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ISSUE 10


Food delivery start-up DoorDash is raising $535 million from Softbank and other investors


SoftBank just invested in yet another Uber competitor, only this time in a slightly different market.


Food delivery start-up DoorDash, which goes head to head with Uber Eats, said Thursday it raised $535 million in a funding round led by SoftBank's $100 billion Vision Fund. The deal values DoorDash at about $1.4 billion, according to a person with knowledge of the financing who asked not to be named because the valuation isn't being disclosed.


SoftBank has been pouring money into ride-hailing companies across the globe, recently taking a 15 percent stake in Uber and becoming the largest shareholder. The Japanese conglomerate also owns a piece of Singapore's Grab, India's Ola and Brazil's 99, as well as China's Didi, which acquired Uber's Chinese operations in 2016. SoftBank has also publicly expressed interest in backing Lyft, Uber's biggest U.S. rival.


Fragmented market


DoorDash competes only with a secondary business for Uber — food delivery — but it's clearly a market that Uber is targeting.


In January, Uber acquired a delivery-only restaurant called Ando, and CEO Dara Khosrowshahi said at an event in Munich that Uber will be the "largest food delivery company in the world this year."


But it's a big fragmented market. And investor sentiment in the space is improving after a treacherous period that followed meal kit delivery provider Blue Apron's IPO in June. While Blue Apron remains more than 70 percent below its debut price, GrubHub, a more direct DoorDash competitor, has almost tripled in the past year and is now valued at over $8.5 billion. GrubHub acquired Eat24 from Yelp last year for $288 million.


DoorDash last raised money in 2016, when the company pulled in $127 million. The Wall Street Journal reported at the time that the valuation was $700 million after the company failed to raise funds at its desired $1 billion price tag.


DoorDash CEO Tony Xu told CNBC that the new capital will enable the company to work with more restaurants, invest in technology that lets restaurants integrate the DoorDash technology on their own websites and mobile apps, and expand geographically from 600 to 1,600 cities in the U.S. and Canada this year.


The goal is "to make DoorDash the last-mile logistics platform in every city," Xu said.


Like Uber, DoorDash has its own staff of developers and operations people and employs contractors to deliver food. Xu said there are over 250,000 so-called dashers on the platform. The company plans to grow from 550 employees to about 800 this year, he said.


This Vision Fund's Jeff Housenbold, a director at Grab and Munchery, is joining DoorDash's board. Sequoia Capital, an existing DoorDash backer, and Singapore's GIC also invested in the round.


As for SoftBank's investment in both Uber and DoorDash, Xu put a positive spin on it:

"The best investors always invest in winners in a category," he said.


By –CNBC



Uber is preparing to sell Southeast Asia unit to Grab in exchange for stake in company


Uber is preparing to sell its Southeast Asia business to Singapore's Grab in exchange for a sizable stake in the company, according to two sources with knowledge of the matter.


No deal has been reached yet, and the timing of any such deal is uncertain.


Grab provides private car, motorbike, taxi and carpooling services in more than 100 cities across Southeast Asia. The company claimed to have 95 percent market share in taxi ride-hailing when it announced plans to raise more than $2.5 billion from SoftBank and other investors in 2017.


The move would mimic Uber's strategy in China, where the company sold its ride-hailing operation to Didi for 20 percent ownership, and Russia, where the company merged its local business with Yandex's ride-hailing business for a 37 percent stake. The objective would be to help Uber reel in its costs in preparation for an IPO as soon as next year, said the sources, who asked not to be named because the discussions are confidential.


Since taking over for co-founder Travis Kalanick in August, Uber CEO Dara Khosrowshahi has focused on cleaning up the company's battered reputation and instilling financial discipline to push toward profitability. Uber's loss surged 61 percent in 2017 to $4.5 billion, according to numbers released this week, though its loss in the fourth quarter narrowed from the prior period.


A tie-up with Grab would also play into SoftBank's efforts to exert greater control over the global ride-sharing market. In January, the Japanese tech conglomerate bought about a 15 percent stake in Uber, mostly buying shares from existing investors. SoftBank also owns shares in Grab, Didi, India's Ola and Brazil's 99, and has publicly expressed interest in Lyft, Uber's main U.S. rival.


