Thailand’s APX Logistics Solutions has secured an undisclosed amount in fresh investment from Japan’s SBI Ven Capital through its joint fund with NTU Singapore’s NTUitive and South Korea’s Kyobo Securities.

The logistics-tech startup, which expanded into Malaysia, Singapore, and Europe in 2024, is gearing up to extend its digital less-than-truckload (LTL) network into Vietnam by 2025.

The investment from SBI will provide APX with valuable expertise and industry connections, alongside support from its other investors, such as ORZON Ventures, a joint fund by Thailand’s PTT Group and 500 Global, the Asian Development Bank, and Wing Vasiksiri.

Also Read: APX wants to revolutionise logistics in SEA with ‘less-than-truckload’ innovation

“We’re on a mission to help businesses reimagine how transportation can be done in Southeast Asia with sustainability front and centre,” said Uwe Dettmann, CEO of APX Group. “We want to leverage our success and learnings in Thailand and expand to key markets across Southeast Asia, offering sustainable and seamless shipping services for businesses of all sizes.”

Founded in 2019 by Dettmann, Sorawit Tantrakulcharoen, and Sukanya Thamthada, APX provides door-to-door cargo transportation services through its network, with modern platforms for LTL and palletised cargo services. It aims to build a connected truck transport network in Thailand and the ASEAN region to improve logistic efficiency. It also reduces CO2 emissions and the number of trucks needed on the road in the long run; the system measures and tracks the emission impact within its overall network, actively making route recommendations to help reduce fuel consumption and carbon footprint.

At the core of APX’s green innovation is an AI-driven freight management system named Palli. The system uses proprietary data and algorithms to optimise truck-loading plans and coordinate the movement of assets across APX’s logistics partners in Thailand, Malaysia, Singapore, and Europe.

Also Read: APX gets ORZON’s backing to build a connected truck transport network in Thailand

APX’s customers can access solutions such as air and ocean freight management, customs clearance, warehousing and distribution, and specialised services such as fulfilment, kitting, and co-packing. Each solution is designed with sustainability in mind, aiming to reduce waste and enhance resource efficiency throughout logistics.

In July 2023, APX raised an undisclosed sum in pre-Series A funding led by ORZON Ventures.

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Image Credit: APX

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When seed-stage founders receive their first investor check, they invariably take one of several routes: 

• A) They rush to the tech press with their fundraising news. 
• B) They throw a WeWork-style party for all of their employees and stakeholders to celebrate the milestone. 
• C) They take to social media to boast of the achievements of their personal branding.

Based on my experience, the correct answer is actually D) none of the above. The founders who choose A, B, or C will inevitably fall by the wayside: Public relations, personal branding, and even company engagement should only come after what matters the most: customer retention and revenue optimisation.

The importance of retention and revenue optimisation

Upon receiving your first investment, founders should focus only on key performance indicators (KPIs) and metrics that help you understand your customers and, in turn, reduce churn while maximising revenue. This priority is built on a simple premise: You may have money now, but this will not always be the case.

For one, the investor dollars may dry up. In the past, you only needed a compelling story about your team’s growth, the product’s development, and an understanding of the market through the lens of your unique expertise. But times have changed: This narrative-driven approach to fundraising will not be enough to take a startup from seed to Series A.

Customer revenues may dry up just as fast. You may have cash in the back from users or clients, but because your startup is so young, there is little historical understanding of how soon or how fast these customers will leave you. You still only have a vague idea about your customer’s lifetime value.

In the face of these uncertainties, there is only one option that makes sense: You need to focus on driving two levers and two levers alone: reducing churn while increasing revenue. For example, a software-as-a-service (SaaS) company will need to figure out why enterprise customers are cancelling their contracts and, more importantly, determine how to thwart that. Their retention strategy may involve everything from key account management to offering automated discounts at the cancellation screen. The point is that they must understand and subsequently address the outflow of customers.

