There have been frequent panel discussions and dialogues about instilling a sense of entrepreneurship spirit and the spirit of daring to fail on both the startup and national levels.

But are we truly walking what we preach?

Despite a recent report that Singapore has retained its place as second best on a World Bank ranking for the ease of doing business, let me tell you why I stand by that statement.

First, ease of doing business does not equate to ease of starting a business. Ease of starting a business also does not mean the environment required for doing so is there. It can simply be the process is quick and efficient, not necessary the proper ingredients for so are there, high labour and rental cost aside. Then again, it also depends on how you define what does the Silicon Valley of Asia mean.

Also Read: Whats Silicon Valleys secret sauce : what Asian entrepreneurs can learn in terms of culture

The silicon chip is an integral component of the semiconductor industry and is used in just about everything that’s computerized and Silicon Valley probably got its name due to a large number of innovators and manufacturers in the region specializing in silicon-based businesses during its earlier days.

I’m also sure you would agree the following are critical to the startup ecosystem: a hotbed of startup activities, great talents, key partnerships, and more importantly, funding.

For the 3rd year running or perhaps even longer (I only researched 3), seed-stage deals have been dropping reflecting the low-risk tolerance here.

Taken from Wikipedia itself, “Silicon Valley has a social and business ethos that supports innovation and entrepreneurship”. From Dictionary.com, an entrepreneur is “a person who organizes and manages any enterprise, especially a business, usually with considerable initiative and risk.”

With all the talks within the ecosystem, about embracing failures – taking risks, do we truly put our money where the mouth is? Or is it simply the case of  “Yeah, take the risk. You, not us.”

 

Just in Q1 2018, Grab received a US$2.5 billion fundraise among the city state’s record US$2.68 billion in VC investment. However, a whopping 93.28 per cent of it is going to just one company.

There used to be frequent debates on many Startup and Entrepreneurship Facebook groups and pages on if the seed stage is dead. Nowadays, I rarely see them. Perhaps the debate has been settled once and for all, or everyone just silently resigned to fate. Perhaps the seed stage is not dead, but it might as well be.

For the 3rd year running or perhaps even longer, seed-stage deals have been dropping. If the mindsets of key private players of the ecosystem do not change while schools are advocating entrepreneurship, how can we have a holistic ecosystem where we cannot even have the chance to truly take chances? Should we motivate our next generation to equip themselves with updated skills in STEMS, AI, coding so that they can become great employees or that one day, they can become the next Facebook or Tesla and there be an environment for so?

Also Read:  What Singapore can learn from Silicon Valley

While I had to turn down a couple of angels as they wanted the majority of my startup’s equity, others might have better luck than me. I could also be talking to unsuitable angels that might not be representative of the “education” and mindset of most angels here.

A friend who works at one of the angel networks here told me she was surprised by how much the angels here require to see before opening their chequebooks when the average investment amount is lower than where she came, another country in Asia despite their PPP and GDP are much lower.

Even feedbacks among founders could be inaccurate as it depends on who we hang around with. During a talk at an entrepreneur hub where there were 2 founders from the USA and Australia respectively, I raised my hand and asked them about their opinion of the fundraising scene here, I could already guess the answer, to which both replied that VCs here give lower valuation, take longer to come back, required more tractions. The only reason why they chose to fundraise and have a headquarter here is that their target market is this region.

A VC once commented that founders should not have “me too” idea and that he looks at founders with skin in the game. Okay, first part sounds reasonable, but how do you measure “skin in the game?” I asked. He replied determination, grit and perseverance.

Okay sure, but How do you measure that? I made dozens of pitches to VCs and angels, and never once did they ask anything besides the solution, the business plan, etc that would determine mine. He answered one way of looking at it was how much have we invested.

As a matter of fact, this question comes up rather often – but how and what has that got to do with anything? A founder that invested 500k vs another that invested 5k?

“How much” is subjective. 500k or even 5 million could be nothing if your father is a regional automotive giant vs me of humble background with my dad also in the automotive industry but working as a driver.

For over a year, I slogged and took the financial risk of doing this full time. While I am very fortunate to have the blessing of my girlfriend whom I have been with the last couple of years, I have to painfully and selfishly shelve aside our hope of applying for a flat now in our late 30s so as to allow me to concentrate on this endeavour.

All this while, not giving up and moving on to attempt to start this startup right after a year of research, interviewing dozens of other users and similar platforms aboard, when just not too long ago, for many months not receive any salaries despite supposedly being a paid director and suffered financial ruins – I persevered.

Never once a VC or angel tried to assess if I have grit. If the angels here behave like VCs and VCs like PEs, who will give founders a chance? The irony? I want to start a reward crowdfunding platform as I wanted to encourage more to take up the path of entrepreneurship and help them to be able to raise the funds to do so.

How Silicon Valley became Silicon Valley could also probably be due to the America Dream and that it is the land of opportunity. I noticed most young entrepreneurs usually have parents that are entrepreneurs themselves. In the UK, only 4 per cent of doctors came from working-class families. Social mobility through entrepreneurship aside, while I envy as they have more access to resources, I also want to believe in a meritocracy – that anyone can succeed with the right idea and hard work.

