Issue 41

Stripe Teams up with PayNet and Launches in Malaysia

Today, Stripe, a global technology company that builds economic infrastructure for the internet, announced its official launch in Malaysia. It also announced a partnership with Payments Network Malaysia Sdn Bhd (PayNet) to make FPX available to businesses in the country. Valued at US$ 35 Billion, Bloomberg reports that Stripe is the 3rd most valuable company in the United States. 

Fintech News Malaysia first reported on the beta testing of Stripe as far back as February 2019. With this launch in Malaysia, any online company in the country can now gain access to Stripe’s entire product stack, to launch, run and scale their business globally from day one – including Stripe Connect for running multi-sided marketplaces, billing for subscriptions and recurring payments, radar for fraud detection and prevention, Sigma for analytics, and more. 

From today, Stripe is also making FPX available in beta, allowing businesses on Stripe to accept payments via online bank transfers, along with major credit cards like Visa and Mastercard. 

Commenting during the launch John Collison, Co-founder and President, Stripe, said “Even today, less than eight percent of commerce is online, largely because moving money on the internet remains complicated, cumbersome and slow,”. 

“At Stripe, our goal is to remove these barriers and build the kind of infrastructure ambitious businesses need to run at internet speed and scale.” 

“Stripe aims to empower more businesses in Malaysia to export their creativity to the rest of the world.” said Piruze Sabuncu, Head of Southeast Asia and Hong Kong, Stripe. 

Stripe has been testing its service earlier this year, and already works with some of the country’s well known companies including: e-commerce solutions platform EasyStore, food delivery service dahmakan, and fashion and retail platform FashionValet. 

Malaysia marks yet another step forward in Stripe’s global expansion, following from the company’s launch in Estonia, Greece, Latvia, Lithuania, Poland, Portugal, Slovakia and Slovenia earlier this year. Globally, Stripe processes hundreds of billions of dollars a year for millions of businesses.

From –

SPE firm Navis Capital acquires Malaysian durian company Hernan

Private equity firm Navis Capital Partners has completed the acquisition of Malaysia’s durian exporter Hernan Corporation, according to a media statement. The financial details of the transaction were not disclosed. Following the transaction, Navis Capital plans to invest up to 400 million ringgit ($95.36 million) to support Hernan Corporation’s expansion plan. 

The PE firm said it will assist Hernan Corporation in growing its capacity to produce durian paste, puree and finished products such as mooncake, ice cream, chocolate as well as other durian flavoured confectionaries. Furthermore, Navis will also look to acquire up to 10,000 acres for durian plantation, starting in Pahang state, Malaysia, in partnership with a local agriculture player. 

Navis said its investment into Hernan was also encouraged by the fast-growing demand for durians in China as well as overseas Chinese communities around the world. In 2018, China spent around $1 billion on importing durian, and the number is expected to double by 2023. Malaysia, along with Thailand, is the main producer of durian. In the future, Navis sees the substantial scope for the application of agri-tech, IoT and Industry 4.0 to modernise the entire value chain from durian farming to processing, according to co-founder and managing partner Nicholas Bloy. n. 

The PE firm will also look to adopt an open collaboration approach with other industry players to raise the standards of the industry. Currently, Navis manages around $5 billion in private equity capital across investments in Asian countries. 

The firm is currently raising its eight vehicle, which has a $1.9 billion hard cap, we had previously reported. In March 2019, Navis received up to $200 million from US government’s development finance institution Overseas Private Investment Corporation (OPIC) for its latest fund. Earlier this year, Navis invested in Vietnam’s private education platform Thanh Thanh Chong Education JSC as well as Thailand’s food processing company Srithai Daily Foods.

From – Deal Street Asia

Honda acquires California’s Drivemode to offer connected mobility services

Honda R&D, the research and development arm of Japanese conglomerate Honda, announced on Monday the acquisition of California-based Drivemode in an attempt to strengthen Honda’s capabilities in the fields of digital and connected mobility products. 

Honda R&D acquired all outstanding shares of Drivemode in a deal completed on September 26, making the connected car platform operator become its wholly-owned subsidiary, said Honda in a company statement. Before the acquisition, Honda R&D and Drivemode have been collaborating and conducting joint development activities since 2015 through the Honda Xcelerator program, an open programme Honda has been pursuing on a global basis for innovators across all funding stages. 

The deal will push forward the combination of Drivemode’s human resources, innovative software technologies and experience as a venture company with Honda’s product development technology and capability to offer connected services, said Toshihiro Mibe, president and representative director of Honda R&D. “With the support of Honda, the Drivemode team can have a lasting impact on actual vehicles and drivers around the world at scale,” said Yo Koga, CEO of Drivemode. Drivemode, founded in 2014, develops and operates smartphone-based connected services, specializing in multiple areas, such as the development of the user interface and application, as well as cloud-based technologies. 

