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Despite growth, there is still a lot of headroom for further innovations

Edtech or edutech — or employing technology to meet the growing demand of providing learning or education related solutions — has recently seen a lot of interest and traction in India, especially in the startup ecosystem. Whether it is learning a new language, or supplementing a full-fledged K-12 education, or supporting higher education, new age startups are helping bring multiple stakeholders — learners, tutors, content providers, parents — in the value network together through their technology-led solutions.

According to the India Brand Equity Foundation (IBEF), India has nearly 1.5 million schools, with over 200 million students enrolled. In addition, more than 36,000 institutes exist for providing higher education, making India one of the largest higher education systems in the world, with over 70 million students enrolled.

Despite this, there is still a lot of headroom for further growth and development. The government has launched a number of initiatives to further skill development and education in the country by increasing budgetary outlays, through public private partnership models to establish higher learning educational institutes, and flagship programs such as the Pradhan Mantri Kaushal Vikas Yojna, National Skill Development Mission, and the National Policy for Skill Development and Entrepreneurship 2015.

Also Read: 500 Startups-backed edtech startup OnlineTyari acquires video sharing app Plix

At the same time, while increasing enrolment continues to be an objective, improving learning outcomes and efficacy of learning programs is increasingly in focus, especially for government schools where a majority of students are enrolled. All these underline the growing importance — and acceptance of this importance — of learned and trained human resources in furthering the growth of the country.

A scalable and sustainable education infrastructure will be a key contributor to achieving these objectives, self-learning will play a significant role in the coming years, and non-government actors are expected to pull their weight by bringing in disruptive enablers.

Here are some trends that we can expect to see in 2017 in the edtech sector:

#1 – Assisted learning and use of multimedia in tele-training. More people will use additional modes of learning to complement their primary learning methods, viz. classroom learning. Learners are now increasingly looking at more sources of information — unlike in the past wherein they relied on their textbooks and notes given by teachers in the class or coaching centres.

The success of Wikipedia (which has emerged as the third most-read website globally), after Google and Facebook) and MOOC (massive open online course) platform like Coursera, demonstrates this amply. Platforms that are able to provide credible information to readers, and not focusing solely on making money from transactions, will definitely rule the internet.

#2 – Learning in their own language. With the advent of technology and the worldwide web being available to everyone and in the language that they are most comfortable in, people will be increasingly attracted to the online medium to gain knowledge. As per the data shared by Indian Languages Digital Festival (ILDF) organised in Mar 2016:

• India has 957 million telecom users. Each month, 8-10 million Indians connect to the internet for the first time, mostly through a mobile phone.
• Facebook has 100 million users in India, of which 85 percent access the social networking site via mobile. Especially in rural India, where teledensity has massive headroom for growth, users will more than quadruple in 4 years’ time.
• Over 54 percent of all Internet users in India will be over the age of 25, of which 40 to 50 per cent will be in rural areas.
• Nearly 30 per cent will be women.
• Nearly 90 per cent will access the Internet through a mobile device.

Also Read: There’s no app for that: For this learning startup, the solution to effective education goes beyond tech

This means that rural population has started taking to the Internet in droves. However, most of these new users will be challenged for fluency in English, and will prefer their native language for ease of understanding and comfort with the learning solutions. Digital solutions, led by good translation services to make learning content available in local languages is the need of the hour. The Digital India initiative will further accelerate the demand for such translation services.

#3 – Indian content available online is chiefly in English, and a very small percentage of this is translated into any Indian language. To bring a change, we need a good translation solution to deliver the available content in local languages. With government’s latest initiative, Digital India, in action. the demand for quick translation services for digital content is going to increase.

#4 – Rise of smartphones and other digital enablers for education. India has clearly leapfrogged desktops and laptops and directly joined the mobile-first bandwagon. Most of the education content will have to be mobile-friendly, since the next 300 million people expected to join the internet will access it over their phones.

As per a report by IAMAI and KPMG, “The number of mobile Internet users in India is expected to grow to 314 million by the end of 2017 with a compounded annual growth rate (CAGR) of around 28 per cent for the period 2013- 2017.” This growth will be a result of government’s Digital India initiative, along with support from mobile internet ecosystem and innovative content and service offerings from mobile-based services players.

#5 – Use of Big Data and Artificial Intelligence to personalise teaching online. Users of online learning tools will expect greater emphasis on understanding the pace and effectiveness of their progress and professional learning. Data analytics and artificial intelligence will have a significant role to play in shaping the delivery of personalised yet automated feedback and reports to these users.

 Also Read: After Mark Zuckerberg, World Bank unit invests in Indian edtech startup Byju’s

#6 – More egalitarian access to learning resources online. Until a few years back, people from Tier II and III cities had to migrate to bigger towns, or else they were forced to let go of their dreams because of unavailability of training and coaching facilities in their small towns. This is going to change very quickly. As per the president of the UPSC students’ association in Pune, there has been a drop in the number of students going to traditional coaching classes recently. Many of the students prefer to invest in mobile apps, than incurring stay and coaching expenses in metros or other cities.

