2023 was a roller coaster ride for regulators around the world. From figuring out how to regulate new emerging technologies such as artificial intelligence platforms like ChatGPT to managing data leaks to high-profile crypto prosecutions, 2023 was an exciting time throughout the year.

In 2024, there are several upcoming regulatory changes that may be taking place in Malaysia.

Regulatory clarity on the use of  SAFE (Simple Agreement for Future Equity) and convertible notes 

The Securities Commission of Malaysia, the capital market regulator, in December 2023 said that it is seeking to introduce a “small offering exemption” in the current securities law in 2024. 

The exemption may permit safe harbour for offerings of a “certain size” to sophisticated investors (i.e., high-net-worth people or accredited investors). To illustrate, Singapore’s threshold is capped at an SG$5 (US$3.70) million funding limit to selected investors. 

The new exemption rule would likely provide better regulatory clarity in line with international practices for startups and small and medium enterprises in Malaysia seeking to raise funds using legal instruments like SAFEs and convertible notes, which are the usual norm for early-stage startup funding in Silicon Valley. 

Cyber Security Bill

Current cyber security offences are regulated by multiple key laws that need serious overhaul, including the Computer Crimes Act 1997, the Communications and Multimedia Act 1998, the Malaysian Penal Code and the Personal Data Protection Act 2010. 

Also Read: Navigating the AI landscape in 2024: Why there is an urgency for enhanced governance

The new Cyber Security Bill is likely to be an omnibus bill form, which means that the bill may cover changes in other present legislations, such as the ones highlighted in the earlier paragraph, to ensure that existing laws may be streamlined, including distinguishing the roles of different entities to minimise any overlaps. 

The government also said the National Cybersecurity Agency (NACSA) under the present National Security Council will be designated as the main entity to regulate and enforce cyber security laws and enhance the country’s cyber resilience. Separately, there is also a plan to form a Cyber Security Commission to strengthen cyber security, but the discussion is still at the preliminary stage, and we may likely hear more updates this year.

A government official said that the Cybersecurity Bill may likely be tabled during the third or the fourth quarter of parliamentary sitting this year. Ordinarily, a draft bill would be made available for public consultation, which we would expect in this quarter or so.

As a startup that may not already be in a regulated space, such as a fintech startup, you may likely need to assess your cyber security policy and internal processes with your IT team to ensure that you are in compliance with the new Cyber Security Bill once it comes into force.

Amendments to the Personal Data Protection Act

Another long overdue bill that has yet to be tabled by the parliament is the amendments to the current personal data protection laws. The minister in charge mentioned that the bill is in its final stages and is expected to be tabled in March of this year.

Among notable improvements include a mandatory obligation for data users to designate and appoint a person as a ‘Data Protection Officer’ and mandatory data breach notification to the Personal Data Protection Department. The bill was meant to be tabled in 2022 but was put on hold due to the general election, so we may likely see the long-awaited changes to be tabled this year.

The Personal Data Protection Department will also further be empowered as a statutory authority as opposed to its present role as a government department under the ministry to better address data leaks and execute its functions more effectively. 

In early 2023, the Singapore and Malaysia governments signed a memorandum of understanding (MOU) to cooperate on personal data protection areas, including the promotion of cross-border data flows and sharing of expertise on personal data protection policies, including monitoring cyber security incidents. So, we may likely hear more updates on this this year.

As a company, you need to take proactive steps and speak to your usual startup lawyer to help assess and update your existing data processing systems and processes in anticipation of it being rolled out in the near future.

Revised beneficial ownership reporting requirements

The new Companies Act amendments bill will include new requirements for companies to maintain a register of beneficial owners (RBO) to enhance corporate transparency. 

Also Read: What is your ecosystem strategy and why is it critical in 2024?

Under the amendments, a company needs to maintain a register of beneficial owners (RBO) at the registered office of the company and report any changes to the Companies Commission of Malaysia (CCM) within 14 days.

The amendments were initially tabled for the first reading in the parliament in October 2023. The second reading may likely be expected to be this year, but it is unclear when the amended Companies Act will come into force. 

The regulator may likely need to release further guidelines on how these provisions will be implemented. Ordinarily, the government may likely allow a certain grace period for companies and relevant parties to adhere to these new provisions. As a founder, you may likely need to speak to your usual service provider to ensure compliance.

Capital gains tax on disposal of unlisted shares

Starting 1 March 2024, a capital gains tax of 10 per cent will be enforced against gains or profits received pursuant to the disposal of unlisted shares held in private companies. 

There are still many questions that need to be answered with respect to the proposed capital gains tax. For example, it is unclear if founders and angels may also be subject to capital gains tax or not, as venture funds are likely to be exempt from such tax.

