‘Line Play’ Virtual World Comes Out of Beta With a Million Users

NHN’s Japan has officially brought it’s Line Play virtual world application out of beta, and is now officially launching. The service reportedly has over a million users already as it comes out of the gate, which gives it a decent userbase to start. The Line Play app can be downloaded for both iOS and Android, but so far it’s only available in Japan only.

From what I can tell, it’s pretty much an Ameba Pigg rip-off, with the same cute characters, the same sort of virtual environments, and room decoration (see the video promo below). In contrast, Ameba Pigg (from CyberAgent) has over 13 million users [1]. CyberAgent is making a big push to move many of those users onto smartphones, so the two companies are going to be fighting over some of the same users for sure.

Line Play first became available in beta about a month ago, and since then the reception looks ok, with Line claiming a million users, as mentioned above. But when we think about Line and its super-effective distribution channel over its chat app, a million users may not be all that impressive. For example, the Line Birzzle game had two million downloads on its first day back in July, and more recently Line Pop reached 10 million downloads in only 12 days.

It’s interesting to watch Line push out such a diverse range of mobile services and apps. I’m not sure how long NHN Japan can keep it up, but it’s certainly forcing other companies in the country to up their game. [Via Japan.Internet.com]

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1. According to Serkan Toto, citing CyberAgent.  ↩

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Silicon Valley’s Gamenauts to bring Asian indie mobile games to international markets

Gamenauts is on the lookout for independent game developers from around Asia, and will help co-develop these titles for a Western market.

The game publisher, founded by former Yahoo! Games Lead Designer Stanley Adrianus, has launched an initiative to provide almost everything needed by independent mobile game studios to compete in Western markets: end-to-end support in game design, user interface, funding, marketing strategy and financial analysis.

Founded seven years ago, Gamenauts already has several successful games in its portfolio, which started with PC-based Spacebound in 2006, followed by Burger Rush, Cate West, Cate West – The Vanishing Files, Restaurant Rush, Stickbound, and Ninja Fishing.

Ninja Fishing, one of Gamenauts’ games released in partnership with Malaysian indie game developer Menara Games.

“We explore new frontiers of fun” is the company’s slogan, and it is looking toward the region for more opportunities, says Stanley, who serves as the company’s CEO. The company is currently partnering with independent game developers, and has actually ted up with Indonesia-based Menara Games in bringing success to its Ninja Fishing title on iOS and Android.

Despite a controversy in which Ninja Fishing has been accused of copying another game, the fitness-challenged ninja gameplay app has managed to climb up to the Top 10 Paid Game lists on the iTunes App Stores in the U.S., UK and nine other countries. Overall, the game is ranked #7 and has clocked 10 million downloads to date.

Another collaboration is with Malaysia-based Nerdook Publications, which is set to release its upcoming Nuclear Outrun Game. Gamenauts brought in another Asia-based game developer, Nightspade, to do the mobile port, given Nerdook’s limited resources in this field. Gamenauts also worked with an art studio to revamp the game’s graphics, and actually funded the port project from start to finish.

Apart from these companies, Gamenauts is also adding Kurechii studio and Artlogicgames into their partner list. But it does not end there, as the company is seeking more partners doing independent work on Android, iOS, PC, Facebook, Wii and DS platforms.

Gamenauts is not exactly popular yet in the mobile gaming space, compared with big names like GREE or Tencent. But in an interview with Pocketgamer earlier this year, Stanley says being small helps with the developer dynamics. “[W]e’re still nimble enough that we can function as an integral part of the development team with the added perspective of a fellow developer.”

And because Gamenauts is self-funded, Stanley says developers can focus on building great apps without having to worry about external pressure from investors. “As a company, we’re still 100 percent self-funded, so we’re not beholden to expectations from outside investors.” If this is the development environment you are looking for, you can get in touch with Gamenauts directly to pitch your app or development team.

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Silicon Valley’s Gamenauts to bring Asian indie mobile games to international markets

Gamenauts is on the lookout for independent game developers from around Asia, and will help co-develop these titles for a Western market.

The game publisher, founded by former Yahoo! Games Lead Designer Stanley Adrianus, has launched an initiative to provide almost everything needed by independent mobile game studios to compete in Western markets: end-to-end support in game design, user interface, funding, marketing strategy and financial analysis.

Founded seven years ago, Gamenauts already has several successful games in its portfolio, which started with PC-based Spacebound in 2006, followed by Burger Rush, Cate West, Cate West – The Vanishing Files, Restaurant Rush, Stickbound, and Ninja Fishing.

Ninja Fishing, one of Gamenauts’ games released in partnership with Malaysian indie game developer Menara Games.

“We explore new frontiers of fun” is the company’s slogan, and it is looking toward the region for more opportunities, says Stanley, who serves as the company’s CEO. The company is currently partnering with independent game developers, and has actually ted up with Indonesia-based Menara Games in bringing success to its Ninja Fishing title on iOS and Android.

Despite a controversy in which Ninja Fishing has been accused of copying another game, the fitness-challenged ninja gameplay app has managed to climb up to the Top 10 Paid Game lists on the iTunes App Stores in the U.S., UK and nine other countries. Overall, the game is ranked #7 and has clocked 10 million downloads to date.

Another collaboration is with Malaysia-based Nerdook Publications, which is set to release its upcoming Nuclear Outrun Game. Gamenauts brought in another Asia-based game developer, Nightspade, to do the mobile port, given Nerdook’s limited resources in this field. Gamenauts also worked with an art studio to revamp the game’s graphics, and actually funded the port project from start to finish.

Apart from these companies, Gamenauts is also adding Kurechii studio and Artlogicgames into their partner list. But it does not end there, as the company is seeking more partners doing independent work on Android, iOS, PC, Facebook, Wii and DS platforms.

Gamenauts is not exactly popular yet in the mobile gaming space, compared with big names like GREE or Tencent. But in an interview with Pocketgamer earlier this year, Stanley says being small helps with the developer dynamics. “[W]e’re still nimble enough that we can function as an integral part of the development team with the added perspective of a fellow developer.”

And because Gamenauts is self-funded, Stanley says developers can focus on building great apps without having to worry about external pressure from investors. “As a company, we’re still 100 percent self-funded, so we’re not beholden to expectations from outside investors.” If this is the development environment you are looking for, you can get in touch with Gamenauts directly to pitch your app or development team.

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Startups: Do NOT sell cloud. Sell Product.

Recently, one of a technology startup was pitching to a customer (happens to be a mid-sized healthcare company) and while the deal was going in the right direction, the startup in order to impress the CIO told him that ‘they are a cloud based company’.