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This is an article contribution from Vipin Agarwal and Bhola Ram Meena, Founders of OnlineTyari.

The views expressed here are of the authors’, 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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Renowala is an online marketplace that brings together homeowners, interior designers, and other home improvement professionals

Nearly 70 startups cropped up in the on-demand home services vertical in India in 2015 when the growth of consumer internet was at its peak. Every startup in this space was betting big on rising migration of people from smaller towns to major cities like Bangalore, Mumbai, and Delhi.

Investors, too, sensed massive opportunities and poured in massive dollars to the likes of UrbanClap, Zimmber, TaskBob, and Housejoy.

However, an investment slowdown that set in towards the second half of 2015 turned things around. Consumer internet began to feel the squeeze, and home services startups were among the worst hit. Unable to raise investments, a few home/local services startups shuttered, some pivoted their business model, while a few got acquired. While players like Housejoy and UrbanClap weathered the storm, startups like Doormint faced an untimely death.

While all this hullabaloo was happening in the market, a startup was slowly and cautiously making inroads into home services — a space with a lot of potential. The negative sentiment in the market did not affect the startup, Renowala, which later went on to raise two rounds of funding.

The Renowala app

“Companies entered this segment with the hope of cashing in on the the rising migrant population to provide home services. But things did not go well for them, and when real challenges came their way, they floundered,” Joshua Kumar, Founder and CEO of on-demand Renowala told e27. “Amidst the fuss, we were quietly building our venture. We weathered the storm and managed to win a decent number of customers. We are now looking to grow fast in the coming months.”

Also Read: Indian on-demand home services startup Taskbob buys Zepper

Based out of Hyderabad, Renowala is an online marketplace that lets interior designers and home owners to come together for their home improvement and design requirements. It has over 2,000 service providers live on the platform. Currently, Renowala has operations in Chennai, Bangalore, Mumbai, Delhi, and Hyderabad.

The firm raised its first round of funding in November 2015, from the promoters of software technology firm Logtally. The second round came in 2016 from FMCG veteran Pradeep Dhobale.

Renowala is now on the verge of launching a mobile app, which Joshua claims will revolutionise the home improvement services space in India. “The app comes with a three simple actions for consumers — open, tap and connect. There are only four personal details required for registration. Once the required service is selected, the customer just has to wait for the service provider within a 10km radius to connect with him/her,” added Kumar, who is also CEO of AceOne Ventures (Singapore) and Vice President at Springforth Capital Advisors.

The app will be providing 20 services that have been carefully selected using data mining information on the most frequented requirements. The services offered by Renowala include interior design, electrical repair, gardening, pest control, house cleaning and plumbing, and Vastu.

Service providers within these 20 services can register as Renowala partners. They only pay 50 rupees (under US$1) for each lead they accept, which is exclusive to them only.

According to Kumar, among a host of on-demand home improvement services, UrbanClap is probably the only startup that Renowala is facing serious competition from. “UrbanClap, with a huge war-chest, is probably our only competitor. But there is still a lot of room for multiple players, as India a vast country. In fact, the existence of multiple players have made it easy for companies like us to enter the market without spending much on educating the customers and creating awareness,” he added.

Also Read: Home services in great demand in India but low frequency dogs startups

Joshua Kumar, Founder and CEO of Renowala

He also estimated that India will experience an 11 per cent annual growth in the home improvement sector. 

Kumar said that the company has been getting a lot of interests from the VC community. “We are keen to raise more capital to further develop our operations and at the same time we are also selective on stakeholders who can contribute strategically to other supporting roles and responsibilities within the business,” he concluded.

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Samsung refutes the decision to seek the warrant, which will be decided on Wednesday

The political scandal that has engulfed South Korea, led to impeachment proceedings for President Park Geun-hye and revealed a rasputin-type character in Choi Soon-sil has come home to roost for one of the country’s most powerful businessmen.

South Korea’s special prosecutor’s office announced today they will seek an arrest warrant for Jay Y. Lee, the Head of Samsung Group, and accused him of paying multi-million dollar bribes to Choi to favours with the government, according to Reuters.

A hearing will be held on Wednesday to decide whether or not to move forward with the arrest warrant.

The amount of money Lee is accused of paying in bribes is an astounding SKW43 billion (US$36.42 million). The accusation claims he did so to facilitate the merger of two affiliate companies (Samsung C&T Corp and Cheil Industries) in 2015 to secure his position as head of Samsung.

Involved in the scandal is the chief of South Korea’s public pension fund, Moon Hyung-pyo, was indicted today and charged with abuse of power and giving false testimony. He admitted to ordering the pension fund to support the merger when he was in charge of the Health Ministry.

Samsung has refuted the recommendation, saying “It is difficult to understand the special prosecutors’ decision,” according to the Reuters article.

Also Read: 7 Asian startups putting the spotlight on agriculture

Choi, who had the ear of President Park, is accused of setting up questionable non-profits and convincing South Korean businesses to donate to the organisations to curry favours with Park. She would then use the money for her own personal reasons.

Samsung was the largest contributor to these organisations and does not deny the donations. It does, however, oppose the claim that the money was used to push through the merger.