Also, companies that elect to get listed on the local stock exchange may also be exempted from capital gains. These exemptions are not mentioned in the recent bill, so they may be likely to be included in a subsidiary legislation this year.

The new capital gains tax may likely impact the local startup scene. Several investors and founders have indicated that they may be considering redomiciling the entity elsewhere to avoid tax exposure. To illustrate, in Asia, only Singapore and Hong Kong do not tax capital gains. 

As a founder, you will need to stay up to date to ensure necessary actions may be taken in a timely manner to manage any potential tax implications together with other shareholders that may be impacted by the new proposed tax. 

—

Editor’s note: e27 aims to foster thought leadership by publishing views from the community. Share your opinion by submitting an article, video, podcast, or infographic

Join our e27 Telegram group, FB community, or like the e27 Facebook page

Image credit: Canva

The post Navigating the regulatory landscape: Malaysia’s startup outlook in 2024 appeared first on e27.

Indonesian agritech startup Semaai has secured US$4.7 million (approximately IDR 73 billion) in a mix of equity and debt financing led by CyberAgent Capital (Japan).

New investors Sumitomo Corporation Equity Asia, Ruvento, MyAsiaVC, and Heracles Ventures, besides existing backers Peak XV’s Surge, Accion Venture Lab, and Beenext, participated. This brings its total funding raised to date to US$7.6 million.

“With the new funding, our company will collaborate with financial institutions and fintech providers to expand our embedded fintech solutions, having already doubled Semaai’s total transaction volume in the last 12 months. This is part of our goal to provide an integrated digital ecosystem that addresses disruptions in the supply chain and fills knowledge gaps for Indonesia’s agri-retailers and smallholder farmers,” said Muhammad Yoga Anindito, Co-Founder and CEO of Semaai.

Also Read: Semaai nets funding to create integrated digital ecosystem for farmers, toko tanis in Indonesia

It will also use the new funds to expand its agronomy advisory service to agri-retailers and farmers and strengthen its presence in Central Java. Semaai plans to cover 75 per cent of the over 8,2001 villages by the end of 2024.

Semaai is a ‘farmer-first’ company building full-stack agritech solutions to help farmers and rural MSMEs such as toko tanis in Indonesia maximise their earning potential and access better financing, services and new markets.

The agritech firm provides three essential services:

1. B2B digital marketplace for agricultural inputs such as seeds and fertilisers,
2. agronomy advisory services to improve their farming practices. The agronomy advisory service allows access to educational content organised by crop type and focused on crop-related pests and diseases. The content aids users in thoroughly understanding the complexities of crop issues and empowers them to prepare to mitigate and address future problems. Users are then recommended products from Semaai’s marketplace platform, culminating in hassle-free doorstep delivery,
3. financial services in partnership with financial institutions and fintech providers.

Semaai claims its net revenue has increased over 15x in the last 12 months, and its Toko Tani marketplace user base has doubled. Furthermore, its advisory feature has witnessed an 8x increase in adoption in the last six months and is used by most of Semaai’s active users.

Also Read: The opportunities and challenges Singapore’s agritech sector faces

In February 2023, Semaai closed a bridge funding round led by Accion Venture Lab and XA Network.

Indonesia’s agricultural sector, together with forestry and fisheries, grew 1.46 per cent every year and 1.61 per cent on a quarterly basis. Badan Pusat Statistik 2023 data shows that the agricultural sector contributed 12.71 per cent of the country’s total GDP.

The post Semaai nets US$4.7M to expand its agritech, fintech solutions to Central Java appeared first on e27.

Komunal, a fintech company offering neo-rural bank services in Indonesia, has raised US$5.5 million in a Series A extension funding round led by Sumitomo Corporation Equity Asia.

Jafco Asia, Skystar Capital, Sovereign Capital, and Gobi Partners co-invested.

With the Series A+ funding, the startup aims to drive financial inclusion in Indonesia by digitalising rural banks. The company will also continue to expand its product offerings and develop partnerships with new rural banks, particularly those outside Java and Bali.

Also Read: Komunal lands US$2.1M Series A to boost financial inclusion in Indonesia through neo rural bank services

Launched in 2019, Komunal digitises rural banks by combining funding access and hyperlocal lending to support economic growth in Indonesia. It provides financial services to the underbanked population through its unique partnership with the rural banks in Indonesia.

The firm’s vision is to elevate rural banks and SMEs in the archipelago to serve their local community better.