It’s important to be hopeful, but when for the 3rd year running or perhaps even longer, where seed-stage deals have been dropping, and the ecosystem is shutting the door of opportunity more and more often, when should we really speak up and urge for more to be done? Isn’t being an entrepreneur being all about changing the status quo?

Also, what does this bode for the long-term health of the ecosystem?

In the US, the odds of becoming a unicorn is 1 out of 1092. If we do not have enough ideas getting invested to compete and survive, the odds of us producing a unicorn are going to get lesser. It takes a village to rear a child, but what happens when the village only focus on the big boys and neglects the toddlers?

Sure, with our favourable tax and business climate, we can become an attractive startup hub. But with established business coming over to be headquartered here and becoming later a unicorn, and with key players here remaining conservative and risk-averse to the seed stage, is that really encouraging entrepreneurship? Or do we promote entrepreneurship like how we import foreign table tennis players?

Singaporean boldly invests in property and the stock market. However, we must also continue to support and invest in our entrepreneurs, else, when we call ourselves the Silicon Valley of Asia, are we referring to the shell or spirit?

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Financial institutions are accustomed to holding on to historical customer data. They view this as a competitive advantage, as well as a security requirement.

Today, however, regulatory and market changes are driving “open banking”, a buzzword that in practical terms usually means “open API”, that is, requiring customer transaction data to be shareable with fintechs, merchants, or customers themselves.

And this is making banks very nervous. But if they play their cards right, banks, lenders, insurance companies and other financial institutions may find open API is a powerful driver of new revenues.

Banks struggle to understand the information they have on their customers, and they need tools to help them make the right decisions and create the right products that their customers want.

Fintech companies, like gini have developed solutions to help commercial banks, credit card companies and other lenders turn data into insight – and insight into action.

Also Read: 7 reasons why profitability is for losers

In Asia, some markets adapted to the open-API trend quickly, such as Korea and India, with regulatory support. Now Australia is mandating open APIs, while regulators in Singapore, Malaysia and Hong Kong are pushing banks to open as well but without explicit direction, leaving it to the marketplace to determine the most relevant use cases.

Some fintechs in these more hands-off environments worry that banks will simply drag their feet. But regulation is not always the most important factor in opening data: the United States, for example, has no such regulatory mandate but has a robust open-API environment, because banks discovered that it helped them compete against disruptive tech players.

So what are some uses cases in a market such as Hong Kong, which is possibly the most developed but also the most traditional banking market in Asia?

Fintechs are building capabilities to help banks and lenders make sense of the troves of data they possess but aren’t able to exploit. They do this by enriching data to build a structured set of data. That’s the first step for a bank looking to use machine learning and AI to improve customer experience and lower operational costs.

Banks may have plenty of historical data about their customers until now they have been flying blind in terms of seeing a customer’s entire portfolio or behaviour.

Fintechs acquire transaction data and “clean” it, eliminating errors, and “enrich” it, making it machine-readable. That data is now being turned into analytics and use cases for banks that need to either reduce their operating costs or generate new revenues.

One of the earliest benefits is removing costs from chargebacks. In Hong Kong, over 10 per cent of calls to banks’ call centres involve questions about card transactions at venues that people do not recognize. This is because many merchants operate under confusing holding-company names.

Also Read:  Blockchain will force banks to change their feudal mindset

This may sound simple, but each investigation costs banks on average around US$100, which adds up to tens of millions of dollars, for every one million customers, over a year. However, the clean data includes geolocation, enabling it to map venues to corporate names – and even to identify individual stores among chains, which are often impossible for banks to figure out. Such data insights not only save banks money on investigations but also reduce the number of incoming calls.

The same kind of structured data can also be used to make money, not just save it. One of the biggest demands among banks is to personalize rewards and offers, delivering the right product to the right customer at the right time.

To date, banks have relied on their proprietary demographic information to come up with new product offers, which tend to be one-size-fits-all pitches.

For banks to be able to leverage more data better, the advent of open API is a game-changer.

A financial institution can work through technology companies, such as gini to access the data from, say, an e-commerce site or a merchant, and develop new products for those customers. And as banks become more comfortable with data exchange, they will begin to embrace the greater value from open API collaborations.

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Tech companies have recently come under scrutiny for being overvalued and scaling their losses instead of building an actual business.

That’s a little ridiculous (almost like judging, say, an electric car company for its inability to manufacture cars.) It’s lonely at the top. We should let the haters hate and focus all our energies on protecting the beautiful tech bubble from unreasonable criticism. Here are 7 great reasons why profitability is for weirdos and boring people.

1. It makes predatory speculation much harder. It’s virtually impossible to pump and dump a tech company from nothing to IPO unless it’s overvalued. And where’s the fun in funding real businesses? Almost as lame as being honest on your LinkedIn profile. I mean, who is that boring?

2. It slows down your growth. Yes, losing more money every month is much more effective in achieving growth than actually growing your business. Losses are the new profits and allow you to generate flash floods of clickbait ads containing half-truths such as ‘the app that all CEOs love’ or ‘this startup is harder to get into than Harvard.’