The CIO later Googled around and found out the (security) issues with respect to ‘putting one’s data on the cloud’. The deal eventually fell through as the CIO demanded the startup to have a in-premise install.

So, what’s the issue here?

The cloud.

Startups look at cloud as a destination and not a delivery infrastructure. The pitch to CIO could have been around an Internet play,  a ‘website’ and not just the cloud infrastructure.

Imagine 1996. Imagine Hotmail.

Imagine Hotmail’s Sabeer Bhatia announcing this to the public:

“All your personal conversation now remains in the cloud. All your email contacts, your personal details are stored in our servers”.

Imagine!

Imagine Hotmail storing all your personal data/conversation in the cloud !!

:)

How many of us would have used email then? Hotmail sold ‘communication benefit‘ to the masses and that’s what startups need to learn!

Cloud = Sexy?

That’s the problem.

Startups in cloud space tend to use cloud as a marketing buzzword and while it purely works for investor pitch, it doesn’t really work for your customers.

Especially in India where CXOs are totally clueless about cloud and often base their decisions on market reports, which are mostly written by consultants to drive more F.U.D into the market.

In fact, we often get emails from investors asking them to ‘introduce to few cloud startups’ and here is how a typical conversation goes:

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Investor: Hey! Please introduce me to few cloud based startups.

Me: Cloud? Which sector?

Investor? Sector ? That doesn’t matter. Startup should be in cloud space, man.

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Sir, aren’t you going to invest in a sector eventually? I mean, a startup solving a pain point in healthcare/education/B2B etc sector? And the startup just happens to build a ‘cloud based’ service that needs no install/consulting/maintenance cost?

True that investors love these buzzwords, but customers are largely confused and startups should be really careful when they say ‘we are on cloud‘.

And for god sake, come down to earth, meet customers and sell the software (the pain-point it solves).

What are your thoughts?

Recommended Read: Popular App Deployment Platform for Indian Startups

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Indonesian Telemarketer and TV Infomercial Maker Takes the Hard Sell into E-Commerce

An Indonesian telemarketing and TV infomercial company DRTV Corporation is now expanding its business line into e-commerce via its new venture, Fastworld.co.id. The website, which was started at the end of 2011, sells six categories of imported products: fashion, beauty, health, fitness, household, and gadgets.

During the Fastworld soft launch earlier this month, the company also announced a partnership with Mandiri Bank to offer integrated online payments on the new e-commerce store, as well as installment payment options there. Fastworld has partnered with payment gateway Dokupay to offer payment options like COD, bank transfer, and credit card.

Ricky Soesanto, the Fastworld business development general manager, shared a few notable numbers regarding the company’s business:

• There are around 300 products sold on the site, with 80 percent from the beauty and household categories.
• The company has 25,000 active members who are considered repeat customers. This is out of a total of 172,000 members who have made at least one purchase from the site.
• 70 percent of the website’s customers are female, between the ages of 26 to 40 years old.
• The volume ratio of the sales made from the website’s shopping cart and telemarketing is 30:70.
• The site receives around 2,000 to 3,000 visits everyday.
• Fastworld also sells its products on 65 other e-commerce sites such as BliBli and Tokopedia. This kind of cooperation accounts for 70 percent of the company’s total revenue.

Currently, Fastworld has another website theFastworld.com, but the company decided to move onto an Indonesian domain and make it its primary home. Ricky said that the move was to make the company look more domestic. Fastworld is now having a year-end sale called “Boom Yes” in which all items are being discounted up to 50 percent until January 15th.

Looking ahead to 2013, Ricky said that they are gunning for a growth rate of 100 percent. In the new year, the company is planning to build a mobile version of its site, as well as mobile apps. It also hopes to add more partnerships with other e-commerce sites, possibly as many as 100. In addition to selling its own products, Fastworld is also open to selling products from other vendors.

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The year that was for Aadhaar, India’s most ambitious technology project [2012 Recap]

Aadhaar, the Unique Identity project of India made a lot of progress in 2012. As the core technology team wrapped up implementation of its  technology backbone, government has begun mobile enabled citizen service delivery in pockets. Full fledged service delivery will begin in January 2013.

This year wasn’t off to a good start for the folks at the Unique Identification Authority of India. The government body tasked with issuing a unique, online, verifiable number to every Indian was looking forward to the National Identification Authority of India Bill which was to give legal credence to the Aadhaar project. However, in December 2011, a Parliamentary standing committee on Finance rejected the bill raising concerns about the future of the ambitious project.

Despite the setback, the authority pushed forward as planned and managed to meet most of its goals for the year.The government had set a target of reaching 600 million people enrolled to the database by 2014. UID is now processing about 6 lakh enrolments a day. Around 270 million people have already been enrolled, says UIDAI Chief Nandan Nilekani.

Technocrat Nilekani had put together an amazing team to set up the tech architecture for the project. Srikanth Nadhamuni, one of the people who helped chip-maker Intel build the first Pentium chip, Pramod Varma, the principal architect of the project and many others like Sanjay Jain, Mathew Cherian and Tushar Vashisht were part of the team that came together to work on the project.

Aadhaar database became the world’s largest biometric database and continued to grow fast. The entire system was built on the open scale out architecture where off-the-shelf commodity hardware was used to achieve massive scale. An Aadhaar enabled payment system was also designed.

With the technology in place, various pilots were initiated in districts of Maharashtra, Karnataka, Jharkhand and Andhra Pradesh. The projects tested the efficacy of Aadhaar enabled service delivery in Public Distribution System, Liquid Petroleum Gas distribution, Banking and other services. Some ideas were dropped and some new ones were included.

The core technology team is now slowly moving out of the UIDAI. Srikanth Nadhamuni is now the CEO of Khosla Labs in India where Sanjay Jain has joined as an entrepreneur in residence. Pramod Varma is an advisor to many startups and is an advisor to the Government. Mathew Cherian and Tushar Vashisht are now doing their own startup called healthifyme. Sanjay Swamy who was a part of the early UIDAI team launched Angel Prime, an incubator for startups with others.

The government recently approved direct cash transfers to beneficiaries of government schemes through the Aadhaar platform. It is also planning to spend nearly Rs 7,000 cr (~$1.2 billion) to distribute millions of free smartphones to the poor next year. These phones will have free internet and a low rental plan. Center will move most of its service delivery to the mobile platform starting next year.