It has so far partnered with 376 rural banks and channels productive loans to MSMEs predominantly based in tier 2 and 3 cities. Through its digital-based DepositoBPR offering, Indonesians can deposit funds in hundreds of rural banks, eliminating the conventional need for face-to-face processes. These deposits also offer higher interest rates than deposits offered by commercial banks.

In 2023, Komunal claims to have channelled US$600 million in combined loans and deposits — nearly tripling from the previous year. Through KomunalP2P, the company has disbursed US$250 million in loans to over 1,300 MSME projects throughout the country.

Also Read: P2P lending platform Komunal raises investment to improve the funding access to Indonesia’s MSMEs

Additionally, DepositoBPR has also channelled US$350 million in deposit funds to 376 rural banks across the nation.

In September 2021, Komunal received US$2.1 million in its Series A round of financing, led by East Ventures, with participation from Skystar Capital.

The post Komunal lands US$5.5M in Series A+ round to digitalise rural banks in Indonesia appeared first on e27.

(This article — first published on September 18, 2023 — has been updated with the details of the latest court order.)

In yet another blow to Nasdaq-listed Society Pass Inc., a US court ordered the data-driven loyalty company to pay US$1.08 million to its former CTO, Rahul Narain, for breaching his employment contract.

The latest judgement, delivered on December 26 by the Supreme Court of the State of New York (the US) on a lawsuit filed by Narain four years ago, comes over three months after the court directed the firm to pay approximately US$750,000 to the plaintiff. Narain had appealed to add a 9 per cent interest rate, which the court granted.

The final amount of US$1.08 million included ~US$749,190 (the value of the 130 company shares Narain is entitled as per the contract) with interest thereon at the statutory rate of 9 per cent per annum from September 4, 2019, until the entry of judgment in the amount of US$290,000.

Also Read: Ex-CTO drags Society Pass into court for “breaching employment contract”, seeks over US$1.3M in damages

“…Adjudged that Plaintiff Rahul Narain, residing at 15721 Berea Drive, Odessa Florida 33556 do recover of Defendant Society Pass Incorporated, with its principal executive office located at 701 S. Carson Street, Suite 200, Carson City, Nevada 89701: (a) the sum of $749,190.00 with interest thereon at the statutory rate of 9% per annum from September 4, 2019 until entry of judgment in the amount of $290,767.82; (b) the sum of $10,000.00 with interest thereon at the statutory rate of 9% per annum from September 1, 2019 until the entry of judgment in the amount of $3,888.49; the sum of $10,000.00 with interest thereon at the statutory rate of 9% per annum from October 1, 2019 until the entry of judgment in the amount of $3,814.52; (c) the sum of $10,000.00 with interest thereon at the statutory rate of 9% per annum from November 1, 2019 until the entry of judgment in the amount of $3,738.08; together with costs of $200 and disbursements of $480 taxed by the Clerk of the Court, respectively, making in all the sum of $ 1,082,078.91 and that the Plaintiff have execution thereon,” read the judgement.

The case concerns the employment contract signed between Society Pass and Narain in 2019. As per his complaint, Narain joined Society Pass as an advisor and consultant for a term of approximately three months in November 2018. The agreement said Narain — a highly experienced computer programmer and technology advisor and formerly the chief architect for IBM Mobile Appliance — would join the Vietnamese firm as its CTO at the end of the said term.

Both parties also extensively negotiated an employment contract in January 2019, following which Society Pass agreed to pay Narain a monthly salary of US$20,000, effective January 1, 2019. Half the salary would be paid initially, with the balance to be paid upon the closing of Society Pass’s Series C financing round.

In addition, the firm, originally from Vietnam, also agreed to pay Narain US$36,000 annually (US$3,000 a month) towards his healthcare expenses. This payment was also due upon the closing of the Series C round. Besides, Society Pass would pay Narain a Series C Bonus totalling US$350,000.

Furthermore, Narain was also entitled to 4 per cent of Society Pass’s common stock upon Series C closing. The parties agreed that these shares would be issued to him in multiple tranches quarterly, effective February 1 2019.

Also Read: US court orders Society Pass to pay pre-IPO shares to co-founder and ex-CMO; company under SEC probe

However, Narain accused the company of failing to honour the contract terms and pay him his earned salary compensation, bonus payments, healthcare reimbursements, equity awards, and severance pay.

Earlier in September last year, the court ordered Society Pass to award a significant block of pre-IPO shares valuing approximately US$6.61 million, with up to an additional US$2.38 million penalty interest, to its co-founder and former CMO Thomas O’Connor for the breach of the Common Stock Purchase Warrant.

According to court documents, Society Pass was being investigated by the US Securities and Exchange Commission (SEC) earlier this year.

