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One of Singapore FinTech Association’s objectives will be to help final-year polytechnic students explore cross-border fintech-related roles

Students from Singapore’s local polytechnics seeking a job in a fintech-related industry will now get a leg up from the Singapore Fintech Association (SFA).

Today, the SFA signed a Memorandum of Understanding (MOU) with these five polytechnics. The MOU builds upon last year’s PolyFinTech 100 initiative, which was designed to help students build fintech skills through mentoring and internships.

Likewise, the SFA will help final-year polytechnic students find internships in fintech-related roles.

These will include internships in startups, financial institutions and regulatory within the fintech ecosystem, both within and outside the border – to give them a holistic perspective of regional and global fintech markets. The SFA will also assign mentors, VCs and incubators to help train students.

The SFA will also launch at least 10 fintech innovation labs. Through exhibits, facilitated tours and programmes, students will be exposed to a range of fintech technology created by established fintech companies such as mobile security startup V-Key and KPMG Digital Village; as well as those rolled out by major financial institutions including HSBC, Open Vault, The FinLab, Visa and Mastercard.

Also Read: Infographic: Why China is the world’s best fintech market

Additionally, the SFA is expected to conduct 100 educational workshops to give students a hands-on experience with the latest fintech innovations. For example, V-Key will host a workshop on how advanced mobile security enables digital banking innovation.

“Following the PolyFinTech 100 launch during the last quarter of 2016, we have gathered good momentum and achieved our target of securing 100 internships within two months. We are excited that this timely partnership with SFA will help open up more opportunities for polytechnic students to keep abreast of the FinTech sector’s evolving needs, fuel their passion for the sector and upgrade their skillsets to meet industry demands,” said Clarence Ti, Principal of Ngee Ann Polytechnic, the SkillsFuture Sector Coordinator for Accountancy and Financial Service, in an official press release.

According to a survey conducted by the Infocomm Development Authority of Singapore in 2015, 5,100 job vacancies are expected to open up in the network and infrastructure sector from 2016 through 2018, with a further 5,700 jobs in data analytics and cyber security. This collaboration will help ensure the new job seekers are well equipped for these roles.

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Even if you don’t necessarily make unicorn status, for some entrepreneurs, it’s all about the journey

Marc Benioff, Richard Branson, Kevin Systrom, Marc Cuban, Aaron Levie, and Evan Williams — What do these names have in common? They might not be familiar at a glance, but most likely, you have used products and services these successful entrepreneurs have launched.

From Salesforce, Virgin Airways, Twitter, Box to Instagram, these entrepreneurs started small but today their ideas rule the world. If you are thinking of launching a startup, you have to be ready to do heavy lifting, and it is no wonder most people quit.

According to a Fortune Report, 90 per cent of startups collapse for many reasons. If you want to be among the 10 per cent who succeed, you have to learn from those who came before you. You might have an incredible business idea, but if you don’t do your homework, it is bound to fail.

To help you avoid the blunders most entrepreneurs make, here is a guide on what you should do and what to expect as you wade through the competitive world of modern business:

1. Research the market

In the Fortune Report, the top reason for business failure is the lack of market for a product. If you look at the most successful startups today including Twitter, Instagram, and Facebook among others, they have come up to fill a gap in terms of message and image sharing. The availability of internet connectivity means people are more connected and as such, there was a need for instant sharing. The products or service you choose must be perfect for the market if you are going to make a mark in your niche.

Also Read: From unknown to unicorn: 8 tips in running a successful startup from Grab’s pioneering employees

2. Sell something you are passionate about

While most startups today are big on technology, you don’t have to jump into the bandwagon if you are not passionate about this field. For your brand to grow, you must believe in it. This is the only way you will be passionate about promoting it. If business is bad, you will remain motivated and that is how brands such as Apple grew even when the world thought Steve Jobs would fail faced with competition from bigger brands.