3. It diverts your time away from fundraising. Stop trying to be an entrepreneur and start wining-and-dining investors. Fundraising is a full-time job; why waste your precious time on building a commercially viable product when you can just defer this issue until your post-IPO penny stock phase? By that time it’s not really your problem anymore, anyway.

4. It turns you into a commodity. Almost all businesses in the world make money, so why be like them? What about originality and changing the world? Screw all those capitalist crooks, and focus on evocative, lucid-vision narratives. It’s about making the world (more precisely, your world) a better place, dammit!

5. It constrains you. You want fluorescent pink walls in the office, a pet elephant, and Michelin-star canteen food but you can’t have that. Why? Budget issues. What’s the point of dedicating your privileged first-world life to fashion yet another gimmicky consumerist pyramid if you can’t have some fun along the way?

‘Lean’ is a word you ask an up-and-coming artist to spray paint onto your fluorescent pink office wall. It’s an idea that applies, if at all, to your employees. Lean makes everything worse when you take it too seriously. Think lean foie gras or lean caviar. Gross.

6. It makes you unattractive as a company. Nobody wants the truth. Stop conspiring to find ways of making your innocent target audience give you their hard-earned cash. It’s unsavoury, like telling your tinder acquaintance about your bloating issue on the first date.

Do you really think VCs want to know how you manipulate innocent users to pay for your products and services? Do you believe they actually enjoy paying for things? Make them all happy by making it free. Start caring about bettering humanity, and stop all that endless greed. Today’s consumers expect your investors to pay for their lifestyle – it’s all about customer-centricity.

7. It limits the extent of your favouritism. With profitability metrics in the mix, it may become harder to justify hiring your 19-year-old brother as Senior Vice President of user engagement (even if he’s good at social media.) Why take that risk?

Honestly speaking, stop thinking about profitability. It pollutes your mind and distracts you from what really matters. Be bold, spend as much OPM* as possible, keep pouring oil onto the hype fire and by all means, start a fund (with OPM*, of course) once you’ve been bought out, to perpetuate the scheme.

OPM = other people’s money = the best money in the world.

Added Podcast Alert!

To understand more about the impacts of profitability in a tech company or any company for that matter, tune into my new podcast “Present to Future” hosted along with Pak Teng Chow, founder of Blockspace Asia, which talks about trends in the tech world and aims to clear up some of the biggest doubts around it.

Please let me know what you think or any tech trends that you would like us to cover !

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Web2ship Services, which helps online sellers to group-buy cross-border shipping services, has won the Malaysia round of Seedstars World 2019 — a seed-stage startup competition for emerging markets and fast-growing startup scenes.

Mentari Alam EKO (MAEKO), a startup that converts food waste into bio-organic compost for agriculture, grabbed the second spot, while iMotorbike, a motorcycle marketplace connecting motorcycle buyers, sellers and service providers, came third.

A total of eight startups were invited to showcase their products. They were BuildEasy, Harvestnet SB, HelloWorld Robotics, Intuitive Asset, and Kravve.

“Seedstars World Kuala Lumpur gave us the exposure and PR we needed while fundraising. In the last few days, we have had many VCs as well as potential clients and partnerships adding us on Linkedin,” said Alex Cheong, Co-founder of Web2ship.

Also Read: How these two TOP100 alumni stand out among the crowd –one fresh funding at a time

Web2ship will represent Malaysia at the Seedstars Summit in Switzerland in April 2020. It is a week-long training programme, with the opportunity to meet the 65-plus winners from other fast-growing economies, as well as investors and mentors from around the world. Regional winners, including Web2Ship, will pitch in front of an audience of more than 1,000 attendees, with the possibility of winning up to US$500,000 in equity investment and other prizes.

Seedstars is a Swiss-based private group of companies with a mission to impact people’s lives in emerging markets through technology and entrepreneurship. The groups’ activities cover over 80 emerging ecosystems through a variety of events such as the Seedstars World Competition, acceleration programmes, physical hubs called Seedspace, venture capital investments and company building activities.

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How Singapore Management University’s Masters of Science in Innovation (MI) is helping shape the region’s next best thinkers

Have you always dreamed of starting your own business? You’re not alone — these days, more and more people are ditching 9-to-5 jobs in favour of being their own bosses. Yet many lack the leadership and knowledge to create breakthrough innovative business ideas. How can you become a leader in developing, market validating, and leading innovative teams to create breakthrough new business ideas?

In Singapore, the Singapore Management University (SMU) offers the world’s only Asia-focused entrepreneurship programme in the form of its Masters of Science in Innovation (MI), which aims to engage, challenge, and grow the next generation of innovation leaders.

The SMU MI curriculum is crafted for corporate managers, creative art professionals, technologists, entrepreneurs, and practitioners keen to advance innovation in their field. It involves regular engagement with thought leaders and schools, as well as practical projects.

Designed to be completed over 12 months for the full-time programme format and 15 months for the part-time format, the programme also consists of a Capstone Project and International Residency.

Gaining valuable exposure


The MI capstone project runs concurrently through the programme, and is co-taught by Paul Santos, a successful venture capitalist and former entrepreneur. He is currently the Managing Partner of Wavemaker Partners, an early-stage venture capital firm founded in 2003 that has over US$265 million in assets under management.