—

The post (Updated) US court orders Nasdaq-listed Society Pass to pay US$1.1M to ex-CTO appeared first on e27.

Embarking on global expansion is essential for entrepreneurs seeking to access new markets and customers, fostering revenue diversification and reducing market dependency. This strategic move enables innovation and collaboration with international partners, paving the way for the development of new products and services.

In order to successfully expand globally, entrepreneurs must carefully consider these factors so they can effectively navigate the challenges and maximise the benefits of global expansion.

Market research

Market trends, client prospects, and competition analysis are included. By understanding the target market, entrepreneurs can adjust their products and services to international clients’ needs. Market research also helps entrepreneurs discover cultural and legal impediments to global expansion and devise methods to overcome them.

Market research helps entrepreneurs identify the countries with the most potential for growth and profit. The target market’s size, purchasing power, competition, and demand for their products or services are assessed. Understanding target market potential helps entrepreneurs make smart decisions and manage resources to succeed in the global market.

Cultural differences can dramatically affect consumer choices, corporate operations, and regulations. Entrepreneurs can improve their products, marketing, and customer service by studying and adapting to a target market’s culture. This can greatly improve success and strengthen relationships with international clients and partners.

Legal and regulatory considerations

Legal and Regulatory Considerations are also crucial for entrepreneurs looking to expand into new markets. Every country has its own set of laws and regulations that businesses must comply with, and failure to do so can result in penalties or even the closure of the business.

Understanding and adhering to the legal framework of a target market is essential to ensure smooth operations and avoid any legal disputes. Additionally, entrepreneurs should also consider the potential challenges of intellectual property protection and trade restrictions that may exist in the new market. By navigating the legal landscape effectively, entrepreneurs can establish a strong, compliant presence in new markets.

• Researching and complying with international laws and regulations
• Understanding intellectual property rights and trademarks in different countries
• Evaluating tax implications and seeking legal advice if necessary

Financial planning

Financial planning is another important aspect for entrepreneurs to consider when protecting their intellectual property. This involves assessing the costs associated with acquiring and maintaining intellectual property rights, as well as creating a budget for ongoing protection.

Also Read: Surviving the storm: Singapore SMEs look to global expansion as recession looms

By properly planning and budgeting, entrepreneurs can allocate resources effectively and ensure that their intellectual property remains protected without compromising their overall financial stability. They may also explore options such as insurance or financing to cover the expenses related to intellectual property protection.

• Estimating costs associated with global expansion
• Assessing funding options for international expansion
• Creating a detailed budget and financial projections

Language and communication

Language and communication are crucial aspects to consider when expanding internationally. Entrepreneurs need to ensure that they have a strong understanding of the local language and culture in order to effectively communicate with potential partners, customers, and employees in foreign markets.

This may involve hiring translators or language experts, as well as investing in language training for staff members. Additionally, entrepreneurs should also consider the cost of translating and localising marketing materials and product documentation to ensure effective communication with international audiences.

• Considering language barriers and the need for translation services
• Developing effective communication strategies for international markets
• Hiring multilingual staff or outsourcing language-related tasks

Logistics and supply chain

When expanding into foreign markets, entrepreneurs must also consider the logistics and supply chain aspects of their business. This includes understanding the various regulations, customs, and shipping requirements in each target market.

It may be necessary to partner with local distributors or establish warehouses in strategic locations to ensure efficient and timely delivery of products. Additionally, entrepreneurs should carefully assess the costs and timeframes associated with shipping and transportation to maintain a competitive edge in international markets.

• Evaluating logistics and supply chain capabilities for international operations
• Choosing appropriate shipping methods and partners
• Ensuring efficient inventory management and distribution channels

Cultural adaptation

Cultural adaptation is crucial for entrepreneurs looking to expand their business into international markets. Understanding and respecting the cultural norms and values of the target market is essential for building strong relationships with customers and stakeholders.

Also Read: AI companies raised record US$50B in 2023 globally: data shows

This may involve adapting marketing strategies, product packaging, and even the overall business model to align with the local culture. It is also important to hire employees or work with local partners who have a deep understanding of the culture and can help navigate any potential cultural barriers.

• Recognising and respecting cultural differences in different markets
• Adapting products, services, and marketing strategies to suit local preferences
• Building relationships with local partners and stakeholders

Risk assessment

Analysing potential risks is a crucial step in ensuring the success of international expansion. Conducting a comprehensive risk assessment allows businesses to identify and mitigate any potential threats or challenges that may arise in a new market.

This involves evaluating political, economic, and social factors that may impact business operations, as well as conducting market research to understand competition and potential barriers to entry. By carefully assessing and managing risks, businesses can minimise losses and increase their chances of success in the new market.