Also Read: Decoding PR: The essential tool for tech startup success

Some startups may be so early in their life cycle that customers are not yet churning, but they are not using the product. This sign is also a red flag: Your customers will soon be leaving out the door.

In addition, the business must optimise revenue. An e-commerce business, for example, can maximise revenue through cross-selling, upselling, and even greater personalisation—which can contribute to a revenue uplift of as much as 25 per cent, according to McKinsey. 

The efforts toward improved retention and revenue generation may not immediately lead to a hockey-stick graph, and that’s fine. Investors are not looking to evaluate you based on the current revenue generated by the dollar. Instead, they will evaluate you based on how well you have identified leaks and opportunities, which speaks to your startup’s aptitude and revenue for revenue growth in both the short- and long term.

Shifting the founder paradigm: Moving the goalposts for success

Retention and revenue optimisation is easier said than done because it requires such a deep paradigm shift. Founders are taught to sell, sell, and sell. They are hyper-focused on getting leads to sign across the dotted line or on getting customers to convert that there is considerably less thought on what happens afterwards.

Instead of looking at a finished sale as a “close” — of the natural endpoint of a process — founders must view it as only the first step in a much longer process of satisfying, keeping, and growing each customer. By moving the goalposts, founders stand a much greater chance of succeeding from seed to Series A: Their startup will rocket past competitors who mistakenly viewed the initial contract as the culmination of all business activity. 

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In Singapore, the medtech sector is booming. From just 59 in 2010, there are now more than 400 medtech companies. The Economic Development Board (EDB) estimates that the market  will hit US$225 billion by 2030 in Asia alone. 

However, this rapid expansion comes with its own set of challenges, mostly a compliance issue which has stifled innovation. 

Last year, the Health Sciences Authority (HSA) in Singapore intensified its efforts to crack down on the illicit trade of health products, resulting in the seizure of over 1.12 million units of illegal items and the removal of more than 12,000 listings from online platforms.

The majority of the removed listings were selling sexual enhancement or male vitality products, hair and beauty products such as anti-hair loss treatment, facial fillers and adulterated skin whitening products. 

What’s behind Singapore’s medtech boom

The growth in the medtech sector in Singapore in the past few years has been due to a few key reasons. 

The first being the support from the government, as they have been proactive in fostering a conducive environment for such companies. Initiatives like the Biomedical Sciences Industry Development Roadmap and funding support from agencies such as Agency for Science, Technology and Research (A*STAR) and Enterprise Singapore have been crucial.

Secondly, Singapore’s strategic location and connectivity make it an excellent base for companies to set up, thus providing easy access to the regional markets. 

Thirdly, HSA ensures that Singapore has a robust regulatory framework with high standards of safety, quality, and efficacy for medical devices. This reliability has bolstered confidence among global medtech firms.

Compliance: A double-edged sword

While HSA’s stringent regulations have enhanced the quality and safety of medtech products, they have also introduced significant compliance challenges. 

Also Read: The rise of generative AI in digital mental health solution

As artificial intelligence and digital health technologies evolve, protecting patient data and ensuring cybersecurity have become paramount. Medtech companies are now tasked with adhering to Singapore’s Personal Data Protection Act (PDPA) and implementing robust cybersecurity measures to safeguard sensitive information. This is no small feat and requires significant investment and ongoing vigilance.

Companies must comply with strict guidelines for labelling, advertising, and promotional activities. Ensuring that product claims are substantiated by clinical evidence and that all marketing materials comply with HSA guidelines is essential to prevent misleading information and maintain consumer trust.

Medtech companies cannot afford to be complacent. To stay ahead of regulatory changes, they must establish robust processes to monitor updates from authorities like HSA, the Food and Drug Administration (FDA), and the European Medicines Agency (EMA). Some of the critical steps they need to do is subscribe to regulatory newsletters, attend industry conferences, and engage with regulatory consultants.

