How a unified approach to payments can ensure a seamless experience for users and enhanced profitability for the e-commerce industry

e-Commerce is a consistent driver of industry growth. 2018 marked the year of e-commerce in Southeast Asia, highlighted by rising incomes, increased mobile adoption, and improved logistics. According to the latest e-Conomy report by Google and Temasek, the region’s digital economy hit an inflection point in 2018 and will reach $240 billion by 2025, which will exceed earlier projections by $40 billion.

Despite this growth trajectory, Southeast Asia still lags behind the rest of the globe in terms of digital and mobile payments penetration. While the region is popularly lauded as being “the next 600 million”, referring to the scale of the population, at least 60 percent remains unbanked or underbanked.

Recognising this gap, innovative fintech startups across Southeast Asia are leveraging tech to meet the needs of consumers who do not have access to traditional banking services such as access to credit, digital payments, and online transactions.

The mobile and digital payments connection

The proliferation of fintech start-ups creates a ripple effect as there is a supply-and-demand dynamic between payments and e-commerce. The pervasiveness of smartphones and faster mobile data connections has driven the growth of mobile commerce. This, in turn, influenced the development of mobile wallets or contactless payment mechanisms. The increased accessibility to cashless payments influences growth in e-commerce and m-commerce, thus leading to a cycle of growth and innovation.

eMarketer, a market research company that provides insights and trends related to digital marketing, media and commerce, projects that within this year, more than half of smartphone users in the Asia Pacific region will pay for goods and services through their mobile devices. By 2022, 56 per cent of payment volume in this region — as well as a staggering 82 per cent in Singapore — is expected to be cashless, according to Frost & Sullivan.

The challenge of digital payments

As digital payments grow, so will concerns over the ease of payments and the security of transactions. The challenge therefore lies in empowering both businesses and customers alike with tools that make digital payments as convenient and secure as paying cash.

According to Cybersource, a global payment management platform from Visa, key trends that businesses should consider when going digital include:

• Integrated frictionless payments;
• Omni-channel, unified commerce and automated checkout;
• Virtualised credentials – embedded everywhere and anywhere.

Reduced transactional friction increases profitability

The ultimate consequence of having high-friction on an e-commerce store is that people buy less because of the added difficulty of completing the transaction. Research shows that around three quarters of e-commerce buyers abandon their shopping carts when it is too difficult to checkout – and this is true across different devices whether on desktop or mobile device.

Transactional friction also includes slow load times and e-commerce pages not optimized for mobile displays. The answer here is to speed up and simplify the shopping and checkout process. Solutions can include reducing page load times through lighter code, server-side improvements, and optimizing on-page copy for better readability even on small displays.

An omni-channel approach to retail improves sales

As part of reducing transactional friction, digital retailers should also consider an omni- or multi-channel approach to sales and checking out. This involves having the ability to service both online and offline customers across both digital and physical channels. For instance, you can allow for online payment, but in-store pickup or collection.

One concern is that an omni-channel retail approach might result in loss of control over where the sale actually happens. For instance, consumers often channel-hop, choosing the most convenient way to buy a product or service. These are platforms not controlled directly by the retailer, such as messaging or social media apps. This means the control of the user experience shifts from the retail business towards the consumer.

For businesses engaging in e-commerce, the key here is to simplify payment mechanisms, which can enhance the user experience, improve loyalty and increase repeat customers. Incorporating solutions such as machine learning, AI, along with social logins and one-click payments can help enhance customer experience, grow revenues and mitigate risks.

Payment credentials are becoming more sophisticated and yet simpler for users

There is a wide disparity of preferred technologies and payment mechanisms across Southeast Asia. For example: Singapore shows a rapid growth in cashless payment technologies. In Malaysia, debit and credit card transactions dominate. Meanwhile, bank transfers and cash are the most popular in Indonesia, although local mobile wallets are starting to gain traction. Cash-on-delivery are still the most popular means of payment in Vietnam and the Philippines.

Such a disparity might make it difficult for e-commerce and m-commerce businesses to address all the nuances of each market in the region. However, this also presents an opportunity, in terms of the need to streamline the payments technology. One trend that Cybersource has identified is how tokens will play a stronger role in securing card data, which is being virtualised. With payments infrastructure moving toward a tokenised approach, credentials become virtualised and can thus be embedded anywhere.

What this means is that a transaction can take place either online or offline, or both within the confines of an e-commerce platform or even across a different platform such as messaging or social media app. User and payment credentials still remain intact due to the tokenised nature of the transaction – ensuring a unified user experience across these different channels.