• Identifying potential risks and challenges in global expansion
• Developing contingency plans for unforeseen circumstances
• Evaluating political, economic, and social stability in target markets

Human resources and talent acquisition

Human resources and talent acquisition play a critical role in the success of global expansion. Businesses need to identify and acquire top talent who can navigate the complexities of international markets and adapt to cultural differences.

This involves recruiting individuals with a diverse skill set and cultural intelligence, as well as providing them with appropriate training and support to ensure their success in the new market.

Additionally, businesses must also consider local labour laws and regulations to ensure compliance and avoid any legal issues that may arise. By effectively managing human resources, businesses can build a strong global team that drives growth and success in the new market.

• Assessing the need for local staff or expatriate employees
• Understanding labour laws and employment regulations in different countries
• Developing strategies to attract and retain global talent

—

Editor’s note: e27 aims to foster thought leadership by publishing views from the community. Share your opinion by submitting an article, video, podcast, or infographic

Join our e27 Telegram group, FB community, or like the e27 Facebook page

Image credit: Canva

The post Navigating global expansion: Essential tips for entrepreneurial success appeared first on e27.

Southeast Asia-based companies raised US$108 million in capital across 19 funding rounds in December 2023, according to a report by startup research platform Tracxn. The number is approximately 57.5 per cent less than the amount raised by regional companies in November 2023 and 89 per cent less than the capital secured in December 2022.

December was the least funded month in all of 2023.

Also Read: Doctor Anywhere nets US$40.8M to deepen presence in secondary care

Early-stage investments (10) accounted for the bulk of the deals in December 2023, followed by seed-stage (8) and late-stage (1) deals.

The top deals in December 2023 were Doctor Anywhere (US$40.8 million), Igloo (US$36 million), LiveIn (US$8.3 million), RADC (US$5.41 million), and Klinik Pintar (US$5 million).

With three deals to its credit, 500 Global stood at the top, followed by Tai Partners (2) and Wavemaker Partners (1).

With US$2.5 billion, May was the most dominant month of 2023 in terms of the total funding raised, followed by October (US$731 million), February (US$640 million), July (US$608 million), March (US$580 million), and June (US$496 million).

Overall, the region’s tech startup ecosystem faced the effects of the funding winter in 2023. The startup industry received a total funding of US$4.3 billion in 2023 (till December 5, 2023), a 65 per cent plunge from US$12.4 billion raised in the same period in 2022.

Also Read: Fintech investments in SEA see record drop in Q3: Tracxn

Companies attracted late-stage funding worth US$1.9 billion in 2023, a sharp decline of 65 per cent from US$5.4 billion raised in the same period in 2022. Early-stage funding stood at US$1.9 billion in 2023 YTD, a 67 per cent drop from the same period in 2022. Seed-stage investments also fell 52 per cent to US$546 million.

The post With just US$108M raised, December was the least funded month in 2023: Tracxn appeared first on e27.

Dear reader,

In December 2023, Southeast Asia witnessed a significant downturn in fundraising, with companies securing $108 million in capital across 19 funding rounds, marking a 57.5% decline from November 2023 and an 89% drop compared to December 2022.

The month emerged as the least funded throughout 2023. Early-stage investments dominated the landscape, constituting ten deals, followed by seed-stage with eight, and late-stage with only one deal. Noteworthy funding recipients in December were Doctor Anywhere ($40.8 million), Igloo ($36 million), LiveIn ($8.3 million), RADC ($5.41 million), and Klinik Pintar ($5 million).

Among investors, 500 Global led with three deals, followed by Tai Partners (2) and Wavemaker Partners (1). Interestingly, May 2023 emerged as the most lucrative month, attracting $2.5 billion in total funding, highlighting fluctuations in investment patterns throughout the year.

These trends may indicate varying investor sentiments and economic conditions impacting the startup ecosystem in Southeast Asia.

Sainul,
Editor.

======

With US$108M raised, December was the least funded month in 2023: Tracxn
Southeast Asia-based companies raised just US$108 million in venture capital across 19 funding rounds in December 2023; The number is ~57.5% less than the amount raised by regional companies in November 2023 and 89% less than the capital secured in Dec. 2022.

Khazanah, CGC Digital invest in Funding Societies
The fintech lender aims to expand its Malaysian coverage to areas beyond Kuala Lumpur, Selangor, Penang, and Johor; It targets to serve over 25,000 MSMEs across Malaysia by the end of 2025.

