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Tag: Startups

  • Alibaba Cloud, IIPL to support Singapore startups

    Alibaba Cloud, IIPL to support Singapore startups

    Alibaba Cloud and Infocomm Investments (IIPL) have announced plans to collaborate to drive technology innovations in Singapore, built upon Alibaba Cloud’s support network and suite of cloud infrastructure services.

    The announcement was made at the Create@Alibaba Cloud Start-up Contest (CACSC).

    The collaboration will combine Infocomm Investments’ existing initiatives for local startups and technology innovations and Alibaba Cloud’s cloud computing resources.

    It will focus on extending sophisticated networking solutions and big data intelligence to a broader base of Singaporean start-ups under Alibaba Cloud’s first global startup program, Create@Alibaba Cloud.

    Alibaba Cloud will also pave way for start-ups in Singapore to leverage Alibaba Cloud’s ecosystem and to gain access to the China market as well as multiple business network resources and funding opportunities.

    In addition, the collaboration will foster innovative exchanges between Singapore and China’s startup ecosystems by inviting accelerators, incubators, and start-ups in Singapore to participate in startup activities in China and vice versa.

    This marks the start of a long term collaboration between both ecosystems to drive innovation, the companies said.

    “We are very proud to work with Infocomm Investments to build a more robust start-up ecosystem in Singapore,” said Sicheng Yu, vice president of Alibaba Group and general manager of Alibaba Cloud Global.

    “This underscores our on-going commitment to drive technology innovation in Singapore, as well as to support local start-ups in their business growth through our cloud capabilities and extensive support network in both local and global markets.”

    The Create@Alibaba Cloud Start-up Contest (CACSC), organized in partnership with Infocomm Investments, is Alibaba Cloud’s first ever global start-up competition, which is aimed at championing start-ups and maximizing their potential.

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  • Large customer base benefits RI start-ups

    Large customer base benefits RI start-ups

    Indonesia’s mushrooming start-up companies have the potential to boost the country’s economy, thanks to their large customer base.

    According to Sillicon Valley-based Fenox Venture Capital, the movement could drive the Indonesian economy to expand faster than its Southeast Asian neighbors.

    “Indonesian start-ups are very powerful, in the sense that Indonesia has a very big consumer base. There are actually a lot of customers who can give feedback,” president and CEO Anis Uzzaman said on Friday.

    He said they had the advantage of endorsement from President Joko “Jokowi” Widodo’s administration, resulting in supportive regulations.

    Indonesia’s current rules are quite liberal in terms of supporting start-ups, compared to several other countries, particularly in the field of financing. For instance, Indonesia allows venture capital firms to invest with convertible notes, which are banned in many countries, said Uzzaman.

    A convertible note is a short-term debt that converts into equity. Under the scheme, investors can lend money to a start-up during the first round of funding and receive shares of preferred stock, rather than getting a payback loan plus interest rates.

    “Regulation issues are a common problem across the world, but the current Indonesian government is willing to make changes. It is a good thing,” he said.

    The Jokowi administration expressed its seriousness in expanding into the digital economy when the President visited Silicon Valley, the world’s center of technological innovation, during a working visit to the US in February.

    Envisioning the birth of 1,000 technopreneurs in the country, the administration allows foreign e-commerce players valued over Rp 100 billion (US$7.62 million) to open businesses and team up with financial authorities to support funding for IT companies and small and medium enterprises (SMEs).

    Several start-ups in Indonesia have gained prominence, such as Go-Jek, a motorcycle taxi service application.

    However, Uzzaman claimed that Indonesia often thwarted the efforts of venture capitalists and investors to reach out to start-ups in regions beyond Java.

    In an effort to provide business opportunities for start-ups across the country, Fenox Venture Capital, a Silicon Valley-based venture capital firm, plans to hold a global contest called the Startup World Cup 2017, in partnership with the government’s Creative Economy Agency (Bekraf).

    The event will comprise a start-up conference and competition with participants coming from 15 countries, including Indonesia.

    The countries will hold their own regional qualifications to select the top 10 participants to present their ideas in front of international judges, as well as world investors and tech company CEOs.

    The regional winners will compete to win a $1 million prize in the grand finale, which will be held in Silicon Valley on March 24 next year. Part of the prize will take the form of investments in the winning start-up.