Data source: NIPFP, Nov 2012

Once direct cash transfer is implemented, subsidies and money from the government under various schemes will go directly to the beneficiaries bank account using their unique identification number issued by the government. Starting January, 51 districts will move to the new cash transfer scheme. From April 2013, 18 states will move to the new system.

Five of the country’s largest banks including the State Bank of India launched Saral Money bank account service, with which a beneficiary can withdraw their money from any ATM or a micro ATM using biometric authentication provided by Aadhar or bank using their mobile phones.

The coming year will be crucial to the success of the project as service delivery brings tangible evidence to the claims made by the government.

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[This article is part of our 2012 Recap series, and is supported by CCAvenue.]

CCAvenue is India’s largest payment gateway solution powering thousands of eMerchants with real time, multi-currency, multiple payment options online payment processing services. The solution is powered by proprietary technology that integrates transaction-processing, advance shopping cart, auction payment collection facility, mobile page, risk assessment and fraud control, smart analytical dashboards, financial reporting and order tracking and many more features.

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Surprise, Surprise: This Year’s Hottest US Stock was a Chinese Tech Company

There were only two Chinese tech companies that IPO’d in the US this year following a grim period of distrust and volatility on the markets – especially when it came to dealing with firms from China. But flash sales site VIPShop (NYSE:VIPS), which listed in March, has managed to break that spell by becoming the hottest overseas company of the year on US markets.

VIPShop debuted on the New York Stock Exchange at $6.50 per share, but closed yesterday at $14.42, a few cents down on its highest-ever peak. That means investors in VIPShop have seen returns of 162 percent (see below), making the e-commerce site the top-performing overseas site listed in the States. The second-highest surge was a mere 44 percent return Israeli company Caesar Stone Sdot-Yam. For comparison, the Dow Jones average saw growth of just 1.17 percent:

$VIPS is tops in 2012 (on Google Finance).

VIPShop differs from most e-commerce sites in China by focusing on time-limited and discounted sales of selected brand goods. At its current stock price, the site has a market cap of over $729 million, which has nearly doubled since we last checked in on its progress back in October.

This world-beating performance by VIPShop will likely give hope to other slated Chinese IPOs for 2013, such as browser maker UCWeb, e-book platform Shanda Cloudary, and clothing e-tailer Vancl.

The only other Chinese stock hitting US shores this year was another techie, the online gaming community YY (NASDAQ:YY), which is also doing well, currently up to $14.75 per share from its $10.50 debut last month.

[Hat-tip to Morning Whistle for spotting this]

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Japanese Startup Giftee Has Free Chicken for Your Facebook Friends

giftee Christmas chicken campaign

Last year you may recall that we featured Japanese startup Giftee, a service that lets you send real gifts to your friends via Twitter or Facebook. That same company is running a fun Christmas campaign today where it is giving away 50,000 pieces of chicken, which you can gift to some of your friends.

Naturally, me and my wife jumped on Giftee to try to send chicken to each other. Because we’re romantic like that. The Giftee site was crawling at a pretty slow speed, so I imagine they have drummed up a lot of traffic with this promotion. But eventually I was prompted to pick a card which would determine how many chicken pieces I could give to friends.

I think I lucked out, because I was awarded five pieces. On the next page, I could then select the five Facebook friends to whom I would send them. Interestingly, the friends I interact with most were not present, which makes me think Giftee has taken steps to prevent people like me from scamming their chicken.

So while five of my friends (see below) have received coupons for 5 pieces of chicken at their nearest Family Mart convenience store, I’m left to go search the fridge for lunch. I think I have a potato or something in there somewhere…

If you’re in Japan and you’d like to give it a try, head on over to the giftee.co website to give it a try. It will be interesting to see how much of a boost in users the site gets from this campaign. Family Mart chicken isn’t particularly expensive, this could be a pretty clever way of acquiring new users just before the Christmas rush.

[Thanks to Steve Nagata for pointing this out. I tried to 'chicken' you, but I couldn't find you on my list!]

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EU Considering Investigation, Possible Tariffs, for China’s ZTE and Huawei

China’s two telecoms giants Huawei and ZTE (HKG:0763; SHE:000063) are facing the prospect of European Union authorities launching an investigation into alleged dumping of telecoms equipment on European markets. It could lead to steep tariffs on ZTE and Huawei hardware in this sector (though not, presumably, on their smartphone sales).

A couple of months ago, the US House completed a probe of ZTE and Huawei and judged them to be security threats that US companies should avoid working with – a charge both companies strenuously deny.

The WSJ (paywalled) notes today:

The investigation could lead to steep tariffs on wireless-network equipment made by the two Chinese firms, which have made deep inroads into the 27-nation EU market over the past five years. An analysis prepared by the European Commission, the EU’s executive arm, and seen by The Wall Street Journal says the two firms are clearly dumping their products onto the European market at unfairly low prices, using aid from the Chinese government that violates international trade rules.

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DailyDose: Sequoia Capital raises $700 million global fund & Over 10 mn downloads for Google iOS Maps in 48 hours

Sequoia Capital raises $700 million global fund

Sequoia Capital has raised a $700 million fund to partner with larger companies on a global basis on investments. It could be an international fund. The company had raised three separate funds for US, China and Israeli investments, including $450 million for a US venture fund, $325 million for a China venture fund and $200 million for a fund for Israel based ventures. [Source]

RIM beta tests BB10 with 120 US cos

Research In Motion Ltd. said the BlackBerry 10, the new smartphone lineup intended to revive its fortunes, is about to begin testing at more than 120 U.S. companies, including 64 members of the Fortune 500. The beta testing is set to start today. [Source]

Google Launches Dedicated YouTube Video Camera App For iPhone and iPod Touch [Source]

Google Maps For iOS Was Downloaded Over 10M Times In Its First 48 Hours After Launch [Source]

Recommended discussion: Google teams celebrating iOS map release.

Iran’s supreme leader “likes” Facebook

Facebook – banned in Iran due to its use by activists to rally government opponents in 2009 – has an unlikely new member: Supreme Leader Ayatollah Ali Khamenei. Launched a few days ago, the Facebook page “Khamenei.ir” displays photographs of the 73-year-old cleric alongside speeches and pronouncements by the man who wields ultimate power in the Islamic Republic. [Source]

Nielsen and Twitter Establish Social TV Rating

Nielsen, a leading global provider of information and insights into what consumers watch and buy, and Twitter today announced an exclusive multi-year agreement to create the “Nielsen Twitter TV Rating” for the US market. Under this agreement, Nielsen and Twitter will deliver a syndicated-standard metric around the reach of the TV conversation on Twitter, slated for commercial availability at the start of the fall 2013 TV season. [Source]

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One97 acquires MobiVite, a self-service mobile marketing platform

Mobile Internet company One97 has acquired MobiVite, a mobile marketing platform which helps brands and businesses to create mobile websites and campaigns. The details of the deal were not disclosed but the company said that it will launch do-it-yourself service for merchants to be able to quickly go mobile.