At the Goldman Sachs Technology and Internet Conference in San Francisco this week, Khosrowshahi said that competing against local players is very hard.


"I think the team ran through an inventory of where we competed, and if we compete on let's say even on a dollar-for-dollar basis against the local player, paying the same amount to drivers, collecting the same amount from riders, in general where we are now is, if both players are kind of spending equally we tend to win share. We've got a better brand, we've got better technology, better network, etc. Whatever it is, we tend to win share. There's certain markets, China and Russia, where that wasn't true. And if your only competitive advantage, or the only reason you can be in a market is because you can spend money, that's not exactly a reasonable proposition."


Reuters reported in November, citing industry sources, that a SoftBank investment in Uber would make it possible for the company to consolidate some of its ride-hailing assets across Asia. An Uber investor told Reuters that shutting its Southeast Asia unit would allow the company to "print money" and make an IPO more realistic.


Uber and Grab declined to comment.



By– New Straits Times



Meet Brain, the company bringing robots to your supermarket


Self-driving cars have dominated chatter about the potential of autonomous technology. However, focusing on just vehicle applications misses how far and wide automation has already begun to go.


Take Brain Corp, a US-based developer of tech for self-driving robots that raised $114 million last summer in a round led by the SoftBank Vision Fund. So, what application for autonomous tech convinced the Japanese investment powerhouse to part with its cash? Cleaning.


‘There’s no point building robots for robots’ sake,’ explained Phil Duffy (right), the VP for innovation at Brain, in an interview with PitchBook. ‘[In cleaning], we found a market with a high turnover rate of staff, rising labour costs and very slow innovation.We are bringing something significant to market, so we went in.’


While the old-school industry was initially receptive of Brain’s ideas, making machines smart in a real-life environment was not simple.


‘Building any kind of navigation-based AI in a lab is one thing,’ Duffy said. ‘But making it work in a real-world situation is an absolute challenge.’


For industrial-scale cleaning, this involves many moving parts, both human and robot. As Duffy explained, there could be up to 20 people in one store at night, driving forklift trucks, restocking and moving carts: ‘Developing AI for those types of spaces is very complex.' To help do it, representatives from the company spent several nights observing the inner workings of different stores to see the patterns that emerge.


"We want to set ourselves up as a company providing AI software to a number of different industries."-Phil Duffy, VP for innovation at Brain.


Janitorial work, however, isn't Brain’s only aim.


‘The goal was always to take our technology into other sectors,’ he said. 'We designed it as a platform originally before going into the cleaning industry, but we needed a market entry point. We want to set ourselves up as a company providing AI software to a number of different industries.’


Duffy named retail, security, logistics, healthcare and consumer applications as other sectors that are broadly ‘on [Brain’s] radar'.


One of the big acid tests for the company’s tech will come this summer. In partnership with SoftBank Robotics, the company will enter Japan’s commercial cleaning robot business. Preparation is going well, Duffy said, but Japanese nuances have brought their own issues.


‘Obviously there are challenges,' he said, 'such as designing a system to work on a Japanese network—there’s a slightly different UI system—as well as configuring it to Japanese store layouts and processes. But we’re working well with SoftBank Robotics to prepare our machines for deployment.’


From – PitchBook


Here’s Why Amazon Bought a Doorbell Company


Last week Amazon.com Inc. bought the Santa Monica, California-based smart home equipment maker Ring for an estimated $1 billion in cash. Though filled with less import than the company’s $13.4 billion acquisition of Whole Foods Market last year, the deal was the second-largest in Amazon’s history. And like all acquisitions, it gives us a rare glimpse into the way Jeff Bezos sees the future.


In the short term, Ring gives Amazon another piece in its Alexa puzzle and a leg up in its race against Google and Apple to control homes that will increasingly be filled with connected appliances. Alexa is a nice novelty now, great for serving up the weather, reading the news and hosting the occasional trivia game. But it will be really useful when it’s the hub that lets people use their voice to arm their security systems, open locked doors and flash video of the person who’s ringing the doorbell out front. Google understands this as well; the new $229 Nest doorbell will come with a free Google Home Mini when it starts shipping this spring.