The takeaway

The retail environment is increasingly shifting toward omni-channel, driven by a focus on technology and user experience. Expect consumers to channel-hop across online and physical stores, aided by smartphones, tablets, and social media, whichever is most convenient.

For a digital retail business, the key to success lies in capturing the benefits across all these channels. This means facilitating the deal from any touchpoint, thus completing the sale regardless of where the user makes the purchase. Here, a secure and efficient payment network can streamline and unify the process, ensuring optimal profitability for businesses and better convenience for users.

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Image credit: 123rf.com / ID 53804229

 

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Today we have updates from government agencies and social media giants

Singapore, UK sign MOU to deepen govtech collaboration and exchange – Press Release

Singapore’s Government Technology Agency (GovTech) and the UK’s Government Digital Service (GDS) has signed a Memorandum of Understanding (MoU) on June 13 to strengthen collaboration in the design and delivery of digital government public services.

The signing took place at No. 11 Downing Street, the official residence of the UK’s Chancellor of the Exchequer. Representing the agencies to sign the MoU were Kok Ping Soon (Chief Executive of GovTech Singapore) and Kevin Cunnington (Director General of GDS UK).

For GovTech Singapore, the MOU is the first it has signed with GDS UK.

“The MoU will facilitate greater sharing of experiences and expertise in the development of digital platforms and services to better serve our citizens and businesses. It will also allow mutual exchange of officers to build capabilities and explore opportunities for collaboration to strengthen the digital partnership between the two organisations,” Kok said in a press statement.

Indonesia cancels plan to prohibit discounts for ride-hailing services – The Jakarta Post

Indonesia’s ministry of transportation announced that it would not prohibit ride-hailing companies, particularly those offering motorbike-based services, from giving tariff discounts, according to The Jakarta Post report.

On Thursday, Minister of Transportation Budi Karya Sumadi told the press that the ministry “would discuss it” upon request from stakeholders.

The statement followed an announcement that the ministry made last month on minimum and maximum tariff regulation for ride-hailing companies. The regulation itself was issued after a series of rallies by motorbike taxi drivers that demanded increased tariffs for their welfare.

Weeks into the trial of the tariff regulation, ride-hailing giants Go-Jek and Grab have given customers discounts amid complaints about the rising tariffs.

Grab Indonesia President Ridzki Kramadibrata said the ride-hailing company was open to discussion with the government over such a regulation.

Also Read: How Singapore’s GovTech is building a robust public e-services ecosystem

Facebook’s new cryptocurrency attracts investors – Wall Street Journal

Facebook’s new cryptocurrency Libra has attracted investments from big names such as Visa, Mastercard, PayPal, and Uber, according to a report by Wall Street Journal.

Citing people familiar with the matter, the report stated that the companies will invest around US$10 million each in a consortium that will govern the cryptocurrency.

Facebook itself will use the money to fund the creation of the cryptocurrency, which is said to be fixed to government-issued currencies to avoid swings.

The cryptocurrency is set to be unveiled in the following week.

Bytedance hires ex-Facebook executive to strengthen TikTok – Bloomberg

Chinese social media giant Bytedance has named Blake Chandlee as the first head of strategic partnerships for its app TikTok, with the official title of vice president, global business solutions.

Chandlee was previously known as an executive in Facebook, who spent about a decade working on the social media giant’s business partnerships in Europe, Latin America and the US.

According to a Bloomberg report, the recruitment is part of the company’s “big recruiting push” to expand the TikTok brand and compete with the likes of Facebook and Snap. It had recently recruited executives from YouTube.

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The funding is the extension of its Series B funding announced last year, led by Kakaopay corp.

Marketplace lender based in South Korea PeopleFund announced that it has raised an additional US$5 million for its Series B round, continued from last year, bringing the total equity raised to date to approximately US$21 million. The Series B round last year was led by Kakaopay corp.

PeopleFund claimed to be the first “Korean marketplace lender” that has secured foreign funding. The startup also said that the US$30M in debt financing will be used to scale up its lending business.

In laymen’s terms, the company connects buyers and lenders to provide customers with more diverse financing options and lenders with an additional revenue channel.

In its official statement, PeopleFund mentioned that Korean government designates fintech as a top priority on the nation’s economic agenda. This initiative, the company believes, has helped propel growth of the marketplace lending sector.

Along with the funding, PeopleFund also appointed three new advisors that will be focussed in providing strategic counsel for the company’s expansion plans beyond Korea.

