A recap of Asian tech in 2019

2019 is almost over, and what a ride it has been - full of ups and downs that challenged our community and made us stronger. [View this email in your browser]( Weekly Commentary Dear {NAME} 2019 is almost over, and what a ride it has been - full of ups and downs that challenged our community and made us stronger. 👏 This is my attempt to sum up a very busy year. 1. The need to be profitable 💰 The WeWork debacle is possibly the [best gift]( that the startup world got in 2019. Don’t get me wrong: I’m not rejoicing at the misfortune of others. But as the company faced troubles after attempting to go public, it got all of us to think more critically about how to build startups more sustainably. I explained this in [a commentary that I wrote a month ago]( “These days in tech, profitable startups are looking very sexy, thanks to WeWork, Adam Neumann, and SoftBank. But to people outside of the tech and startup community, it must have been so amusing to see that most industry insiders are only now starting to realize that turning a profit is critical to the survival of any business.” “In our quick chats with founders, I learned that startups big and small are taking steps towards being profitable. To me, that’s a good indication that the community is becoming wiser and more responsible. And for companies, perhaps it’s also an exercise in managing scale – being or staying lean and mean ahead of an impending global financial downturn is probably a smart move.” This is an ongoing conversation, and it will likely continue in 2020. Recently, a prominent investor in the region told me over coffee, “Funding is drying up, and even the really good companies are finding it harder to fundraise.” You have been warned. 😟 2. China’s growing clout 🇨🇳 China continues to be an “influencer” in Asia’s tech and startup ecosystem. It’s kinda [shaping Southeast Asia]( - in a good way, I believe, and the rest of the world can draw inspiration and lessons from the Middle Kingdom. It has become common for founders to visit the country to learn more about how Chinese companies operate. The typical feedback I hear is that going on such a trip helped open their minds, as startups in China function at a whole different level. Read some of our select pieces below. You can also find all of our China coverage [here](. - [China’s profitable food delivery giant bodes well for Grab and Gojek]( - [3 years on, WeChat’s ‘instant apps’ have changed the internet]( - [Bytedance: The empire expands]( - [Why Alibaba acquired a fast-growing new shopping app]( - [The 50 top-funded startups and tech companies in China]( Chinese companies like Alibaba, JD.com, Tencent, Bytedance, Meituan, and YY (remember [the $2.1B Bigo deal]( continue to invest and take a strong interest outside their home market. That said, not all is rosy for China’s startups. Remember Ofo? It’s a painful tale but it can be quickly forgotten in the sea of other stories. I recommend giving this piece a go - “[Why Ofo failed?](. There’s a lot that we can learn from the whole saga. 3. The heated battle between Grab and Gojek (ง'̀-'́)ง Gojek and Grab kept on aggressively amassing capital through 2019, and it was quite a spectacle. More than US$11 billion of total disclosed funding were raised between the two, with Grab getting the lion's share. 2019 also marks one full year after Gojek has expanded outside of Indonesia. The results are debatable. Industry insiders have speculated that Gojek is happy to be no. 2 or 3 in overseas markets, but I’ve also heard that Gojek has taken an “all or nothing” approach. Either way, Gojek is marching forward with its regional expansion plan, as it’s expected to [enter]( Malaysia and the Philippines in 2020. A report by advisory firm ABI Research placed Grab ahead of Gojek by a [wide margin]( in Southeast Asia’s ride-hailing race. Whether this finding rings true or not depends on which company you’re more aligned with. Ride-hailing is just one of the services of the super-app vision, and the two companies will continue to battle it out on the payments and food delivery fronts next year. Read some of our best stories on these archrivals below. You can also find all of our Grab and Gojek coverage [here](. - [The state of the super-app race in Southeast Asia]( - [Can GoPlay be a game-changer for Gojek?]( - [Grab: Indonesia’s fifth unicorn?]( - [Why there’s nothing really super about super apps]( - [An analysis of Gojek and Grab’s valuations and profitability prospects]( 4. The rise of Southeast Asia and India 📈 Southeast Asia is on the up and up as the [digital economy expands]( showing breakthrough growth, particularly in Indonesia and Vietnam. We’re in “[Southeast Asia’s golden age]( as investor Nick Nash puts it, with startup fund Asia Partners predicting that more than 20 tech companies from the region will be worth more than US$1 billion by 2029. Renowned investment firms including Temasek, GGV Capital, Qiming, and Lightspeed are looking a lot more closely at the region. If I were to speculate, the obvious candidates that could break past the billion-dollar valuation mark in 2020 are Ninjavan, Carousell, Circles Life, Ruangguru, and Shopback. And maybe Tech in Asia? 🤭 Read: - [The most connected VCs in Asia]( - [An analysis on Southeast Asia’s exit landscape]( - [4 factors turning Vietnam into Southeast Asia’s next growth story]( - [More VCs are vying for Southeast Asia. Here’s how they can compete]( - [Indonesia’s ecommerce race gets brutal]( - [The 50 top-funded startups and tech companies in Southeast Asia]( Indian startups keep making the headlines too, with Paytm’s [recent $1 billion]( fundraise and Oyo’s [ambitious expansions]( as well as [Delhivery]( and [BigBasket’s]( entry into the unicorn club, and the minting of Byju’s founder (an [ex-math tutor]( Byju Raveendran [as a billionaire](. Unicorns aside, India is also home to many fast-growing startups like [Meesho]( [Cars24]( [Rebel Foods]( and [Groww](. This year, we also saw more connections between India and Southeast Asia. [Grab-backed]( Oyo expanded to the region with its [$1 billion war chest]( as it goes up against [local player RedDoorz](. Flipkart co-founder Binny Bansal [set up]( his $400 million fund in Singapore, while SaaS provider Freshworks [extended its reach to]( Southeast Asia. And India doesn’t seem to be slowing down this holiday season. Based on our company database, we are so far already tracking [more than 50 deals]( in December. Read: - [Why online milk delivery is taking off in India and not elsewhere]( - [These are the most active investors in India’s startups]( - [The 50 top-funded startups and tech companies in India]( 5. Founders’ fond farewells 😢 This year saw several founders step down and move on to the next adventure. From Alibaba’s [Jack Ma]( Bukalapak’s [Achmad Zaky]( and Gojek’s [Nadiem Makarim]( to [Lei Jun]( of Xiaomi as well as Larry Page and Sergey Brin [of Alphabet]( - aka the parent company of Google. Hopefully, founders can keep making an impact in their next gig as they focus on the bigger-picture things that their country or the world needs. It also establishes a nice institutional precedent for companies, motivating them to still grow and thrive even after founders step away from day-to-day management. With new leadership and change of roles, how will Alibaba, Gojek, and Bukalapak fare? It’s going to be a fun 2020 - I’m excited to see what happens next. Beyond that, which up-and-coming startups will make breakthroughs in the next decade? And which tech firms will go public? And as funding runs dry, will we see many companies die? If you have any thoughts, please drop me a line and let me know. I’ll be taking a break next week, so see ya in 2020! You can find last week’s commentary via this link – “[It’s too easy to villainize founders](. You can read all my commentaries [here](. P.S. We’re nearing the end of a decade, but it’s just the beginning of Southeast Asia’s golden age. The Asian tech and startup scene has come a long way, and we’re working on a report that reflects the current state of the industry. You can help us by [doing our 6-minute survey here](. We will use the results to bring you fresh perspectives and in-depth insights into our ecosystem. Many thanks! 🙏 ABOUT TECH IN ASIA Our goal is to build and serve Asia’s tech and startup community. 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