Micoworks scores US$24.5M to expand its marketing platforms into SEA
Investors include Vertex Growth, JAFCO Group, Mitsubishi UFJ Capital, SMBC Venture Capital, and Mizuho Capital; Micoworks is setting up development teams in the Philippines and Taiwan, besides broadening its reach to Taiwan and Thailand.

Zenius to temporarily shut down after facing operational challenges
The Indonesian edutech company did not specify when its services would be unavailable; It also did not specify what would happen to its employees; Over the past two years, the company showed signs of struggle as it underwent three rounds of job cuts.

Indonesian fintech firm Komunal raises US$5.5M
The investors include Sumitomo, Jafco Asia, and Gobi Partners; Komunal enables societies nationwide to access the highest possible government-guaranteed deposit rates from rural banks in any region without visiting the bank.

Etherscan acquires Solana block explorer Solscan
The move lets Malaysia-based Ethereum blockchain explorer Etherscan expand “the accessibility of blockchain data across multiple networks; Solscan serves over 3M users monthly in the Solana ecosystem, which has been described as an Ethereum alternative.

AnyMind appoints Mayi Baviera as Country Manager, Philippines
AnyMind has also reappointed Punsak Limvatanayingyong, former Country Manager of Thailand for AnyMind Group, as MD (Creator Growth); Baviera was most recently Country Director for the Philippines at ADA.

Life3 Biotech, Union Solar launch low-carbon facility LUSH in Singapore
LUSH will open around the second quarter of 2024; It harnesses solar energy and water-upcycling to produce plant-protein and leafy vegetables sustainably in a closed-loop symbiotic system.

OpenAI’s app store for GPTs will launch next week
OpenAI said that developers building GPTs will have to review the company’s updated usage policies and GPT brand guidelines to ensure that their GPTs are compliant before they’re eligible for listing in the store — aptly called the GPT Store.

AI likely to make up to 20K jobs redundant
Consulting firms and recruiters emphasised that companies, specially in the IT, hospitality and banking industry are trying to upskill their workforce, but warned that the advent of AI will lead to retrenchments in the coming months.

Wildfire eliminates landfills by turning residual wastes into renewable energy, hydrogen
The startup has developed modular plants which can be rapidly deployed and used to convert biomass and waste into renewable energy products at low cost.

For US$139, this startup turns your iPhone into a BlackBerry-era relic
The Clicks keyboard brings the “benefits” of touch and typing together. By moving the keyboard off the display when typing, Clicks almost doubles the available screen. Yes, you can now see all your typos in HD clarity.

WV Fund foresees a surge in single-decision-maker funds in SEA
WV Fund Founder Wing Vasiksir cites advantages like founder empathy and quick decision-making while acknowledging scaling challenges.

Pitching 101: Questions that VCs will ask you during a pitch session
Even during the pandemic, opportunities to attend a pitching session with a potential investor remain abundant.

Ampotech aims to revolutionise smart buildings with IoT and edge computing
Ampotech transforms electrical panels, providing real-time insights and improving sustainability for over 60 organisations across SEA.

Pitch deck for dummies: A compilation of top tips and advice from the community
While there are many factors that contribute to the success of a fundraising process, you want to make sure that your pitch deck is spot on.

Reflections on my journey: 2 years in corporate communications and digital marketing
I feel grateful to have the opportunity to try out a marketing role, and it changes the way I look at creating and capturing the value of a piece of work.

The key to tackling climate change: Electrify shipping
Reaching our climate change goals will not be the result of one initiative, one policy, one company or one solution.

Navigate in a cookie-less world, leverage AI and think community-first
Outsmart AI with a human touch, go deep into understanding your customer, and focus on product-led growth and community for marketing.

Unlocking the future of lending with risk-based pricing
As lending goes beyond typical borrowers with strong credit histories and high scores, lenders face the challenge of enabling access.

The post Ecosystem Roundup: December was the least funded month of 2023; Zenius to temporarily shut down appeared first on e27.

In an ideal world, good begets good. Good deeds are lauded, and good behaviour is rewarded. Lending often works the same way. Borrowers with high credit scores are rewarded with low-interest rates, and conversely, those with low credit scores must pay higher interest on their loans.

This is a rather simplistic explanation of risk-based pricing, i.e. a process by which lenders offer different interest rates to different borrowers based on their creditworthiness. Aside from their credit scores, this may also involve assessing the borrower’s employment status, current debt, if any, assets, and so on. As a result, all borrowers for a single credit product will not be offered the same terms and rates.

The concept is by no means new – back in 2018, then deputy governor of the Reserve Bank of India, N S Vishwanathan, said, “Risk-based pricing of loans would need fair assessment and understanding of the risk involved, rather than merely relying on collateral and/or guarantees obtained from stakeholders including equity holders. Banks should charge interest rates that are commensurate with the risk involved in the projects that are being financed.”

