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Startups Weekly: Will the real unicorns please stand up?

Posted by on Jun 1, 2019 in Aileen Lee, alex wilhelm, bluevoyant, Co-founder, CRM, crowdstrike, cybersecurity startup, dashlane, economy, editor-in-chief, entrepreneurship, eric lefkofsky, Finance, garry tan, Indonesia, initialized capital, money, neologisms, Pegasus, Private Equity, records, SoFi, Softbank, Southeast Asia, starbucks, Startup company, Startups, startups weekly, stewart butterfield, tiny speck, unicorn, valuation, Venture Capital, virtual reality | 0 comments

Hello and welcome back to Startups Weekly, a newsletter published every Saturday that dives into the week’s noteworthy venture capital deals, funds and trends. Before I dive into this week’s topic, let’s catch up a bit. Last week, I wrote about the sudden uptick in beverage startup rounds. Before that, I noted an alternative to venture capital fundraising called revenue-based financing. Remember, you can send me tips, suggestions and feedback to kate.clark@techcrunch.com or on Twitter @KateClarkTweets.

Here’s what I’ve been thinking about this week: Unicorn scarcity, or lack thereof. I’ve written about this concept before, as has my Equity co-host, Crunchbase News editor-in-chief Alex Wilhelm. I apologize if the two of us are broken records, but I think we’re equally perplexed by the pace at which companies are garnering $1 billion valuations.

Here’s the latest data, according to Crunchbase: “2018 outstripped all previous years in terms of the number of unicorns created and venture dollars invested. Indeed, 151 new unicorns joined the list in 2018 (compared to 96 in 2017), and investors poured more than $135 billion into those companies, a 52% increase year-over-year and the biggest sum invested in unicorns in any one year since unicorns became a thing.”

2019 has already coined 42 new unicorns, like Glossier, Calm and Hims, a number that grows each and every week. For context, a total of 19 companies joined the unicorn club in 2013 when Aileen Lee, an established investor, coined the term. Today, there are some 450 companies around the globe that qualify as unicorns, representing a cumulative valuation of $1.6 trillion. 😲

We’ve clung to this fantastical terminology for so many years because it helps us classify startups, singling out those that boast valuations so high, they’ve gained entry to a special, elite club. In 2019, however, $100 million-plus rounds are the norm and billion-dollar-plus funds are standard. Unicorns aren’t rare anymore; it’s time to rethink the unicorn framework.

Last week, I suggested we only refer to profitable companies with a valuation larger than $1 billion as unicorns. Understandably, not everyone was too keen on that idea. Why? Because startups in different sectors face barriers of varying proportions. A SaaS company, for example, is likely to achieve profitability a lot quicker than a moonshot bet on autonomous vehicles or virtual reality. Refusing startups that aren’t yet profitable access to the unicorn club would unfairly favor certain industries.

So what can we do? Perhaps we increase the valuation minimum necessary to be called a unicorn to $10 billion? Initialized Capital’s Garry Tan’s idea was to require a startup have 50% annual growth to be considered a unicorn, though that would be near-impossible to get them to disclose…

While I’m here, let me share a few of the other eclectic responses I received following the above tweet. Joseph Flaherty said we should call profitable billion-dollar companies Pegasus “since [they’ve] taken flight.” Reagan Pollack thinks profitable startups oughta be referred to as leprechauns. Hmmmm.

The suggestions didn’t stop there. Though I’m not so sure adopting monikers like Pegasus and leprechaun will really solve the unicorn overpopulation problem. Let me know what you think. Onto other news.

Image by Rafael Henrique/SOPA Images/LightRocket via Getty Images

IPO corner

CrowdStrike has set its IPO terms. The company has inked plans to sell 18 million shares at between $19 and $23 apiece. At a midpoint price, CrowdStrike will raise $378 million at a valuation north of $4 billion.

Slack inches closer to direct listing. The company released updated first-quarter financials on Friday, posting revenues of $134.8 million on losses of $31.8 million. That represents a 67% increase in revenues from the same period last year when the company lost $24.8 million on $80.9 million in revenue.

