This week, the Indonesian government prohibited social commerce players such as TikTok Shop from making direct transactions on social media platforms. The new regulations aim to level the playing field between conventional sellers and online sellers, especially micro, small, and medium enterprises (MSMEs).
Indonesia is the first market in Southeast Asia to push back against TikTok’s growing e-commerce presence. It is also the Chinese company’s second-largest market after the United States. Our analysis takes a close look at the new rules, which regulate cross-border online transactions and place a minimum price on imported goods, and their potential impact.
Moving onto the other major headlines from the week that went by…
From the LP-GP sphere
Global alternative investment firm Varde Partners has raised nearly $1.5 billion for its latest asset-based lending opportunities vehicle.
The Washington State Investment Board has approved a total of $550 million in commitments to funds managed by global private equity (PE) majors KKR and TPG. Both vehicles will invest in Asia.
Singapore-based Novo Tellus Capital Partners has reportedly received around $375 million for the inaugural close of its latest fund targeting mid-market technology and industrial sectors across the Indo-Pacific.
Temasek’s subsidiary True Light Capital has closed its first flagship fund at $3.3 billion to invest in Greater China. The vehicle invests across private and public equity, as well as indirectly through PE and venture capital (VC) funds.
Templewater, the backer of one of Hong Kong’s most used public transportation Citybus, is raising its second PE vehicle and its debut decarbonisation fund, according to a top executive.
Blockchain-focused VC firm Hashed is looking to raise $200 million for its new fund, a top executive at the firm told DealStreetAsia.
Singapore-based Southeast Asia Women’s Economic Empowerment Fund, or Sweef Capital, has secured the fourth close for its maiden fund at over $37 million, per a regulatory filing.
Indonesian VC firm Intudo Ventures has filed with the US Securities and Exchange Commission (SEC) to raise a new fund, about two years after it closed its third fund at $115 million.
CAS Star, a Chinese investment firm that focuses on early-stage hard tech startups, has held the first close for a new RMB-denominated fund, bringing its total assets under management (AUM) above the 10-billion-yuan ($1.4 billion) mark.
Early-stage investment platform Antler India has secured capital commitments worth $60 million (Rs 500 crores) for its maiden pre-seed fund, which is likely to hit a final close at $75 million (Rs 600 crores).
Trifecta Capital, which has backed the likes of BharatPe and Cars24 in India, has closed its third fund at $213 million (Rs. 1,777 crores), more than a year after its initial target to close the fund.
Despite losing some of its sheen due to a resurgence of geopolitical tensions and a muted domestic economic recovery, China cannot be ignored as it remains a high-priority market for some institutional investors, according to limited partners.
Indian PE investors remain bullish on the local stock market’s stability and resilience as an exit avenue. The optimism comes despite tapering exit activity in the past few months on account of macroeconomic uncertainties and market volatility.
With soaring interest rates putting pressure on real estate investments in the Asia Pacific, commercial properties are losing their lustre among investors, while new-economy assets continue to be a bright spot, said Kenneth Gaw, president and managing principal at Gaw Capital Partners.
Some of the world’s biggest investment firms believe that Southeast Asia’s “moment in the sun” has arrived, but only fund managers with the ability to deliver long-term, high-quality returns can seize the opportunity.
Deal counter
Singapore’s sovereign wealth fund GIC is understood to be among investors vying to buy up to a 20% stake in Bach Hoa Xanh from Vietnam’s retail giant Mobile World Investment in a deal that could value the grocer at up to $1.7 billion.
True North, one of the oldest PE firms in India, has agreed to sell a significant part of its stake in health insurance company Niva Bupa to its joint venture partner Bupa for around Rs 2,700 crore ($329.27 million).
Mubadala is reportedly in talks to acquire a stake of less than 10% in India’s Manipal Hospitals, in what could be the Abu Dhabi sovereign fund’s first investment in the Indian healthcare space.
Green hydrogen project developer InterContinental Energy has raised $115 million from GIC and clean hydrogen industry-focused investor Hy24.
Southeast Asian online lending platform Funding Societies, popularly known as Modalku in Indonesia, has raised $27 million in debt funding from investors led by Asia-focused private credit financier AlteriQ Global.
Singapore-based biotech startup Automera has bagged $16 million in Series A funding co-led by US-based Accelerator Life Science Partners (ALSP) and Temasek-backed ClavystBio.
India’s Serentica Renewables, a decarbonisation platform, has secured $361 million in debt from power sector lender REC Limited, just days after raising $310 million from Power Finance Corp.
Indian social commerce player Meesho, which recently hit headlines for turning profitable, is understood to be in fundraising talks with PE firm WestBridge Capital.
Bright Money, an AI-enabled personal finance platform, has raised $62 million in a mix of debt and equity from Encina Lender Finance, Alpha Wave, Hummingbird and Peak XV Partners.
Enflame Technology, a Tencent-backed Chinese AI chip maker, has closed its Series D funding round at 2 billion yuan ($273.7 million).
Chinese synthetic human collagen tech startup Trautec Medical Technology has garnered 200 million yuan ($27.3 million) in a Series B round led by L Catterton.
Pivot!
Southeast Asian super app Grab has decided to wind up its GrabInvest business, along with associated investment products, AutoInvest and Earn+.
Indonesian agritech startup EdenFarm has laid off approximately 300 employees as the company is planning to focus on its seasoning brand called TuangTuang, which was launched in September.
German food delivery giant Delivery Hero has scaled down operations in the Asia-Pacific region as part of its plan to “streamline operations to become leaner and more agile”.
Indian education firm BYJU’S is reportedly planning to cut around 5,500 jobs to decrease costs amid a restructuring of its business.
Earnings reports
Indonesian fintech company BukuWarung recorded a net loss of $25.3 million for the financial year ended December 31, 2022, up 33% from a $19 million loss in 2021.
Singapore-based blockchain analytics platform Nansen posted a nearly $16-million loss in the 15-month period ended December 31, 2022, led by a massive surge in administrative expenses, regulatory filings showed.
Indonesian fintech firm DigiAsia Bios posted a net loss of $7.48 million for the financial year ended December 31, 2022. The net loss shrunk by more than half from 2021’s figure of $16.73 million as overall expenses declined and revenues rose.
Analysis
Southeast Asia’s fintech space might have grabbed record funding in recent years, but according to industry experts, recent innovations in the sector have been merely incremental rather than truly disruptive.
Indonesian food and beverage (F&B) players, which survived the pandemic onslaught through swift business strategy shifts, are now looking at fundraising to accelerate their expansion plans.
As J&T Express prepares for an initial public offering on the Hong Kong stock exchange, the courier company faces several concerns and regulatory hurdles over foreign ownership in its first and core market – Indonesia.
Malaysia has been the worst-performing among Southeast Asian countries in terms of fundraising this year, according to data from DealStreetAsia – DATA VANTAGE. What ails its startup ecosystem, and can it be cured?
Since COVID-19 hit Southeast Asia in early 2020, deep tech deals have been trending upwards and accounted for 14% of the total deal volume in the first half of 2023, according to a new DATA VANTAGE report.