3. Be radical

If you are going to start a business, make sure it is uniquely bold. It has to be an idea that is disruptive because this is the only way people will notice it. Consumers are used to the same variation of products and they are now looking for radical ideas to make their lives better. The idea is to come up with an idea that is radically different and from here, make it radically better

4. Start small, but dream big

Most startups fail because they inject all their capital as they enter the market and a few months down the line, they can not meet operational costs. It is advisable to keep costs as low as possible as you start because you are still testing the waters. This gives you time to study the competition and understand the market from inside.

Also Read: 6 ways entrepreneurs successfully handle sales slumps

5. Make mistakes

If you are venturing into business, you should never be timid because this will cost you. Always try out new ideas and when they don’t work, stop looking back. It is important to listen to constructive criticism because this is the only way to learn and grow. Even the richest entrepreneurs today encourage startups not to fear making mistakes when they are testing their business models as these will turn out to be the foundation of success.

6. Be flexible

You might have the best business idea, but if you are not willing to change it to accommodate the realities in the market, you are doomed. It is important to be flexible because this means the business keeps going. If you stick to your reasoning alone, you end up losing invaluable time and it might not be easy to recoup.

7. Be realistic

Of course, every entrepreneur is hopeful that things will work out but you should not peg all your investment on hope alone. You must have a contingency plan to overcome unexpected occurrences. Most startups run out of cash fast because they feel that the tide will turn soon enough. You have to expect difficulties in the contemporary business environment and have some plans on how to cope with them.

Also Read: Crowdfunding corner: 9 steps to a successful fundraiser

8. Take things easy

Building a successful business is a marathon not a sprint, and many would-be entrepreneurs have learnt this the hard way. You have to avoid the speeding urge and instead build sustainable systems that will guide your business as it gradually expands. Burnout is not uncommon among entrepreneurs and it ruins even the best business ideas.

With these tips, you can now start doing your research and remember to take your time before plunging into the market.

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The views expressed here are of the author’s, and e27 may not necessarily subscribe to them. e27 invites members from Asia’s tech industry and startup community to share their honest opinions and expert knowledge with our readers. If you are interested in sharing your point of view, submit your post here.

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The decision comes in the wake of strong protests by city’s public transport utility BMTC, whose revenues were hit by carpool service offered by online cab operators

In a major setback, the Transport Department asked online cab aggregators including Uber and Ola to stop car-pooling services in Bangalore, according to various reports.

According to the department, car-pooling by aggregators is a direct violation of the the Motor Vehicles Act of India.

After a meeting with the representatives of online cab operators in the city, Transport Commissioner MK Aiyappa told reporters that cabs cannot pick up from and drop passengers at multiple locations before the end of each trip. It is also posing huge security risks, as passengers especially women have to share rides with strangers.

The cab companies have been given three days to comply with the rules, after they asked for time to make necessary changes to their software. Violators will be booked and prosecuted after this period, added the Commissioner.

Also Read: Zupp aims to bridle BlaBlaCar’s Ryde with its GPS-based car pooling app

The decision comes in the wake of strong protests by city’s public transport utility BMTC. In a letter to the transport department, BMTC managing director Ekroop Caur said its revenues were severely hit due to carpool offered by online cab operators.

Pooling has been one of the major revenue sources for online cab operators in India. While ride-sharing helps the consumer to save money, it also helps reduce pollution to a certain extent. More over, in a city like Bangalore, notorious for traffic snarls, car-pooling is the best alternative.

It is not the first time cab operators are facing music in Bangalore. Last year, Uber and Ola were asked to stop their respective bike-taxi service in the city, after the state government termed it illegal.

Image Credit: iqoncept / 123RF Stock Photo

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As a realisation of the previously announced partnership, the option to book for Blue Bird taxis is now available on Go-Jek’s Go-Ride service

A partnership between Indonesian ride-hailing service Go-Jek and taxi company Blue Bird, which had been announced since mid-2016, has finally shown its result. The Go-Jek app (particularly on iOS platform) has officially been renewed with a feature that allows Go-Jek users to book for Blue Bird taxi through the Go-Ride service, which also includes the use of Go-Jek’s cashless payment service Go-Pay for payments.

