Singapore: Appknox closes $652k pre-Series A investment from SeedPlus

Visual of Appknox homepage. August 2016

Appknox, a mobile security company based in Singapore, has raised S$875,000 ($652,985) in a pre-Series A round led by SeedPlus, a new seed stage VC firm backed by Jungle Ventures, Infocomm Investments (IIPL), Accel Partners, and RNT Associates. The investment also sees Foo Tiang Lim, Operating Partner of SeedPlus, joining the Appknox board.

With the newly infused capital, Appknox has launched its cloud-based mobile security solution for businesses in Southeast Asia. Appknox is also an alumni of JFDI Asia and Microsoft Accelerator in Bangalore, India. It enables businesses to conduct a security analysis on cloud-based emulation engines without having to share their mobile app source code.

Users can input the URL of any app on the app store, with Appknox able to provide results of a security analysis within minutes. Appknox claims to be the first in the industry to launch an automated dynamic emulation engine for the iOS platform, allowing businesses to tackle challenges associated with analysing iOS applications.

Speaking on the development, co-founder and CEO Harshit Agarwal, said, “South East Asia is one of the fastest growing regions in the world in terms of internet economy Research by Google and Temasek shows that the digital economy will grow to around $200 billion by 2025.”

“With the growth of e-commerce and digital payments, security will be the most important pillar of support. With the Governments of Singapore and Malaysia announcing their Smart Nation objectives, now is the best time for businesses to start planning security on a regular basis,” he added.

To date, customer response has been positive, with the Appknox launching their solution last year in India, counting major Indian e-commerce and payments businesses like Paytm, Times Internet, BigBasket, CitrusPay, and more among their customer portfolio. “Appknox helped us find some really interesting security loopholes and also helped us to fix it immediately,” says Hari Palappetty of BigBasket.

Speaking about his experience with Appknox, Dwi Sasongko Supriyadi, Head of Engineering of HOOQ said, “I like the detailed analysis along with code snippet that potentially leads to a problem. The turnaround time from app submission to report generation is quick which helps us to identify problem in our product and enables us to address it quickly.”

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Origins & investor response

Asked about what led to the formation of the company, Prateek Panda, co-founder and CMO, told DEALSTREETASIA: “We were in the security space for 4-5 years and had pursued computer engineering together. We first started doing bug bountys – where bug hunters find bugs and exploits in programmes – and reporting them to companies like Microsoft and Facebook. We also found issues in Google and Adobe. So thats where we started in 2009/2010.”

He continues, “We started researching and doing this then we conducted research, training and workshops for SMEs to help their developers understand their security environment better. That’s where we started building our expertise. In early 2014 Snapchat was hacked and millions of user identities were compromised. Then came Starbucks, which saw about 37 million accounts hacked. I think this happened in January or February.”

“The three of us then decided to start up [AppKnox] and we moved into JFDI to start working on our initial plan. So 2014 saw us joining JFDI and moving to Singapore from Bangalore. That’s how we started out with the whole plan. We spent a few months speaking to customers and reiterating the product.In June 2014 we started a private beta with a small pool of customers and in August 2014 we moved to Microsoft Accelerator in Bangalore. From there we started acquiring more customers and developed a more mature business and product roadmap,” he added.

In his interview with DEALSTREETASIA, Panda states that the current focus is on the Indian market, given their understanding of the market ecosystem of the subcontinent and their greater familiarity with it.

Commenting on the investment, Foo stated: “We are always on the lookout for start-ups with cutting edge technology, promising ideas and a great founding team. Given the explosive growth in mobile apps and smartphone users globally, security will only be more important as the next billion smartphone users get online. Appknox is well poised to tap on this huge opportunity.”

Meanwhile, Ravi Narayan, the Global Director, Microsoft Startup Growth Partners, sees the investment as an inflection point in the venture’s growth trajectory, given the increasingly mobile-oriented nature of information technology and computing.