Also Read: Fintech startup Arax Wallet merges with crypto exchange COSS

In Korea alone, there are currently 150 marketplace lenders in Korea, in which only 50 are operational and only the top 5 players, including PeopleFund. The sector serves more than 60 per cent of the market.
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Becoming an accomplished entrepreneur isn’t just about creating a great product

Being afraid to lose. Thick skin. The patience to queue for hours. While these traits form part of the (stereotypical) Singaporean’s DNA, such qualities might not make for a successful entrepreneur.

Instead, what traits would be required? The best way to find out is naturally to ask people who are successful entrepreneurs themselves. That’s what Dr. Lillian Koh, CEO of fintech education provider FinTech Academy, did in a “The Art and Science of Entrepreneurship” panel discussion at the Young NTUC’s recent inaugural LIT DISCOvery conference, which involved veteran entrepreneurs such as:

• Christopher Yeo, CEO of artificial intelligence platform Sentient.io,
• Rachel Lim, co-founder of fashion e-commerce store Love, Bonito, and
• Entrepreneur and investor Teo Ser Luck

Drawing from their wealth of experience, they shared their thoughts on five traits that Singapore’s entrepreneurs need to develop to excel in their business ventures.

Self-awareness

Self-awareness refers to being aware of who you are as a person, such as your interests, qualities, and shortcomings. With entrepreneurship being all the rage these days, being self-aware can help you decide whether this is what you really want for yourself before you take the plunge.

For example: are you keen on pursuing a particular business venture because you have passion for it, and believe it can – as Lim puts it – “make a dent in the universe”? Or was that business idea the first one that came to mind, and you’re charging in blindly because you see entrepreneurship as your ticket to fame and stardom?

When you start building your business, you’ll likely also have to build a team that can complement your strengths and weaknesses – assuming you know what these are in the first place.

“If there’s one thing I wish I had known earlier, it’s that I had known myself inside out,” shares Lim. “It’s only in knowing yourself and your values, what makes you tick, your motivations, what are the areas of the business that you can and want to focus on, that allows you to have that knowledge to bring the right people to come and team up with you. And the right people at the right time is everything.”

Business-mindedness

Let’s say you’ve exercised your self-awareness muscle, and decided that entrepreneurship is the right path for you. You’ve also decided that your business will be one selling your favourite snack: salted egg yolk fish skin.

However, imagine that we live in an alternate universe where absolutely no one will eat nor buy salted egg yolk fish skin. Do you go ahead with this business, even though you love salted egg yolk fish skin to bits?

Probably not. Remember, you’re running a business here. If you don’t have a product or service that enough people will pay for, you may face difficulties covering your expenses, let alone make any profits.

You can’t afford to be too romantic about your business. The longer you let a failing business drag on, the more money and time it’ll cost you, Teo says.

“If nobody’s paying for your services, or the products you’re trying to develop fail, or you can’t raise money, maybe you should review your business model, your products and services, and take a hard look,” he advised.

“Cut your losses [if you need to] and do it quick, then review if you can make a comeback.”

Salesmanship

To complement your workable business model, you need to be able to make sales. Your revenue certainly is going to materialize out of nowhere.

Based on his experience in the fintech industry, Yeo opined that the “biggest blind spot for entrepreneurs who are geeks and techies is actually in sales […] many of them are so deep into their tech that they think customers will just bash down their door to say ‘Let me buy, let me buy’.”

Also Read: A customer-centric and cross-channel approach to payments will drive growth for your business

Unfortunately, it doesn’t work like that. Having the world’s best product or service isn’t going to do your business any good if you can’t persuade people to open their wallets for it.

Yeo said that even if you don’t do the selling yourself, you’ll likely need to manage the sales team you’ve hired to close the sales. Naturally, you can’t do this well if you don’t have some prior sales knowledge or experience, so be prepared to brush up on your sales skills.

Avoid micromanagement

Congratulations! After a long search, you’ve managed to hire the right individuals who identify with your values and business goals, and have the required skills, to help make your vision a reality.

The next step is to give your team space to actually do their work.

“I like to empower my team members to make decisions without micro-managing them,” shared Yeo. “I think people appreciate that you trust them, and allow them to do their job without you looking over their shoulders all the time.”

Your business is your baby – we get that. It can be terrifying to see your business in the hands of others, because there’s a chance they’ll make a mistake that erases all your hard work. But remember that you hired these talented people because you trusted they could get the job done.

So learn to let go and let your team do what they were hired to do, Yeo advised. More likely than not, their competence and dedication to your cause will exceed your expectations by a mile.