MobiVite is one of the vendors chosen by Google’s “Let’s talk Mobile” program through which the search giant wants to take thousands of Indian small and medium businesses online.

The platform is owned by Delhi based technology startup Srishti TechNet, founded by Sanjay Goel, a National Institute of Fashion Technology graduate who had launched “Ethnic India,” a a fragrance brand. Ethnic India was sold to its competitor Ripple Fragrances.

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Recommended Read : 2012 Recap : The Year Mobile Internet Surpassed Desktop Internet in India
——————–

Delhi based One97 has been investing and acquiring small companies to cobble together a full services mobile Internet company. Last month, through its investment fund, the company invested in point of sale solutions company MobiSwipe. The Mumbai based company’s solution allows merchants to use Android mobile phones or tablets as Point of Sale (PoS) terminals with the capability to accept credit and debit card payments.

The Mobile Value Added Services market in India is expected to generate more than $10 billion in the next four years, according to a report. The 2011 report says that overall revenues from communications services will cross Rs 20,000 crore while total revenues from entertainment services would reach Rs 25,000 crore while Information services is pegged at Rs 7,900 crore.

A fast moving startup which is looking to disrupt the space is MobMe. The startup founded in 2006, is looking to raise funds through an Initial Public Offering at the National Stock Exchange’s SME exchange. Though smaller in size compared to One97, the company has been building muscle in payments and other areas. MobMe recently partnered with Dutch security leader Gemalto and Valimo Wireless Oy of Finland to roll out mobile digital signatures for secure logins and mobile transactions in India.

One97′s latest buy looks like a revenue sharing arrangement than an acquisition. Or is it just us? What do you think?

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How Do China’s Online Retailers Differ from Major Online Retailers of the United States?

This question originally appeared on Quora, and the answers that follow were provided by Ben Chiang, Adventure Capitalist, Zach Brown, a Texan in China, and Grady Ha, marketing and strategy consultant.

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Ben Chiang ¶

Ben Chiang, Adventure Capitalist

I’d highlight three major characteristics:

1. Market dominance

Taobao/affiliates have dominated Chinese e-commerce since it began. Taobao is a C2C eBay-like site, T-Mall is a B2C Amazon-like site, and Alipay is a PayPal-like payment service. They have had 70 to 100 percent market share since their inception. Only recently have other sites emerged, such as 360Buy (which has raised well over $1 billion in private capital) in general B2C, as well as vertical or specialized sites focusing on cosmetics/bags/lingerie/kids in direct B2C, flash sales, subscription, or group-buy sales.

2. Delivery expectations

Because of significant investments, mostly by 360Buy and Taobao, Chinese consumers have been trained to expect next-day or even same-day delivery for their e-commerce purchases. Amazon’s CFO recently came out to say they don’t see any way to get to one-day delivery anytime soon [1]. When I think about how Prime/2-day delivery was an inflection point in my own e-commerce buying habits, one-day is even better.

3. They have everything

Seriously. You can find some cool stuff in the long-tail through eBay, Etsy, etc. in the States, but as the majority of the world’s consumer trinkets are made in China, it makes sense that everything you’d want is on there. We recently ordered twenty scratch-n-sniff belts on Taobao for $12, fake Jeremy Lin jerseys for $15 each (rip off!!), then thirty sunglasses for a bachelor party for $15, and finally three inflatable sharks for $7. It makes costume and theme parties that much more fun/easier/cheaper.

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Zach Brown ¶

Zach Brown, a Texan in China

1. As Ben mentioned, the express delivery process is one area of difference and probably the most significant of any between the two markets. I work with KuaiDi companies often, and it is firstly awesome, and secondly something that could never exist in the US or most western developed countries. It’s basically cheap labor and strength in numbers drives that industry. Quality is a huge issue though, as the large SF Express and a few smaller others are the only ones not franchised.

2. Consumer preference and product usage varies between US and China (or any other country for that matter), so the product mix and styles you see a brand in US selling may be very different from what that same brand is selling online in China.

3. TMalls B2C Platform has a low cost of entry and huge market reach for businesses, so you can see many foreign brands entering the China market on an e-commerce platform only for their first year or two until they decide to go home or invest more.

4. Security in the US is much further along than China. Whether that is due to actual IT solutions or rather a much smaller number of scam attempts in the US, I am not sure – I would guess both though.

5. Tmall is set up to allow each brand to really differentiate their selling platform. Ebay does not do that as well, and I am not sure there is a comparable platform in the US.

6. Payment terms and payment methods.

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Grady Ha ¶

Grady Ha, Marketing and strategy consultant

I’m going to jot down a few quick thoughts, as we actually work very closely in this space. Most of the Chinese eCommerce activity is seen through aggregator sites such as TaoBao, Taobao Mall (T-Mall), 360Buy, etc. Aside from the points already made, keep in mind a few more significant differentiators (and this is comparing via B2C aggregator sites such as Amazon and Ebay and does not touch upon B2B, or backend logistics that may involve warehousing, IT platform integration, etc.)

1. Store and Platforms: TaoBao is essentially a China domestic copy of eBay that serves as an aggregator of C2C (Consumer to Consumer) goods. This is where individuals can set up shops using predesignated shop templates, see who browses (and some other basic tracking analytics), maintain and fulfill orders, and send them out based on local distribution/logistic networks that are only limited by physical proximity of the destination to the warehouse (we’ll get to that later). This is mostly where you will see ‘mom-and-pop’ stores as well as distributors of copied goods.

T-Mall, or Taobao Mall, serves as an aggregator of factory/brand authorized goods that require additional verification and has much more stringent regulations in order to ensure authenticity of goods and enhance trust among consumers. This is where most Chinese consumers will go if they wanted better quality of goods backed by brand authorized distributors.

Major differentiators here include a relatively good search algorithm (although it is lacking in cross-shopping/selling features), goods that are tailored to the Chinese consumer (which includes a wide variety of products and product lines that would contribute to point 3 that Ben made), and what I perceive to be a major integration of social messaging/instant messaging utilizing WanWan/QQ for customer support before/during/after the shopping process.

