Tech In Asia gets the exit and acquirer we all expected

Singapore Press Holdings is the obvious buyer at a $30 million price tag

Nov 02, 2023

Welcome back,

I can’t really ignore a media acquisition in Southeast Asia, especially one that hasn’t been widely covered, so here we are with Singapore Press Holdings’ deal to buy Tech In Asia.

I’m happy for Tech In Asia CEO Willis Wee, who I’ve known for a long while. We both began writing about Southeast Asia tech in 2010—more than a decade ago—but he had the foresight to build a media business and raise venture capital. I hate sharing old stories but here’s an interview he gave me in 2011 when Tech In Asia was called Penn Olson… thankfully he rebranded it 😆

Best,

Jon

Disclosure: I recently agreed to take a paid advisory role with Tech In Asia and am in the very early stages of consulting with their team. However, I was unaware of this news before it became public and have no inside information. Neither Wee nor editor-in-chief Terence Lee would say any more when I asked them. (Yes, these days I write this newsletter and do consulting—message me if you’re interested in exploring working together.)

Tech In Asia finally gets the exit and acquirer we all expected

Tech In Asia has its exit after Singapore Press Holdings (SPH) agreed to buy the fellow Singapore-based media startup. The deal size wasn’t disclosed but we can reveal it values Tech In Asia at $30M and it will be paid out in a combination of cash and shares, according to two sources who are aware of details of the transaction.

I don’t have a breakdown of the cash/shares split, but there are performance-based metrics on top of that price. Tech In Asia raised around $13M from investors, who are all above water from this deal. TIA claims to be profitable, its last financing was back in 2017 when Korea’s Hanwha led a $6.6M round at a valuation of around $27.5M.

Tech In Asia, which is more than 10 years old, had been pitching itself to potential acquirers and investors (as I previously noted) at a valuation of $30M-$40M since even before Covid.

SPH, as Singapore’s largest media operator, was an obvious candidate and there’s been conversations running for years. SPH reorganised itself into a non-profit more than two years ago, which might have had a bearing on this deal, which is expected to close by the end of this year.

So why is SPH buying TIA?

The idea is to combine TIA with Business Times (BT), SPH’s financial and business outlet as the media giant itself said. The technology industry continues to grow at a fast pace in Southeast Asia, with companies like Grab, Lazada, Sea and others hiring in droves and generally more visible than was conceivable a decade ago. It makes sense that SPH wants to enlarge its technology chops as a media outlet.

This acquisition will mean both more startup coverage and, perhaps more importantly, picking up Tech In Asia’s events business, which specialises in tech shows in Singapore and Jakarta that attract thousands of attendees and top sponsors.

There’s a sense that in-person events are back after Covid, and events are an area where Tech In Asia probably does as good a job as any media business in Southeast Asia.

It looks like the two media brands will initially maintain their independence post deal (more on that below) and there’s no indication that Tech In Asia will cut any of its staff, which counts more than 50 people across content, events and more.

And the financials?

As mentioned, the final price isn’t official and I’m not able to break out the $30M I’ve reliably heard based on cash, shares, etc. But there’s still a wealth of financial information, thanks to data from VentureCap Insights.

The major shareholders include:

Hanwha 18%
Willis Wee 15%
Fenox 15%
East Ventures 11%
SB ISAT (a SoftBank Indosat fund) 9%
LightVC 6%
Simile Venture Partners 5%
Walden International 4%
Y Combinator 3%

Notable shareholders with under 1% include Facebook co-founder Eduardo Saverin and GGV Capital’s Jixun Foo who both invested in a personal capacity.

ESOPs haven't really taken off in Southeast Asia so it is refreshing to note that 11% of shares were carved out for the Tech In Asia team.

Tech In Asia claims to be profitable but the numbers on file don’t support that. Tech In Asia was profitable in 2020 and 2021 but it lost SG$642,249 (US$470,000) in 2022. Revenue in 2022 grew by nearly 9 % year-on-year to reach SG$7.2M, or US$5.3M.

What does this mean?

Startup media M&A does happen in Southeast Asia, albeit not at crazy prices. Just getting an exit is a good outcome and media deals rarely have that hockey stick spike that VCs chase for outsized returns. These are classified more as investments in an ecosystem—because an ecosystem needs media outlets if it is to have a chance of thriving.

Still, SPH-TIA is a second notable media acquisition from Southeast Asia in recent times. Singapore-based Deal Street Asia (DSA) was acquired by Japan’s Nikkei—the parent of the Financial Times—for as much as $10M in 2019.

TIA and DSA are rivals for news and events, but very different businesses with Tech In Asia arguably more mature given its longer story and varied journey.

DSA went full paywall with an annual subscription costing a punchy $319. That’s bundled with investor-centric events. DSA also offers a “data platform” for financial information and startup funding for Asia, although it is subject to a lawsuit from rival platform VentureCap Insights which claims plagiarism.

(At the time of writing, DSA hadn’t covered the deal.)

TIA makes money from its aforementioned events business and charges $199 per year but provides access to basic news stories for free. It has been quite a ride much like the startups it follows. That began with an initial investment from East Ventures back in 2011 to Y Combinator, an acquisition of its own, a focus on services, a dreadful redesign, painful layoffs and more.

It can be tough to integrate media brands, especially when the culture is very different. SPH is a very traditional and corporate newsroom where editors earn their positions after decades and many staff are there for years having come through journalism school. Online media is a lot more flexible, less office-based and more transient.

SPH said that “TIA and BT will operate as separate brands” during the 12-18 month post-integration process, but after that it is less clear. Especially if the main goal is to own the TIA event business.

Additional reporting from Ka Kay Lum

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