Blue Bird taxis are now included as transportation options in Go-Ride

The two parties had previously stated that the partnership will involve three aspects: technology, payments system, and promotion channels. The partnership becomes a refreshing take as Blue Bird has been known to reject ride-sharing services ever since its launch in the country.

Blue Bird itself has its own booking app My Blue Bird. It has also been renewing and improvising recently, in order to compete with other online booking services.

Also Read: Developing: Go-Jek and taxi company Blue Bird to announce partnership

On a separate occasion, Blue Bird Online Operational Director Sigit Djokosoetono stated that the expansion of taxi booking channel is a business strategy that the company is currently focussing on. One of them through the partnership with Go-Jek.

The move was based on data recorded by Blue Bird, which revealed that by mid-2016 taxi booking via app has reached 30 per cent of its total incoming bookings. By opening up more online channels, there is a potential to expand the company’s consumer reach.

From the competitor’s side, Uber and Express Group announced by the end of last year that they are exploring partnerships by announcing a ride integration pilot programme and financing programme in Jakarta. Through this partnership, Express taxi drivers will be able to use UberX service to pick up bookings. Uber drivers will also have the option to finance their vehicle purchase through Express Group, without any taxi attributes or brandings, as part of Uber’s Vehicle Solutions programme.

Like Blue bird, Express already owns MyTrip as the official app to book its services. According to Express Group COO Benny Setiawan, generally Express Group’s partnership with Uber is meant to increase the utilisation of the company’s fleets, which consists of 11,000 unit of taxis across Indonesia.

Also Read: Uber explores partnership with Indonesian taxi company Express Group

The Blue Bird-Go-Jek partnership has opened a new chapter in the Indonesian land transportation industry. When industry players have shown signs of acceptance towards ojek (motorbike taxi) through digitalised services, today taxi services have begun to explore more serious partnership with on-demand service providers. The partnership is expected to breed better innovation to provide more convenient public transportation services for the society.

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The article Taksi Blue Bird Kini Bisa Dipesan Melalui Aplikasi GO-JEK was written by Randi Eka Yonida and was first published on DailySocial. English translation by e27.

The views expressed here are of the author’s, and e27 may not necessarily subscribe to them. e27 invites members from Asia’s tech industry and startup community to share their honest opinions and expert knowledge with our readers. If you are interested in sharing your point of view, submit your article here.

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Mobile virtual network operators (MVNOs) will not be exempted from this new regulation

Mobile telecom operators in Thailand have been ordered to implement an online fingerprint ID system for new SIM registrations, according to a report by the Bangkok Post. The new regulation is expected to roll out by March, and is applicable to both new prepaid and postpaid SIM card registrations.

The National Broadcasting and Telecommunications Commission (NBTC) said that mobile virtual network operators (MVNOs) will not be exempted from this rule. This is despite calls for MVNOs for exclusion, citing additional costs that will make them less competitive than major telcos.

Also Read: Thailand government pushes businesses to help build smart cities

Any telco found violating the rule will risk incurring fines, having their license revoked, a ban from receiving new numbers from the regulator. It will not be compulsory for existing mobile subscribers to register on this new system.

This policy marks a push by the Thai government to safeguard its increasingly digital-driven economy. About 14 million of Thailand’s 103 million mobile subscribers use mobile banking services; an online fingerprint ID system will help to mitigate frauds arising from these mobile financial transactions.

Each registration via online fingerprint ID system will cost between 1,000 (US$28.50) to 2,000 baht (US$59) for the mobile operator.

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Consistency, targeting, and distribution channels are key to an effective content strategy

Businesses that use content marketing enjoy 7.8 times more website traffic than businesses that don’t.

The question is how to make it work for your business.