2. Distribution: Here is where it gets very interesting. I won’t get into the specifics about SKU distribution, or product line decisions and warehousing – but logistics and distribution is a whole different animal as compared to the U.S. In the U.S., essentially both customers and shippers have three major options (USPS, UPS, and Fedex). All of them have varying degrees of shipping speed, tracking, and drop-off/pick-up options. In China, despite recent attempts at standardization and consolidation of logistics, there are still a multitude of companies that operate via motorcycles/courier networks that can deliver with relative speed accuracy. That is to say, you live next to where the product is actually being shipped out.

Despite all the touting about one-day or same day shipping, if you don’t live in a city that has a warehouse where the product is coming out from and where the courier can pick up relatively soon/effortless, you’ll get the product within a few days to a few weeks. I witnessed first hand as the coordination between shipper and logistics company was a cross-calling mess as we tried to ship a product by calling the logistics hub, and the hub called the delivery driver (who physically had to come to the warehouse and pick up the item) – and in the middle of all this it requires coordination by all parties just to have the item shipped outbound. If the warehouse was located farther away from the city, or if you lived in a more remote area, the product will simply take an extraordinary longer period of time to arrive (without an accurate tracking mechanism to boot).

3. Trust: Trust means both trust in the website itself, products, and payment platforms. Recently with Alipay, it’s become much better as consumers load credits onto their Alipay account, which makes Alipay (or other payment platforms) serve as the middle man, and therefore take on some of the inherent risk. Previously, direct transactions by credit card weren’t regulated by industry security standards and simply served to dissuade consumers from shopping online, and requiring a COD option, as handing physical cash (or returning the item directly if the consumer was dissatisfied) felt more secure than sending financial information electronically.

T-mall additionally provided an aggregator of verified distributors that sold goods that consumers can be sure of. Due to the availability of counterfeit goods, Chinese consumers are simply more wary and concerned about if they are really getting what they pay for.

There are a huge amount of counterfeit sites that sell counterfeit goods. Even on T-mall/TaoBao, we are seeing stores set up by unauthorized retailers (which T-Mall subsequently takes down) that erode consumer trust.

More questions on e-Commerce:

• What are the recent trends that are revolutionizing Chinese e-commerce industry?
• Which online grocery website in India is popular?
• What trends are revolutionizing Social E-Commerce?

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1. Amazon CFO ‘doesn’t see a way to do same-day delivery’ | The Verge  ↩

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Web of Failure: How China’s Internet Policies Have Doomed Chinese Soft Power

This past week, even as net users across the country were discovering that China’s Great Firewall has been upgraded and that many VPNs no longer work, China’s state-run Xinhua wire service was busy using Twitter. It’s the kind of frustrating irony that Chinese web users are used to by now; the nation embracing popular foreign web platforms to try to get its own message out while simultaneously working tirelessly to ensure that its citizens cannot access those same platforms.

When it comes to the web, China has continually struggled to choose between its impulse to control things as tightly as possible and its recognition of web platforms as a powerful way to broadcast its propaganda both at home and abroad. In the past few years, its apparent strategy has been to attempt to have its cake and eat it too: to broadcast its own message using all the Western web channels at its disposal while blocking those channels for domestic web users. Unfortunately for the government, having your cake and eating it is impossible, and this policy — if it is continued — will prove to be an utter failure.

Domestic Stability

China’s censorship of Western web platforms like Facebook and Twitter is predicated on the idea that those platforms, because they are uncensored, threaten China’s domestic stability. In the wake of the 2009 Urumqi riots, numerous Western social media sites (including the aforementioned Twitter and Facebook) were blamed for facilitating the organization of protests and the spread of “harmful information,” and were subsequently blocked.

Blocking websites does increase stability in the short term, because people with dissenting messages have fewer ways to spread them. In the long-term, though, this kind of stability is unsustainable. Censorship, after all, does not eliminate dissent; it merely silences it, or more often pushes it into different channels. And while China’s Great Firewall (GFW) makes organizing dissent more difficult, it also foments dissent by frustrating people who are trying to do normal internet things but can’t because of the blockages.

Moreover, it encourages creative ways to circumvent the blocks both technologically and ideologically (China’s net users may be the world’s most creative when it comes to using puns and homophones to discuss sensitive issues without setting off keyword blocks). The Great Firewall also effectively moves many dissenters from foreign sites (where most of the audience can’t understand them) onto domestic services like Sina Weibo. And while Sina Weibo and other Chinese social services are monitored and censored, they’re often not monitored and censored quickly and efficiently enough to stop so-called “harmful information” from spreading.

The harder China cracks down on VPNs and other GFW-circumventing technology, the worse this is going to get. If Ai Weiwei and his followers (for example) are prevented from using Twitter, does the government really think they’re just going to stop expressing themselves and give up? No, they will turn to domestic sites, and while domestic censors will block their accounts and delete their messages, some of those messages will get through. And in a country where strident dissent is often illegal, its impact and its spread are intensified.

To put it another way, if the Chinese internet was uncensored, the dramatic statements of Ai Weiwei and other dissidents probably wouldn’t be considered remarkable. And if everyone had the freedom to express themselves without fear of censorship and reprisals, Ai Weiwei’s fearlessness wouldn’t be particularly important. Honestly, if the government really wants to effectively silence Ai Weiwei, they should dismantle the Great Firewall tomorrow.

A Death Blow to Business

China: Taking the “inter” out of the internet.

What’s effective in fostering stability is, I’ll admit, debatable, but it’s less debatable that China’s internet policies have had a strong negative impact on businesses. If the recent blocking of foreign VPNs proves to be the new normal — and we have every sign that that is the case — I expect numerous foreign businesses to move some or all of their operations out of China. In addition to the fact that many businesses use blocked web services for communication and marketing, VPNs provide a crucial layer of security to corporate communications by encrypting the connection of those using the service. Without that layer of security, companies worried about cyber attacks, IP theft, and corporate espionage are going to be pretty exposed, and some of them will inevitably decide that the advantages of doing business in China are outweighed by the potential costs of having products or plans stolen by competitors.

(True, many businesses use their own VPNs rather than the commercially-available ones that are currently blocked. But the Chinese government has said that all foreign-run VPNs are illegal unless they register with and are approved by MIIT, which none of them have.)

