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Here’s what you should know today:

1. RedMart hired ex-Amazon and Facebook exec as Chief Product Officer

Singapore-based RedMart has appointed Patrick Teo as its new Chief Product Officer (CPO) and Executive VP Engineering. Teo is hailed from Silicon Valley where he previously posted in as Head of Tech and Site Leader for Amazon.

His impressive CV also including Head of Engineering for Facebook’s Local and Entities division, VP Engineering for Shutterfly. Under his stewardship, the startup went public for IPO in 2006.

RedMart’s President, Vikram Rupani said that Teo’s appointment is “a stamp of validation for Singapore’s maturing tech ecosystem and the quality of our own engineering core.”

Read the full story here.

2. Uber fled Russia after $3.7 billion merger agreement

Uber and Yandex are merging their ride-hailing businesses in Russia. The former will invest $225 million and take a 36.6% stake in the new venture, leaving Yandex with a controlling stake of 59.3%.

“This deal is a testament to our exceptional growth in the region and helps Uber continue to build a sustainable global business,” said Pierre-Dimitri Gore-Coty, Uber’s Chief for Europe, Middle East and Africa.

Together, Uber and Yandex handle 35 million rides a month. The yet-to-be-named venture will be valued at $3.73 billion and the deal is expected to close in the last quarter of 2017.

Read the full story here.

3. CashCashPinoy shuts down in the Philippines

Founded in 2010, CashCashPinoy announced on its website that it’s “taking some time out from the spotlight.” The online company used to be a discount site offering its members bargains from various merchants.

The company has been the subject of numerous complaints of selling fake and low quality products as well as allegations of scams, leading to their payment partners like PayPal and BDO to pull the plug on the transactions coming from the site.

It is not clear yet as what to led to the shutdown of the business, although there has been a report about the company’s filing for bankruptcy posted on business rating and reviews site Jabber.

Read the full story here

As you may have already realized, Amazon’s recent $13 billion acquisition of Whole Foods is more than about groceries. By adding an enormous offline groceries chain and its customers attention to its repertoire, the retail beast moves closer to becoming a real one-stop destination for all consumer needs.

Slate puts it best, “Scale, meet scale. Logistics, meet logistics. Loyal customer base, meet loyal customer base.”

Before this, Amazon was already banking on America’s $800 billion grocery business via Amazon Fresh; it’s key competitors being Instacart, FreshDirect, Google Express and Blue Apron.

An Amazon Prime member can now receive everything he or she needs within two hours or shorter depending on their location; a feat these other grocery delivery services will find it tough to beat. 

This move will further reinforce consumer behavior of searching for products directly on Amazon rather than a typical search engine – behavior already witnessed in Indonesia.

This acquisition also puts in Amazon’s hands customer data from a network of shoppers that ring up $300 million in sales across North America. 

Why else would Facebook partner with Dunnhumby, a grocery data firm in 2016 to learn more about how Facebook advertising incentivizes purchases?

The grocer, most importantly, also has veteran experience and knowledge on sourcing and storing fresh food that can help Amazon’s “wasteful” Amazon Fresh operations and improve the entire customer experience, a staple to Bezos’ business philosophy.

Bloomberg reported that workers at Amazon Fresh threw away about a third of the bananas it purchased because the service only sold the fruit in bunches of five. Employees trimmed each bunch down to size and chucked the excess.

“There’s just not a lot of demand there. The whole premise is that you’re saving people a trip to the store, but people actually like going to the store to buy groceries,” said Kurt Jetta, chief executive officer of TABS Analytics, a consumer products research firm.

The grocery game can’t be won by trucks and websites alone. Whole Foods gets two-thirds of its sales from fresh fruits, vegetables and meats, whilst other supermarkets gets only 25% of sales from those fresh categories.

“Whole Foods as a kind of guinea pig for Amazon — a pricey, organically sourced one, perhaps, but a guinea pig all the same.” – NY Times

Whole Foods’ grocery-distribution infrastructure is already expected to act as Amazon’s grocery-distribution infrastructure and will incorporate the e-tailers technological capabilities to streamline the checkout process at Whole Foods to possibly push the long-awaited “cashier-less” Amazon Go concept.

