Major economic crises are often challenging to anticipate ahead of time, but once they hit, their impact tends to follow certain familiar patterns, especially when it comes to businesses.
In the immediate aftermath of the COVID-19 pandemic, aggressive cost-cutting led to many instances of layoffs. Those stories continue to emerge, with fintech firm Oriente confirming it has let go of a fifth of its staff since the fourth quarter of 2019.
But some attempts at damage control will eventually fail, and it’s not surprising that layoff stories eventually lead to articles about business failures. We had previously reported that Indonesia’s Airy Rooms had let go of staff; this week we learned that the Traveloka-backed startup will shut down for good.
Meanwhile, in Vietnam, e-commerce startup Leflair has filed for bankruptcy.
The big picture
It’s important in times of upheaval and uncertainty to look at broader trends and changes to understand how the world is changing.
In the Philippines, top e-wallet providers are burning more cash and delaying their profitability timelines despite the crisis increasing the use of digital transactions. Meanwhile, the use of e-commerce and food and grocery delivery platforms has, unsurprisingly, soared during the pandemic.
Investors are looking closely at logistics startups in Indonesia, with last-mile specialist SiCepat Express and B2B platform Waresix understood to be in advanced stages of closing funding rounds.
German private equity (PE) platform Moonfare sees family offices driving PE investments in the Asia Pacific over the next six to 12 months in a bid to better diversify their portfolios.
An EY survey of senior corporate executives found high expectations of a merger and acquisition comeback in the next 12 months.
For under-the-covers consumer trends, check out Smile Makers and the good vibes they’re generating.
Regulators are keeping busy as well.
The Securities Commission Malaysia is giving digital payment channels a boost by opening the doors for capital market products to be accessed via e-wallets and e-payment platforms.
Deals: Deeptechs and China consumer plays
China continues to dominate the megadeal market in Asia. Car trader Chehaoduo took $200 million from SoftBank Vision Fund and Sequoia Capital China in an extended Series D round, while blind box doll brand Pop Mart secured more than $100 million of PE capital ahead of an expected initial public offering.
In Singapore, fintech player Nium closed a round of undisclosed size that included Visa, BRI Ventures and other existing investors.
Cancer immunotherapy startup Hummingbird Bioscience secured additional funding in an extended Series B round from Heritas Capital and new investors. Biodegradable plastic manufacturer RWDC raised $133 million in two Series B rounds.
In Indonesia, business-to-business fast-moving consumer goods platform GudangAda secured $25.4 million in a Series A round led by Sequoia India and Alpha JWC, with Wavemaker Partners joining.
On the merger and acquisition front, Singapore-based ARA Asset Management and ARA founder John Lim jointly acquired a 52 per cent stake in non-bank crowdfunding platform Minterest.
Singapore-based financial product comparison site GoBear acquired end-to-end digital consumer lender AsiaKredit for an undisclosed sum.
Funds go to work
Funds are still getting ready to deploy.
South Korea’s DT&Investment is in talks with Japanese gaming company Colopl Inc.‘s venture capital arm to invest in Southeast Asia.
Dakota Ventures is committing to invest $1 million in synergistic and millennial-focused startups in Myanmar.
Impact investment firm One to Watch could get a 0.4 million euro ($438,075) grant from the Dutch development bank FMO to invest in accelerator programmes in Myanmar and Nepal.
Malaysia’s Permodalan Nasional Bhd plans to increase the global exposure on its portfolio to about 30 per cent by 2022.
In conversation with Sequoia and Vertex
On May 14, Sequoia’s Abheek Anand and Vertex’s Chua Kee Lock will discuss dealmaking during the current crisis with DealStreetAsia editor-in-chief Joji Philip. The webinar is open only to premium subscribers. If you haven’t registered, you should.
Have a good week ahead!