Last Thursday, prosecutors questioned Samsung’s Lee for 22 hours in connection with the political scandal.

One interesting wrinkle of the investigation was the special prosecutor’s office spokesperson Lee Kyu Chul told reporters on Sunday that the office would consider the import of Samsung on South Korea’s economy when deciding whether or not to move forward.

Today, the spokesperson said, “While the country’s economic conditions are important, upholding justice takes precedence,” according to the Reuters article.

Jay Y. Lee became the de-facto head of Samsung when his father Lee Kun-hee, the Chairman of Samsung, had a heart attack in 2014.

Also Read: Calling all techies! These 10 jobs might be right for you

The political scandal has rocked South Korea and resulted in massive protests that led to the impeachment proceedings against President Park. She denies any wrongdoing but her approval rating sank to a record low of 4 per cent.
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Because doing good is good business

I often hear this from people:

“I need to make sure my business can survive before I start thinking about doing good.”

Or:

“When my startup gets to X size, we’ll start giving back to the community.”

Does this sound like you?

Well, what if I told you that you can create social impact right now without sacrificing that unrelenting focus on growth your investors (or soon-to-be investors) demand? No matter what size or stage your startup is at, and without breaking the bank!

Here are 3 easy things that you can do to get started right now:

1. Put your money where your mouth is

Your purchase decisions can create huge impact — both negative and positive. So, when you have the choice, and with all things being equal, why not source your stuff from social enterprises?

Need some business cards or would like to send a special thank you card to a client? Get your printing and design work done by Words with Heart, an eco-stationary and custom printing that funds education for women and girls in developing countries.

Hosting Friday night drinks with the team this week? Do you know what tastes extra refreshing and delicious, with a hint of saving the world? You can get your weekly craft beer fix from local social enterprises like The Good Beer Company and take a cool swig of their Great Barrier Beer, all in support of Australia’s greatest marine park — the Great Barrier Reef!

Another favourite of mine from the boys in Byron Bay is Stone & Wood. Doing good can be as easy as heading to your local bottle-o and grabbing a case beer.

Is wine your poison of choice? Melbourne-based Kooks makes socially-conscious handcrafted wine and “leave out all the usual stuffiness, stinginess and snobbery you often find in ‘good wine’,” (according to them).

Mmmm tastes like this could be good for the world …

When you’re choosing where to source from, why not check out the many social enterprises around the world (and right here in Australia) that provide top quality products, sourced from ethical sources, that are environmentally friendly, and/or support local communities.

For a quick go-to source, check out the B Corporation Certified organisations from around the world. This certification is like the fair-trade certification for the social business world. Collectively, B Corps lead a growing global movement of people using business as a force for good. Individually, B Corporations meet the highest standard of verified social and environmental performance, public transparency, and legal accountability.

TLDR: If you’re going to buy something, make that purchase count.

Doing good is good business

Nielsen’s 2014 Global Survey on Corporate Social Responsibility shows that, “55 per cent of global online consumers across 60 countries are willing to pay more for products and services from companies that are committed to positive social and environmental impact.”

And, according to CECP’s 2013 Infographic, more consumers want to know what companies are doing to improve communities and want to spend their hard-earned dollars with companies that do better at doing good.

It’s not only consumers that are demanding more from businesses. CECP’s 2014 Giving in Numbers Report suggests that employees want to work at companies with good values.

Startups that ingrain social impact at the core of their mission right at the start will continue to create impact as they grow. Read this Medium post by Damon O’Sullivan, Founder & Director of Melbourne-based, social innovation consultancy firm, Thick, on how his company got started what it has meant for their business. His team been donating 5 per cent of their revenue to charity since inception, and at the end of 2016 reached two milestones: 5 years of doing it; and, their first A$500,000 (US$373,000) donated.

So what can you do now to incorporate social impact as part of your business? Check out resources like Shared Value Initiative for case studies on how others have done it. B Corporation has some great information on how you can measure your social impact and get everything in order legally. Social Change Central has a pretty handy Social Lean Canvas for you to turn your ideas in to action and also provides information on opportunities available in Australia for social enterprises.

TLDR: Business is no longer just about making money. Creating social impact is increasingly becoming more important to everyday consumers, and your business model can make all the difference when starting up.

3. Do less harm

In 2015, American author and newspaper columnist, Anand Giridharadas got up on stage at the Aspen Action Forum in front of top leaders in the social justice world to say:

“When you give back, when you have a side foundation, a side CSR project, a side social-impact fund, you gain an exemption from more rigorous scrutiny. You helped 100 poor kids in the ghetto learn how to code. The indulgence spares you from questions about the larger systems and structures you sustain that benefit you and punish others: weak banking regulations and labour laws, zoning rules that happen to keep the poor far from your neighbourhood, porous safety nets, the enduring and unrepaired legacies of slavery and racial supremacy and caste systems.

Anand boldly points out the overwhelming incentive to “give back” after we have already taken, rather than focussing on how to reduce our impact when taking. For many businesses and industries, the incremental change they make by giving back is often far outweighed by the negative effects of operating their core business.