Grit

In theory, starting a business is really easy. All you need to do is to engage a corporate secretarial firm to incorporate a company for you, and voilà! You can immediately put the title of Founder on your CV.

But growing and scaling your new business is the tough part. Every day, new problems will present themselves, shares Teo. You’ll need to have the grit to press on through these, even if others may just admit defeat.

Lim is no stranger to adversity. To start her blog shop (which later evolved into Love, Bonito), she dropped out of university and broke her government scholarship bond. And to repay the bond, she had to borrow a five-figure sum from her mother — wiping out her mother’s entire life savings in the process.

Also Read: How to avoid the pitfalls of starting up

“At that time, my dad had also just gone through bankruptcy so it was financially a very tough time for us. That gave me even more impetus to make sure I wouldn’t fail, that my business would do well, because I really didn’t want to waste my mum’s sacrifice,” recounted Lim, to applause from the audience.

You’ve heard from the experts. Now, it’s your turn.

You may be tempted to mug the five traits shared above like how you would for study for an exam back in school.  Unfortunately, entrepreneurship is not something that you can memorize your way to success.

Instead, you’ll have to practice these five traits throughout your entrepreneurship journey until they become second nature to you. And if you’re serious about being an entrepreneur, there’s no better time to start than now.

Good luck with your business, and godspeed!
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Image Credit: J. Kelly Brito on Unsplash

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

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Climate change presents a real existential threat to the human race, but can technological solutions stop it in its tracks?

Early June, New Scientist published an article with a chilling headliner:

“Is it true climate change will cause the end of civilisation by 2050?”

The article paints a disturbing future of the consequences of lethal soaring temperatures hitting the globe: imagine, ice being non-existent in the Arctic during the summer; rising sea levels; the total collapse of the Amazon ecosystem; and more than half of the world’s population subjected to nearly a month’s worth of fatal heat — it’s not a pretty picture.

While efforts have been made to circumvent the inevitable end, we all play a huge role to prevent this from happening. It’s important to really consider the implications of your day to day activities that are currently affecting the environment.

Cities are responsible for 70 per cent of global emissions and 65 per cent of global energy demand. In 2030, cities will account for more than three-quarters of electricity use. How can we leverage technology to accelerate our cities into being zero carbon – transforming us from climate culprits to climate solvers?

That is why it is important to find out how companies are taking measures to contribute to reducing their impact on the environment.

As urban residents, our carbon footprint is largely determined by our city’s building infrastructure, transportation options and food systems. FASTRACK explores technology’s role in making significant changes at a wider scale quickly for a zero carbon city.

When you attend Fastrack: Tech for zero carbon cities (presented by ENGIE Factory, in collaboration with e27), attendees can find out more on current and upcoming technologies that pave the way for zero emission buildings, green mobility and sustainable food systems.

Plus, discover the exhibition of innovative startups, earth-friendly products and services (and how their products and make your business greener), and great networking after!

Find out more about the event at this link

RSVP now at our Eventbrite link

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Image Credit: Roxanne Desgagnés on Unsplash

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It is important to stay on top of the trade war news, but picking sides is an egregious mistake

I have spent the last month procrastinating on a Huawei column. To me, it felt like breaking up with a significant other because it is a terrible experience but one that is necessary. Being a tech reporter and not commenting on Huawei is like being a culture writer and ignoring Keanu Reeves.

The reason I had been so reluctant to write my opinions about Huawei is because the entire discussion has been poisoned by nationalism.

This is problematic for me because I despise nationalism. I think it is a common thread in most wars, it allows people to make racial proclamations that are almost always wrong and it creates emotional stubbornness that is quite ugly.

Then, I realised, that is the column.

One of the first learnings any immigrant will experience is the realisation that every person thinks their home country is the best in the world. This is why debates over food, culture or national preferences are so pointless. Truly being stuck in a nationalistic mindset is a fantastic way to miss out on great food, excellent conversations and new friends.

When this mindset is transferred to a telco brand caught in the middle of a bilateral trade war, it results in a truly toxic conversation.

I am an American, which means that if I wrote an anti-Huawei column it would immediately be picked apart as another bullet fired to defend my team.

But the thing is, I don’t care about Huawei, I think both Washington and Beijing are acting like spoiled children in the trade war and the only good thing that has come out of the Huawei mess is the sliced Apple logo metaphor (because it’s clever).

Also Read: Fintech startup Arax Wallet merges with crypto exchange COSS

If Huawei navigates the global turmoil and supplies the world’s 5G, then great. If they collapse because they can’t survive without the American market, then so be it.