Regulatory challenges can have both positive and negative impacts on innovation 

This focus on safety can enhance patient outcomes and increase trust in medtech products. 

An upside would be having a competitive advantage. Medtech firms that successfully navigate regulatory challenges and obtain approvals can gain a competitive advantage. 

Also, being compliant with rigorous regulatory standards can enhance a company’s reputation and credibility in global markets.

However, the cost and time spent complying with regulatory requirements, particularly for smaller medtech firms with limited resources, can be a huge issue. The investment in regulatory compliance may divert resources away from Research and Development (R&D) activities. 

Also Read: Solving multiple medtech problems with a single device powered by AI

Another downside would be risk aversion, wherein, in some cases, stringent regulations may discourage risky or novel innovations due to concerns about meeting regulatory standards. This could stifle breakthrough technologies that have the potential to revolutionise healthcare.

Advice for new entrants

For companies looking to enter the Singapore market, understanding regulatory requirements is paramount. Familiarising yourself with HSA’s regulations, including the classification of medical devices, setting up a Quality Management System (QMS), and navigating regulatory pathways for registration, importation, and market approval, is essential.

Another important piece of advice would be to understand the local market needs. The products should be tailored to the healthcare landscape and specific needs of the healthcare providers and patients in Singapore.

Future trends in regulatory requirements

As digital health technologies and AI applications in healthcare continue to evolve, regulatory frameworks must adapt to ensure safety, efficacy, and data privacy. This may involve introducing specific guidelines for digital health and AI-driven medical devices.

With the growing connectivity of medical devices and cybersecurity threats, future regulatory requirements may include stringent measures to ensure cybersecurity resilience. Compliance with data protection regulations, such as Singapore’s PDPA, will also be critical.

With the constant threat of global warming and climate change, regulatory frameworks may incorporate requirements related to the environmental impact of medical devices throughout their lifecycle. This could involve considerations such as eco-design principles, recycling and disposal requirements, and sustainable sourcing of materials.

As the sector evolves, so too must the regulatory frameworks, adapting to new technologies and emerging challenges to sustain Singapore’s position as a global medtech leader. The future of medtech in Singapore is bright, but only if we continue to innovate and adapt to the regulatory landscape.

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Fintech has revolutionalised the payments industry and apart from the grand global success, its presence in the Southeast Asian market has attracted many giants from all over the globe to invest and branch out to this region.

Online shopping, food ordering, online taxis, and even money lending are now powered through digital tools by fintechs. But, the most interesting part is the attraction of giants such asGojek, Uber, etcetera to invest in the fintech industries of Southeast Asian markets. 

As the digital financial services tend to generate annual revenue of US$38 billion in Southeast Asian markets by 2025, which is way more than the annual revenue of US$11 billion generated by far in 2019, I look at what led to its exponential growth.

Business models 

There are several vital business models being used by fintech companies in the Southeast Asian region. But, among all the business models the two highest-grossing business models are digital payments and digital lending services.

 

Digital lending services have already made a mark in the global markets and with the rise of digital lending in the Southeast Asian region, there have been new players emerging in the market infusing more capital. But, next to it is the most prolific business model for revenue– digital payments!

Also Read: Fintechs often encounter issues translating a POC into a production order, finds study

Digital payments have been the pioneer of all the digital financial services. It is set to cross the mark of US$1 trillion revenue by the year 2025 and this goes to show that the digital payments business model has been the prime focus for many new and old players in the Southeast Asian fintech industry.

New kids on the block

Fintech industry in this region is quite segregated and there has been no monopoly among the players. But, there has been a tight competition between the local and the global players. Some of the local players are gaining high due to the local presence over the years.

Top five fintech companies in Southeast Asia:

1. Tookitaki
   A Singapore-based enterprise fintech software solution provider.
2. Incomlend
   A Singapore-based online multi-currency invoice exchange platform.
3. Sunday INS Ltd.
   An AI-based insurance and claims solution provider.
4. Growpal
   An Indonesian funds distribution and funding management services provider.
5. Funding Societies
   A Malaysian finance and investment management provider for small businesses.