Startup Capital

Online lender SoFi has quietly raised $500M led by Qatar
Groupon co-founder Eric Lefkofsky just-raised another $200M for his new company Tempus
Less than 1 year after launching, Brex eyes $2B valuation
Password manager Dashlane raises $110M Series D
Enterprise cybersecurity startup BlueVoyant raises $82.5M at a $430M valuation
Talkspace picks up $50M Series D
TaniGroup raises $10M to help Indonesia’s farmers grow
Stripe and Precursor lead $4.5M seed into media CRM startup Pico

Funds

Maveron, a venture capital fund co-founded by Starbucks mastermind Howard Schultz, has closed on another $180 million to invest in early-stage consumer startups. The capital represents the firm’s seventh fundraise and largest since 2000. To keep the fund from reaching mammoth proportions, the firm’s general partners said they turned away more than $70 million amid high demand for the effort. There’s more where that came from, here’s a quick look at the other VCs to announce funds this week:

~Extra Crunch~

This week, I penned a deep dive on Slack, formerly known as Tiny Speck, for our premium subscription service Extra Crunch. The story kicks off in 2009 when Stewart Butterfield began building a startup called Tiny Speck that would later come out with Glitch, an online game that was neither fun nor successful. The story ends in 2019, weeks before Slack is set to begin trading on the NYSE. Come for the history lesson, stay for the investor drama. Here are the other standout EC pieces of the week.

Equity

If you enjoy this newsletter, be sure to check out TechCrunch’s venture-focused podcast, Equity. In this week’s episode, available here, Crunchbase News editor-in-chief Alex Wilhelm and I debate whether the tech press is too negative or too positive in its coverage of tech startups. Plus, we dive into Brex’s upcoming round, SoFi’s massive raise and CrowdStrike’s imminent IPO.


Source: The Tech Crunch

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Singapore’s Grain, a profitable food delivery startup, pulls in $10M for expansion

Posted by on May 10, 2019 in Asia, bangkok, Cento Ventures, ceo, Deliveroo, Food, food delivery, Foodpanda, funding, Fundings & Exits, grain, Honestbee, Impossible foods, munchery, online food ordering, openspace ventures, Singapore, Southeast Asia, Spotify, Startup company, TC, Thailand, transport, Travis Kalanick, Uber, United States, websites, world wide web | 0 comments

Cloud kitchens are the big thing in food delivery, with ex-Uber CEO Travis Kalanick’s new business one contender in that space, with Asia, and particularly Southeast Asia, a major focus. Despite the newcomers, a more established startup from Singapore has raised a large bowl of cash to go after regional expansion.

Founded in 2014, Grain specializes in clean food while it takes a different approach to Kalanick’s CloudKitchens or food delivery services like Deliveroo, FoodPanda or GrabFood.

It adopted a cloud kitchen model — utilizing unwanted real estate as kitchens, with delivery services for output — but used it for its own operations. So while CloudKitchens and others rent their space to F&B companies as a cheaper way to make food for their on-demand delivery customers, Grain works with its own chefs, menu and delivery team. A so-called ‘full stack’ model if you can stand the cliched tech phrase.

Finally, Grain is also profitable. The new round has it shooting for growth — more on that below — but the startup was profitable last year, CEO and co-founder Yi Sung Yong told TechCrunch.

Now it is reaping the rewards of a model that keeps it in control of its product, unlike others that are complicated by a chain that includes the restaurant and a delivery person.

We previously wrote about Grain when it raised a $1.7 million Series A back in 2016 and today it announced a $10 million Series B which is led by Thailand’s Singha Ventures, the VC arm of the beer brand. A bevy of other investors took part, including Genesis Alternative Ventures, Sass Corp, K2 Global — run by serial investor Ozi Amanat who has backed Impossible Foods, Spotify and Uber among others — FoodXervices and Majuven. Existing investors Openspace Ventures, Raging Bull — from Thai Express founder Ivan Lee — and Cento Ventures participated.

The round includes venture debt, as well as equity, and it is worth noting that the family office of the owners of The Coffee Bean & Tea Leaf — Sassoon Investment Corporation — was involved.

Grain covers individual food as well as buffets in Singapore

Three years is a long gap between the two deals — Openspace and Cento have even rebranded during the intervening period — and the ride has been an eventful one. During those years, Sung said the business had come close to running out of capital before it doubled down on the fundamentals before the precarious runway capital ran out.

In fact, he said, the company — which now has over 100 staff — was fully prepared to self-sustain.

“We didn’t think of raising a Series B,” he explained in an interview. “Instead, we focused on the business and getting profitable… we thought that we can’t depend entirely on investors.”