Reddi Kotha, Academic Director of the MI programme, Associate Professor of Strategic Management explains: “We believe that rigorous theory should be combined with cutting-edge practice to have the best learning at SMU. Paul and I have revamped the curriculum to include custom cases on VC-backed companies, to help situate the ideas of our students in a fertile ground. Paul provides guidance on the specific challenges their business ideas may encounter, and how the student teams can overcome these challenges.”

Eligible full-time students will also have the opportunity to participate in the optional internship to further their learning.

“For full-time students who want to get further grounding in innovation, we recommend they do optional internships at entrepreneurial companies, to complement their in-class learning and capstone project. The internship will help them to gain a deeper understanding of the application of the innovation theories, tools and skills from the programme,” says Reddi.

Increased access to resources

In addition to the industry exposure, full-time students of the MI programme will also have access to venture funds totaling over S$1 million. From the P.A.K. Challenge to the Lee Kuan Yew Global Business Plan Competition, there are many opportunities organised by SMU, its student entrepreneurship club, SMU Eagles and the SMU Institute of Innovation & Entrepreneurship (SMU-IIE), for students to validate concepts and give life to their ideas.

In addition, each student team receives a S$1,000 grant from SMU-IIE for their capstone project. Explains Associate Professor Kotha “This budget enables students to ‘make a little and sell a little’, so their prototypes can be tested. While not all ideas are conducive to this process, attempting to get as near as possible to solving real-world problems is the best way to learn and gain insights on the market.”

Aside from monetary support, the SMU-IIE incubator also provides students with workshops and hotdesking spaces, as well as the opportunity to get feedback on business ideas through monthly pitching sessions.

Officially known as the Business Innovation Generator (BIG), the IIE incubator had nurtured over 200 incubatees since its inception, and helped raise funding in excess of S$59million. Some of BIG’s most illustrious start-ups include Tech in Asia, Reebonz, Ninja Van, Carro and Red Dot Payment. BIG also conducts events and programmes such as the two-day Brand Hackathon, and the Startup School to help aspiring entrepreneurs formulate a validated product or viable business plan, and an intensive 9-month incubation programme designed for start-ups to validate and sell their business or innovation ideas.

Networking and mentorship opportunities are also available. Says SMU-IIE Director Hau Koh Foo: “We have recruited a team of “high powered” mentors comprising ex-ministers, chief executive officers of listed companies, and technology leaders, to not just advise but to have the ability to bridge the right connections for our SMU entrepreneurs.”

The most important quality for those keen to be a part of this programme is a good attitude. As Mr Hau puts it: “Students must be coachable team players who are willing to collaborate and give back to the SMU startup community. At the onset, we are looking for awesome founders, not awesome ideas. We believe that founders who have the right attitude, grit, drive and are collaborative can eventually develop good ideas, rally support from the various stakeholders, and bring their ideas to market successfully.”

Interested in joining the SMU MI programme and embarking on your own journey as an entrepreneur? Find out more here.

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This article is brought to you by the SMU Lee Kong Chian School of Business Social Media Team

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Back in July, WeWork Labs announced that it has launched SPACE-F, a food-tech startup incubator, and accelerator in Thailand, in partnership with the National Innovation Agency (NIA), SET-listed Thai Union Group PCL, and Mahidol University’s Science Faculty.

SPACE-F aims to build a sustainable ecosystem to nurture food tech startups in Thailand. It claims to be the first such initiative in the country and plans to provide services and support to empower the next generation of innovation in food tech.

Targeting to facilitate innovation in one of the following areas: health and wellness; alternative proteins; smart manufacturing; packaging solution; novel food and ingredients; biomaterial and chemical; restaurant tech; food safety and quality; and smart food services, Southeast Asia will likely see a new wave of food tech companies coming out of Thailand.

Adrian Tan, Head of Labs, Southeast Asia for WeWork said: “The time is ripe for food tech advancements, and along with the perfect partners for this program, we are excited to select Thailand as the first stop to launch our partnered Food Labs program and help bring to life some of today’s brightest ideas right here in Thailand.”

Here are some of the already established food tech -with some of them listed on Tracxn’s “FoodTech Startups in Bangkok” in the country that paved the way for the up and coming food startups.

Polpa

Polpa is an on-demand food delivery service based in Bangkok that helps people watch their waistline and eliminates the consumption of rich, oily, and processed food that increases the early death rate.

Launched in November 2015 originally as about 18 Mediterranean-inspired homemade dishes menu from ingredients sourced locally, Polpa offers only healthy meals made from natural, organic ingredients in its menu with each food item displayed with a basic description of its nutritional benefits.

In March 2018, Polpa was acquired by Dahmakan, Malaysia-based ready-to-eat food delivery startup, foraying into the Thai market.

Wishbeer

Wishbeer is a Thai take on beer startup, where it provides choices of beers from across the globe and let customers go wild over them.

Also Read: One beer a day keeps the doctor away: Wishbeer Founder

Wishbeer was founded in 2012, aimed to import premium beers like the options of Pale Ales, Dark Lagers, to Herb-Spiced kinds into Thailand with more affordable prices. Wishbeer claimed that it also offers gluten-free beer.