Consumer trends

As the fintech industry is rising to its peak, the Southeast Asian fintech market set a new annual record with US$701 million raised throughout the third quarter of 2019. Consumer trends have seen a fundamental shift in the adoption of new Fintech technologies.

With the digitisation of the fintech products and adoption of AI in the efficient management of financial services, it is creating new opportunities and new markets to be explored.

Also Read: Swiss fintech incubator F10 enters Singapore, soon to kick off accelerator programme

Many chatbots and AI-based startups are gaining traction and the most interesting part is the adoption and trust of consumers in these technologies for the management of their finances.

Innovative footholds

Innovations have found a new foothold in the fintech industry in the Southeast Asian region. The biggest innovative adoption for fintech in the region has been AI-based, machine learning and Natural Language Programming (NLP). 

Banks have the problem of storing BigData, process them and analyse them to design personalised financial products for their consumers, which can be delivered through highly reactive real-time apps developed through mobile app development. But, with the AI-based technologies and power of cognitive computing solutions, this has been achieved by several Southeast Asian banks and financial service providers.

Digital lending has been a popular innovation in the fintech industry. With modern technologies and innovations in data processing and predictive analysis, the digital lending paradigm has grown more personalised and custom-tailored for the Southeast Asian markets.

What does the future hold

The future of fintech evolution in the Southeast Asian markets lies in the innovations and development of some key factors. Connectivity is one of the important factors as the fintech industry is moving more towards digital expansion. In countries such as Indonesia, Philippines, Vietnam, and Thailand; rural areas have huge internet connectivity gaps.

Higher broadband access and digital literacy can change this scenario and bring in more users and consumers from rural areas. There are several other challenges to be overcome. Like the once where a centralised payment infrastructure is in need to reduce the hassles of cross-border payment regulations and issues.

Also Read: Strengthening its expansion into fintech, Grab introduces GrabPay Card

Countries such as Indonesia, Vietnam, and Myanmar need some data protection regulations. Though Singapore, Malaysia, and the Philippines do have data regulations for users. Other concerns over cross-border data flow and issues pertaining to the digital trade need to be addressed.

About 47 per cent of fintech Startups in the region depend upon the loans for funding and that is the key issue to be addressed for the fintech industry’s development in the region. This needs to be realised and more funding and venture capital should be infused into the startups and digital financial service providers.

So, if you are a financial startup, looking to storm into the fintech industry of the Southeast Asian market, then this the right time for you to cash in!

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This article was first published on December 20, 2019

The post How fintech is disrupting the Southeast Asian payments market appeared first on e27.

M-DAQ Global, a Singapore-headquartered fintech group, has completed the acquisition of Easy Pay Transfers, a licensed B2B payments service provider based in Malaysia.

This acquisition will bolster the Singaporean firm’s local payment capabilities in Malaysia, creating synergy with its existing B2B solutions for foreign exchange and cross-border payments.

Also Read: A new breed of fintech payment is here to slay the game

With this acquisition, M-DAQ Global is now present in seven countries and territories and serves nearly 39,000 clients worldwide.

Licensed under the Money Services Business Act 2011 in Malaysia, Easy Pay Transfers provides businesses with online payment services. As companies expand their customer and supplier channels across the Asia Pacific region, the Singaporean fintech firm aims to facilitate seamless cross-border transactions across regional currency corridors.

Jared Ang, founder and CEO of Easy Pay Transfers, said: “This deal signifies our united aim to expand our market reach across Southeast Asia and foster greater ease of conducting business.”

M-DAQ Global empowers businesses and individuals in cross-border transactions by providing a holistic suite of cross-border FX and payment solutions.

Also Read: M-DAQ raises funding from Samsung

In 2022, M-DAQ acquired Wallex, a B2B cross-border payments provider in Singapore, Indonesia and Hong Kong.