And, ladies and gentleman, the irony of that is that VCs very much like a business that can self-sustain — it shows a model is proven — and investing in a startup that doesn’t need capital can be attractive.

Ultimately, though, profitability is seen as sexy today — particularly in the meal space where countless U.S. startups has shuttered including Munchery and Sprig — but the focus meant that Grain had to shelve its expansion plans. It then went through soul-searching times in 2017 when a spoilt curry saw 20 customers get food poisoning.

Sung declined to comment directly on that incident, but he said that company today has developed the “infrastructure” to scale its business across the board, and that very much includes quality control.

Grain co-founder and CEO Yi Sung Yong [Image via LinkedIn]

Grain currently delivers “thousands” of meals per day in Singapore, its sole market, with eight-figures in sales per year, he said. Last year, growth was 200 percent, Sung continued, and now is the time to look overseas. With Singha, the Grain CEO said the company has “everything we need to launch in Bangkok.”

Thailand — which Malaysia-based rival Dahamakan picked for its first expansion — is the only new launch on the table, but Sung said that could change.

“If things move faster, we’ll expand to more cities, maybe one per year,” he said. “But we need to get our brand, our food and our service right first.”

One part of that may be securing better deals for raw ingredients and food from suppliers. Grain is expanding its ‘hub’ kitchens — outposts placed strategically around town to serve customers faster — and growing its fleet of trucks, which are retrofitted with warmers and chillers for deliveries to customers.

Grain’s journey is proof that startups in the region will go through trials and tribulations, but being able to bolt down the fundamentals and reduce burn rate is crucial in the event that things go awry. Just look to grocery startup Honestbee, also based in Singapore, for evidence of what happens when costs are allowed to pile up.


Source: The Tech Crunch

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Shiok Meats takes the cultured meat revolution to the seafood aisle with plans for cultured shrimp

Posted by on Mar 15, 2019 in Asia, asia pacific, Australia, food and drink, India, meat, Singapore, Southeast Asia, TC, United Nations, Y Combinator | 0 comments

Rising consumer interest in alternative proteins and meat replacements has brought hundreds of millions of dollars to companies trying to grow or replace beef or chicken, but few companies have turned their attention to developing seafood alternatives.

Now Shiok Meats is looking to change that. The company has raised pre-seed financing from investors like AIM Partners, Boom Capital, and Ryan Bethencourt and is now part of the recent Y Combinator cohort presenting next week.

Co-founders Sandhya Sriram and Ka Yi Ling are both stem cell scientists working at Singapore’s Agency for Science, Technology and Research who decided to leave their cushy government posts for life in the fast lane of entrepreneurship. 

The two have set themselves a goal of creating a shrimp substitute that would be similar to what’s typically found in the freezer section of most grocery stores — and a minced shrimp-replacement for use in dumplings.

There’s a huge market for seafood across the globe, but especially in Asia and Southeast Asia where crustaceans are a huge part of the diet. Chinese consumers alone account for the consumption of some 3.6 million tons of crustaceans, according to a 2015 study from the Food and Agriculture Department of the United Nations .

Shrimp cultivation as it stands is also a pretty dirty business. The industry is constantly being criticized for poor working conditions, unsanitary farms, and ancillary environmental damage. A blockbuster report from the Associated Press revealed instances of modern slavery in the Thai seafood industry.

“We chose to start with shrimp because it’s an easier animal to deal with compared to crabs and lobsters,” says Shriram. But the company will be expanding its offerings over time to those higher-end crustaceans.

Right now, the focus is squarely on shrimp. The company’s early tests have proved successful and the company estimates that it can make a kilogram of shrimp meat for somewhere around $5,000.

While that may sound expensive, it’s still much less than many of the lab-grown meat companies are pending to produce their replacement beef.

“We’re still relatively low compared to the other clean meat companies, which are still at hundreds of thousands of dollars,” says Ling.

The company is looking to bring its first product to market in the next three-to-five years and will initially target the Asia-Pacific consumer.

That means initially selling into their home market of Singapore and expanding into Hong Kong, India and eventually, Australia.

 


Source: The Tech Crunch

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CXA, a health-focused digital insurance startup, raises $25M

Posted by on Mar 13, 2019 in Asia, asia pacific, b capital, Banking, ceo, China, Co-founder, cxa group, economy, Eduardo Saverin, Europe, Facebook, Finance, funding, Fundings & Exits, healthcare, Indonesia, insurance, Louisiana, money, North America, openspace ventures, singtel, SingTel Innov8, Southeast Asia, Venture Capital | 0 comments

CXA Group, a Singapore-based startup that helps make insurance more accessible and affordable, has raised $25 million for expansion in Asia and later into Europe and North America.

