TikTok's biggest rival soars; Clubhouse living on borrowed time in China
Asia Tech Review: 8 February 2021
There’s a lot to get through this week including how TikTok’s biggest rival is soaring, why Clubhouse is the hot app in China (but likely not for long) and who is one of India’s next unicorns.
Speaking of Clubhouse, I’ve started using it more often. A lot of new people across Asia have joined in recent weeks but I’ve found that conversations vary in quality—quite wildly in fact. Let me know which rooms you like and why, and follow me over there too. My account is @jonrussell. Maybe there’s scope for ATR rooms or live interviews in the future.
Until next time,
Chinese video app Kuaishou—a rival to TikTok—has a blockbuster public debt after its share price nearly tripled following an IPO in Hong Kong. The list is notable for a couple of reasons
This is the first breakout IPO in Hong Kong since the HKEX relaxed rules in 2018 to attract tech firms. Yes, HKEX has attracted names such as Razer, Tencent’s e-publishing business and secondary listings from Alibaba, JD.com and NetEase—but this time it is different. This is a hotly anticipated stock that’s sure to attract money from China and beyond.
Why? Because of similarities to TikTok and parent company ByteDance.
Kuaishou takes a different approach to TikTok—it’s broadly more rural and focused on less professional content creators, as this podcast Tech Buzz China episode explains in detail—but for investors seeking the here and now, it serves as a proxy to TikTok.
It’s hard to make sense of markets today—there’s plenty of talk of a bubble—but the sheer numbers themselves are crazy.
If Kuaishou can sustain its share performance, ByteDance’s future IPO—whenever it comes—will be a blockbuster for sure.
Proof of that potential: Tencent is escalating its legal attack on ByteDance after it sued for alleged monopolies
Clubhouse is getting popular in China and it isn’t hard to see why. The chance to talk to anyone in the world about any topic without filters is rare in China. Already rooms have sprouted discussing taboo subjects like Taiwan, or ironically playing the daily news show to hundreds of people. Ultimately, that’s why Clubhouse is likely to be blocked sooner or later. Although the app is actually no longer listed in the Chinese version of the App Store which shows some level of anticipation from either Apple or Clubhouse. Still, you can expect the Chinese Clubhouse clones to arrive very soon.
But there is one Chinese winner from Clubhouse’s rise: Agora, the Shanghai/California company which powers the social app using its technology. It’s stock price has gone gaga following Clubhouse’s rise in popularity and new $1B valuation.
It’s pretty widely assumed that ride-hailing is struggling but Didi reportedly made a $1B profit in 2020—”the first time the business made a significant amount of money on a full-year basis since 2017”
China is taking aim at big tech with an updated set of anti-monopoly rules:
The rules, issued by the State Administration for Market Regulation (SAMR) on its website, bar companies from a range of behaviour, including forcing merchants to choose between the country’s top internet players, a long-time practice in the market.
SAMR said the latest guidelines would “stop monopolistic behaviours in the platform economy and protect fair competition in the market.”
Meanwhile, Ant reported plans to spin out its consumer credit data business—a unit that has attracted regulatory attention—in a move that it hopes will clear the way for a fresh IPO attempt within the next two years. The company is said to have netted a $2.3B profit prior to its failed IPO last year.
Tencent fired more than 100 staff for grift following a year long investigation
Drone firm DJI is waiting on whether a new US President can reverse a deteriorating relationship that’s affected its business in the US
Initially, though, it appears that there’s no let up. The Biden administration is reportedly looking into past startup deals that are linked to Chinese investors. The WSJ reports that the “national-security panel that gained powers under Trump [will] become [an] even sharper weapon under Biden.”
China’s digital currency project is gaining more credibility after it launched a joint venture with SWIFT, the global money transfer organisation.
And finally—troubled EV company Faraday Future wants to go public. And yes, you guessed it, it plans to do so via a SPAC.
Twitter temporarily blocked access to accounts in India belonging to politicians and activists on Monday following pressure from Narendra Modi’s government over contentious new agricultural laws in the country.
The move drew accusations of censorship as New Delhi ramps up pressure against farmers protesting the reforms, which aim to loosen regulation in the country’s agricultural sector. Last week, clashes in the capital left one protester dead and hundreds of police injured.
The accounts, which had been critical of the new laws, were blocked following a request from the Ministry of Electronics and Information Technology, according to Twitter. The suspension was later lifted, however, after company representatives met government officials.
Mobile Premier League, known as MPL, is India’s next unicorn-in-waiting after it raised $100M at a post-money valuation of $900M—that’s nearly double its previous valuation
Zomato reportedly raised $500M in what is billed as a pre-IPO round
Zetwerk raised $120M for its B2B marketplace for manufacturing parts
There were dramatic scenes in Myanmar where the military held a coup using very Trump-like rhetoric.
In the process, the military ordered an internet shutdown which lasted two days, social sites like Facebook, Twitter and Instagram were targeted separately.
I looked into Flash Express, a heavily-funded logistics and delivery company that’s tipped to become Thailand’s first unicorn if it can control its loss-making business
Grab closed a $2B loan facility. The company said it was increased from an initial $750M and it appears it’ll mostly be used to strengthen Grab’s financial position. There have been numerous reports linking Grab with a US IPO. There’s often a pre-IPO funding round but this could be it given how frequently Grab has raised from investors lately.
Speaking of Grab, Singapore taxi firm ComfortDelGro is experimenting with ride-hailing to add a new twist to their rivalry
How (and why) insurance startup GoBear burned through nearly $100M before closing shop
Google founder Sergey Brin opened a family office in Singapore—the fund’s size is unclear but Brin himself is estimated to be worth more than $80B
Tesla wants in on Indonesia’s EV battery supply chain project alongside LG Chem and CATL
GajiGesa, which offers fintech services to underbanked workers in Indonesia, raised $2.5M
English learning app Elsa, which is backed by Google, raised $15M to expand out of its native Vietnam
Bot MD, a service that helps doctors and healthcare professionals get quick access to accurate information, raised $5M for expansion
SoftBank is reportedly asking its high-profile companies to push for IPO and take advantage of the current bullish market for tech stocks
Indeed, SoftBank’s confidence in the markets is such that it filed for two more SPACs. They take its total to three and they tie up with its Vision Fund.
One interesting component of both SPACs is that they have what is known as a forward purchasing agreement connected to SoftBank’s Vision Fund 2. That agreement allows the second Vision Fund to purchase shares into these SPACs when they begin their business combinations with their target startups, essentially giving it the right to buy into the mergers. The Vision Fund has a $100 million agreement with SVF 2, and a $150 million agreement with SVF 3.
You just finished reading Asia Tech Review, the weekly newsletter for keeping up with the tech industry across Asia.
If someone sent this to you, you can sign up for free at Asiatechreview.com