The firm is backed by international institutions, such as Affinity Equity Partners, Ant Group, EDBI, NTT Communications, and Samsung.

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Shares 101: Understanding shares ownership and investment

Shares are legal rights that represent a shareholder’s stake in a company. In addition to shares subscription, a company may also issue warrants (i.e. an investment instrument which grants an option to the holder to convert the warrants into shares), but we won’t cover it in this post. 

It is common for a company to issue different types of shares, as each type of shares provides different rights to its shareholders. The type of shares that can be issued by companies are usually governed by the company law depending on where your startup is domiciled.

Considering that traditional bank loans are out of the question, for most startups, the usual way for founders to raise funds in their company is to sell the equity stake in the company in exchange for cash. In exchange for the new capital, the company will issue new shares, either ordinary shares or preference shares, to the investor, who will be a new shareholder in the company. 

Consequently, deciding on the investment shares is crucial for making informed capital-raising decisions.   

Also Read: Laws, capitalism, creators and AI

This table summarises the key differences between ordinary and preference shares.

What are ordinary shares?

Ordinary shares (or ‘common stock’) represent the equity stake in a company. As a founder, founders’ shares are typically issued when a startup is formed before any equity is purchased by future investors or VCs. Ordinary shares confer voting rights, allowing the ordinary shareholder to influence the company’s direction. 

However, in terms of financial returns, company law ranks ordinary shareholders at the absolute bottom of the order of priority. Dividends, if any, are paid out only after all other obligations, including those to creditors and preference shareholders, are met before any distribution may be made to the ordinary shareholders.   

Prior to a capital raising exercise, a company’s shares capital may initially consist of ordinary shares held by the founders and angels.

What are preference shares?

A preference share (also called ‘preferred stock’) is a class of shares which offers its holders a more secure position. These preference shares usually come with preferential rights, such as priority in receiving dividends and asset distribution in the event of a liquidation. 

Also Read: The secret sauce of de-risking early-stage venture capital

In our experience acting as the law firm for VCs at Izwan & Partners, VCs usually insist on “watertight” agreements that seek to mitigate the risks they take with their investment (as VCs are expected to finance unproven companies). 

For instance, although company law states that preference shareholders by default may not have any voting rights, most or all holders of preference shares expect to have voting rights. Additionally, preference shareholders may yield influence through clauses like reserved matters, anti-dilution protection, and board representation. 

When negotiating a preference share issuance, founders should consider the following matters:

• Investor category: Generally, if the investor is a financial investor (i.e. a professional investor that deploys capital on a professional basis) like VCs and corporates, you may expect preference shares to be the default investment instrument. 
• Valuation: The company’s valuation will affect the conversion price of preference shares into ordinary shares. The conversion ratio formula is usually agreed upon at the time of the investment and is based on factors such as the preference share’s issue price, conversion price, or a predetermined formula. For instance, if the conversion ratio is set at 1:1, each preference share is converted into one ordinary share.
• Liquidation preference: As a VC, liquidation preferences allow for some form of capital protection for its capital investment. In the financial context, liquidation preferences are usually expressed as a multiple of the original investment. The “1x” means a VC will get a dollar back for every dollar invested, a full recouping of their money (in practice, the entire scenario only works on the basis that there’s enough cash to cover this, while ordinary shareholders will receive what’s left — if there is money left over of course).
• Exit strategy: A VC usually investment holding period in an investee is between two to five  years. Therefore, the founders’ exit plans (IPO, acquisition) would need to be aligned with the preference share structure. 
• Control: The level of control founders wish to retain will impact voting rights and other governance provisions, such as negotiating a set of reserved matters (i.e. actions that the company must not do without the approval of the investor) that will not stifle the daily operations of the business.