Huawei is not a friend, colleague or even local small business, so why do we care about their success or failure (except for the job stability of the average employee). Huawei is a gigantic corporation, not some plucky startup trying to take on giants. They are the giant.

And yet, people either root for them — or wish them ill — as if their success actually makes a difference in our lives.

This is because Huawei has done a brilliant job of leveraging the victimhood narrative to build its brand. The clear winner of the trade war has been Brand Huawei (only the c-suite actually knows if this transfers to Company Huawei).

The result is that the media now covers media “Apple-style”…aka no matter how minor the update, Huawei will receive coverage. This is the dream of any public relations team, even if sometimes the news is not positive.

Because of this, Huawei has become the substitute for all things trade war. When people talk about Huawei, they aren’t really talking about the company, they are talking about China.

Most arguments fail to acknowledge that Huawei could dominate 5G for the next decade, while China struggles to recover from the trade war. Or, Huawei could collapse in financial ruin but China could skyrocket blast the US and become the next global hegemon.

Unfortunately, neither of these narratives fit the nationalism that drives the discussion around Huawei. One good example is the impending launch of HongMeng (Huawei’s new operating system).

People were absolutely certain this thing would be a TOTAL FAILURE or RESOUNDING SUCCESS. Anybody making these all-bold predictions have no clue what they were talking about. Only the people personally involved in making the operating system have any ability to predict if it will work or not — and even then they are just making an educated guess.

Also Read: e27 partners with Wholesale Investor to help startups raise funds

But in our desire to defend or destroy a gigantic corporation, absolute certainty is the only way to approach the subject.

I guess the hope of this column is to remind people to continue to watch the trade war, stay informed and make decisions accordingly. But, don’t pick sides.

Try to remember that both China and the US are great-but-extremely-flawed nations. A person making decisions out of nationalistic tendencies is going to make zero impact on the actual outcome of the war, and in doing so is going to close themselves off to regular folks who don’t care about Apple, soybeans, Huawei or rare earth metals.

It’s okay to be patriotic, but nationalism leads to wars and it is up to the individual to act as a saucer and cool off the boiling tea.

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The startup also offers a Bluetooth-enabled dive computer, called COSMIQ, which lets divers track and calculate important information, such as when they need to take a decompression stop

(Editor’s Note: Here’s a story from our archives we feel is relevant even today and deserves your attention)

In 2011, James Tsuei, a scuba diver enthusiast, decided to plan a vacation and get his Open Water Diver certification, an entry-level autonomous diver certification for recreational scuba diving. But the process of planning and finalising the trip took a whole month, which consisted of hours of internet searching for suitable destinations and finding the right dive operator, along with multiple postings on dive forums looking for advice.

“There wasn’t any centralised information resource on the internet for scuba trip planning, and all dive-related bookings required a long emailing back-and-forth process with clarifying details to accomplish,” Tsuei tells e27. “I saw a business opportunity here, and this led us to founding Deepblu, which aims to solve problems associated with dive trip planning and booking.”

As per some estimates, there are currently about six to eight million active divers (defined as people who make three or more diving sessions each year), and dive trips are big investments. Divers spend an average of US$1,000 on equipment and certification, and then even more money on dive shops (businesses run by dive professionals who provide training and tours), flights and accommodation. However, information about diving (destinations, quality of dive operators, etc) are all very fragmented online with no central location to assist divers with their trip planning process.

Founded in 2015, Taipei-headquartered Deepblu brings resources for divers onto a centralised platform. In addition to a social network for divers to share dive logs and photos with other enthusiasts, the startup also offers a Bluetooth-enabled dive computer, called COSMIQ. A wristwatch-like device, COSMIQ lets divers track and calculate important information, such as when they need to take a decompression stop.

“Divers can capture and record their dive experiences through the COSMIQ device. They can also capture all of their precious dive memories under their Deepblu profile stored in the cloud. It also enables them to share their dive adventures through social media posts on Deepblu with location tags,” he explains.

Divers are also able to ask questions or exchange opinions in the discussion groups on the social networking platform.

Also Read: As Southeast Asia pushes to digitise SMEs, Echelon is here to help facilitate the process

Recently, the startup rolled out Planet Deepblu, an interactive dive travel booking and planning tool. “Planet Deepblu is a marketplace, where dive shops can list their services on the platform, and divers can chat directly with dive shop owners, making for a personal experience. We position it as the ‘Airbnb for diving’,” he adds.

According to Tsuei, Planet Deepblu enables users to research thousands of dive spots throughout the world. The platform has accumulated over hundreds of thousands of user generated content (UGC) shared by its users about dive destinations including dive data, dive spot reviews, photos, and videos covering over 10,000 dive sites around the globe.