After spending more than six years with different businesses in all type of industries, I have learned three simple rules that can make or break your content marketing strategy.

These three rules are as follows:

1. Publish consistently on your blog

Do you’ve an editorial calendar for your brand?

Do you know how many blog posts will be posted next month?

How often do you post new content?

An editorial calendar tells you when you’ve to publish, what has to be published, and why exactly you should publish.

Even if you are to publish a single blog post a month, be sure you do it consistently. You’ll not see results in the early days, but that shouldn’t stop you from updating your blog.

Stick to the plan – even if it doesn’t work.

A content editorial calendar helps you with supplying meaningful and purposeful content to your blog. Large businesses like CoSchedule (publishes 7 to 10 posts a week) as well as small businesses like Jeremy Diamond (publishes 2 to 3 posts a week) use content editorial calendars to make sure they know what they have to publish and when it has to be published.

When you publish content consistently on your blog, it has several benefits such as search engine crawlers have something new to crawl every time they visit your blog, your readers will have something new to read, it drives traffic from search engines, and more.

Keep updating your blog often and consistently.

It will work eventually.

Also Read: Definitive steps to a content marketing strategy your customers will love

2. Convert and distribute content

Publishing on your blog isn’t enough. You’ve to distribute content so that you reach a larger group of your target audience that is, otherwise, unable to find you and/or your content.

Not everyone likes reading articles. Most of the people love watching videos and they spend more time on YouTube than on social networks.

A good chunk of your target audience might never visit your website unless they see a video or maybe read a PDF or maybe listen to a podcast.

Arjun Reddy, the founder of Super Baby, shares his experience with content distribution for his website:

“Ever since we started using images and videos for promotion, we have seen a massive rise in traffic and conversions. The same piece of text from our website is converted into images and videos, and it performs better than our website.”

Are you distributing content on all the networks?

Is your business converting and distributing content to reach a larger audience?

Most probably not.

But the businesses that do so are seeing awesome results like Cox Media (60 per cent increase in client inquiries) and Blackbaud (800 leads generated).

Here is how to do it.

1. Convert your blog post into other content types like video, PDF, slides, podcast, infographic, white paper, case study, email series, webinar, etc. It is little extra work that doesn’t cost you a lot of bucks because you’ve the content.
2. Distribute content on leading websites like video streaming websites, image sharing sites, syndication networks, etc.
3. Repeat.

There will come a time when a single blog post will drive hundreds and thousands of visitors from multiple sources.

Also Read: Advice for startup freshmen: How to develop a content marketing strategy that works

3. Understand your target audience

Don’t tell me you don’t have buyer personas.

Create them.

According to Pamela Vaughan from HubSpot, buyer personas help businesses in understanding their customers. With buyer personas, you can create personalized content and products for target audience based on their unique needs and challenges.

If you don’t know who your audience is, what are its interests, what are its needs, challenges in life, objectives, average income, etc. it seems to be pointless to write content for them.

You simply cannot make your content appealing.

Create buyer personas. Understand your target audience.

That’s it

These three content marketing ideas will help you achieve results that you haven’t thought of. Let’s surprise your competitors.

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The views expressed here are of the author’s, and e27 may not necessarily subscribe to them. e27 invites members from Asia’s tech industry and startup community to share their honest opinions and expert knowledge with our readers. If you are interested in sharing your point of view, submit your post here.

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SoundHound’s platform promises to open up the race on voice command technology with Google Assistant, Siri, and Alexa. Samsung and NVIDIA might be eyeing incorporation into self-driving cars

Houndify’s collective AI mission fits right in with Samsung’s IoT plans and NIVIDA’s self-driving car strategies (screenshot)

Player 3 has entered the game. SoundHound announced a gargantuan US$75 million funding round Tuesday led by Samsung Catalyst Fund and NVIDIA with an eye on spending to better develop a rival to Google Assistan, Siri, and Alexa. If recent moves by the corporate titans are any indication, the move will have dramatic implications on the autonomous vehicle race.