A startup lawyer can help you go through the term sheet to ensure that all the investment terms are industry standard terms, and help you negotiate (as you are usually at the highest negotiating point during the term sheet in contrast to subsequent rounds when the definitive documents are being prepared usually by the investor’s lawyer). 

Final thoughts  

Ordinary shares, while carrying voting rights, offer limited financial protection to the holders. As an investor, preference shares offer a range of benefits, including dividend preferences, liquidation preferences, in addition to the existing contractual rights such as anti-dilution protection and reserved matters. While preference shares offer greater flexibility when it comes to structuring the shares issuance, it can also be complex and confusing to structure due to the wide range of features available. 

As a founder, engaging a startup and venture lawyer as early as possible prior to your capital raising exercise can help you ensure that you’re aligned in terms of your investment expectations when dealing with investors while complying with the applicable securities laws. 

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Aleta Planet, a Singapore-based company providing cross-border payment services for businesses in the Middle East, has secured undisclosed investment from National Pulse, a Dubai-based company focused on tech-driven businesses.

The investment will allow the fintech firm to expand its footprint in the UAE, Middle East, and Africa.

Also Read: Cross-border payments: Can incumbent banks compete with fintechs in Asia?

Dubai will henceforth serve as Aleta Planet’s global headquarters, while the Singapore office will support expansion in the Southeast Asian region.

Aleta Planet founder and Group Chairman Ryan Gwee said: “This investment by a savvy investor with deep experience and contacts in the Middle East, will super-charge our efforts to expand B2B payments in the region as well as the global markets of China, Africa and Europe.”

The startup plans to establish a joint venture with National Pulse to focus on B2B cross-border transactions, initially targeting the Middle East’s agri-trade and logistics sectors.

Founded in 2014 by former banker Gwee, Aleta Planet aims to simplify online, cross-border and multi-currency transactions. Its network lets individuals and businesses deposit local currencies in 39 countries or remit funds to 140 countries. In addition, it provides merchant acquisition, card issuance, remittance and B2B payments.

The company, licensed by the Monetary Authority of Singapore, also has offices in Hong Kong, Dubai, Spain, and Malaysia.

Mohammad Bin Markhan Al Ketbi, founder and Group Chairman of National Pulse, said: “Aleta Planet’s innovative and transformative technologies are reshaping how cross-border transactions are managed. Their expertise in handling multi-currency transactions will greatly enhance our upcoming digital solutions, set to revolutionise the international trade and digital economy landscape.”

National Pulse invests in and partners with companies that provide innovative technologies to support the digital transformation for a swathe of traditional businesses in financial services, education, healthcare, agriculture, commerce, etc. It also runs the NatOne Venture Accelerator
Programme to help young companies navigate new markets and seek high-potential opportunities.

Also Read: Huawei Pay joins hands with Aleta Planet to introduce NFC, QR code payments for S’pore users

The investment in Aleta Planet comes when the market for financial technology in the UAE is poised for growth and is projected to expand at double-digit rates in the coming years. The UAE is ranked as the leading fintech hub in the Middle East and Africa regions, with funding jumping 92 per cent to US$1.3 billion in 2023, in contrast to a global decline in funding for the sector, according to Kapronasia, a consulting firm on payments, banking and capital market industries in Asia.

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As AI technologies continue to advance in Southeast Asia, it is crucial to address the social considerations surrounding their development and implementation.

As part of e27‘s flagship conference, the Echelon X panel discussion, titled ‘Responsible AI in Southeast Asia: How do we go about it?’, delved into a conversation on the ethical and societal implications of artificial intelligence (AI) adoption in the region.

Moderated by Scott Bales, Keynote Speaker and Thought Leader at ODE Management, the panel featured esteemed speakers:

• Niki Luhur, Group CEO, Vida Digital Identity
• Jayotika Mohan, APAC Head of Startups & SMB, Google Cloud, Google
• Yasunori Kinebuchi, Director, NTT
• Sau Sheong Chang, Deputy Chief Executive, Product and Engineering, GovTech Singapore

The panel discussion explored the nuances of responsible AI, highlighting the importance of ethical guidelines, transparency, and accountability in AI development and deployment. It underscored the need for a balanced approach that maximizes AI’s benefits while mitigating potential risks and ensuring that technology serves society’s greater good.

