From Amazon’s entry to tech leaders’ market debuts and the region’s biggest investments, here’s the rundown of the top tech news that made a splash in Southeast Asia this year (in no particular order).
1. Dave McClure’s fall
The year saw a wave of sexual harassment stories sweep industries across the world. Before the scandal involving Hollywood film mogul Harvey Weinstein broke out, a flood of women in tech came forward with their experiences at the hands of powerful men. Among them was entrepreneur Cheryl Yeoh, who accused prolific Silicon Valley investor Dave McClure of sexual assault.
Yeoh, the former CEO of Malaysian innovation agency Magic, claimed McClure propositioned her several times, pushed himself against her, and kissed her against her will in her own apartment in 2014.
Yeoh broke her silence on the incident after another woman, who runs a fitness startup in the US, alleged in a New York Times exposé that McClure sexually harassed her.
2. Back-to-back public debuts
Southeast Asia’s startup community kept a close watch on the initial public offerings of PC gear maker Razer and Tencent-owned games company Sea late this year.
Based both in San Francisco and Singapore, Razer was well received at the Hong Kong Stock Exchange (HKEX) in November, surging on the first day of trading due to bullish outlook on the company’s sales.
The company, backed by Singapore’s sovereign wealth fund and Hong Kong billionaire Li Ka-shing, raised US$530 million, which it would use to expand into new verticals, including mobile devices. It unveiled its first smartphone a week before its market debut.
It doesn’t seem like the company will end on a high note at HKEX this year however, as it currently trades below IPO price.
Razer’s listing quickly followed that of Sea’s, which has been viewed as a test of how public markets treat tech firms that have amassed users but are still waiting to turn profitable.
Sea listed on the New York Stock Exchange in October, raising US$884 million. The stock had a rocky start, falling below its IPO price of US$15. Analysts said investors might be jittery about Sea’s future given heavy losses.
Formerly known as Garena, Sea started as an online gaming company in 2009 and then branched out to digital payments (AirPay) and ecommerce (Shopee). It previously declared that Shopee was the number one player in an area it defined as “Greater Southeast Asia”. This didn’t sit well with Alibaba-owned Lazada, which for quite sometime has asserted its claim to the throne.
Sea has seen a dramatic increase in its revenue, thanks to its core games business. Yet losses have also widened as the firm continues to spend to capture market share in ecommerce. Nevertheless, Sea believes that Shopee can become a lucrative business on its own over the long term.
3. Amazon’s grand entrance
Speaking of ecommerce, the sector just got a lot more exciting with US behemoth Amazon now in the picture.
After playing the “will they, won’t they” game for a long time, Amazon finally rolled out its two-hour delivery service Prime Now in Singapore last July. Five months later, it introduced the full Prime membership, offering faster and cheaper shipping of items as well as unlimited free international shipping, among others.
Nevertheless Prime’s arrival not only ups the stakes in Southeast Asia’s ecommerce market, where Amazon is facing off against Shopee, Lazada and another Alibaba-backed player Tokopedia, plus various smaller portals. It also brings Amazon into direct competition with local content streaming players such as iFlix, Hooq, and Viddsee, and global rivals like Netflix.
Anticipating Amazon’s much-talked-about foray, Lazada launched its own membership program as early as April – in collaboration with its online grocery delivery unit Redmart, and other brands like Netflix and Uber.
4. Alibaba’s shopping spree
Jack Ma’s company continued its big push into Southeast Asia, this time leading a US$1.1 billion investment in Indonesia’s Tokopedia.
Alibaba now holds a minority stake in Tokopedia, which is a version of Taobao – the Chinese behemoth’s consumer-to-consumer marketplace. This marks Alibaba’s first direct investment in an Indonesian startup.
In the meantime, Ma’s firm this year hiked its stake in Lazada to 83 percent for roughly US$1 billion.
While Lazada and Tokopedia are competing in Indonesia, sharing the same investor has fueled rumors of a possible alliance.
5. US giant bets on Indonesia
Another mega deal happened in Indonesia in 2017: online travel startup Traveloka’s US$350 million funding round led by Expedia.