What does this mean for everyone?

Following the announcement of Amazon’s acquisition, grocery chains’ stock took a tumble on Friday. Walmart stores Inc. fell 4.7%, while US retailer Kroger Co. dropped 9.2%.

Payment companies such as Square.Inc also fell over the concern that the acquisition will lessen the importance of traditional payment methods.

The value of the industry should reflect grocery players across the globe, also counting those investing in countries such as Singapore and Thailand. The acquisition may not have a direct impact on Southeast Asian grocery players yet, but it represents how change could come in the future as Amazon is rumored to launch in Singapore and Lazada’s acquisition of RedMart.

If grocery players remain purely within their vertical, it could make them vulnerable to an acquisition or worse, once an all encompassing, data hungry giant makes it way into the market.

Amazon’s acquisition of Whole Foods can serve as validation to how important consumer data, logistics, payments and an integrated value chain is, for small players that do not have this, it will be difficult for them to exist in the future.


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Here’s what you should know today.

1. Paytm is in talk for a $1.5 billion investment from SoftBank

Paytm is reportedly in talks with Japan’s SoftBank Group to raise $1.2-1.5 billion in cash which will place the valuation of the India-based company up to 9 billion.

Getting SoftBank on board as a large shareholder will help Paytm reduce the control of Alibaba and anticipate possible government concerns about a Chinese firm having a strong hold in Paytm.

Alibaba currently owns a controlling stake of 60% in Paytm’s ecommerce business – which was separated from its payment service last year. SoftBank is an early investor of Alibaba.

The investment in Paytm means an opening for SoftBank to the India’s big financial services market.

Read the rest of the story here.

2. Malaysian government-backed agency launches digital hub and entrepreneur initiatives

Malaysian Digital Economy Corporation (MDEC) has announced two new initiatives that will help boost the country’s digitalisation efforts.

First is Malaysia Digital Hub – a program that will provide the necessary resources for startups to scale globally, including funding opportunities, mentorship and other aspects of a conducive business environment such as corporate tax exemptions.

The first three digital hubs are APW, The Co. and Common Ground. They are all located in the Klang valley.

The second is Malaysia Tech Entrepreneur Programme (MTEP), aimed to attract global talents to expand or build startups in Malaysia. The agency will enlist the expertise of Microsoft, Next Academy, Maybank, and Y Academy with Kejora to run the initiatives.

Read the rest of the story here.

3. Lazada teams up with Netflix and Uber ahead of Amazon’s entry into Southeast Asia

In anticipation of Amazon’s expected entry into the region this year, Lazada teaming up with Netflix and Uber to offer Amazon Prime-like membership program called LiveUp.

For a fixed yearly fee of $20 or SG$28, the subscribers will gain access a range of deals across services from these companies.

That includes free/faster delivery service from Lazada and Taobao, promotions for Redmart, free six-month subscriptions for Netflix, and discounts for rides and meal deliveries on Uber.

Lazada is not the only one benefitted from the partnership. It will give Netflix an open it’s needed in the region where people are reluctant to pay for content and Uber will have support in its competition with Grab.

Read the rest of the story here.

Welcome back from the weekend. Here’s what you should know today.

1. Viva Republica raises $48M to boost p2p money, eyes Southeast Asia expansion

South Korea-based fintech startup Viva Republica has raised a US$48 million in a Series C round led by Goodwater Capital. Viva will use the newly-raised capital to acquire users and launch new products.

Going forward, the platform plans to introduce three new services: loan brokerage, overseas transfer, and micro insurance and foreign exchange. Viva also has plans to expand to Southeast Asia through an M&A but said that it would not disclose specific plans.

Read the rest of the story here.

 

2. Zalora invests $4.2mil on regional e-fulfilment hub in Malaysia

The e-fulfilment hub handles thousands of orders per day, approximately 4.5 million items and serves as the company’s sole fulfillment hub for Malaysia, Brunei, Hong Kong, Macau and Taiwan. It also provides stock support for Indonesia and the Philippines.