The startup takes a unique route to insurance. Rather than going to consumers directly, it taps corporations to offer their employees health flexible options. That’s to say that instead of rigid plans that force employees to use a certain gym or particular healthcare, a collection over 1,000 programs and options can be tailored to let employees pick what’s relevant or appealing to them. The ultimate goal is to bring value to employees to keep them healthier and lower the overall premiums for their employers.

“Our purpose is to empower personalized choices for better living for employees,” CXA founder and CEO Rosaline Koo told TechCrunch in an interview. “We use data and tech to recommend better choices.”

The company is primarily focused on China, Hong Kong and Southeast Asia where it claims to works with 600 enterprises including Fortune 500 firms. The company has over 200 staff, and it has acquired two traditional insurance brokerages in China to help grow its footprint, gain requisite licenses and its logistics in areas such as health checkups.

We last wrote about CXA in 2017 when it raised a $25 million Series B, and this new Series C round takes it to $58 million from investors to date. Existing backers include B Capital, the BCG-backed fund from Facebook co-founder Eduardo Saverin, EDBI — the investment arm of the Singapore Economic Development Board — and early Go-Jek backer Openspace Ventures, and they are joined by a glut of big-name backers in this round.

Those new investors include a lot of corporates. There’s HSBC, Singtel Innov8 (of Singaporean telco Singtel), Telkom Indonesia MDI Ventures (of Indonesia telco Telkom), Sumitomo Corporation Equity Asia (Japanese trading firm) Muang Thai Fuchsia Ventures (Thailand-based insurance firm), Humanica (Thailand-based HR firm) and PE firm Heritas Venture Fund.

“There are additional insurance companies and strategic partners that we aren’t listing,” said Koo.

Rosaline Koo is founder and CEO of CXA Group

That’s a very deliberate selection of large corporates which is part of a new strategy to widen CXA audience.

The company had initially gone after massive firms — it claims to reach a collective 400,000 employees — but now the goal is to reach SMEs and non-Fortune 500 enterprises. To do that, it is using the reach and connections of larger service companies to reach their customers.

“We believe that banks and telcos can cross-sell insurance and banking services,” said Koo, who grew up in LA and counts benefits broker Mercer on her resume. “With demographic and work life event data, plus health data, we’re able to target the right banking and insurance services.

“We can help move them away from spamming,” she added. “Because we will have the right data to really target the right offering to the right person at the right time. No firm wants an agent sitting in their canteen bothering their staff, now it’s all digital and we’re moving insurance and banking into a new paradigm.”

The ultimate goal is to combat a health problem that Koo believes is only getting worse in the Asia Pacific region.

“Chronic disease comes here 10 years before anywhere else,” she said, citing an Emory research paper which concluded that chronic diseases in Asia are “rising at a rate that exceeds global increases.”

“There’s such a crying need for solutions, but companies can’t force the brokers to lower costs as employees are getting sick… double-digit increases are normal, but we think this approach can help drop them. We want to start changing the cost of healthcare in Asia, where it is an epidemic, using data and personalization at scale in a way to help the community,” Koo added.

Talking to Koo makes it very clear that she is focused on growing CXA’s reach in Asia this year, but further down the line, there are ambitions to expand to other parts of the world. Europe and North America, she said, may come in 2020.


Source: The Tech Crunch

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NetEase is the latest Chinese tech giant to lay off a big chunk of its staff

Posted by on Feb 28, 2019 in alibaba, Amazon, Asia, Business, China, Didi Chuxing, E-Commerce, eCommerce, Gaming, JD.com, layoff, netease, public relations, Southeast Asia, Tencent | 0 comments

NetEase, China’s second-biggest online games publisher with a growing ecommerce segment, is laying off a significant number of its employees, adding to a list of Chinese tech giants that have shed staff following the Lunar New Year.

A NetEase employee who was recently let go confirmed with TechCrunch that the company had fired a large number of people spanning multiple departments, including ecommerce, education, agriculture (yes, founder and executive officer Ding Lei has a thing for organic farming) and public relations, although downsizing at Yanxuan, its ecommerce brand that sells private-label goods online and offline, had started before the Lunar New Year holiday.