FoodStory

Operating under Thailand-based startup Living Mobile, app-based FoodStory targets business owners to help them manage their restaurants. As for customers, the app can be used to connect with these restaurants.

Foodstory, founded in 2012, offers the POS system, inventory management, eMenu, business reports, branch management, and e-promotion system for restaurants. It allows restaurants to manage orders, queues, table booking, billing, and even kitchen.

Wongnai

Founded in 2010, Wongnai offers primarily restaurant reviews in Thailand, allowing users to access information and photos of restaurants in the country with a map-based search. It also lets users posting their reviews of a restaurant.

In 2016, Wongnai secured a Series B funding from InTouch Holdings’ VC arm, InVent. In 2018, the company invests US$1 million in restaurant POS startup FoodStory to help build its restaurant management system on its platform.

JuiceInnov8

Also classified as a deep-tech startup, JuiceInnov8 is a food biotechnology-focussed company that seeks to bring less sugar & lower calories juice using a sugar reduction technology platform that uses natural, non-genetically modified microbes, and its proprietary sugar conversion processes.

According to the company, JuiceInnov8’s technology allows juices that are available in the market to retain its original juice content and key nutrients but with near-zero sugar and calorie content.

In February, it closed a US$500,000 pre-Series A round led by 500 Startups’ Durians II Fund, and TukTuks Fund.

Kinkao

Founded in 2016, Kinkao describes its business as an online home chef community that delivers food from homes to customers. Customers can book a home-cooked meal for office lunches, events, and private chefs for get-togethers and parties.

In December 2018, Kinkao raised a round of funding from 500 Startups’ 500 TukTuks II, its Thailand-focussed seed fund, alongside five other startups.

Thai Snack Online

Thai Snack Online offers a digital way to enjoy snacks through subscription boxes that consist of biscuits, candy, chips, nuts, crackers, fruit snacks, cookies, seafood snacks, and instant food.

The company that was founded in 2015 supplies products from various well-known brands such as Sugus, Pejoy, and Koala’s March and accepts online payment and customer order tracking services.

KukBox

Using KukBox’s iOS app, users can order food from multiple nearby restaurants in a single order. It uses an in-house delivery team.

Besides that, the company that first started its operation in 2017 also provides a menu with calorie count and tracks calories consumed on the app.

HungryHub

HungryHub specializes in buffet restaurant reservations with point incentives, provides both website and mobile applications. It lets users book restaurants and for restaurants, and manage their reservations.

HungryHub has two interfaces – one for the diners and one for the restaurants, both are connected in real-time. The diners can search for various listed restaurants, look for their menus, and book a table by specifying the date, time and party size.

Also Read: Thai buffet app Hungry Hub secures US$450K funding from Expara, 500 Startups

Established in 2014, HungryHub first served as an online restaurant reservation app. However, in 2016, the startup pivoted and redefined itself into a fixed-price dining offer app.

In August 2019, HungryHub received its first funding from Expara and 500 Startups, raising US$450,000.

Cookly

Based in Thailand, Cookly focusses on the cooking activity vertical of food technology, as it offers online booking for cooking classes.

Cookly allows customers to discover and book cooking classes around the world leveraging on its connection to cooking schools to assure a high level of quality and trust. Cooking schools agree to work with them, because of low online visibility and poor to no existing booking systems.

Cookly said that its customers are mainly tourists around the world, interested in cultural activities.

In June 2018, Cookly announced that it has raised an undisclosed pre-Series A funding round led by Poramin Insom, founder of leading cryptocurrency Zcoin. Existing investor 500 TukTuks also participated in the funding round.

Eatigo

Eatigo is an app-based restaurant booking service provider that facilitates time-based discounts for restaurants. Merchants move customers from peak to off-peak and attract new customers to increase profitability. Users make online reservations and have varied discounts depending on the time slot for each restaurant every day.

Founded in 2013, Eatigo found global fame in 2016 when the restaurant booking app secured a Series B funding from TripAdvisor’s TheFork, its global restaurant reservation brand. It was TripAdvisor’s first investment in Southeast Asia-based startup.

Also Read: Restaurant booking app eatigo raises multimillion-dollar Series A

Two years later, TripAdvisor adds capital into the company in a pre-Series C round, putting the company at a total of US$25.5 million in funding raised.

Eatigo allows users to grab cheap meal deals during off-peak hours. The model, the company said, helps restaurants maximise their capacity and the customers to eat at discounted prices.

With Thailand embraces the country’s globalised food culture through technology, it’s not impossible to have a first unicorn from the sector, especially with a name like Eatigo that puts Thailand in a bigger league. It’s just a matter of time now to welcome more food tech innovation into the country that has long been associated with food.
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If you’ve been following the cryptocurrency or FinTech fields, chances are that you’ve heard of the term Initial Coin Offering (ICO). This is a relatively new way for startups to raise money by issuing and selling their very own cryptocurrencies. 

Individual projects would have their fundraising rounds completely finalized in a matter of weeks, if not days, getting retail and institutional investors to line up to participate. 