He opines: “Appknox is well positioned to solve a major problem for every business with an app. It’s a big, global app ecosystem and Appknox can make them more secure and therefore be embraced by their users widely.”

Edited excerpts:

Currently, who are some of your major customers?

We are currently working with all the large digital payments and e-commerce companies in India like Myntra, Paytm, FreeCharge and Big Basket. In Singapore we work with Hooq and Redmart. In addition to those, we’re working with a couple of other companies in Singapore as well, in particular a large local enterprise. Back in India, we work with a large global enterprise whose security is based in and managed from India and we handle 350 apps for them globally.

What are the plans for Indonesia and other major Asian markets? What’s your take on companies having a foreign policy?

We are seeing disruptions growing in the digital payments space. However, Internet penetration is very low and is something that needs to go up at a faster rate. We’re expecting that to go up really fast. In fact in ASEAN, the number of of startups coming up in Indonesia is almost twice as much as Singapore. They still have to get there in terms of VC investment and quality.

One of the focuses for our company in Indonesia is going to be digital payments and I feel that we can be a good partner to help digital payments grow in the country

For China, it is an extreme case as they support their own local businesses. I don’t know if we will ever have business operations in China unless a local partner is willing to take it up with us over there. If Uber couldn’t find a way to compete, then nobody can. It’s no surprise that china is that kind of a market. They are right in their way to encourage people to buy local digital products, as part of their national policy.

For instance, they don’t have Google and Baidu works perfectly fine for them. If something like Google that has reached anywhere cannot have a competitive presence in China, then when we think about a foreign policy, we prefer to take baby steps then define a foreign policy of how we plan to do business in other countries.

As part of our SaaS solution, you can use it anywhere. I wouldn’t say we spend time on making policies. From our perspective, if we see a potential in some market, better to jump in and test the waters – which is what companies do – and these large enterprises have such a long cycle to release new products into the markets. Startups are more agile in this sense, in that we cna enter the market faster.

What’s your own view on the VC ecosystem in SIngapore and the region?

It’s a very closed system. There’s a constant comparison between what’s happening with you and a US counterpart, with expectation to reach similar metrics despite a comparatively smaller investment and operating in a smaller market. Singapore is a smaller market than Mumbai as a city. And Southeast Asia is a smaller market than the US as a whole.

But again, it also differs from product to product and company to company. If you’re a B2C company then India is a great place to be, it just requires a different strategy to go to market. One of the things we’ve noticed which makes us really excited to work with Jungle Ventures and SeedPlus is that SeedPlus works on a model of operating partners working with you on a daily basis full-time aiding in product development, business development and marketing.

The biggest difference is that they don’t act like a VC but think like an entrepreneur and don’t step back in getting their hands dirty, unlike other VCs who’d stop at the money part and at most make a few connections for you. They help us with brainstorming and figuring out our product and business strategy and we work on that on a daily basis.

The concept with SeedPlus is that we have to be in their office to tap into their operating partners. That’s what Jungle Ventures is trying to change and what we want to be part of.

What do you make of the overall trend of Indian businesses establishing themselves in Singapore?

We’re incorporated in Singapore and investors are Singaporean. Our tech team sits in India but we are looking to expand our business development team in Singapore to oversee APAC expansion.

“We first started out in Singapore before coming back to India. In terms of the mobile security market, India is not really a hot space. Most companies are not event concerned about security and there are no rules or laws protecting data privacy. Its also quite similar in Southeast Asia. Singapore is more mature as a market.

To be honest, banks are security companies within themselves, so the outlook towards security is much better compared to the countries around Singapore. That’s why we understood the need to go back to India to test our product and make sure we’re ready for the Singapore market prior to our lauinch. Much more mature in terms of security as compared to India.

Alot of Indian entrepreneurial ventures moving into Singapore primarily because they want to tackle the Asian market, Singapore has a great mix of talent and I think that’s why its one of the most important business destinations in Asia.

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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.