Multiple Chinese media outlets covered the layoff on Wednesday. According to a report from Caijing Magazine, Yanxuan fired 30-40 percent of its staff; the agricultural brand Weiyang got a 50 percent cut; the education unit downsized from 300 to 200 employees; and 40 percent of NetEase’s public relations staff was gone.

A spokesperson from NetEase evaded TechCrunch’s questions about the layoff but said the company is “indeed undergoing a structural optimization to narrow its focus.” The goal, according to the person, is to “boost innovation and organizational efficiency so NetEase can fully play to its own strengths and adapt to market competition in the longer term.”

NetEase CEO Ding Lei pictured picking Longjing tea leaves in Hangzhou. Photo: NetEase Yanxuan via Weibo

Oddly, ecommerce and education appear to be some of NetEase’s brighter spots. The company singled them out alongside music streaming during its latest earnings call as the three sectors that saw “strong profit growth potential” and “will be the focus of [the company’s] next phase of strategic growth.” The staff cuts, then, may represent an urgency to tighten the purse strings for even NetEase’s rosiest businesses.

The shakeup fits into market speculation about company staff cuts to save costs as China copes with a weakening domestic economy. JD.com, a rival to Alibaba, is firing 10 percent of its senior management to cut costs, Caixin reported last week. Ride-hailing giant Didi Chuxing plans to let go 15 percent of its staff this year as part of a reorganization to boost internal efficiency, though it’s adding new members to focus on more promising segments.

Alibaba took an unexpected turn, announcing last week that it will continue to hire new talent in 2019. “We are poised to provide more resources to our platforms to help businesses navigate current environment and create more job opportunities overall,” the firm said in a statement.

2018 was a tough year for China’s games companies of all sorts. The industry took a hit after regulators froze all licensing approvals to go through a reshuffle, dragging down stock prices of big players like Tencent and NetEase. These companies continue to feel the chill even after approvals resumed, as the newly minted regulatory body imposes stricter checks on games, slowing down the application process altogether and delaying companies’ plans to monetize lucrative new titles.

That bleak domestic outlook compelled NetEase to take what Ding dubs a “two-legged” approach to game publishing, with one foot set in China and the other extending abroad. Tencent, too, has been finding new channels for its games through regional partners like Sea’s Garena in Southeast Asia.

NetEase started in 1997 and earned its name by making PC games and providing email services in the early years of the Chinese internet. More recently the company has intended to diversify its business by incubating projects across the board. It has so far enjoyed growth in segments like music streaming and ecommerce (which is reportedly swallowing up Amazon China’s import-led service) while stepping back from others such as comics publishing, an asset it is selling to youth-focused video streaming site Bilibili.


Source: The Tech Crunch

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Go-Jek’s Get app officially launches in Thailand as Southeast Asia expansion continues

Posted by on Feb 28, 2019 in Asia, bangkok, carsharing, ceo, Collaborative Consumption, countries, Food, go-jek, grab, Indonesia, Philippines, Singapore, Softbank, Southeast Asia, Thailand, transport, Uber, vietnam | 0 comments

Go-Jek is extending its reach in Southeast Asia after its Thailand-based unit made its official launch, which included the addition of a new food delivery service.

Get, which is the name for Go-Jek business in Thailand, started out last year offering motorbike taxi on-demand services to a limited part of Thai capital city Bangkok, now the company said it has expanded the bikes across the city and added food and delivery options. Get’s management team is composed of former Uber staffers while CEO Pinya Nittayakasetwat was recruited from chat app Line’s food delivery business.

Over the last two months, Get claims to have completed two million trips in the past two months. There’s no word on when Get will add four-wheeled transport options, however. On the food side, Get is claiming to have 20,000 merchants on its platform but there are some issues. Rumming through the app, I found a number of listed restaurants that didn’t include menus. In those instances, customers have to input their dish and price which makes it pretty hard to use.

Go-Jek’s Get app in Thailand doesn’t include menus for a number of restaurants, making it nearly impossible to order

Grab is the dominant player in Thailand, where it offers taxis, private cars, motorbikes, delivery and food across eight markets in Southeast Asia. Go-Jek rose to success in its native Indonesia, where it began offering motorbikes on demand but has expanded to cover taxi, cars, food, general services on-demand and fintech. Its investors include Google, Tencent, Meituan and Sequoia India.