SoundHound will use the funds to invest in what it calls “Collective AI,” which the company defines as “a powerful architecture giving users of the platform the power to bring voice-enabled AI to everyone, everywhere.” In other words, it could be a stepping stone to more fluidly allow different search and automation algorithms to work in sync.

The company debuted its voice assistant platform Houndify in March 2016 for both Android and iOS with an eventual goal of writing an algorithm that could surpass its chief rivals over at Apple, Google, and now Amazon. The platform lets third-party developers (they claim 20,000 use it right now) build their own assistant programmes and claims to be the only one of its kind that can “integrate voice and conversational intelligence into their products” according to a marketing video.

“We are at the inflection point of our long-term vision that every product or service needs to have a smart voice-enabled interface, and consumers have increasingly high expectations for this requirement, beyond simple commands or skills,” SoundHound CEO Keyvan Mohajer said in a press release.

Also Read: Artificial Intelligence can democratise healthcare access in India, says Manish Singhal of Pi Ventures

Developers have used it to help with their projects on NVIDIA and Samsung’s ARTIK Smart IoT platform.

“With this strategic investment, we will bring the power of the proprietary technology behind our independent Houndify platform to even more users globally and amplify the rollout of our Collective AI architecture.”

Samsung and NVIDIA hit the road together?

This investment by Samsung via its Catalyst Fund shows the technology giant is definitely in the voice recognition game and comes amid early reports of an assistant app dubbed Bixby on the Samsung Galaxy S8. It follows a low-lying presence at CES for Samsung, where technologies like Amazon Alexa went out of their way to try to steal the show. Samsung incorporated a personal assistant into one of its refrigerator models, but that was about it — hardly a real offensive against rivals Google Home and Amazon Echo.

There is more here to Samsung’s possible strategy, evident with the addition of NVIDIA that could point to autonomous vehicles. NVIDIA has gone all in on self-driving cars of late after announcing two separate partnerships with Audi and Mercedes-Benz to build autonomous vehicles. Samsung is in the running to close a colossal US$8 billion acquisition of Harman, which debuted its on self-driving concept on the show floor in Las Vegas earlier this month.

Also Read: The long, winding road for bot and Artificial Intelligence in Indonesia

Google has been aggressive with its debut of Assistant and chat app Allo in 2016, as has Amazon.

Global Catalyst Partners, Walden Venture Capital, and Translink Capital were returning investors for what is considered a Series D financing round. New investors include the creatively branded MKaNN, Japanese firms Nomura Holdings and Sompo Japan Nipponkoa Insurance, Kleiner Perkins Caufield & Byers, Recruit Holdings’ RSI Fund, and finally the SharesPost 100 Fund.

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The article With eye on self-driving cars, Samsung and NVIDIA invest $75 million in Soundhound to battle Alexa, Siri first appeared in Geektime.

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Building a business is not all fun and games

Starting a business is easy; running a business is more complicated. If you have a great business idea, it’s smart to plan ahead and avoid some of the most common pitfalls and concerns, so that your company can easily survive the big problems that tend to plague businesses over their first two years.

Here are six mistakes that can kill your startup in the first couple of years:

1. Cash flow problems

Difficulty with cash flow might be one of the most common problems for new businesses. You haven’t yet learned your cycle with busy and slow times, you may need to purchase more inventory or stock than you will in later years, or you may have spent most of your initial capital in getting set up.

To make sure your business does well over the first few years, you should either have plenty of capital held in reserve, to cover any lean times that arise, or you should plan carefully for all potential slow periods, and make sure that you have what you need to get through them, budget-wise.

2. Personality mismatch

You might have decided to go into business with your spouse, your best friend, or a buddy from college. But as you start to work together, you find out that the two of you just work in such fundamentally different ways that you struggle to find common ground.