The amount brought Traveloka’s total disclosed funding to US$500 million, which included contributions from investors like East Ventures, Hillhouse Capital Group, Sequoia Capital, and Chinese ecommerce firm JD.
The round reportedly raised Traveloka’s valuation to US$2 billion, according to Bloomberg sources.
6. The first Filipino unicorn
The Philippines hit a huge milestone this year with the birth of its first billion-dollar startup. Revolution Precrafted, a developer of prefabricated designer homes, raised its series B round co-led by Singapore’s K2 VC last October, valuing the company at over US$1 billion, according to two Tech in Asia sources familiar with the deal.
That makes two-year-old Revolution one of, if not the fastest to achieve billion-dollar status in Southeast Asia, said one of the sources – a claim confirmed by Tech in Asia data.
The startup’s new prominent investor K2 was founded by venture capitalist Ozi Amanat, who’s known for his investments in Alibaba and Twitter before their public offerings. K2 counts several unicorns in its portfolio: Spotify, Magic Leap, Paytm, and Palantir.
Revolution sells prefab homes conceived by world-renowned architects and designers such as Zaha Hadid, David Salle, Tom Dixon, and Marcel Wanders. The homes are priced at an average of US$120,000. They can be ordered from the company’s site and shipped anywhere in the globe in at least 90 days. As of March, it had US$110 million in orders.
500 Startups earlier admitted fighting hard to join the company’s first funding round announced in March.
7. Uber’s cunning tactics
2017 has been hell for the US ride-hailing juggernaut. It started in February, when former Uber engineer Susan Fowler wrote a blog post detailing the sexism and harassment she experienced in the workplace. That post set into motion a series of events that ultimately resulted in the ouster of Uber co-founder Travis Kalanick as CEO.
Uber had been accused of stealing trade secrets from Google to speed up its own self-driving car efforts, using possible illicit programs to undermine its competitors, including Singapore-based Grab, paying bribes in Asian markets, covering up a massive data breach that compromised the personal data of millions of its users, and more.
All the bad press supposedly prompted Japanese tech giant Softbank to bid for Uber shares at a steep discount, potentially cutting its valuation by another US$20 billion.
In one of many efforts to revamp the company’s culture, new CEO Dara Khosrowshahi last month outlined new rules for Uber’s staff. Probably the most important among them – “Do the right thing. Period.”
8. Uber gets in bed with Singapore’s largest taxi company
Uber signed a deal to sell 51 percent of its car rental unit to ComfortDelgro for US$218 million and form a joint venture with the city-state’s leading taxi firm.
The partnership will allow Uber’s Lion City Rentals to leverage ComfortDelGro’s fleet management and operations capabilities. Uber users will be able to directly book ComfortDelGro cabs via the US company’s app, while the taxi firm’s drivers will be able to accept ride requests through it, giving them an additional source of income.
The transaction appeared to be something of a coup for Uber, which has faced ferocious opposition from licensed taxi providers in Southeast Asia and other parts of the world.
9. Malaysia opens digital free trade zone
In November, Chinese billionaire Jack Ma opened the doors to a free trade zone in Malaysia that’s designed to tap into region’s ecommerce boom.
First announced in March, the Digital Free Trade Zone is now open to trade, with Malaysia’s government anticipating the joint venture with Alibaba to handle US$65 billion worth of goods once in full flow, and create 60,000 jobs by 2025. The goal is for small businesses to make use of the trade hub as easily as larger companies do. It will also be used for non-ecommerce purposes, such as global exports.
The hub will likely benefit Lazada, which has a mix of small merchants and big-name brands.
10. Grab’s massive war chest
The final big story of the year: Grab’s US$2 billion funding round from China’s Didi Chuxing and Masayoshi Son-led Softbank, the single largest financing in the history of Southeast Asia.
The new investment supposedly gave the firm a post-money valuation of over US$6 billion, making it the region’s most valuable startup.
Grab will use the money to tighten its grip on the ride-hailing market in the region and invest in its mobile payments solution, GrabPay.
The company has made GrabPay available to use for payments at hawker center stalls and restaurants in Singapore, marking its biggest move yet outside of the transportation segment.
This post 10 tech stories that rocked Southeast Asia this year appeared first on Tech in Asia.
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