Fast-forward a couple of years, however, and we can see that most of the projects which raised money through an ICO failed to deliver on their promises, causing their investors massive losses. 

Nevertheless, the history of ICOs, regardless of how brief it may be, is definitely an interesting one, especially for those with interests in investments. The following graphic represents their growth and their evident decline.

In any case, let’s have a look at how ICOs caused a massive disruption in traditional VC fundraising models and why they eventually failed. 

It all started back in 2016

Technically, ICOs started back in 2015 as some very large projects such as Ethereum, IOTA, and Augur had their coin offerings held in 2015. However, this new fundraising method for blockchain-based startups and businesses really took off in 2016 when their number started to grow notably. 

Not only the number of ICOs skyrocketed but also the number of investor dollars. Data from popular resource ICOData reveals that 29 projects managed to raise as much as USD$90 million back in 2016. While this may seem as an inconsiderable amount in the traditional world of investments, it has to be considered that this was a model introduced just a few months ago. 

What is more interesting, however, is the speed with which these projects raised money. FirstBlood raised USD$5.5 million and SingularDTV raised USD$7.5 million – both of them doing so in less than 15 minutes. While not every project saw its capital funded as quickly, most of them were particularly fast, especially compared to traditional equity-based funding. 

Transitioning Into 2017

This is where things started to get really interesting. As opposed to 2016, when the model was going through its very early stages, 2017 saw an influx of capital poured into blockchain-based startups through initial coin offerings. 

The year saw more than $6 billion invested into roughly around 875 different projects. Naturally, everything peaked in December. 

December was the parabolic month for cryptocurrencies and businesses around them. Bitcoin surged to an all-time high of around  USD$20,000 and the entire market cap of all digital coins peaked above USD$800 billion. The world was taken by a storm. 

Everyone was talking about Bitcoin and data from Google supports it. 

The interest in the world’s leading cryptocurrency transitioned to the entire market, as seen on the above charts displaying the capital raised through ICOs. 

This is also when we start seeing massive returns from those projects. The cryptocurrencies they issued through an ICO would eventually get listed on an exchange and their prices would skyrocket, netting initial investors tremendous gains. 

Let’s take Binance Coin (BNB), for example. That’s the native coin of the world’s leading cryptocurrency exchange, Binance. Their ICO took place between July 1st and July 21st, raising a total of USD$15 million. Investors could buy BNB tokens for USD$0.10.

Less than a month later, its price was already around USD$2.8, marking an increase of around 2,700 per cent. In December, during the surge, its price was around USD$8, which gave investors a return upwards of 8,000 per cent in less than half a year’s time. It’s perhaps very easy to see why people were eager to invest in ICOs back at the time. 

Going downhill: The bear market of 2018

Once Bitcoin hit USD$20,000 and it pulled the entire market with it, retail investors poured the market with interest surging on a daily basis. 

More and more initial coin offerings started to pop up, each one of them hitting its targets quickly and without any serious hassle. This also gave birth to the so-called “whitepaper” fundraising model where, essentially, all a project had to do is write up a detailed plan of what it intends to do with the money, in order to raise it. 

Looking back, one can easily see how the entire surge was based on nothing but speculation as pretty much everyone invested in those projects only for the returns they would yield following their listing. 

And this had its effect on the ICO market, as crypto startups continued to raise tremendous amounts of money. Well, at least for the first few months of the year. 

The year saw a total of 1253 projects raising around USD$7.8 billion. Yet, the graphic looks particularly different compared to that of 2017. 

Interested started to fade away and for the entire 2019 so far, there were only 96 projects that managed to raise around USD$366 million – a fraction of the capital gained in the previous year. 

Now that we saw how ICO progressed and, as it turned out, regressed, over the years, let’s explore some of the reasons for their demise. 

Lack of developments

As we said in the beginning, ICOs had companies issuing cryptocurrencies that were sold to investors to raise capital for funding the project’s future development. A lot of these tokens, as they are also commonly referred to, served some utility as they could be used within the project’s own ecosystem for different purposes. Some tokens acted like equity stakes, giving investors rights to the revenues of the project to a certain extent. 

But in order for all of this to yield any fruit and to become a working model, the projects had to deliver. They had to develop the products they promised. 

That wasn’t the case, for the most part. In fact, it was recently reported that an overwhelming amount of ICO-based projects didn’t add a single line of code in 2019. To be more precise, out of 2000 reviewed projects, 640 from them failed to display any activity at all. More alarmingly, their current combined market capitalisation is more than USD$415 million. 

The crypto winter

Another reason, which is more on the speculative side of things, is the prolonged bear market that cryptocurrencies saw throughout the entire 2018 and the beginning of 2019. 

Bitcoin went from USD$20,000 in December 2017 to about USD$3,100 in November 2018. The entire market capitalisation of all cryptocurrencies shrank down to below $200 billion, becoming a shadow of its former self. 

Altcoins, as all cryptocurrencies apart from Bitcoin are commonly referred to, went through even bigger declines. In fact, a broad range of them is currently trading at prices which are 90 per cent lower than their former all-time high values. 

In fact, one trader invested 50 Bitcoin in 50 different altcoins, putting 1 BTC in each back in mid/late 2017. The losses he incurred range from almost 100 per cent to 70 per cent, depending on what he invested in. 