“Planet Deepblu already has over 500 dive experiences for scuba divers to discover and book directly with dive operators. Divers can directly contact the dive operators through the in-platform messaging feature to learn more about their services and book their trip,” he shares.

While the current focus is the North American market, the company plans to quickly scale Planet Deepblu to cover Southeast Asia and the Asia Pacific, which has the world’s most stunning dive sites.

Tsuei claims that the niche scuba diving market has a considerable economic scale. The total global spending in recreational scuba diving and snorkeling was around US$25-30 billion in 2017. The largest piece of the average diver’s spending on scuba activities outside of scuba travel-related expenses (transportation, lodging and meals) is on dive experiences, which is approximately 30 per cent of the total pie. This is the focused business of Planet Deepblu.

As of now, Planet Deepblu is a free-to-use platform. In future, as it matures, it will pivot into a commission model, wherein it will take a cut from booking transactions. The firm also plans to expand to a wider audience by moving into other water activities like snorkeling to earn additional revenues.

Deepblu recently raised US$3.9 million from Silverlink Capital, which helped it to bring COSMIQ to the market and build the Deepblu social platform. It is now raising its second pre- Series A and looking for strategic investors that will be able to help us to develop Planet Deepblu and its services to the next stage.

Currently, US based users account for the the largest user base for Deepblu, followed by China.

In the scuba dive booking space, Deepblu competes with PADI. But unlike PADI, Tsuei claims, Deepblu does not just provide a limited selection of expensive live board experience, but all kinds of diving experience such as wreck diving, shark diving, cave diving and even dive experiences for physically challenged divers.

“In emerging market like China and Southeast Asia, scuba diving is perceived as a trendy sport amongst young professionals and a great way to explore the world. We hope to leverage this trend to grow our platform,” he concludes.

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Echelon Asia Summit 2018 is e27’s flagship platform that brings together startups, investors, corporates, governments, tech ecosystem players and customers. Register for your conference passes today.

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When choosing an incubation programme or an innovation partner, entrepreneurs and  organisations need to be aware of their underlying business models

Singapore’s start-up ecosystem has been growing fast. The number of startups here has increased by more than three times in the past decade[1]. One only needs to visit the startup enclave LaunchPad at One north to find out how vibrant the startup scene is. The JTC hub is home to more than 800 startups and close to 50 incubators[2]. Incubators in the ecosystem play an important role behind successful startups by providing targeted business assistance at very early stages of the company.

In recent years, I have had the chance of interacting and collaborating with different incubators in Singapore and overseas. Although many of them offer similar business assistance, they have vastly different business models which define their priorities. I would classify incubators into four different categories:

• Teacher
• Agent
• Merchant
• Builder

1. The Teachers

The “Teacher” operates the incubation program similar to a MBA program. They are a school for startups. After the application and admission process, the startups will be put through classes, trainings, and consultancy to get themselves ready to pitch their ideas to the selected investors. There will also be networking events and parties where startups get connected to the who’s who.

The secret sauce lies in the inherent good quality of their applicants. To succeed, they need to develop an outstanding brand name to attract the best candidates. Y Combinator is one of the most successful “Teacher” type incubator, and other notables include 500 Startups, AngelPad, Chinaccelerator. There are many more trying to follow this model. However, their successes are extremely difficult to duplicate. It is akin to creating another Harvard MBA program in Singapore.

2. The Agents

The “Agent” type of incubator typically help start-ups to reach out for customers or investors in a different region. In some variations, the Agents also help large corporates to search for disruptive innovation.

The “agent” is a viable business model because there are real needs for both startups and corporates. Besides the plain vanilla servicing fee, Agents often provide additional services such as market research and consultancy to generate more income. The paying customers are the core of their business. Agents have a strong imperative to maintain good linkages with customers and ensure efficient operation to bring the information/start-ups that customers are interested. Some of the “agent” types incubators are LabCentral, Plug&Play, and MBC Biolabs.

3. The Merchants

The top priority for a merchant is to sell its own product or service to its customers. Similarly, Merchant-type incubators are most willing to help start-ups whose successes better market their products or services. They are usually incubators belonging to large corporates.

Necessarily, Merchants spend a lot of effort on marketing. Sometimes, its whole incubation programme is supported by the marketing and sales budget.  They would love to organise or participate in high profile events and promote incubatees’ success stories to sell their own products. Some of the “Merchant” types incubators are Huawei i5Lab, HP Enterprise Incubator, and Microsoft Accelerator.