What are the benefits of risk-based pricing of loans?

• First and foremost, risk-based pricing models offer an extra layer of protection for
  financial institutions lending to non-prime borrower cohorts.
• Flexible risk pricing models allow lenders to set interest rates that align with their
  financial goals. The financial security offered by risk pricing gives the lender more leeway
  for product and process innovation.

Also Read: How will generative AI advance embedded lending

• Research has shown that risk-based pricing can improve loan performance by bringing
  down delinquency rates.
• Risk-based pricing offers lenders the ability to tailor loan rates and terms so that they
  can lend to more borrowers, even if they don’t have the required credit scores and
  history. The higher risk level is offset by the higher interest rates, and subprime
  borrowers have a shot at accessing the credit they need.

Even as recently as 2016, risk-based pricing was almost an alien concept in India. Less than a decade on, most leading lenders are on their way to working with these pricing models.  It wouldn’t be a stretch to say that the rise of risk-based pricing has a lot to do with credit expansion to thin-file and new-to-credit (NTC) customers in recent years – 35 million borrowers opted for their first credit product in 2021, and well over 30 million did the same in the following year.

The rise of alternate data-driven underwriting is helping lenders fine-tune their scoring models by adding depth and texture to existing data sources. This adds further nuance to traditional indicators and, hence, enables progressive, risk-based bucketing of borrower cohorts and dynamic pricing.

As lending goes beyond typical borrowers with strong credit histories and high scores, lenders face the challenge of enabling access while protecting their business interests – and risk-based pricing comes in as a win-win in this situation. With the Reserve Bank of India’s recent move to increase risk weights for unsecured loans, lenders must focus heavily on pricing risk accurately while ensuring adequate risk capital in their books.

The growth of risk-based pricing has for long been a slow burn, but all signs point to it getting into its stride sooner rather than later.

—

Editor’s note: e27 aims to foster thought leadership by publishing views from the community. Share your opinion by submitting an article, video, podcast, or infographic

Join our e27 Telegram group, FB community, or like the e27 Facebook page

Image credit: Canva

The post Unlocking the future of lending with risk-based pricing appeared first on e27.

Tokyo-based e-commerce enabler AnyMind Group has appointed Tae Woo (Ted) Kim as Country Manager (Korea) and Mayi Baviera as Country Manager (the Philippines).

Baviera replaces Siwat Vilassakdanont, former Country Manager for the Philippines. Vilassakdanont is now Managing Director (Thailand and the Philippines).

In addition, the company announced the reappointment of Punsak Limvatanayingyong, former Country Manager of Thailand for AnyMind Group, as Managing Director (Creator Growth).

Also Read: AnyMind Group agrees to acquire Indonesian e-commerce enabler DDI

According to Co-Founder and CEO Kosuke Sogo, the appointments were made to enhance AnyMind Group’s collective experience and strengthen its focus across its leadership team as the company prepares for a new growth stage. “We are now at a key moment of opportunity where the e-commerce and marketing industries continue to develop, and new technologies promise to transform businesses of all sizes. We want to lead this generational transformation and continue to advance a borderless world where anyone can easily do business through the internet.”

As the Country Head, Kim will lead AnyMind Group’s business and operations in Korea. He was most recently Regional Director for Korean Clients at data, artificial intelligence and technology transformation company ADA. Before ADA, he held roles in Google, Microsoft and Twitter.

AnyMind Group, which entered the Korean market in November 2023, recently partnered with creator management company Treasure Hunter to provide marketers and businesses access to an immediate pool of influencers and content creators in the republic.

Baviera was most recently Country Director for the Philippines at ADA. Before ADA, she held leadership roles at Cheil and Digital FCB Manila. Similar to Kim, Baviera will be responsible for AnyMind Group’s business and operations in the Philippines.

Vilassakdanont will be responsible for AnyMind’s business and operations in Thailand and will continue to oversee the Philippines market. Vilassakdanont joined the group in March 2019 following the acquisition of Moindy, where he was Managing Partner. He has a background in investment and entrepreneurship, with Executive Director and Partner roles in Trinity Securities, ARK Investments and Merrill Lynch. He also co-founded various startups, including WXYX and Delicious.

Limvatanayingyong, who joined AnyMind Group in March 2019 through the acquisition of Moindy, started in 2004, marketing independent music labels and musicians’ music through digital platforms. Moindy became Thailand’s first YouTube multi-channel network in 2014 before its acquisition by TV Thunder Public Company Limited in 2017. After AnyMind’s acquisition in 2019, Moindy was merged into AnyMind’s Creator Growth business, which provides various offerings to creators, including brand collaborations, content monetisation and music distribution across different platforms, growth consultation and strategy, the creation of private-label brands and merchandise for creators.