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In a recent conversation with e27, Anchanto CEO Vaibhav Dabhade discussed the recent trends in the Southeast Asian e-commerce sector and changes since the COVID-19 pandemic. He focuses on the end of the era of supply-led growth in e-commerce.

“What we have seen in the last two to three years is that the inflexion point has been reached,” he begins.

“So, today, the supply-led growth is very much finished. The actual growth of e-commerce is where we are currently, where it is largely driven by consumers’ choices. The demand-driven e-commerce growth phase that we are in today is much slower than when it was supply-driven. We are at the point where e-commerce is becoming more predictable, but we can assess and forecast much better.”

Dabhade also notes that after a period of cash-burning by brands and e-commerce platforms to generate demand through promotions, they have finally toned down to a level of normalcy. “Discounts are getting to a normal level; we also started to see that spending has become much more realistic. Many small businesses survived post-pandemic, but brands that were grown solely by discounts did not.”

“Marketing-led correction has not had a good time since the pandemic.”

Also Read: Ecosystem Roundup: Anchanto raises US$12M; MAS earmarks US$182M more to boost fintech innovation; How Tiki manages to keep employee churn rate healthy

Responding to these changes, Anchanto shifted its focus to adapt to changing market conditions. The e-commerce and logistics solution provider now focuses on the mid-market and enterprise segments of its customers.

To deliver high-quality service, Anchanto educates its customers about the importance of paying a worthy price. “When you start to go with platforms purely driven by discounts, you end up paying more in the long run. Many brands also realise that when they use a logistics company and cheap software, they will eventually struggle. They can’t scale … as they don’t get the needed expertise and depth.”

“This is why we are very cautious about price points. To whom do we sell? How do we sell? At what price point? We’ve been more selective about that lately.”

There is also a greater emphasis on product functionality, as Anchanto promotes its platform as a tool to provide insights, not just to help with logistics or warehousing.

“We give them a much deeper insight based upon the data we have with us, which is helping them to make better decisions.”

On being a growth stage startup in e-commerce and logistics

In a recent interview with e27, published exclusively for Pro members, Dabhade spoke about the key milestones that Anchanto had achieved recently.

Also Read: Thailand’s APX Logistics nets funding from SBI Ven Capital for Vietnam expansion

Apart from operating in 11 countries, the company hired senior roles and entered unique segments such as the B2B and Muslim commerce segments.

According to the CEO, significant milestones that Anchanto has made include hiring senior roles that it has been expecting to do for a long time, such as a Chief People Officer and a Chief Product Officer. It has also acquired customers from specific segments, such as the B2B and Muslim commerce segments.

“We see good tractions coming from the Muslim fashion industry in Southeast Asia,” Dabhade says.

Having raised a US$12 million Series C funding round in 2020 from MDI Ventures and Ascendia, Anchanto claimed to have achieved profitability even back then.

“We are super proud that, in 2023, we grew Anchanto by 42 per cent. We are very, very proud of delivering that level of growth in the current economic situation,” Dabhade says.

“We believe this shows that we are on the right track and can grow further. In a lackadaisical market situation, our business model is working.”

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Image Credit: Anchanto

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Decentralised Physical Infrastructure (DePIN) is set to become a US$1+ trillion sector over the next decade. Retail users, both merchants and consumers, will benefit the most from this growth. 

Projects like BitTorrent and Tor showed the power of decentralised resource-sharing systems. Emerging DePIN networks are building on this foundation. But their scope is much bigger now, thanks to blockchain, cryptography, and AI. 

Today, a few giant corporations have disproportionate control over the world’s data, as well as hardware and computational resources. One, this is risky, as the recent Microsoft outage showed. 