“Many of the winners of our age are active, vigorous contributors to the problems they bravely seek to solve. And for the greater good to prevail on any number of issues, some people will have to lose — to actually do less harm, and not merely more good. We know that enlightened capital didn’t get rid of the slave trade. Impact investing didn’t abolish child labor and put fire escapes on tenement factories. Drug makers didn’t stop slipping antifreeze into medicine as part of a CSR initiative. In each of these cases, the interests of the many had to defeat the interests of the recalcitrant few.”

If there’s one thing that you take away from this today, it’s to be more conscious about your individual impact. Because even though your individual impact may be small, collectively we can change the world (as cliché as that may sound). Taking a critical and tough look inwards will reveal many small things that we are each guilty of. To start, I encourage you to check out Anand’s talk here or read the transcript here.

“We talk a lot here about giving more. We don’t talk about taking less. We talk a lot here about what we should be doing more of. We don’t talk about what we should be doing less of.”

TLDR: Instead of looking at ways you can create impact, how can you do less harm?

And that is all, folks! What can you do today?

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This post originally appeared on amranaidoo.com.

Amra Naidoo is the host and producer of the Doing Good Podcast — your guide to doing good. She works to bridge the gap between large corporates and social enterprises, structuring strategic partnerships to leverage pooled resources and deliver real results on-the-ground. Amra is the former Head of Partnerships at UN Women Singapore and also led Project Inspire, a multi-award winning, global social entrepreneurship initiative.

Amra frequently speaks about the importance of partnerships and combining social and business at events and conferences. She is an ambassador for Impact Journalism Day by Sparknews, and has recently been appointed as a World Economic Forum Global Shaper. She has been featured as one of Harpers Bazaar’s 2014 Women Who Inspire Others, and often mentors & consults with young social entrepreneurs.

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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Agate Jogja Co-Founder Frida Dwi tells us a few things –including what he has in mind for the future

Reports about the operational cessation of Indonesian game developer company Agate Jogja had gained a considerable attention from local game developer communities. In Jogjakarta, startups focussing on gaming products are quite popular, with communities such as Gamelan routinely host meetings and co-training events. Agate Jogja Co-Founder Frida Dwi, who is also known as Ube, is a well-known figure in the community. There is no question anymore about his ability, as recently the team that he led scored champion title in the Indonesia Next Apps 3.0 competition, initiated by Samsung and DailySocial.

It is very important to note that Agate Jogja does not fully shut down its company. Ube explains that Agate Jogja consists of several elements, which are the Agate Jogja brand itself, the co-founders and their team in Jogjakarta, and its operational activities of the company. The brand will continue to be owned by Agate Jogja’s holding company Agate Studio, which opens up the possibility for it to return to the market with a different composition.

We dig deeper into the lessons to learn from Ube’s journey with Agate Jogja, including the issues that led him to the decision of leaving Agate Jogja.

A startup’s team composition

While the product is a crucial component of a business, it is not the only aspect that mattered, as there are several that need to be synergised in order to accelerate business. Often we see a rather simple product idea being packaged in such a way that it gathered the public’s interest, while being placed on a specific market with a clear target.

Also Read: Nintendo’s first entry in the mobile gaming arena is laudable, but will it stick?

In a startup, generally the developer team is going to focus on how the product is going to spring to life, while other divisions such as marketing and research are going to wrap it up with the right branding, launching time, and target market.

This issue is considered as the most basic reason why Agate Jogja decided to call its operational quits. To DailySocial, Ube explains that:

“My greatest challenge has been insufficient management skills. It also happened that in the past five years I have been wearing multihats, being in charge of both management and production. This has led to the stagnation of Agate Jogja, making the co-founders (me and Estu Galih) felt that we do not have the capability to help the team to grow well.”

Business management itself involves a lot of aspects. Starting from internal operational needs, business development needs, to human resource and financial accommodation in a business activity. In the case of Agate Jogja, the two co-founders have extensive background in application development, with their expertise coding and game designing being their most advanced skills.

Gaming market share in Indonesia is huge, but also dynamic

The significantly growing number of smartphone and internet users opens up plenty of new opportunities for creative industry to make money, and mobile gaming is not an exception. Several surveys stated that games still dominate the top positions of smartphone users’ most used applications, together with social media.

Also Read: Young but not n00bs: The 8 startups putting Asia on the online gaming map

Local game developers generally agree on this notion. The potential is huge, but there are many things left to be understood.

“Mobile game potential in Indonesia is big. In almost every startup event or creative digital seminar, there are always intriguing data presented. But I personally feel that mobile game users in Indonesia are very unique, very hard to predict. There are many things to study from our mobile game users … As for Indonesian mobile gamers segmentation, there are many users out there and they were all unique, requiring a lot of adjustments that are often beyond our comprehension as a developer,” Ube says.

This is in line with what DailySocial had found in a survey about local mobile game developers. The survey revealed that 49.61 per cent of total respondents are not aware of the existence of local game developers. Sometimes they do not even realise that the games that they are playing were made in Indonesia.