That’s the same playbook Grab is using, but Go-Jek is taking its time with its market expansions. Thailand represents its third new market beyond Indonesia, following launches in Vietnam and Singapore. The Philippines is another market where Go-Jek has voiced a desire to be present — it has even made an acquisition there — but regulatory issues are holding up a launch.

Regional expansion doesn’t come cheap and Go-Jek is in the midst of raising $2 billion to finance these moves. It recently closed $1 billion from existing investors, and Deal Street Asia reports that it could raise as much as $3 billion for the entire Series F round. That’s likely in response to Grab’s own fundraising plans. The Singapore-based company closed $2 billion last year, but it is looking to increase that total to $5 billion with a major injection from SoftBank’s Vision Fund a key piece of that puzzle.


Source: The Tech Crunch

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Ambitious Singapore startup Delegate wants to bring its event booking platform to the US

Posted by on Feb 9, 2019 in Asia, austin, Companies, delegate, funding, Fundings & Exits, Jacqueline Ye, Melissa Lou, Pinterest, Singapore, Southeast Asia, taiwan, United States, Zendesk, zopim | 0 comments

It’s not often that you hear about a startup from Singapore with ambitions to expand to the U.S, but that’s exactly the goal for event booking service Delegate.

Founded in August 2015, the company aims to be a one-stop shop for booking an event, that covers corporate and professional functions, celebrations like weddings and more personal events such as birthdays or get-togethers.

Beyond the essential step of securing a venue, Delegate’s platform covers a range of different needs that include: food and beverage, photography and videography, flowers and decor, entertainment such as bands, invitation and gifts, event staff, production equipment and transport.

“We saw a huge gap in the market,” co-founders Melissa Lou and Jacqueline Ye, who both worked in the event industry prior to starting Delegate, told TechCrunch in a recent interview. “There was no one resource for finding events and resources.”

The Delegate platform covers venue booking, catering, staffing, entertainment and more.

But, beyond being a booking platform for consumers, Delegate has a smart hook that attracts those on venue and event hosting side. In addition to helping them generate bookings via its sites, Delegate offers a subscription ‘Pro’ product that helps them manage daily operations, generate leads, collect bookings and handle collaborations with others in their supply chain.

There’s also an element of granularity with the consumer side of the business. Delegate has set up options to make the myriads of suppliers, venues and more navigable for less experienced customers. That includes a ‘deals’ section for, well, deals and an inspiration board for the planning process which is itself inspired by Pinterest’s visual approach.

Coming soon, the company hopes to add payment plans to help make it easier to pay for major events, as well as a new offering focused squarely on business users and API integrations for third-party services.

Lou and Ye started the business nearly four years ago with around 100 vendors thanks to their personal and business networks. Today, it claims 1,700 vendors and 70,000 users across Singapore and Hong Kong, its first expansion market.

Delegate co-founders Jacqueline Ye and Melissa Lou (left and right) want to expand their service to the U.S. market.

Already present in two of Asia’s top event locations, where average spend is among the highest for the region. But since those countries are limited in size — Singapore’s population is just shy of six million, Hong Kong’s is around seven million, it makes sense that Delegate is now looking for its next moves. Lou and Ye said they plan to launch the service in “key cities” in Australia and the U.S. to tap what they see as lucrative markets, while Korea and Taiwan are also on the radar closer to home in Asia.

“We see these markets as a good fit for us,” Lou explained. “They have a fair share of corporate events already and, in particular, Australia is a good country because we have a good network there.”

Entering the U.S. might sound implausible to some, but already soft launches of the platform in LA and Austin have drawn interest from over 100 vendors, the Delegate co-founders said. That’s without any major marketing push to either businesses or consumers, and it gives the company optimism. Already the U.S. is a listed location on their service but, for now, there are less than a dozen vendors and there’s no specific location.

Beyond early outreach, the company has raised funds for expansion. Last month, Delegate announced a $1 million pre-Series A round from an undisclosed family office (with apparent links to the event industry) and angel investors who founded Zopim, the Singapore-based startup that sold to Zendesk for around $30 million in 2014.

That network and Saas expertise is likely to help with those ambitious global expansion plans, although Lou and Ye said they aren’t planning to raise their Series A just yet. They say they plan to stretch their runway and keep their costs lean, a practice the founders say they have stuck to since bootstrapping without outside funding for the first year of the business. It’s unlikely bet for most startups in Southeast Asia, but if Delegate can gain even just a small foothold in the U.S, it would be a massive validation of its business model and niche, and no doubt precipitate that larger Series A round.