Two, it’s unfair to the grassroots entities who are the producers of monetisable data and consumers of hardware. They are the real source of value in this sense. 

DePIN can fix this and catalyse a paradigm shift. Users can monetise excess computational or hardware resources or, say, their vehicles’ data. Merchants can accept crypto payments through blockchain-native PoS machines. 

Through all these, retail entities can be more direct, autonomous participants in the phygital economies of the future. DePIN, the Great Democratiser (or access/opportunity equaliser), has thus also been one of the leading crypto narratives in 2024. 

DePINs are here to thrive

Though still nascent, the DePIN ecosystem has both negative and positive forces working in its favour. On the one hand, the downsides of hardware and software monopoly are becoming increasingly visible even to average users. 

There was no need for thousands of people and businesses to remain stranded for hours, losing hundreds of thousands of dollars. This situation would not arise if the world ran on decentralised infrastructure with in-built redundancy and resilience. That’s DePIN’s significance by negation — it is what legacy infra is not. 

As for the positive side, it opens many unprecedented avenues to become valuable in its own right. While seeding torrent files to support peer-to-peer downloads has been possible for years, it does not bring any monetary gains for seeders. DePIN changes that enable incentives over and above goodwill or ideology. 

Also Read: Securing the future: Transforming industries through blockchain’s immutable ledgers

That also means DePINs make monetary incentives for resource contributions the norm and not a choice. Moreover, using DePIN networks makes individuals resistant to censorship and manipulation, especially in crisis times. 

For instance, it’s pretty impossible to execute an internet blackout by shutting down a decentralised WiFi network. Because here, the supporting physical infra — modems, routers, etc. — are distributed across a wide geographical region and are not situated in a single, identifiable, and stoppable location. 

At the same time, communities can become more self-sufficient and reduce living costs by sharing energy via decentralised grids. Smaller businesses can also hedge against depreciating local currencies by using stablecoins or crypto for day-to-day transactions. 

The possibilities are endless. That’s why over 17 million DePIN devices are already in action worldwide, and the sector’s market cap has crossed US$24 billion within a year or two. 

Further, AI’s rapid growth is a strong external catalyst for DePIN’s upcoming growth both on the demand and supply sides. From decentralised compute marketplaces to smart AI-powered sensors, these two are made for each other, so to speak.  

Overall, DePIN is not merely here to stay but to thrive. But like any booming, there is a need for caution. 

What is DePIN and what is not

Once, every crypto project had something to do with DeFi. Then, they fell for NFTs. AI was the next cool kid on the block. Many others came and went by in the past few years. 

Now it’s DePIN’s turn. It has great promise, and existing projects are already showing decent results. Investors and VCs are very interested in this, as well. So naturally, every other project calls itself DePIN. 

Also Read: The emerging crypto trend of 2024: The intersection of AI and blockchain

While the attention and hype are great from a short-term adoption perspective, it’s important to define and recognise what is DePIN and what is not. 

Simply put, a real DePIN project must build and provide some hardware devices: routers, PoS machines, storage systems, etc. ‘Physical infrastructure’ is in the sector’s name, after all. While this seems trivial and obvious, it’s not so in reality. 

Digital-only projects offering decentralised computation, payment services, etc., often stake claims on the DePIN fame. And while they may have great products to offer, they are not DePINs. 

Moreover, DePIN projects must implement distributed governance models based on hardware ownership. Network participants must receive substantial monetary incentives for their contributions. 

DePIN is a fairly new paradigm and recognising its core differentiators from the get-go is important from a long-term growth and stability perspective. 

Last but not least, it’s essential that retail users get a clear sense of why this matters to them and why they must care. 

Although not a ‘number go higher’ game in the literal sense, more retail participation is the key to stronger, more robust DePIN networks. And unlike in legacy setups, it’s best if participants know their stakes as well as duties. Because autonomy without knowledge is incomplete.

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