Regulatory Hurdles

While at the beginning regulators were still trying to figure out how to deal with this new way of fundraising, this year we saw definitive actions on their behalf. 

The US SEC recently fined Block.one, the publisher of EOS – an ICO which managed to raise more than USD$4 billion back in 2017 and 2018, with USD$24 million for failing to register itself as a security offering. The same thing happened to Telegram’s TON cryptocurrency, the token sale of which was halted under similar merits. 

Regulators across the world are tightening their provisions regarding cryptocurrencies in order to protect investors after the bloodbath of 2018. 

All of the above, coupled with new investment options such as Initial Exchange Offerings, which provided alternative to ICOs, inevitably led to the demise of the former. 

The takeaway

Initial Coin Offerings could have been a very fruitful and hassle-free way of raising capital. They provided a fresh alternative to the challenging VC model and also lowered the barrier for retail investors to jump in early on in potentially prosperous startups. 

Unfortunately, their run was for not. But it’s not because of the model – it’s because of the projects. A lot of people took advantage of the hype surrounding ICOs and simply capitalised on it, without providing any measurable results in return. 

However, we can already see that things are starting to get better. Regulators are stepping in, large cryptocurrency exchanges are openly backing certain projects, providing the necessary due-diligence for investors to make informed decisions.

With that said, the cryptocurrency field is seemingly becoming more mature, and it’s particularly interesting to see how it will develop in the near future. 

 

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Image Credit: worldspectrum

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Indonesian e-commerce giant Tokopedia today announced the launch of Tokopedia Salam, its new curated channel for Muslim-friendly products and services.

The channel aims to help customers purchase halal-certified and Muslim-friendly products and services including food, beverages, fashion and beauty products.

It also enables customers to purchase sharia-based financial products (such as mutual funds) and donate to their chosen charities.

Tokopedia is also looking forward to introducing pilgrimage (umrah) packages in the channel.

Also Read: Today’s top tech news: Tokopedia projects to contribute US$12B to Indonesian economy; WeWork India to raise US$200M

According to Garri Juanda, Head of Tokopedia Salam, the company found out through research that more than 80 per cent of its users have the needs to purchase halal-certified food products. More than 85 per cent of its customers also have the need to purchase in the Muslim fashion category.

The launch of the product is in line with the trend in regional tech startup ecosystem, where companies are trying to cater to the needs of Muslim population in Southeast Asia through sharia-based fintech services or halal-certified travel and tourism packages.

Venture capital firms such as Gobi Partners have also included “taqwa tech” as a preferred vertical for its recently launched funds.

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Image Credit: Tokopedia

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Echelon Asia Summit 2020’s TOP100 has officially kicked off with recruitment of aspiring startups to join a list of graduates that have gotten recognised, backed, and in the process, made a name for themselves.

e27 checked in on two of the most successful startups from 2018 to 2019 that participated in TOP100 and came out on top. Here they are and what they’re up to post-TOP100.

From Malaysia, Dropee

Dropee is a B2B eProcurement marketplace that joined 2018’s TOP100 and qualified to go on and represent Malaysia alongside PHP web application & server management provider Runcloud.

Dropee might not emerge as 2018’s winner, but it caught lots of attention. In January 2019, it raised US$341,000 seed funding from Vynn Capital, in which the company said it used for kickstart market expansion, hire new talents, and introduce new product features.

Dropee was founded in 2016 by Lennise Ng and Aizat Rahim. It connects suppliers with small and medium enterprise (SME) business owners in real-time.

Suppliers and brand owners can streamline the product fulfillment process and facilitate bulk purchases through a suite of enterprise solutions provided by its platform. It offers features such as automated ordering placements to reduce stocking issues, a digitalised documentation, such as auto-generated purchase documents and cloud storage accessibility, which seeks to reduce human error and eliminates inefficiencies.

It also has tools to easily compare suppliers, prices, and products. It currently specialises in the Food & Beverage, FMCG, and retail market segments.

Also Read: Malaysian B2B marketplace Dropee wins grant from TERAJU’s SUPERB programme

Currently, Dropee focusses operations in Kuala Lumpur, Penang, and Johor.

Before this funding, Digital News Asia reported that Dropee raised US$71,600 from undisclosed angel investors and received a. US$35,800 grant from Cradle Fund.

Back in June 2019, Dropee introduced SME business financing in collaboration with Grab Financial. Powered by their lending and P2P financing partner, Grab would provide business financing to Dropee’s merchants and retailers.

The financing allows retailers to procure products directly from suppliers within the platform; with a financing tenure of up to 12 months. This way, Dropee guarantees a speedy processing time with low interest and a shorter repayment period.

In August, Digital News Asia reported that Dropee stroke another innovation in its platform. Dropee dropped NexHera, a suite of digital tools that seek to strengthen B2B relationships by giving merchants real-time visibility of business data across their supply chain and free up the paperwork hassle.

By co-existing with NexHera, Dropee said, multi-channel (offline-to-online) orders are consolidated on a user-friendly, personalised dashboard, which also provides real-time connectivity of customer information and inventory movement. Users will also get insights into customer behaviour and preferences, which aims to help maximise value and optimise marketing budgets.