But the Great Firewall doesn’t just damage foreign companies in China, it is also crippling to Chinese companies that are looking to expand globally. Without access to social media tools like Facebook and Twitter, Chinese web companies are at a significant disadvantage when it comes to everything from market research to actual marketing. And although companies can establish overseas offices or find other ways to circumvent censorship and access these platforms, with all of them so widely blocked in China, there’s little impetus for Chinese developers to try to work with them. Chinese startups are focused on developing products that work with Chinese social platforms like Weibo, and that’s great, but it ultimately limits the scalability and global relevance of their products. At present, China’s regulatory environment might encourage the development of some truly remarkable domestic services, but it is difficult to imagine a globally dominant web startup from China because the Chinese internet is so thoroughly walled off from the rest of the world.

Soft Power in Chains

Of course, the Great Firewall does more than just prevent Chinese web services from going global; it is also a huge hindrance for Chinese cultural exports. I was reminded of this just recently while writing about the award Korea’s Ministry of Culture gave to Google because Youtube has been such an effective platform to spread Korean culture. In China, the success of Korean pop star PSY’s Gangnam Style video prompted a lot of discussion about whether China could ever produce its own PSY. I’m not sure what the answer to that question is, but it is irrelevant, because even if China could produce its own PSY, it could never export it. PSY’s song exploded in large part because his video went viral on Youtube which — surprise, surprise — is blocked in China.

Now granted, even if VPNs were totally blocked, a Chinese PSY could just fly out of China with a USB stick and upload his video to Youtube from abroad. But I highly doubt the global response would be the same, because whether we’re aware of it or not, a big part of enjoying any cultural experience is interaction. Gangnam Style was catchy and weird — certainly China can produce something like that — but it ultimately also got the Western media to interact with Korea and Korean culture, and we all learned a little something about the Gangnam district and Korean satire along the way.

That is the part of Gangnam Style that China could never produce, because the government actively discourages that sort of interaction. While it wants to promote Chinese culture, it does not believe that pop music — and certainly not politically satirical pop music — has any place in that promotional effort. Instead, the government pushes Confucius and other valuable-but-unappealing-and-mostly-irrelevant aspects of Chinese culture to Westerners while keeping its citizens and whatever culture they create quiet. Chinese and foreign net users are carefully segregated, and while China is happy to use foreign platforms to promote the party line through official channels like Xinhua, it is unwilling to trust its own people with access to almost any foreign social communication platforms.

The problem (for China’s government) is that culture doesn’t work that way. Great cultural works are rarely produced by the state; they are produced by artists, creatives, academics, entrepreneurs and other regular people. Chinese artists have produced many great works, but China’s government is generally not willing to let these people communicate directly with the outside world. In an age where global communication and cultural broadcasting is simpler and more direct than ever before, China has shackled its own soft power by ensuring that its cultural producers have access to almost none of these new platforms.

True soft power — in fact, true culture — cannot come without discussion and interchange. When was the last time you saw a really powerful movie or read a really powerful book and then discussed it with no one? Culture is by definition a discussion, an exchange, and a kind of ongoing communication. But China’s government has for the past several years been attempting to shove its own message into the global internet’s cultural exchange while doing what it can to keep the West out of China’s culture and keep Chinese people from easily interacting with the outside world. That is why Xinhua has a Twitter account but the average Zhou cannot. It’s also why Xinhua’s Twitter account isn’t actually following anyone. China is interested in using social media services only to broadcast itself; it has no interest in interacting with the outside world in a meaningful way.

No Hope for the Future?

It is a terrible sign that China’s crackdown on VPNs does not seem to have lessened after the conclusion of the 18th Party Congress. And at the same time, despite a couple years of massive expenditures in return for almost nothing in the way of results, China has shown no signs of wanting to adjust its shut-up-and-let-me-talk-dammit approach to soft power.

China’s state media frequently complains that the West doesn’t understand China, but China has steadfastly refused to use internet platforms like Twitter and Facebook to attempt to increase that understanding in any meaningful way. And although the government remains dedicated to improving Chinese soft power, I have seen no signs that it is inclined to attempt a shift in strategy anytime soon.

In the long term, I suspect the Great Firewall will prove to be domestically unsustainable. But until the wall comes down, China’s attempts at soft power are little more than a pipe dream, and its economic growth, especially in the tech arena, is ultimately going to be limited by the severe barriers it has erected between itself and the world at large.

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Crowdsourcing Week to Hold First Global Conference in Singapore

Yesterday, the event known as Crowdsourcing Week announced its first ever global conference on crowdsourcing, crowdfunding, and open innovation that will run from June 3 to 7, 2013. This five-day event in Singapore will focus on how “a crowd of people” can make remarkable contributions at the enterprise level through a collaborative business model.

According to Ludvik Nekaj, the CEO and co-founder of Crowdsourcing Week:

Crowdsourcing is rapidly expanding as a disruptive practice in the working world and we see more and more companies trying to utilize the huge potential. The democratized web promises to become the next revolution that will change business as usual.

This international conference aims to help educate, engage, and equip the new generation of top-level business executives, entrepreneurs, government, and nonprofit leaders. It’ll focus on trends and on topics covering best practices in open innovation, delivering insights into the business dynamics of the future, and demonstrating the impact of these technologies.

Crowdsourcing Week 2013 has more than 30 sessions planned for the event, which showcases field experts and practitioners who will address the various topics on latest trends, strategies, and innovations, such as Shelly Kuipers from Chaordix and Sean Moffitt from Wiki Brands.

Furthermore, there will be a pitch competition during the conference targeted at crowd-centric startups selected by a panel of experts from different industry sectors. More information regarding the startup pitch competition will be released next month.

Crowdsourcing Week is also working closely with Singapore’s government agencies with the aim of highlighting Asia, especially Singapore, as the emerging global hub of business innovation.

For more information on Crowdsourcing Week 2013, the conference speaker lineup and topics, please see crowdsourcingweek.com.

Disclosure: Tech in Asia is one of the media partners for Crowdsourcing Week 2013. See our ethics page for more details

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Kindle Store’s Initial Presence in China: Problems Emerged

 

img:kindle.chineseall.com

 

Kindle store for Chinese works went live last week, offering over 22 thousand Chinese-language e-books with about a thousand free titles. Though Chinese users can only access those books through its iOS or Android apps, it is reported that five gadgets have received approval from authorities and are expected to appear on China market by the end of this month at earliest.

Looks like a good start, but both my friends and I aren’t motivated to use the service, only to find that we cannot buy those books with our Kindles bought from abroad. The e-book market in China has already been crowded and each of the major players has its own cutting edge, from content to design. When industry professionals and average readers opened the Chinese-language Kindle apps, they felt disappointed.

Apps & content of inferior quality?