Also read: Accelerators versus incubators: Which one should your startup go to?

4. The Builders

The Builders are creators of new ventures. Typically. they are small outfits that build companies using their own ideas and resources. Unlike venture capitals, the Builders take a different approach in starting a new business. They pull business ideas within their own network and form internal teams to develop them. These teams spend most of their time pushing the product into the market and focus little on raising funds. It is natural process of how a business owners start their new ventures and has been a rising trend in the startup ecosystem.

The Builders has a much higher success rate of starting a new company. The startup projects are initiated by experienced and resourceful entrepreneurs who are actively looking for new business opportunities. More importantly, the projects are driven by an internal team who are tightly knitted through previous start-up projects. There are also economics of scale since the teams are able to re-use infrastructure and best practices across different projects.

At the core, the venture builder model is centered around internal teams led by experienced entrepreneurs. Although it is a resource-intensive model, there are some notable examples including Rocket Internet, Obvious Corp, Incube Labs, JCS Venture Lab, and Betaworks.

Not all business incubators are created equal

When choosing an incubation programme or an innovation partner, entrepreneurs and  organisations need to be aware of their underlying business models. Not all business incubators are created equal, so is their value to your business. Understanding them and selecting the right one could be the first step of your challenging journey as an entrepreneur.

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References:

1. Singapore Department of Statistics
2. SPRING, More support for startups to growth locally and globally

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

Featured Image Copyright: bozenafulawka / 123RF Stock Photo

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This year’s edition of ORIGIN will be held in Malaysia on June 21, 2019

ORIGIN by TechNode — an international conference that aims to examine the latest developments in ASEAN’s and China’s tech startup scene – is back for its second edition. It will be held in Kuala Lumpur, Malaysia, on June 21, 2019.

The event, which saw its inaugural run at SWITCH 2018, will be collaborating with the Malaysia Tech Week 2019 this year. ORIGIN will be expanding beyond the shores of Singapore to help more people around the Southeast Asia region understand why and how to get involved in this new stage of China-ASEAN development.

A conference to bridge China & Southeast Asia’s tech ecosystems

According to Tan Shi Hui, Country Manager, TechNode Global (SG), “ORIGIN aims to facilitate more interaction and cross-pollination between China and Southeast Asia’s sharing economy by bringing international industry leaders and technology-changers globally to different Southeast Asia’s cities.”

“Attendees will gain insights on the latest trends and developments in China’s vibrant tech scene and Southeast Asia’s rapid growth landscape,” she says.

Tan adds that the conference is aligned with TechNode’s vision — to be the number one platform bridging Chinese and global tech ecosystems.

“We recognize that Southeast Asia’s tech ecosystem is booming and as China’s digital economy matures, Chinese tech firms increasingly look to Southeast Asia for growth opportunities. With our Southeast Asia regional office set up in Singapore a year ago, TechNode aims to power up the bridge between Southeast Asia and China.”

The ASEAN-China Synergy

ORIGIN’s conference agenda consists of four hours worth of content uncovering insights on the latest trends and developments in China’s vibrant tech scene and Southeast Asia’s rapid growth landscape. This would include topics such as fintech, AI, e-commerce, venture investments, and micro-influencers.

The agenda boasts of a stellar line-up of household names in the Southeast Asia tech industry, such as Sharmeen Looi, Co-founder at ShopBack Malaysia; Yeoh Chen Chow, Co-Founder at Fave Group; Ng Sai Kit, Chief Executive at Captii Ventures, and Navin Danapal, SEA Director at SOSV to name a few.

Also Read: Smart Axiata’s Young Innovator Program names top 5 teams in Impact Hub incubator

The speaker roster also includes the likes of Maggie Long, Director of Global PR & Communications at Kuaishou Technology, and Dr. Lu Gang, CEO & Founder, TechNode, to represent China’s tech scene.

Tan sums up the content strategy nicely, “Southeast Asia is about five to six years behind China; we can learn from the challenges China faced, the lessons have they learned, as well as what paths to follow.”

“One strategy for Chinese VCs is not to invest directly into Southeast Asia but rather to help their portfolio companies get into specific countries,” says Tan.

“Generally, Southeast Asian startups are open to Chinese money. We believe Southeast Asia is now in a strong position to ride this wave and also better prepare to resolve similar challenges if they surface in Southeast Asia,” she adds.

A freebie for the #e27community

At e27, we avidly support and participate in ecosystem building initiatives. These help us stay true and relevant to our mission — empowering entrepreneurs with the tools to build and grow their businesses.