    Fenox expects to see at least 750 startup entrepreneurs from the ASEAN region apply for the competition.

    In Indonesia, the company is conducting road shows in six cities to ensure that start-ups in the region take part in the event.

    “The start-ups should be a PT and we prefer those that already obtained financing, whether from institutional or individual investors,” said Aldi Adrian Hartanto, an associate member at the firm’s Jakarta branch office.

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  • Late to the Party, Global Banks Try to Muscle Into India’s Start-Up Boom

    Late to the Party, Global Banks Try to Muscle Into India’s Start-Up Boom

    Global investment banks are scrambling to get a piece of the action from India’s booming technology start-ups, having missed out on the initial flurry of dealmaking to their better-connected but much smaller domestic rivals.

    Banks including Goldman Sachs Group Inc, Citigroup and Morgan Stanley are looking to hire more bankers in India and are now regularly attending “bake-offs” to pitch for advisory roles on deals, according to several banking industry sources.

    Foreign money has been pouring into India’s fast-growing e-commerce sector, with investors ranging from Japan’s Softbank Corp to Singapore’s Temasek Holdings and GIC Private Ltd piling in.

    Many large global investment banks have stayed away from work in the emerging sector though due to the relatively small deal sizes.

    Now they are stepping up efforts to build relationships while the companies are still young — learning lessons from China where many of them are struggling to compete with small boutique banks as Internet deals pick up speed.

    “Several of these companies will be large IPO candidates in the next 12 to 24 months, so the big banks have to start positioning themselves for this,” said Harish HV, a partner in India at advisory firm Grant Thornton.

    The number of venture funding deals for technology start-ups in India in the first quarter of 2015 was the highest in nine quarters and exceeded the number of such deals in China, according to data from CB Insights. The total value of investments in India topped $1 billion for the third straight quarter.

    Local rivals

    To compete with local rivals like Avendus Capital and Kotak Mahindra Capital, foreign banks are now pitching for relatively small deals at start-ups, hopeful they will eventually lead to more lucrative work, banking sources said.

    Avendus, which focussed on the tech sector before the deal momentum picked up, ranks fourth in the advisory league table for announced technology deals in India so far this year. That’s ahead of bigger global rivals including Credit Suisse, Bank of America Merrill Lynch and JPMorgan, according to Thomson Reuters data.

    While Credit Suisse topped the fee income table with $7.7 million in India technology advisory fees in 2014, Avendus ranked second with $3.7 million from seven deals, according to data from Thomson Reuters/Freeman Consulting Co.

    “We first looked at the sector and said ‘okay the sector is going to be sizeable. Who are the leading companies in this?’” said Aashish Bhinde, head of Avendus’s digital and technology practice.

    “Global investment banks were completely missing from the scene.”

    Now foreign investment banks are starting to make inroads. Jefferies’ India arm advised home shopping firm Naaptol.com to raise about $20 million last month from Japan’s Mitsui & Co Ltd and some existing investors.

    Citigroup Inc, which advised Indian online payment services provider One97 Communications in raising funds from Alibaba Group affiliate Ant Financial Services in February, is “very focused” on the internet space in India, said Madhur Deora, its managing director for investment banking in India.

    Morgan Stanley and Goldman Sachs did not respond to requests for comments on their work with Indian technology start-ups.

    Western-style fee

    While India has fewer Internet users than China, online sales could rise to over $100 billion in 2020 from $2.9 billion in 2013, making it the fastest-growing market globally, according to a Morgan Stanley research report.

    This has led to global banks vying to offer services like loan financing to online retailers like Flipkart and Snapdeal, hoping this could help them secure mandates on any future IPOs, sources said.

    “Fees on these IPOs would be much more Western style than the commoditised deals in India,” said an M&A banker with a large foreign bank, also one of the advisers on Chinese e-commerce giant Alibaba Group Holding’s record $25 billion IPO last year.

    For large IPOs, Indian tech companies would need the marketing muscles of big foreign banks. But the local banks have likely cemented strong enough relationships that their foreign rivals can not push them out entirely.

    “I would be surprised if any investment bank out there is not rapidly building up their digital and tech practice given the pace and momentum with which the transactions are happening, which is good for the industry,” said Bhinde of Avendus.