“The e-books are poorly made. Apps are full of bugs and cumbersome to use that take little of user experience into consideration”, said Hu Xiaodong, VP of Doukan whose business began as an alternative Kindle system for Chinese reading (source in Chinese). Many users encountered typos, missing words or pages, or displaced images in the books. It is true that text files provided by Chinese publishing agencies always are of low quality.

As you cannot expect those old, state-owned publishing bodies to make improvements, many e-book providers re-do the typography themselves. Tangcha, a well-regarded e-book provider, would do a redesign for every single book with a particular Chinese font bought from a HongKong designer. Douban Read, an e-publishing platform under Douban the social network, also takes care of content themselves and offers delicately-designed, easy to use reading apps.

But it seems Amazon would rather encourage publishing companies to do it by sharing 5% more of sales with those who’d like to do so (source in Chinese).

Competitiveness: price?

Mr. Hu with Douban is kind of angry that Kindle apps include price comparison feature, saying “its complete disregard for the feelings of publishers“. He doesn’t welcome price wars in book industry. I checked out prices of one of the works by the latest Nobel Prize winner in literature on all e-book platforms, finding Amazon China indeed offers a low price, but not the lowest — 360Buy wins here.

Considering so many Chinese users are still downloading illegitimate e-books, price war really doesn’t make any sense here. Efforts made by existing players to have users pay are create better designs and features, as mentioned, and differentiated content. Both Tangcha and Douban Read carry exclusive content, having a say in copyright industry. Cloudary, among several others, is a platform for producing exclusive content — original online literature.

How would Kindle China differentiate? Hard to imagine. Hopefully it’s not price. Since Amazon acquired Joyo and became what it is now, Amazon China has been just another e-commerce retailer. And mind you, there weren’t many strong competitors in Joyo times, while there are a flock of powerful players in e-publishing business.

Walls

The Kindle store is operated under Chineseall, a Chinese digital publishing service, as Amazon hasn’t got authorization for operating such a business from the General Administration of Press and Publication (GAPP). When reached out by media, Wang Qiang, the director responsible for such an issue at GAPP confirmed that it’s illegitimate to “borrow” a license and would look into it. According to You Yunting, a Shanghai-based intellectual property lawyer, Amazon China is even not a qualified body to apply for such a license as “video & audio production as well as the electronic publication and making is prohibited for foreign investment.”

Will Kindle devices change anything when they finally make their way into China market? I have friends having been using Kindles for reading Chinese characters in PDFs. When asked whether they’d buy e-books from Amazon China if their devices could do so, some of them answered that they’d still download free, pirated files as always; the rest said they’d incline to other reading apps since they’ve been using them for a while.

Related posts:

1. Amazon Kindle Coming to China Soon?
2. DangDang To Launch Kindle-Like E-book Reader
3. The Falling of (Some of) Chinese Android App Stores

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Chinese new media is the future, and it will always be

All in all, media companies are doing alright in America. In China, things are different. Traditional media companies all cry wolf, but are still making money hand over fist, while media, the supposed young Turks, are trapped.

In America, Traditional media is losing money but surviving. There are certainly bad news: Newsweek is tranforming itself, yet again; Rupert Murdoch is shedding his beloved print media. But there are also good news: billionaires still love media. The Financial Times loses money, but it may be the perfect forum for Bloomberg’s story tellers, so Mayor Michael Bloomberg may splash a tiny part of his $29 billion fortune for it.

In regard to new media, things are also looking up. The Verge is an awesome site with awesome tools, and according to its owner Vox Media, is apparently “very profitable” after only one year of operation. This proves TechCrunch and their AOL siblings are not anomalies after all. This may also explain why there are new attempts like Medium popping up all the time.

Things couldn’t be more different in China. The report of the death of traditional media has been greatly exaggerated. Publishers still make money by printing and selling books, newspapers and magazines are still making money by selling new issues.

New media companies like tech blogs are prospering if you are simply counting them and disregarding fact that none of them are making money. In fact, this has been going on for so long that some commentators are literally starting to predicate how each tech blog will fall.

Even aggravators are not doing well. No one knows whether mobile reading will produce revenue or not. That’s why Xianguo, the Chinese competitor to Flipboard, is essentially taking the approach of wait and see.

To understand why this is, we have to analyze the media landscape of China and abroad. Traditionally, media companies made money through three methods. First, and the most obvious, is to sell content as you would any commodity, make consumers or advertisers pay for what you have to offer; the second is Warren Buffett’s favorite, monopolize information and make yourself a toll booth; the third is to use content as a loss leader, make money through some other products.

In America, The New York Times and the Washington Post will fall in the first category. They offer premium news, and people would pay for them, albeit we don’t know if enough people will pay for them for them to be profitable. This model is being challenged all over the place, as Newsweek can attest. But quality is a relative thing, and certain companies are bound to survive the great onslaught.

So Even though they have lost their bread and butter, traditional media still have immense legacies to fall back one, and win, lose, or draw, they will go down swinging. The Washington Post probably may or may not save itself simply charging its readers, but this is the route Philly Inquirer and other publications are taking. In addition, Americans pay generously, so even relative newcomers like The Verge can make money by simply offering quality contents.

In contrast, the toll booth model that media used to thrive on is basically dead. Instead of local papers such as The Rocky Mountain News monologizing everything from where to rent houses to how to find jobs, Google and other internet ventures have ate their lunch, broke their lunch box, and put them out of business. Toll booth still exists, but they are now utilities, not media companies.

The loss leader model is the great white hope. Newbies like TechCrunch makes more money on their events. Even a traditional powerhouse like the FT functions that way: Bloomberg is interested in the newspaper primarily to sell more of their $200,000 terminals.

In China, there are similarities to America. The toll booth model does not work here either. In the commodity model, however, Chinese traditional media are clearly the winner. There is still a large population willing to pay for traditional media. New media, on the other hand, are taken for granted, and that’s unlikely to change for the time being.

This also means traditional media, with more eyeballs, are good loss leaders, while new media are not. Another factor we must consider is the fact that Chinese media are great loss leaders-for the Chinese government. All the major important media properties are government controlled, and things will remain this way.

With all things working against them, even the best new media companies in China may be barely profitable at best. Chinese new media is the future, it will always be.

Photo credit: BigStockPhoto

 

Related posts:

1. The Chinese Social Media Landscape
2. What the Future Looks Like for Chinese LBS?
3. The Loyalty, The Missing Treasure in Chinese Social Media

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Chinese App Market Caught in a Dilemma: Shuabang

So what is so-called Shuabang? That’s the Chinese saying of the manipulation practice of using various shady methods to propel an app onto the top of the App Store ranking. App-ranking manipulation has cornered small developers—their newborn apps might sink without the trick but the manipulation cost is really a financial burden to a small team. The status quo in China is that nearly 80% apps are ‘Shuabanged’ to the top rank, and hidden hands are in control of most Top 50 apps.