Despite the situation, there is a unique strategy that local game developers have been doing, which is by tagging along a recent trend to be developed as a game-based content. If you remember games such as Tahu Bulat or Dimas Kanjeng Gandakan Uang, developers are quick to read what has been taking the public’s attention, enabling them to jump on it as a medium of creativity, with a strong impact on the promotional process. Behind those challenges there is always a way for creators to maximise existing potentials.

“There are always the ups and downs [of running a game startup]. The ups are when a game becomes featured on Google Play, the number of downloads increase, or when our income experiences a rollercoaster. It also includes winning competitions, meeting lots of partners who are very helpful. Overall, the journey with Agate Jogja had been a pleasant one, because of the many things I was allowed to create,” he says.

Also Read: PlaySimple raises US$4M to take India’s mobile social gaming to the next level

Always be prepared for every possibility

The Agate Jogja team itself has been disbanded since June 2016, right before the holy month of Ramadan, leaving only the two co-founders to continue operational activities and participating in several competitions. In October, Ube and Galih took time to go to Bandung to temporarily join Agate Studio, to exchange knowledge and discuss the plan to set up a new Agate team in Jogjakarta.

After a long discussion, it is finally decided for Agate to focus production process in its Bandung headquarter, while the two co-founders return to Jogjakarta, declining the company’s offer to relocate to Bandung due to their own personal circumstances.

By December 2016, all Agate Jogja games in Google Play have been removed to Agate Studio’s account. Ube and Galih then submitted their resignation from Agate. By January 2017, Agate Jogja’s operational, which is led by Ube, has been ceased.

Startups are often faced with challenging business dynamics. As what happened to Uber, there are many big decision to make, including the decision to end a business. Risks should always been a consideration for business players, and it has to be carefully considered in order to create peace of mind.

When the shutdown happens, at least the team members will not be surprised as they have been prepared since early on. It is likely to be on Ube’s mind at the time.

Also Read: migme partners with Hong Kong-based gaming studio Gamespark to bring on 4 new games

“For the sake of all team members, the Agate Jogja co-founders agreed to disband the team, completed with several months worth of severance as a token of appreciation for their service. The announcement was also made gradually; we delivered the news to the team about one month before the end, so that they could prepare their future plan.”

Undying spirits

Everyone is entitled to their own choices, as they will be the only one to face the consequences of their own decision. Continuing his story, Ube stated that after the co-founders resignation and cessation of operations, the Agate Jogja brand ownership will be returned to Agate Studio. Any future decision related to the future of Agate Jogja, or the Jogjakarta base of Agate Studio, has been handed over to the Bandung-based team.

Ube and Galih will continue on working in game developing. By the time this article is written, the two are in the process of completing their latest game development project.

“As for me, I will continue on working in game development, together with my co-founders we begin to set up a small team, starting over from zero again. Just two people involved. Hopefully it will be easier to manage. We have a name in mind but perhaps we will only announce it when our first game is published. Wish us luck.”

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The article Pelajaran Penghentian Operasional Agate Jogja 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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Art and luxury item marketplace operator The Artling has raised a series A worth US$1.75 million, it announced today. The funding comes from Edipresse Media, a European luxury lifestyle media company.

The Artling was founded in 2013 in Singapore by Talenia Phua Gajardo. Talenia worked for renowned architect Zaha Hadid in London and is heavily involved in Singapore’s art scene.

The Artling will hire more people and focus more on marketing.

The Artling operates TheArtling.com, an online art gallery that offers curated works of art for sale, and the more recently launched Luxglove, a marketplace for luxury and collectible items, including pre-owned jewelry, watches, artworks, and even classic cars and old whiskey.

Owners of such items (both private collectors and stores) can approach the company and the team curates, photographs, and uploads the listings on the website. Talenia says Luxglove recently arranged the sale of a vintage car and a bottle of a 50-year-old Yamazaki single malt worth US$60,000. So this goes a tad beyond the usual Carousell fare.

“We’ve been keeping things lean for a while and have had an extremely conservative burn rate to date,” Talenia tells Tech in Asia. “Both platforms are now at the stage where we need to ramp up and expand.”

The startup will use the funding to hire more people and focus more on marketing, two areas it held off on previously in order to control its spending. It will also be moving into a larger space as the team grows.

Its new relationship with Edipresse will also provide useful connections in the luxury and lifestyle world.

Sharing the art

Additionally, the company announced it has acquired Artshare, a Hong Kong-based website that offers a look into local exhibitions and galleries and allows users to buy selected works.

The terms of the deal are not disclosed. The acquisition will help The Artling expand its footprint in Hong Kong and the Chinese art world.

Artshare founder Alexandre Errera will continue as advisor to The Artling, while Artshare’s brand will be fully incorporated into the Singaporean company.

Talenia says The Artling’s revenue has doubled year-on-year but does not share any specific numbers.

The Artling raised a seed round of US$200,000 from angel investors in 2014.

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Startups in Southeast Asia pulled in more moolah than ever before from investors in 2016. Total funding in the region hit US$2.6 billion, up over 60 percent from the previous year’s US$1.6 billion, according to the Tech in Asia Database.