Source: The Tech Crunch

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First China, now Starbucks gets an ambitious VC-funded rival in Indonesia

Posted by on Feb 1, 2019 in alibaba, alibaba group, android, Apps, army, Asia, carsharing, China, Companies, East Ventures, economy, funding, Fundings & Exits, go-jek, Google, grab, Indonesia, Insignia Ventures Partners, internet access, Jakarta, JD.com, managing partner, mcdonalds, online food ordering, online marketplaces, Pizza Hut, Singapore, Southeast Asia, starbucks, temasek, Tencent, United States, WeWork | 0 comments

Asia’s venture capital-backed startups are gunning for Starbucks .

In China, the U.S. coffee giant is being pushed by Luckin Coffee, a $2.2 billion challenger surfing China’s on-demand wave, and on the real estate side, where WeWork China has just unveiled an on-demand product that could tempt people who go to Starbucks to kill time or work.

That trend is picking up in Indonesia, the world’s fourth largest country and Southeast Asia’s largest economy, where an on-demand challenger named Fore Coffee has fuelled up for a fight after it raised $8.5 million.

Fore was started in August 2018 when associates at East Ventures, a prolific early-stage investor in Indonesia, decided to test how robust the country’s new digital infrastructure can be. That means it taps into unicorn companies like Grab, Go-Jek and Traveloka and their army of scooter-based delivery people to get a hot brew out to customers. Incidentally, the name ‘Fore’ comes from ‘forest’ — “we aim to grow fast, strong, tall and bring life to our surrounding” — rather than in front of… or a shout heard on the golf course.

The company has adopted a similar hybrid approach to Luckin, and Starbucks thanks to its alliance with Alibaba. Fore operates 15 outlets in Jakarta, which range from ‘grab and go’ kiosks for workers in a hurry, to shops with space to sit and delivery-only locations, Fore co-founder Elisa Suteja told TechCrunch. On the digital side, it offers its own app (delivery is handled via Go-Jek’s Go-Send service) and is available via Go-Jek and Grab’s apps.

So far, Fore has jumped to 100,000 deliveries per month and its app is top of the F&B category for iOS and Android in Indonesia — ahead of Starbucks, McDonald’s and Pizza Hut .

It’s early times for the venture — which is not a touch on Starbuck’s $85 billion business; it does break out figures for Indonesia — but it is a sign of where consumption is moving to Indonesia, which has become a coveted beachhead for global companies, and especially Chinese, moving into Southeast Asia. Chinese trio Tencent, Alibaba and JD.com and Singapore’s Grab are among the outsiders who have each spent hundreds of millions to build or invest in services that tap growing internet access among Indonesia’s population of over 260 million.

There’s a lot at stake. A recent Google-Temasek report forecast that Indonesia alone will account for over 40 percent of Southeast Asia’s digital economy by 2025, which is predicted to triple to reach $240 billion.

As one founder recently told TechCrunch anonymously: “There is no such thing as winning Southeast Asia but losing Indonesia. The number one priority for any Southeast Asian business must be to win Indonesia.”

Forecasts from a recent Google-Temasek report suggest that Indonesia is the key market in Southeast Asia

This new money comes from East Ventures — which incubated the project — SMDV, Pavilion Capital, Agaeti Venture Capital and Insignia Ventures Partners with participation from undisclosed angel backers. The plan is to continue to invest in growing the business.

“Fore is our model for ‘super-SME’ — SME done right in leveraging technology and digital ecosystem,” Willson Cuaca, a managing partner at East Ventures, said in a statement.

There’s clearly a long way to go before Fore reaches the size of Luckin, which has said it lost 850 million yuan, or $124 million, inside the first nine months in 2018.

The Chinese coffee challenger recently declared that money is no object for its strategy to dethrone Starbucks. The U.S. firm is currently the largest player in China’s coffee market, with 3,300 stores as of last May and a goal of topping 6,000 outlets by 2022, but Luckin said it will more than double its locations to more than 4,500 by the end of this year.

By comparison, Indonesia’s coffee battle is only just getting started.