Why Malaysia? One of the main things Zalora looked at in deciding the location for its e-fulfillment hub was the geographic density of orders and customers. The highest density comes from West Malaysia and Singapore. The hub is located in Shah Alam, an industry-heavy city accessible by seaport and airport, and close to Kuala Lumpur.

Lower cost markets such as Indonesia and the Philippines were not picked because of higher risks and complexities in dealing with customs controls.

Read the rest of the story here.

 

3. Recommended Reading: Why Alibaba’s latest Paytm buy proves Amazon is playing a losing game in Asia

Alibaba’s latest investments into Paytm is a clear signal of its growing investment presence. Fintech is one of Alibaba’s domineering tentacles into the region. Then there’s Lazada with its recent investment in Redmart.

 We need to see Alibaba in the context of Chinese investors’ overarching trend of divestment from the mainland and heightened interest in the global economy.

But Alibaba’s tech investments and acquisitions are not the only parts of the whole. With Jack Ma personally advising Malaysia’s digital economy, it’s hard not to see how Alibaba can potentially become a regional champion.

Read the rest of the story here.

Here’s what you should know before rounding up the day.

1. Amazon launches subscription service for tech toys

What? Amazon launched a new subscription program aimed called STEM Club, which delivers educational toys to your home for $19.99 per month.

What else? The subscription program won’t feature just any ol’ STEM toys, but will rather only include those that have recently launched or those that are exclusive to Amazon.

How does it work? The first toy will arrive in under a week’s time with free shipping. From that point forward, a new item will arrive on a monthly basis. The service is only available in the U.S.

Read the rest of the story here.

 

2. Singapore’s MC Payment acquires a fintech startup to work with Alipay

Singapore-based MC Payment announced that it has acquired a controlling stake in Genesis Payment Solutions.

What is Genesis? Genesis is a Singaporean payments company that is licensed by Alipay to acquire merchants for the Chinese online payments provider.

What does the deal provide? Through the deal, MC Payment gains access to Genesis’ clients, mostly small- and medium-sized enterprises, as well as the firm’s merchant-acquiring license with Alipay.

Read the rest of the story here

 

3. Recommended Reading: RedMart, Lazada and the future of online grocery market in Asia

Roger Egan, the co-founder and CEO of RedMart shares his views about the future of online grocery retailing in Asia.

His outlook on Southeast Asia’s online grocery market: Grocery represents about 60% of the $814-billion total retail market in Southeast Asia. With 1% online grocery current penetration and a tech-savvy consumer base, we believe Southeast Asia will quickly catch up and leap to 15-20% penetration in cities.

Where he sees RedMart in 5 years: Egan expects for RedMart to have approximately 15% of the market share in Singapore.

Read the rest of the story here

Here are the ecommerce news you should know today.

1. Tesco is secretly setting up their online store in Singapore

Well, it doesn’t seem like a secret anymore. But news suggests that supermarket giant Tesco is gearing up to fight against Redmart and Amazon in Singapore. Tesco may not be visible on the streets  of Singapore, but it seems that the country will be Tesco’s testbed to go all out online, under the supermarket’s subsidiary called “Tesco Digital Ventures”.

Watch this space.

Read the rest of the story here.

 

2. Indonesia lays out regulations for peer-to-peer loan startups

It’s Indonesia’s first attempt at laying down rules to define how people may use the internet to connect money lenders with borrowers in efficient ways. Here are some quick pointers:

  • Foreign ownership limited to 85%
  • Foreigners can only act as lenders
  • Minimum capital of approximately $200,000

Read the rest of the story here.

 

3. What’s coming in Southeast Asia: The digital health opportunity

Healthcare in Southeast Asia is a US$100 billion dollar market. But there is a stunning diversity in the health systems of the ASEAN-10 cluster.

The ecommerce wave has also hit the healthcare sector, especially in regards to pharmacies. Digital marketplaces can help consolidate offerings to consumers in a landscape that is scattered with mom&pop pharmacies.

Going forward, this seems to be the trend for 2017.

Read the rest of the story here.

Interested to learn more about the Southeast Asian ecommerce landscape? Check out the 11 trends that will shape the region’s ecommerce landscape in 2017 here.