One caveat: many startups that scored investments didn’t disclose the amounts so the tally could have been bigger.

The number of deals fell for the first time in five years to 365 – from 380 in 2015 – amidst talks of a cooling off in startup financing.

Singapore and Indonesia continued to figure prominently on investors’ radar, accounting for US$1.4 billion and US$967 million of the investments, respectively. Malaysia was next (US$84.8 million), followed by Thailand (US$79.3 million), Vietnam (US$60.9 million), and the Philippines (US$14.6 million).

No winter for big players

Southeast Asia continued to attract investors, who might have been looking for new growth opportunities. Its performance bucks the slowdown seen in India in 2016, and the big drop-off in China in the latter half of the year.

Also, while some startups might have felt a freeze as money was not flowing as freely as in years before, funding was always available for the truly robust ones. Prominent names like Grab, Go-Jek, Garena, and Tokopedia managed to bag yet more funding as they ramped up operations.

See: The 12 biggest funding rounds in Southeast Asia this year

Those big-ticket deals, mostly in the July to September quarter, accounted for the bulk of funding.

From October to December, funding amounted to US$225 million, the lowest quarterly sum in 2016 and down 7 percent from US$242 million in Q4 2015.

Except for series A funding, all stages recorded a rise last year. Late-stage funding, which used to be rare, went up thanks to the mega rounds closed by the likes of Grab (note: Go-Jek’s US$550 million is not included in the graph as the round is unknown).

As expected, ride-hailing and logistics was the best-funded sector, netting US$1.35 billion. Ecommerce, the king of 2015, and many previous years, came next with US$421 million invested amidst rosy projections for online shopping growth in the region.

Thanks to Tech in Asia’s Queena Wadyanti for compiling the data.

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A BigBasket distribution center. Photo credit: BigBasket.

On-demand grocery startups Big Basket and Grofers say they are not merging, irrespective of what media reports today claim.

Big Basket CEO Hari Menon and Grofers CEO Albinder Dhindsa responded to an article in The Times of India, which said the companies have held merger talks, though the discussions are in a preliminary stage and have moved slowly.

“The report is all bunkum, it doesn’t make sense for us to buy Grofers,” Hari tells Tech in Asia.

Ganging up on Amazon

The TOI says that merger talks between the two companies started in November last year, and will be brought up during BigBasket’s board meeting scheduled for end of January.

A deal will depend on BigBasket’s upcoming financing round, the report says. The Bangalore-based startup is set to raise US$150million in a fresh funding round.

Albinder Dhindsa, cofounder and CEO of Grofers. Photo Credit: The Week.

What are called “mergers” in the business world are rarely those in reality. A true 50:50 partnership almost never occurs. In this instance, it is likely that BigBasket would buy Grofers, if at all, rather than “merging with it.”

A source close to the matter tells Tech in Asia that the company heads have met time and again, and have sometimes discussed the advent of Amazon and ways to counter that in the past. Last year, that duo raised the topic of a possible merger, but only conversationally, “and nothing came of that. They didn’t even follow up.”

BigBasket is one the few companies in the country that seems to have cracked on-demand grocery deliveries in India – a space so hard to navigate that others, including Flipkart, Ola, and even Amazon have struggled with.

See: BigBasket’s secret to handling 35,000 orders a day, where even Amazon fumbles

Different paths

Amazon piloted its grocery unit in India starting September, but it doesn’t deal in fresh produce in any major way.

Grofers is on a path to rebuild itself after making some false moves in the past. Flush with cash, it chased new markets instead of building its core logistics team. The move backfired. Albinder has since taken up a number of measures to correct his mistakes, including investing around US$10 million in its supply chain.

“We are still doing that. We’ve been growing on a trot these past four months,” CEO Albinder told Tech in Asia. Initially just an online runner boy, Grofers is now going the inventory-led way, like BigBasket.

BigBasket says it averages about 50,000 orders in a day. Grofers services around 10,000.

See: Grofers 2.0: inside the startup’s big mistakes and learnings

On the face of it, a BigBasket-Grofers merger could create a local giant that would be in a stronger position to take on Amazon when it eventually launches grocery delivery in full force in the country.

However, BigBasket is run by a team that strongly believes in being “grocers first, that just happens to be online.” Grofers is the opposite, where the team says they are “a tech company first, and then we are a grocery company.”

The differences of principles aside, a Grofers sales would free its investors for an exit, but it is likely to add to BigBasket’s chores.

An employee cuts vegetables at BigBasket’s distribution center. Photo credit: BigBasket.

Bangalore-based Bigbasket has been working on its back-end platform for years to build a logistics team that can deliver on time, with minimal hassles. Tech in Asia tested those claims last year. The company was on time with every order bar one. In two instances there were items missing, but BigBasket sent prior notifications about that, and reversed the money immediately. In the one instance the delivery was late, the company refunded some money as compensation.

“In grocery, you need tech but have to keep it simple. You have to make it simple for the shopper to find rice and daal,” Hari says.