Alexa currently works with a host of third-party smart home products. But owning Ring’s varied assortment of video doorbells, security cameras and accessories allows Amazon to accelerate their development and make them exclusive to Alexa. (It bought a similar company, Blink, last year.) Amazon can also do the typical Amazon thing and lower prices, probably by incorporating the optional subscription plans for keeping recorded video into the soup of benefits that is a Prime membership.


There’s also a medium-term benefit to adding Ring. Package theft, a.k.a. “porch pirates,” is a rampant problem in much of the country, one that has required Amazon delivery people to start emailing customers photographs of packages left by the front door, and which, in the past, has forced the company to restrict same-day delivery from neighborhoods with high crime rates. Last year, Amazon introduced a home camera and a service called Amazon Key, which automatically opens doors for verified delivery people. Amazon Key works with so-called “smart locks” made by other companies. Ring doesn’t sell door locks just yet, but you can imagine a day when Amazon owns all the components to make such a service work.


The implications of the Amazon-Ring deal are really interesting to contemplate when we start thinking farther out. We know Amazon wants to deliver groceries. But leaving bags of kale and cartons of milk outside for hours doesn’t work, and many Amazon Fresh subscribers aren’t crazy about accumulating those bulky blue totes filled with dry ice. When Amazon is behind your home security system, your doorbells and door locks, Amazon workers will be able to walk in, unpack the bags and bring the milk right to the refrigerator.


But why stop with groceries? With its endless appetites, Amazon wants to expand in the massive home-services category, fertile ground for companies like Handy Technologies Inc. and Thumbtack Inc. Imagine sitting at school or in your office and being able to buzz in the cable guy or a plumber after verifying they are who they say they are with live video on your phone. Or we can go even further: The Amazon front door and security system could one day open for your trusted housekeeper, dog-walker or exterminator, and no one else.


To keep growing at 30 percent a year, Amazon has to start selling us services, not just stuff. The Ring acquisition, with its smart doorbells and security cameras, is another step along that path. Rivals should beware: Amazon’s move into smart home devices is going to give all new meaning to the words “lock in.”



From – Bloomberg



Private Equity Firms Are Battling for Control of an Indonesian Lender


Private equity firms including Warburg Pincus are vying with suitors across Asia for control of a TPG-backed Indonesian consumer finance company, people with knowledge of the matter said.


Taiwan’s Cathay Financial Holding Co. and South Korea’s Shinhan Financial Group Co. are among first-round bidders for a stake in PT BFI Finance Indonesia, said the people, who asked not to be identified because the details are private. Bloomberg News was first to report in September that Trinugraha Capital, whose investors include TPG, is seeking a sale of its 43 percent holding.


BFI Finance has also attracted interest from Baring Private Equity Asia, the people said. Trinugraha Capital has received at least 10 bids for the stake, according to the people.


Shares of BFI Finance have more than doubled over the past year, giving the Jakarta-based firm a market value of $986 million. The benchmark Jakarta Stock Exchange Composite Index, which hit a record high last month, rose about 20 percent over the same period.


Used Automobiles


Foreign financial firms have been drawn to Indonesia’s rapid economic growth and the size of its population. Any deal for BFI Finance would add to the $8.5 billion of announced acquisitions in Indonesia in the past 12 months, data compiled by Bloomberg show. Mitsubishi UFJ Financial Group Inc. agreed in December to buy a $1.2 billion stake in PT Bank Danamon Indonesia.


Trinugraha Capital’s other investors include Southeast Asian buyout firm Northstar Group and Indonesian businessman Garibaldi Thohir. It hopes to choose a winning bidder around mid-year, one of the people said.


Representatives for Baring Private Equity Asia, BFI, Cathay Financial, Northstar, Shinhan Financial, TPG and Warburg declined to comment. Thohir said in a mobile phone text message that he wasn’t aware of any deal.


Most of BFI Finance’s business is financing purchases of used automobiles. The company, founded in 1982, also makes loans to buyers of heavy equipment, trucks and industrial machinery. It has 218 branches and 124 kiosks spread over 33 of Indonesia’s 34 provinces, BFI Finance’s website shows.



From – Bloomberg



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