Similarly, TechNode hopes to reach out to a wider community through e27, specifically those based in Malaysia to inform them about ORIGIN.

We are inviting the #e27community to gain access to ORIGIN by TechNode and other partner events happening from 19th – 21st June at  Malaysia Tech Week 2019 by submitting your request here: https://www.surveymonkey.com/r/2FBDYSF

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These curated deal-making sessions will be organised based on sectors such as banking and finance, fintech, transport and mobility

Singapore launches matchmaking initiative for startups and potential investors [KrAsia]

The Monetary Authority of Singapore (MAS) and Enterprise Singapore has jointly launched Deal Fridays, an initiative that will match startups in the city-state with investors.

These curated deal-making sessions will run every Friday for 19 weeks, from June 21 to October 25. They will be organised based on sectors such as banking and finance, fintech, transport and mobility, and more.

Deal Fridays is meant to connect startups with potential investors that are keen to tie up with companies with new ideas and scalable business models in their fields. The idea is to limit the time that startups normally need to burn through while seeking new investors.

This initiative is part of the Singapore FinTech Festival (SFF) x Singapore Week of Innovation and TeCHnology (SWITCH) event, which will be held in November.

Nikkei acquires 26% stake in Indian media startup NewsRise [press release]

Nikkei announced today that it has acquired 25.99 per cent of the outstanding shares in Indian media startup NewsRise Financial Research and Information Services.

Under the brand of Nikkei Markets, Nikkei and NewsRise have been jointly providing English-language news on Southeast Asian stock markets since April 2017, independently reporting from Malaysia, Hong Kong and Singapore.

With the capital tie-up, Nikkei and NewsRise will step up co-operation to deliver  quality and quantity of the region’s market news.

NewsRise was founded in 2013. It is a publisher of real-time financial news, research and information for currency, debt, equity and resources asset classes for use by banks, broking houses, asset managers, corporate treasurers and individual investors. It has news bureaus in Mumbai, New Delhi, Kolkata and Bengaluru which are manned by competent business journalists and news editors.

The investment in NewsRise is one of Nikkei’s strategic initiatives to expand its footprint in Asia. Nikkei has recently acquired a majority stake in DealStreetAsia, a Singapore-based financial news site with a focus on corporate investment activity in Southeast Asia and India.

Korean lending marketplace PeopleFund bags US$35m Series B extension [DealStreetAsia]

South Korean lending marketplace PeopleFund has raised US$35 million as an extension to its Series B financing round, led by Lending Ark Asia Secured Private Debt Fund, a secured private credit strategy of Hong Kong-based CLSA Capital Partners.

New and existing investors including Shinhan Invest Corp. and D3 Jubilee also participated in the round, according to a statement.

The funding will help PeopleFund pursue international expansion as part of its strategic plans. The investment by Lending Ark comprises both secured debt and equity financing. The US$30 million debt financing will allow PeopleFund to scale up its lending business.

China opens Nasdaq-style board to lure tech firms back home [TechCrunch]

China’s much-anticipated Science and Technology Innovation board officially launched in Shanghai today, marking Beijing’s major step in drawing high-potential tech companies to list at home.

The new Star Market, first announced by President Xi Jinping in November, is expected to be a key fundraising avenue for tech companies from an array of stages, given its criteria (link in Chinese) are less stringent than other domestic boards. Beijing has over the past year encouraged local firms to become more self-reliant in producing chips and other core technologies as an escalating trade war threatens to cut China off the U.S. supply chain.

The new startup board began taking applications in late March and have so far received applications from 122 companies, according to information from the Shanghai Stock Exchange .

Enterprise conversational AI startup Yellow Messenger raises US$4M [press release]

Yellow Messenger, a provider of conversational AI solutions to enterprises, announced today that it has raised Series A funding of US$4 million from Lightspeed Venture Partners and prominent angel investors.

The angel investors that participated in the round include Phanindra Sama (Founder, Redbus and CIO of Telangana State), Kashyap Deorah (Founder of Hypertrack, Author of Golden Tap), Anand Swaminathan (Senior Partner, McKinsey & Co.), Prashant Malik (Co-founder, Limeroad), Nishant Rao (former MD, Linkedin India), Kunal Bahl (Co- founder Snapdeal) , Rohit Bansal (Co-founder, Snapdeal), Monisha Varadan (Zephyr Ventures), and Alap Bharadwaj (APAC Innovation, Google).

Yellow Messenger plans to use the funds to further its tech capabilities, and also to expand its customer success teams and presence in high-potential markets across Asia, the Middle East, and other emerging markets.

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