Grofers, in comparison, still struggles with glitchy tech and erratic deliver boys. Its revenue shrunk from US$129,449 in financial year 2015 to US$85,586 in 2016, according to official filings. It lost US$8.9 million in 2016, compared to US$572,141 in 2015.

BigBasket saw revenues jump to US$82.6 million from US$24.9 million in 2015. Losses came in at US$40.6 million, compared to US$9 million in 2015.

Adding Grofers – which is in the middle of rebuilding its team and setting its house in order – to its portfolio will involve taking up added responsibilities that Hari and team could do without at this stage, unless it guarantees future investments from Grofers’ top tier investors, Tiger Global and SoftBank.

In November, Albinder told Tech in Asia that Grofers had more than US$90 million in the bank.

“It’s a dilemma for Grofers whether to spend money or seek a merger. For BigBasket, it finds little value in Grofers’ technology, customers or revenue,” the Times of India quoted a source as saying.

“It’s a different issue if Tiger and SoftBank want to talk a merger with follow-on investments. The hurdle to the deal making is the fact that BigBasket would dictate terms, but Grofers wouldn’t give up because it still has a lot of cash left on its books,’ the source elaborated

India has recently seen an increasing number of tech deals aimed at market control. Just last year, Flipkart’s Myntra bought distressed rival Jabong.

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Just in time for the new year, this week’s roundup features two healthtech startups. The newly funded companies raised money primarily from corporate venture capital funds. Leading firms such as Toyota, GMO, DeNA, and Daiwa all chipped in funds.

Full details below.

FiNC

Photo credit: Michael Zittel.

FiNC, a mobile-first healthtech startup, has raised US$17.5 million in a series C. The round comes a little over one year after the company raised an undisclosed amount in a series B. Dai-Ichi Seimei, a popular Japanese life insurance brand, was a repeat investor. Food and beverage corporation Kagome and Toyota’s Mirai Fund were prominent additions.

The company uses a team of nutritionists, trainers, and data scientists to help users figure out the best way to slim down and stay healthy. This core offering has been supplemented by corporate fitness services, personal training options, and an online mall.

Campfire

Photo credit: pasiphae / 123RF.

Campfire, a popular crowdfunding platform in Japan, has raised US$2.9 million. Since its founding in 2011, 150,000 users have given US$14 million to 4,200 projects. The round featured a who’s who of Japanese investors led by GMO, SMBC Venture Capital, East Ventures, and DeNA.

In its bid to separate itself from competitors like Kibidango, Makuake, and ReadyFor, Campfire will be beefing up its AI capabilities to better analyze the future potential of listed projects. It will also explore adding social lending to its platform.

HR Brain

Photo credit: bimdeedee / 123RF Stock Photo.

HR Brain, a startup promising to take the headache out of HR evaluations, raised an undisclosed amount of money from Janesia Ventures and Beenext. The cloud-based offering is customizable – users can choose from systems like OKR, 360-degree, and MBO frameworks and add further modifications as needed.

The funding caps a string of PR victories for the firm. Founded by Hiroki Hori, a former star at CyberAgent who managed the company’s leading social blog business, the startup completed Recruit’s accelerator program and won the TechCrunch Japan 2016 award last November.

HealthServer

Credit: e-Magine Art

HealthServer is back in our weekly roundup, just a few weeks after making its debut last December. The startup offers a sleek device that will analyze your physical condition and then produce the vitamins you need to improve your health.

Though the product is still not available for purchase – and the precise method of use is still vague – it has shown no trouble in attracting venture capital. Previous investors like Shiseido Ventures, an offshoot of Japan’s largest cosmetics manufacturer, and DyDo, one of the nation’s biggest vending machine operators, returned for this round. KLab Ventures and Daiwa Corporate Investment joined as well.

Piece of Cake

Photo credit: rawpixel / 123RF.

The tastefully named Piece of Cake is a startup best known for its Note and Cake services. Note is a straightforward personal blogging tool, while Cake is a content aggregator that provides 13,000 articles sourced from over 700 creators and 50 companies.

Though curation media in Japan has taken a hit recently, highlighted by DeNA’s plagiarism scandal, Piece of Cake secured an undisclosed round from TBS Innovation Partners – the venture arm of a prominent Japanese broadcast company.

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Photo credit: vicnt / 123RF Stock Photo

Indian real estate portal Housing.com got acquired last week by another online property marketplace PropTiger. It was a distress sale at a valuation of US$70-75 million for the SoftBank-backed startup, which had raised US$160 million in funding since its inception in 2012.

Barely a month before the sale, I met the man who had been put in charge of nursing the startup back to health: Jason Kothari, earlier credited with the turnaround of Valiant Entertainment in New York. The beleaguered startup was in a freefall after its co-founder and CEO Rahul Yadav was sacked following a public spat with the board.

The backers – SoftBank, Helion Venture Partners, Nexus Venture Partners, and Qualcomm Ventures – wanted to salvage what they could of their investment. The stock-swap deal with PropTiger at least gives them another shot at getting some tangible returns in the future.

See: Why is a turnaround expert joining Snapdeal?