The company offers a mobile-based connected car platform through consumer-facing apps, driver assistance and analytics for fleet managers, and a bring-your-own-device connected car solution for automakers. 

Its safe driving app has over 2.5 million downloads in 150 countries, according to the company website. Drivemode has raised a total of $9.2 million across three funding rounds. The company closed $6.5 million in a Series A round led by Panasonic in March 2017. 

It also completed a $2 million seed round in December 2014 and a $650,000 angel round in January 2014, according to Crunchbase.

From – Deal Street Asia

Treat Yo' Self: Southeast Asia's e-Commerce Sector to Hit $150 Billion by 2025

The e-commerce market in Southeast Asia has grown sevenfold since 2015, to $38 billion in 2019, far outpacing any other internet-based sector in the region, a recent study showed, adding the sector is expected to hit the $150 billion mark by 2025, thanks to more and more people using internet in the region. 

Even though ease and convenience have fuelled the boom in e-commerce around the world, steep online discounts have played a bigger role, especially for big-ticket items like electronics. 

In Southeast Asia, online shopping festivals organised by international, as well as homegrown companies, have risen: from 9/9 (9 September), to Singles Day, (11/11) which has helped Alibaba post record sales year after year. 

A Google Trends report showed that queries related to vouchers, coupons, and promotions, typically given out by e-commerce platforms during shopping festivals, have more than doubled over the last four years. 

Perks such as same-day, or two-hour deliveries have also incentivised consumers to purchase online, with shorter delivery times catalysing purchase of cheap, everyday items, such as groceries, clothing, medicines etc. 

Gamification of e-Shopping 

Leading e-commerce apps in Southeast Asia have tapped the “social media influencer” culture, to enable online shopping-related content, such as “unboxings” of products, followed by reviews. 

Limited time offers, where customers are given only a few minutes to check out items from their baskets if they want to avail deep discounts, have also helped drive online sales. 

The e-commerce industry has inadvertantly given rise to several logistics players in the region, which then compete with each other on delivery times, and cost of operations so that they can bag contracts with big online shopping players, again making the system more conducive to attract consumers to the online shopping ecosystem. 

But being forced to let go of profit margins to attract buying customers online, e-commerce companies in the region have turned to supply-side monetisation, by offering value-added services for a fee to its sellers, such as logistics, inventory management, and advertising, the joint study between Google, Temasek, and Bain & Co added.

From – Entrepreneur Asia Pacific

Southeast Asia's Fintech Industry is set to Cross $1 Trillion by 2025

A recent survey showed that of the 400 million adults in Southeast Asia, only 104 million are fully “banked”, and have full access to financial services, while 198 million do not even own a bank account. 

And while the region houses some of the biggest financial companies in the world, very basic problems – like infrastructure costs, absence of public registers and reliable credit information, along with stringent financial regulations – have made it difficult for institutional banks and insurers to penetrate the region in a meaningful way. 

But that is changing now, thanks to financial technology companies. 

The growth of fintech firms of various shapes and sizes across Asia over the last five years has been fuelled not only by advancement in technology and rate of internet penetration in the region, but also because of more and more people becoming financially savvy, and therefore demanding better financial services. Digital payments in Asia, which includes account-to-account transfers, and e-wallets, has reached an inflection point in Asia, a joint study by Google, Temasek and Bain & Co shows. 

Growing in the double-digit range, digital payments are expected to cross $1 trillion by 2025, and account for nearly one in two dollars spent in the region. The market for e-wallets is expected to grow even faster, from $22 billion in 2019, to $114 billion, a more than fivefold jump, by 2025. 

Interest in Asia’s fintech sphere is pouring in from sources beyond those that typically play in the field – such as banks, insurance companies, and remittance companies – from ride hailing, ‘super-app’ companies, pure-play fintech companies, e-commerce, and social media platforms. 

Independent players that only provide financial services online – such as Vietnam’s Momo, a payments app, Stashaway, a digital wealth management service, and Akulaku, an Indonesian digital lender – navigate specific pain points such as access, convenience and transparency, to provide services to people who normally would not have had that kind of access. 

Companies like Lazada, Gojek, Grab, and Sea Group have a leg-up on pure-play fintechs because they already have an established customer base, and therefore, have fewer and less costly barriers to entry. They often partner with traditional financial companies to offer services such as insurance and loans, along with digital payments. 

With a huge underbanked population yet to be brought into folds of formal financial services, the growth potential for fintech companies remains abundant in Southeast Asia. Companies that have already established themselves in the fintech market in the region have made a significant dent in the underbanked population, and those entering now are still finding it comfortable enough to hold their own.

From – Entrepreneur Asia Pacific
 All Rights Reserved 2019.

9 Temasek Boulevard Suntec Tower 2
#09-01 Singapore 038989
+65 6407 1344

[References] [Disclosure]