How you handle this problem depends on how serious the issue is. Do you just find that your friend’s chewing with his mouth open is seriously disgusting, and you wish you never had to look at it again, or is your spouse’s inability to stop talking about work at home starting to affect your relationship? Taking a serious look at the problem and its source will help you know what to do. Consider carefully: Which is more important, your business or your relationship?

3. Heavy focus on funding

On the flipside of the overextending problem, companies can become so focused on going through rounds of funding and trying to be seen as a unicorn that they completely forget to deliver a functioning product. Plus, companies that give away all of their assets in early rounds of funding can find that they have seriously devalued their companies before they even get started.

Also Read: Startup funding in 2017: A different game?

If you can save up the cash to get your company off the ground on your own, that is always going to be the best way to get started. Save funding rounds for when you have something to show. You’ll get a better deal and be more successful as well.

4. Doing it all Yourself

One obvious way to cut costs when you’re bootstrapping a startup is to just take care of things yourself. It makes sense, after all. Handle the books, combine the content marketing and SEO, design the product, get the website up and running. It’s a good way to get moving, but it’s no way to run a business over the long term.

To avoid getting stuck managing everything at your company, make a list early on of what you’re good at, and what tasks would be best outsourced. Then, as your company begins to gain traction, outsource those pieces one at a time. What you need to offload first is going to be individual.

Some entrepreneurs are more than comfortable managing the books for years, but want to outsource social media the very second they can afford it; some prefer the reverse. The important thing is to focus on what you’re good at, and delegate the things that you’re not good at.

5. Overextending

Many bootstrapped businesses end up running through their early years mostly on credit cards. While this is certainly a solution, it is far from the ideal one. It places a great deal of stress on the entrepreneur to make the business succeed, which can actually be counterproductive. Also, if credit is the company’s only real source of capital, what happens if they run out of credit?

Also Read: Is your entrepreneurial journey just another rat race? Here are 20 things that say it might just be so

To help avoid this problem, exhaust every possible source of capital before you look at credit cards as a viable option. Try local banks, small business administration loans, credit unions, and more. Be very, very careful any time you put up personal assets for business money.

6. Failing to pivot

Absolutely no business or endeavour goes according to plan. A business plan should be a strategic document that lays out the crucial aspects of your company, but it should also give you a roadmap to flexible functioning. If your business plan is rock solid, but offers no room for change, it is not serving you as well as it could.

What are the biggest mistakes you see in new startup businesses?

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The views expressed here are of the author’s, and e27 may not necessarily subscribe to them. e27 invites members from Asia’s tech industry and startup community to share their honest opinions and expert knowledge with our readers. If you are interested in sharing your point of view, submit your post here.

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The deal was announced by InnoVen Capital, who also revealed a funding of the digital media company Conversant Solutions

InnoVen Capital, a joint venture between Temasek Holdings and United Overseas Bank, announced today it has inked two venture debt deals with Malaysia’s 123RF and Singapore’s Conversant Solutions.

The financial details of the deals were not announced, but InnoVen did highlight that both of these startups would be considered later-stage enterprises.

123RF is a company that has leveraged its large stock photo library to compete on a global stage and grow into one of Malaysia’s success stories.

Conversant Solutions is a company that facilitates digital media production with its ‘Swift’ brand of products. They include services like file transcoding, cloud integration and a content management system.

In January, Conversant signed an MOU with Alibaba Cloud to build an online education platform in Kuala Lumpur called EduCloud.

Also Read: The Jay Kim Show: Pat Flynn on niching down to build authority

Raising money through the venture debt route is an alternative for companies looking for a cash injection without raising a VC round or taking out a bank loan. It is often used for growth capital for startups who may not pass the metrics used by traditional banks.

An alternative cash-injection

According to an InnoVen spokesperson, the structure is similar to a bank loan, but they do not require personal guarantees (sometimes banks ask for business owners to use their own financial assets as collateral). InnoVen also has limited financial covenants (metrics that the company is expected to meet).