From Vietnam, Ecomobi

Hailing from the most exciting economy in Southeast Asia for now, Ecomobi was one of the two winners in the 2019’s TOP100 finale.

Before joining Vietnam’s chapter of this year’s TOP100, it is reported that in 2017, it received an undisclosed sum in investment from Hong Kong-based STI Capital, followed by backing from ESP Capital (Vietnam) and Nextrans Capital (South Korea) in 2018.

Ecomobi describes itself as a social commerce platform that builds partnerships with publishers and facilitates commerce through social media platforms such as Facebook, YouTube, Zalo, and Instagram.

Ecomobi uses AI, machine learning, and chatbots to help brands connect with key opinion leaders and sell their products through reviews, promoted content, and product experience.

In September, DealStreetAsia reported that Ecomobi announced that it has received an undisclosed amount of funding from VinaCapital Ventures, a US$100 million venture capital fund focussed on tech startups in Vietnam and Southeast Asia.

Also Read: AI-powered social selling platform Ecomobi connects brands with influencers, boost their sales

VinaCapital Ventures was also joined by additional investors include Korea-based firms GS Shop, Naver Group, Line Ventures, and the follow-up funding by ESP Capital.

Ecomobi CEO and founder Thanh Truong stated that next in the pipeline for the company is to launch in Malaysia and the Philippines.

With operations in Indonesia, Vietnam, Thailand, and Singapore, Ecomobi claims that it supports e-commerce giants such as Tokopedia, Shopee, Tiki, and Lazada, as well as brands such as Sony, Samsung, and Vascara.

Both Dropee and Ecomobi have received funding post-TOP100 and have significantly improved since their Echelon days.

What both have experienced can be yours to take. Make the first step, plunge into the competition, and create noise around your products through 2020’s TOP100. Sign up here.
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Singapore to ban e-scooters from footpaths – Channel News Asia

Singapore’s Land Transportation Authority (LTA) announced that it will ban e-scooters from footpaths in the country starting from November 5, Channel News Asia reported.

The use of such devices will be allowed on cycling paths and park connector networks, and there will be an advisory period until December 31.

Food delivery services in Singapore such as Deliveroo and Foodpanda are known to use e-scooters to deliver customers’ food.

Responding to this issue, Senior Minister of State for Transport Lam Pin Min stated that the regulation is not a complete ban on e-scooters and that LTA will work with such companies to help their riders switch to motorcycles or bicycles instead.

Grab, which services such as GrabWheels and GrabFood commonly use e-scooters, has issued a statement.

The company said that it plans to “engage in further dialogue” with the government for the possibility of riders who had displayed “responsible riding behaviours” to be given the option to continue on using e-scooters “under certain conditions.”

It will also reach out to all affected riders by end of this week.

Specifically on GrabWheels, Grab said that:

“With the new direction, GrabWheels will also commence measures to suspend its shared ePMD service progressively from November 5, 2019. All existing ride-plans will be refunded in the next 30 days to users’ credit cards. Grab remains committed to serving Singapore and will explore other ways to serve our users with alternative active mobility options.

GrabWheels has been growing our shared e-scooter service in Southeast Asia, with a focus on Indonesia. Our service in Indonesia has seen six-times growth in number of rides over the last three months, and we remain committed to expanding the service to the rest of the region.”

Singapore-based spacetech startup Aliena raises US$1M – Dealstreet Asia

Singapore-based space tech startup Aliena raises US$1.5 million (US$1 million) in a funding round led by Cap Vista Private Ltd, Dealstreet Asia reported.

Aliena designs low power propulsion systems for satellites to perform advanced manoeuvres in space. According to Aliena CEO and Co-Founder Mark Lim, this allows for more complex operations to be performed onboard smaller satellites.

Also Read: E-scooter-sharing startup Popscoot pivots to FOUND, now gamifies your daily commute and rewards you for it

Didi Chuxing in talks to enter the Philippines – The Philippine Daily Inquirer

Chinese ride-hailing giant Didi Chuxing is in talks with U-Hop Transportation Network Vehicle System Inc. (U-Hop) for a partnership to enter the Philippines, The Philippines Inquirer reported.

Politician Luis “Chavit” Singson, who owns U-Hop, confirmed the talks and said that the partnership aims to “break the monopoly of Grab” in the market.

Officials from Didi and the Land Transportation Franchising and Regulatory Board (LTFRB) did not immediately responded to request for comments on Thursday.

U-Hop itself is one of the companies with licenses to operate a ride-hailing service in the Philippines.

TikTok declined to testify at US congressional hearing on risks to American consumers – SCMP

ByteDance’s TikTok has declined to testify at a congressional hearing scheduled by Republican Senator Josh Hawley to discuss its business and risks to American consumers, South China Morning Post reported.

“We appreciate Sen. Hawley’s invitation. Unfortunately, on short notice, we were unable to provide a witness who would be able to contribute to a substantive discussion,” a ByteDance spokesperson wrote.

In addition to TikTok, Apple was also invited to testify and had also declined the invitation.

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Image Credit: Mike Enerio on Unsplash

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