Also Read: How AnyMind Group achieved profitability through its approach to human resource and leadership

Founded in 2016 in Singapore by Kosuke Sogo and Otohiko Kozutsumi, AnyMind Group offers software and solutions for end-to-end commerce enablement in the business supply chain. It operates across Southeast Asia, East Asia, India, and the Middle East.

Last month, the group announced its expansion into Saudi Arabia by opening an office in Riyadh.

Early last year, the firm made its public debut on the Tokyo Stock Exchange Growth market.

The post AnyMind appoints Mayi Baviera as Country Manager, Philippines appeared first on e27.

Traditionally, waste-to-energy solutions were deemed viable only for cities with low populations. Australian startup Wildfire Energy is set to change this perception as well as the waste-to-energy landscape with its cutting-edge gasification technology. The vision is to eliminate landfills by turning residual wastes into renewable energy and hydrogen.

“Global solid waste generation is over 2 billion tonnes annually, and landfills are responsible for over 5 per cent of global greenhouse gas emissions. We offer a solution that converts waste into electricity and hydrogen with net negative carbon emissions,” according to Jamie Roodenrys, General Manager (Strategic Partnerships).

Also Read: Hydrexia enables users to store and transport hydrogen more economically with less space

Founded by Greg Perkins, Denis Doucet, and Grant Bollert, Wildfire Energy has developed modular plants which can be rapidly deployed and used to convert biomass and waste into renewable energy products at low cost. The solutions are suitable for industrial decarbonisation and improving waste management in outer urban, regional and remote communities, where landfill is currently the only option.

Wildfire Energy focuses on recycling a wide array of waste, from plastics and biomass to electronics. The startup aims to salvage materials that are challenging to recycle conventionally, offering a solution to waste-related environmental issues.

Wildfire Energy, a winner of last year’s Petronas FutureTech 3.0 programme, is currently on the cusp of realising its vision; it is gearing up to build its first full-scale project, processing approximately 45,000 tonnes of waste annually in Brisbane next year.

Also Read: How to navigate the investment opportunity in climate tech sector

The heart of Wildfire Energy’s technology lies in Moving Injection Horizontal Gasification (MIHG), a process that diverges from traditional incineration. Operating in a low-energy, low-oxygen state, the technology converts waste back into its constituent gases, producing synthetic gas (syngas) with about 40 per cent hydrogen content. This breakthrough enables the startup to harness energy from waste materials that would otherwise end up in landfills or incinerated.

The gasification process addresses waste management issues and provides a commercial model capable of cleaning the environment. The resulting energy products have the potential to decarbonise industries such as energy, waste, and transport. The main products generated by the process include synthesis gas, electricity, hydrogen, and heat. The synthesis gas, containing about 40 per cent hydrogen, can be utilised to generate electricity, power vehicles, and decarbonise various industries.

“We want to take the waste that otherwise gets dumped in the ground, and we’ll convert that into useful products,” adds Roodenrys.

Additionally, the byproducts, such as slag from inert materials like aluminium and steel, find valuable applications in construction, further adding to the environmentally friendly outcomes of the process.

While the technology seems revolutionary, the key question remains: is it cost-effective? “Our innovative gasification technology presents a scalable and economically viable solution. Unlike traditional waste-to-energy models that require large populations to be economically feasible, Wildfire Energy’s technology thrives in smaller cities and towns,” claims Roodenrys.

The startup is currently in the development stage, operating a pilot plant in Brisbane and collaborating with industry players to analyse outcomes. The upcoming full-scale plant in Brisbane, with a projected cost of US$50 million, is expected to secure 100 per cent funding by May next year.

Last September, Wildfire Energy partnered with Naturgy Innovahub to develop its MIHG technology to produce hydrogen from a range of residual wastes, such as municipal solid waste, and agricultural residues, such as wheat straw.

Also Read: On the precipice of energy transition

Wildfire Energy’s approach involves a build, own, and operate model for the initial project. However, future projects may adopt a build-and-operate transfer model, allowing clients to take ownership after a demonstration period. The ultimate goal is to deliver numerous projects worldwide under license agreements, contributing to a global shift towards sustainable waste management.

As the world grapples with environmental challenges, Wildfire Energy’s innovative technology offers a beacon of hope, transforming waste into a valuable resource and paving the way for a greener and more sustainable future.

The post Wildfire Energy aims to eliminate landfills by turning residual wastes into renewable energy, hydrogen appeared first on e27.