Chinese VC funding falls off a cliff but deals continue across Asia
Chinese VC funding falls off a cliff but deals continue across Asia
Asia Tech Review: 17 May 2022
Welcome back,
The past week has been dominated by news from the crypto world, as the drastic fall of Korea/Singapore-based project Terra sent the entire market tumbling. This isn’t a crypto newsletter but the whole episode is impossible to ignore.
My own take is that a sustained bear market is here—it’s hardly a big prediction if you look at the global economic situation with public markets etc—which will make the next 6-24 months an interesting time indeed. Not just for crypto, but future IPOs, growth investment and VC across the board. I’m not old enough to have professionally lived through 2008 (bumming around London and Thailand doesn’t count) so there’s a lot for us ‘first-timers’ to experience and learn.
Those rain clouds are somewhat present in this week’s newsletter, though there are still plenty of early and growth investments including at least one new unicorn.
See you again next time,
Jon
PS: This is too good to not share
Stories in focus
Sea is expanding its focus beyond e-commerce and payments with plans to acquire an insurance company in Indonesia. The likely target was reportedly Asuransi Mega Pratama, a group that was recently acquired by one of Sea’s business partners—any deal would pave the way for the firm to enter a general insurance market worth more than $5B in Indonesia alone. It’s likely to also dovetail with Sea’s ownership of Bank Kesejahteraan Ekonomi, which is now known as PT Bank Seabank Indonesia
China funding falls off a cliff
Fundraising by China-focused private equity investors has reportedly fallen to its lowest level in 13 years, as early-stage backers of the country’s start-up scene grapple with Beijing’s tech crackdown and zero-Covid policies. Venture capital and private equity funds concentrating on the Greater China region raised just $1.7B in the first quarter of 2022, according to estimates from industry data provider Preqin. That’s down more than 90% year-on-year and it marked the lowest amount since 2009—the global financial crisis
Coinbase confirms India’s central bank forced its UPI service offline
Coinbase CEO Brian Amstrong has explained why the firm halted its trading service in India days after shipping a feature that allows customers to buy crypto using UPI - “Informal pressure” from the Reserve Bank of India
Google targets IPL broadcast deal
There’s an unlikely bidder for the broadcast rights of the Indian Premier League: Google. The search giant is said to be making a play for the hugely popular sports franchise—which trails only the English Premier League and US NFL in terms of audience. Last year, the IPL reached 600 million viewers, according to BCCI estimates—so understandably it’s a hotly contested deal with Amazon, Walt Disney, Sony and others also vying link
China
The US Department of Commerce could ban American companies selling advanced chipmaking equipment to Chinese firms. That’s in response to the continuing trade war and China’s fairly public ambition to build its own chip tech ecosystem link
In related news, US Congress may soon require government agencies to vet tech startups that seek federal funding. This follows a Defense Department study that found China is targeting companies that win funding under the Small Business Innovation Research program through “state-sponsored” attacks link
The Biden administration has drafted an executive order that would give the Department of Justice powers to stop foreign adversaries like China accessing Americans’ personal data link
ByteDance is reportedly aiming to push Douyin’s shopping revenue to $240B this year—that’s double last year link
SMIC, China’s top chip maker, said the Shanghai lockdown could reduce production by 5% this quarter, which could leave domestic smartphone makers suffer up to 200M fewer shipments this year link
AliExpress Russia, the e-commerce joint venture between Alibaba and three Russian partners, is making layoffs that could affect up to 40% of employees working in areas that have become’ expendable’ following sanctions on Russia link
India
Following drama which saw allegations emerge against CEO Ashneer Grover, BharatPe—the $2.8B payment startup—plans to claw back Grover’s shares and terminate ‘several’ employees Link
Google now requires personal loan apps in India to complete the additional proof of eligibility requirements, including copies of licenses by the Reserve Bank of India (RBI) link
Crypto exchange CoinDCX has set up a venture arm with an initial $13M allocation to spend over the next year link
Flipkart, Reliance Retail and Amazon are among the e-commerce firms in talks to join India’s ambitious Open Network for Digital Commerce link
Byju’s is reportedly in talks with banks to raise more than $1B in order to acquire another edtech company link
Swiggy is buying popular dining out and restaurant tech platform Dineout for a reported $200M link
It has emerged that Indian tax officials froze $478M worth of deposits lying in local bank accounts of Xiaomi in February as part of an investigation into alleged tax evasion link
Southeast Asia
Digital payments processor Opn, formerly known as Synqa and Omise, raised $120M in a Series C+ funding round—there’s conflicting reports as to whether its valuation reached $1B. Privately, I understand it is just short of the mark for now link
Atma, an Indonesian social job platform, raised $5M link
Eureka Robotics, the team behind the ‘IkeaBot’ which is based on research from Nanyang Technological University in Singapore and MIT, raised $4.25M link
GIC lead a $170M investment in Chainalysis which values the crypto analytics startup at $8.6B link
Ant Group is recruiting 20 new positions in Singapore as it doubles down on Southeast Asia link
Carousell acquired second-hand fashion retailer Refash for an undisclosed sum. Launched in 2015, Refash claims to have processed over 5M pieces of clothing and resold apparel from over 300 fashion labels link
East Ventures raised a new $550M fund—it plans to allocate $150M to early-stage deals and $400M for growth link
South Korea
Decorating and interior startup Bucketplace raised $182M to finance a push into AR—the 8-year-old company also saw its valuation reach $1.4B to make it another rare Korean unicorn link
Seadronix—which aims to reduce marine accidents at port and sea with AI—raised a $5.8M Series A extension to take the total round up to $8.3 million link
Coupang said its first-quarter net loss shrank by 29% from a year earlier—it posted a net loss of $209.2M in Q1 2022 compared to a $295M loss one year earlier link
Samsung Electronics is in talks with clients about hiking prices for chip contract manufacturing by up to 20% this year link
Japan
Japan’s Zeals raised $38.8M to scale its chat commerce platform—the round brings its funding to date to $41.4M link
Rest of Asia
Data leaked by Anonymous hacktivists has put Sri Lankans at risk of cybercrime link
SoftBank’s two Vision Funds have been hit hard by plunging tech valuations as global interest rates climb and China tightens its regulatory grip on the industry. The world’s largest tech fund is estimated to have lost about US$18.6 billion on its public portfolio in the quarter ended March link
In response, SoftBank may slash its investment amounts to half or even a quarter of that this year link
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