify, an AI-powered PR service founded by Chien Lee that delivers an automated public relations system for clients.
• Gigvvy Science, a platform for speeding up the sluggish vetting and reviewing of critical science research co-founded by New Zealand-based co-founders Lisa Hsu and Mark Mai.

AppWorks Chairman and Partner Jamie Lin said at the opening of the event:
“Of the 31 teams that were admitted to the AW#19 program, 19 are working with AI/IoT, 10 with Blockchain/Crypto, and 2 are incorporating both technologies. What’s more, 23 per cent of founders from this batch are female, which marks one of our highest percentages in recent years. With the addition of the graduates from AW#19, there are now a total of 376 active startups and 1,113 founders in the AppWorks Ecosystem.”

Also Read: Our TOP100 Taiwan champion says let’s bring chatbots to real estate!

Founded in 2009, AppWorks is a startup community built by founders, for founders. With its commitment to mentorship, investment, and talent, AppWorks said it has established a one-stop-shop for founders willing to drive a change they see in the world through its three primary lines of service: Accelerator, Funds, and School.
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Yangon-based on-demand trucking start-up, Kone Si has received a six-digit investment for nationwide expansion from Yangon Capital Partners (YCP), a Myanmar-focused venture capital under Trust Venture Partners, a local financial advisory firm, and Nest Tech– a Vietnam-based venture capital company as reported by local media.

This is the second round of investment for Kone Si after it initially received pre-seed funding from Phandeeyar in 2017, which has invested in Kone Si and 16 other local companies since 2016.

The start-up is planning to use the new funding to boost its technology platform, acquire talent, and expand to other commercial cities around the country to strengthen its user base.

A Top 100 contender, the ecosystem of Kone Si comprises more than 100 business shippers and over 2000 truckers; it also has an average month over month sales growth of 30 percent.

Ma Zar Phyu Tint Lwint, CEO of Kone Si said that in addition to understanding the power paradigm between the customers and truck suppliers, knowing the logistics freight flows throughout the year in the country is critical as that can help partner truckers get return loads and operate efficiently.

Also read: Don’t sleep on them: Here are food tech startups from Cambodia, Myanmar that you should know about

Businesses in Myanmar face difficulty in outsourcing transportation to third parties due to unreliability, lack of standardised procedures and non-transparent pricing among truckers, according to Kone Si.

Moreover, due to fluctuating transport pricing controlled by large trucking groups as well as unethical working nature, small fleet owners and individual truckers have to struggle to get regular jobs. Kone Si aims to bridge the gap between shippers and small fleet truckers.

“The services designed by market-savvy management will bring down logistics cost, a bottleneck of business operation across industries, and eventually benefit consumers in Myanmar” said Shinsuke Goto, managing director of YCP.

Just last week, Emerging Markets Entrepreneurs (EME), an early-stage venture capital firm, had also announced during its anniversary celebration on November 20 that it had invested a six-figure and five-figure sum respectively into two local start-ups: Natural Farm Fresh, a local company producing high-quality solar-dried chili powder and other dried products, and Yangon Broom, a home-services firm offering on-demand services including cleaning and ironing to residential homes and businesses.

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