Source: The Tech Crunch

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Facebook removes hundreds of accounts linked to fake news group in Indonesia

Posted by on Feb 1, 2019 in Asia, computing, digital media, Facebook, fake news, Indonesia, instagram, Myanmar, Philippines, photo sharing, Singapore, Social Media, social network, Software, Southeast Asia, sri lanka, TC, Thailand, United Nations, United States, world wide web | 0 comments

Facebook said today it has removed hundreds of Facebook and Instagram counts with links to an organization that peddled fake news.

The world’s fourth largest country with a population of over 260 million, Indonesia is in election year alongside Southeast Asia neighbors Thailand and the Philippines. Facebook said this week it has set up an ‘election integrity’ team in Singapore, its APAC HQ, as it tries to prevent its social network being misused in the lead-up to voting as happened in the U.S.

This Indonesia bust is the first move announced since that task force was put in place, and it sees 207 Facebook Pages, 800 Facebook accounts, 546 Facebook Groups, and 208 Instagram accounts removed for “engaging in coordinated inauthentic behavior.”

“About 170,000 people followed at least one of these Facebook Pages, and more than 65,000 followed at least one of these Instagram accounts,” Facebook said of the reach of the removed accounts.

The groups and accounts are linked to Saracen Group, a digital media group that saw three of its members arrested by police in 2016 for spreading “incendiary material,’ as Reuters reports.

Facebook isn’t saying too much about the removals other than: “we don’t want our services to be used to manipulate people.”

In January, the social network banned a fake news group in the Philippines in similar circumstances.

Despite the recent action, the U.S. company has struggled to manage the flow of false information that flows across its services in Asia. The most extreme examples come from Myanmar, where the UN has concluded that Facebook played a key role in escalating religious hatred and fueling violence. Facebook has also been criticized for allowing manipulation in Sri Lanka and the Philippines among other places.


Source: The Tech Crunch

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Go-Jek makes first close of Series F round at $9.5B valuation

Posted by on Feb 1, 2019 in Asia, carsharing, Collaborative Consumption, Companies, financial services, food delivery, funding, Fundings & Exits, go-jek, Google, grab, Indonesia, JD.com, online food ordering, Philippines, series f, Singapore, Southeast Asia, Tencent, Thailand, transport, Uber, vietnam | 0 comments

Go-Jek, the Indonesia-based ride-hailing company that is challenging Grab in Southeast Asia, has announced the first close of its Series F round, as TechCrunch reported last week. The company isn’t revealing numbers. Sources told us last week that it has closed around $920 million, but we understand that today that the round is at over $1 billion. Go-Jek is planning to raise $2 billion for the round, as reported last year.

Go-Jek said that the first close is led by existing backers Google, JD.com, and Tencent, with participation from Mitsubishi Corporation and Provident Capital. It didn’t provide a valuation but sources told us that week that it is around $9.5 billion.

Starting out with motorbike taxis in 2015, Go-Jek has since expanded to taxis, private car and more. The company said it plans to spend the money deepening its business in Indonesia, its home market, and growing its presence in new market expansions Vietnam, Singapore and Thailand. It is also working to enter the Philippines, where it had a request for an operating license rejected although it did complete a local acquisition after buying fintech startup Coins.ph.

The Go-Jek business in Indonesia includes transportation, food delivery, services on demand, payments and financial services. That’s very much the blueprint for its expansion markets, all of which are in different stages. Go-Viet, its Vietnamese service, offers food delivery and motorbike taxis, Get in Thailand operates motorbike taxis and in Singapore Go-Jek provides four-wheeled car options.

Combined those efforts cover 204 cities, two million drivers and 400,000 merchants, the company said, but the majority of that is in Indonesia.

Grab, meanwhile, became the top dog after buying Uber’s local business, and it operates in eight countries. It recently crossed three billion rides to date and claims 130 million downloads. Grab said revenue for 2018 was $1 billion, it expects that to double this year. It has raised $6.8 billion from investors, according to Crunchbase, and its current Series H round could reach $5 billion.

Go-Jek claims it has 130 million downloads — despite just being in three markets — while it said it reached an annualized transaction volume of two billion in 2018 and $6.7 billion in annualized GMV. Those figures require some explaining as Go-Jek is being a little creative with its efforts to compete with Grab on paper.

Transactions don’t mean revenue — a transaction could be a $1 motorbike ride or a payment via QR code — and GMV is not revenue either, while both are ‘annualized’ which means they are scaled up after measuring a short period. In other words, don’t take these figures too literally, they aren’t comparable to Grab.


Source: The Tech Crunch

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