Damage control

Jason’s first task was damage control. “The reputation was at rock-bottom,” he told Tech in Asia in an exclusive interview.

The founder of a company being sacked by its own board of directors had made Rahul Yadav the Steve Jobs of India in the eyes of many. Jason had to combat that. He reached out to all the participants of the fiasco – employees, investors, and even media – to clear the air.

“I went to every business head, every investor, and journalists, to just talk to them. Re-building relationships was crucial to bring back lost reputation,” Jason says.

But Housing needed much more than PR to get out of its swamp.

The company had been touted as a disruptor of the highly unorganized real estate sector, with a technology-backed model to make house-hunting easier. In 2014, SoftBank pumped US$90 million into Housing at a valuation of US$250 million.

The company was ahead of its competitors. There was no reason to hurry.

But the group of 11 friends from IIT Bombay helming the startup seemed to get carried away and faltered in utilizing the funding judiciously. The company spent a whopping US$20 million of the SoftBank funding on a single marketing campaign. Mind you, Housing wasn’t making large sums of money at that time.

Here’s how much cash it was burning: at the end of March 2015, the startup reported losses of over US$40 million, on a revenue of just around US$2 million. The company’s expenses were out of control. Employee cost at the end of March 2015 had jumped four-fold to US$13 million, and annual marketing costs had increased almost 10-fold to US$18 million. The investors objected, Rahul responded with animosity, and eventually he was sacked by July.

The problem with Housing was its leadership, Jason says. “An entrepreneur who has seen multiple markets and challenges would realize the importance of judicious expenditure. Housing’s founders probably didn’t have that exposure.”

The company tried to create too many things at once, and none were monetizing meaningfully.

The company tried to create too many things at once – hostels, renting, land buying, commercials, luxury, and so on – and “none were doing well, or monetizing meaningfully.”

“My advice would have been to slow down. The company was already ahead of its competitors. There was no real reason to hurry,” Jason says. With good investors backing the company, it was a chance to put systems in place and consolidate.

But prudence was the last thing on the founders’ mind. Housing, declared its expansion to 10 cities in 2013, when just two weeks earlier the plan was to run a pilot program in Pune. “There was no team to manage expansion at that scale, there were no systems to handle it,” points out Jason.

The team grew from a 100-member team to a 1,000-member team in a matter of months. At one point in 2014, the team grew to 2,500.

The turnaround man: former Housing CEO Jason Kothari. Photo credit: Snapdeal.

Dressed up for a sale

Ultimately, when mounting expenses went out of hand, the company had to let go of close to 900 people in two rounds of layoffs. But reducing cash burn alone wouldn’t cut it. To make the company attractive for a buyout, Jason needed to dress up its revenues too.

The solution was shutting the rentals business, and to focus all resources on buying and selling property. Rentals accounted for almost 80 percent of Housing’s business. It brings high volumes of business, but on low margins. Buying and selling, on the other hand, is where the company made most of its money as it offers high margins.

We visited China, studied their market, and compared it to our market.

The changes flowed from a study of what other companies were doing right in different markets. “To start with, we visited China, studied their market, and compared it to our market,” says Jason.

The idea that emerged was to build a full-service company, which would help users discover property online for buying and selling, and then close the deal offline through partner brokers. Housing decided to partner brokers, because having them in-house would drain margins, Jason says.

The market for housing online was just about US$200 million in 2016. The mostly-offline brokerage market, on the other hand, is valued at US$4 billion. “There is a huge market if we tap the offline brokerage market. It’s largely unorganized, and we can make inroads,” says Jason.

These plans had to be revisited after India’s recent demonetization. The real estate sector operated largely in cash transactions, and it would take time for a new structure to emerge. Until then, property sales would slow down.

Housing had to return to its roots and announce a renewal of its rentals business last month. The sale to PropTiger followed soon afterward, and Jason Kothari quit Housing to join ecommerce site Snapdeal, which also belongs to the SoftBank portfolio in India.

(Left to right) Housing cofounders Advitiya Sharma Sharma and Rahul Yadav in good times. Rahul Yadav was fired as CEO of Housing in 2015. Photo credit: Housing.com.

See: Consolidation in real estate: Quikr and CommonFloor merge to kill Housing

Time of reckoning

Housing’s investors live to fight another day for returns on their investments. They do have equity in the merged entity, albeit at little over one-third of the startup’s peak valuation. It came almost exactly after a similar takeover of Housing’s main tech rival CommonFloor with classifieds portal Quikr, which Tech in Asia had warned was a death knell for Housing.

Still, the Housing’s takeover by PropTiger was probably a better outcome than fashion portal Jabong being sold to Flipkart for just US$70 million in cash. The Rocket Internet-backed startup once held high hopes of a US$1 billion valuation.

A professional CEO taking over the troubled Housing before its sale has a parallel with what’s happening at India’s biggest unicorn. Kalyan Krishnamurthy re-joined Flipkart from Tiger Global to clean house after a series of devaluations in a losing battle with Amazon. We’ll probably know in a year’s time if this leads to a turnaround, an IPO, or a distress sale.

See: 25 failed startups in 2016 and what we can learn from them

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