What makes it different from VC funding is the notes are not convertible, which is why it an attractive avenue for growth-stage companies. Investors and owners in 123RF and Conversant Solutions will see the company get a cash injection without much dilution in their stake in the company.

Also Read: 6 lessons learnt from Startup Weekend Singapore final pitches

“InnoVen isn’t limited to funding earlier-stage companies. We also provide venture debt to larger tech enterprises as a complimentary funding source to equity financing,” said Chin Chao, the CEO of InnoVen Capital, Southeast Asia, in a statement.

“Both the 123RF and Conversant deals exemplify the important role that venture debt plays throughout a company’s life-cycle.”

InnoVen Capital is expecting to ink 50-60 deals in 2017, according to the spokesperson.

The venture lending platform is active across Southeast Asia and India.

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Image credit: gmast3r / 123RF.

Venture lending firm InnoVen Capital announced today it has extended loans to stock image database 123RF and digital media services provider Conversant Solutions.

InnoVen previously secured deals with fitness subscription app KFit and fashion marketplace Pomelo.

Startups keen on venture debt, a new concept in Southeast Asia given the ecosystem’s youth, have multiple options to choose from. InnoVen, which operates out of Mumbai and Singapore, expanded to Southeast Asia last March. It expects to do US$500 million worth of venture debt deals in Asia in the next five years.

Venture debt allows us to keep our equity – it is a cheaper form of financing.

A month later, government agency SPRING Singapore launched a venture debt program with three banks, aiming to finance up to US$355 million by 2018. One of the partner banks, UOB, has been offering venture debt since 2014.

Details on the 123RF and Conversant deals are undisclosed. 123RF has been fully self-funded and is profitable. However, 123RF took up the deal to build a relationship with the venture lending firm and help itself with some operating expenses, founder and CEO Andy Sitt tells Tech in Asia.

“Venture debt allows us to keep our equity – it is a cheaper form of financing,” he says. 123RF has about 1 million paying customers and over 12 million monthly active users.

Conversant is headquartered in Singapore and has offices in Shanghai, Malaysia, and the Philippines. Its customers include telcos like Singtel and Axiata, media companies like Singapore’s Mediacorp, and companies like IBM, Visa, and Canon.

“Venture debt generally applies across all tech industry verticals,” InnoVen Southeast Asia CEO Chin Chao tells Tech in Asia. InnoVen doesn’t limit itself to early-stage companies either, as demonstrated by the deals with 123RF (founded in 2005) and Conversant (founded in 2002). “Both deals exemplify the important role that venture debt plays throughout a company’s lifecycle,” he adds.

123RF has been fully self-funded so far. Photo credit: 123RF.

Another way to finance

InnoVen is a joint venture between Temasek Holdings and UOB and was born when Temasek bought SVB India Finance, a notable venture debt provider in India. The deal, worth US$48 million, was announced in April 2015.

Venture debt is a type of loan that can be used by a company to carry it over a particular threshold between venture capital fundraises or to purchase necessary equipment. It has the advantage of not diluting the company’s ownership, since the financer doesn’t take equity in return for the funds. It’s also not as demanding to the borrowing company in terms of collateral – which bars a lot of startups from qualifying for more traditional business loans.

However, as debt, it needs to be repaid, which means it’s not just easy money for a startup if it doesn’t have a clear view on how to pay the money back.

InnoVen does not require equity in the companies in return for the funds.

As a venture lending firm, InnoVen does not require equity in the companies in return for the money it extends. Rather, returns come through interest and fees on the loans, among other things.

These comprise a fixed return component, while a variable component is based on warrants for the financed company’s stock. In other words, InnoVen has the option of receiving stock in the borrowing company.

The firm doesn’t disclose the kind of returns it expects in these two deals.

InnoVen Capital Group COO and Innoven India CEO Ajay Hattangdi has told Tech in Asia that venture debt is both “extra runway” and an “insurance policy” for companies. It’s not meant to replace equity funding.

See: 16 years after Citibank shot him down, his venture debt firm scores in India and SEA

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