 

Shuabang: the Only Choice for small developers

Wu Gang, CEO of mobile game developer WiSTONE recently summed up the mobile game market in 2012, noting that ranking manipulation has developed from a bud to a necessity for Chinese mobile developers. On the other hand, It explained why Shubang became a burden to small teams since the flourishing market led to the rise of manipulation cost directly.

Astepgame CEO Yang Zhongning also echoed that 80% apps among the top rank raised their places by way of manipulation. Insiders revealed that some developers event built dedicated team in charge of the evil deed.

Why developers are so addicted to the wrongdoing? On one hand, Shuabang can yield obvious results with relatively low costs compared with advertising. The advertising cost could be ten times higher. On the other hand, nice ranking could also help developer get more attentions from investors.

Ecosystem was damaged, developers trapped, users disturbed

The storm of Shuabang not only deprived new products of exposure to the public, but also compromised user experience.

Spending RMB 2,500 per day, shuabang company could pin your app into Top 100 while RMB 10k per day translates to Top 50. The market was totally disrupted. It’s just a matter of time that people find out the App Store ranking are trashed with subpar titles, costing the credibility of the ranking. Eventually, developer will have to figure out other methods to promote their app. Verily, that is the way of the app world in China.

 

Related posts:

1. Shuabang: The Great Evil in China
2. 115.com Caught in Inevitable Dilemma　
3. Guohe MIX, Puzzle out the Marketing Dilemma for Mobile Game Developers

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RenRen Adds Timeline Feature

Chinese social networking service RenRen has just rolled out its long-awaited timeline feature along with other major facelifts of the site.

Facebook firstly launched timeline late last year to turn one’s footprints on the social networking site into a storybook. It took Renren a year to catch up with the feature. So they better come up with something more different and innovative.

And, did they?

After poking around the new release, you’ll find there aren’t too many improvements or even so-called micro-innovation, basically, it resembles its inspiration on many respects, like the big cover picture, the left-right two columns design that separated by a timeline and so on.

And the company’s CEO Chen Yizhou said that timeline was indeed a revolution, improving the efficiency of communication. Those SNS without timeline would be doomed to die. I guess he won’t mention who led the revolution though.

 

Related posts:

1. Tencent’s QZone to Release A New Feature, Called Timeline, Like Facebook’s
2. Renren Testing Revamped Site with a Touch of Pinterest
3. 360 Announces its Strategic Partnership with Renren

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Golden Gate Ventures Scores a Triple Turkey: Coda Payments, RedMart, and TradeGecko

It’s an early Christmas for three startups and a triple turkey for the Golden Gate Ventures (GGV) team this morning, as it announces its inaugural investments in Coda Payments, RedMart, and TradeGecko.

Some of our readers might recall back in February where we reported that GGV, had set up a US$10 million venture fund focusing on startups in Southeast Asia. These new investments appear to be the result of that, although, the individual investment amounts were not revealed. According to to GGV, the decision was a careful and thorough one. It took more than a year of researching, meeting more than 400 teams, and hosting events to eventually decide.

On the selection process, Vinnie Lauria, founding partner at GGV, said:

We selected these investees for two reasons. First, for their strength as high-growth start-ups that are already impacting regional buying and selling behaviours positively and expanding e-commerce in Asia. Second, because they plug us into a market of more than half a billion people. Southeast Asia sees 650,000 new internet users come online each month. Smart mobile devices are the future in this part of the world and our portfolio puts us right at the heart of the mobile space.

So what do the three startups do, and what is so attractive about them in the eyes of the GGV team?

Coda Payments deals with micropayments, offering a hassle-free solution for users to make online purchases through their mobile accounts. Coda Payments CEO Neil Davidson tells us that the new money will be used to support the development of the platform and go-to market activities.

You probably won’t be able to find out much information on Coda, other than it being the first recipient of Japan’s GMO VenturePartners latest fund (GMO VP III), since it has not launched yet. But Neil told us that the startup will officially launch with its first operator partner in Indonesia next January. Taking full advantage of GGV’s positioning as a Southeast Asia specialist, Coda also looks to expand across the region for the year 2013.

Vinnie has full confidence in the team on its partnership in Indonesia too:

Even in the US, you have more than Paypal. You have Google Wallet and Amazon. So a country like Indonesia will definitely support multiple payment systems. There is definitely room for multiple players. Payment is the bedrock for any startups to exist in this ecosystem.

RedMart is no stranger to some of our readers. RedMart is an e-commerce site made for busy bees to purchase non-perishable goods and it delivers right to your doorstep. It has also attracted investment from Skype co-founder and angel investor, Toivo Annus.

According to co-founder Roger Egan, the gross annual run rate revenue is a whopping S$3 million (US$ 2.46 million) and the company is fast approaching profitability. It also helps that the capital requirement for building robust, sophisticated logistics along with the technology infrastructure has been surprisingly low.

The team will be using the investment money to build both its technology and physical fulfillment centre required for its scaling efforts. As for RedMart’s expansion plans, Roger tells us:

We do plan to expand internationally and are currently evaluating potential Southeast Asian cities [to expand to,] as opposed to entire countries. However, we must first establish a strong foundation in Singapore. The Singapore grocery market is US$ 5.2 billion, so there is plenty of opportunity for growth here.

We’ll move as quickly as possible to capitalize on the tremendous opportunity in the region without risking distraction from getting the basics right in Singapore first.

TradeGecko is a Software-as-a-Service (SaaS) for businesses to manage their inventory, orders, and customers. The Singapore-based startup is also one of the recent JFDI-Innov8 2012 Bootcamp program graduates, and is run by three founders from New Zealand.

And it was also the Kiwi founders who impressed GGV. Vinnie elaborates:

First the team. [TradeGecko has a strong] technical team giving back to the community. I see them hitting a global trend with the indie retailers being able to find and connect with the wholesaler in today’s on demand world.

These three investments neatly wrap up the year 2012 for GGV team. It has aggressive ideas for the upcoming year, and is planning more than ten investments for the year 2013.

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Golden Gate Ventures makes first three investments into Southeast Asian startups

Singapore-based incubator, Golden Gate Ventures, has announced its first three investments into TradeGecko, RedMart and Coda Payments.

Golden Gate Ventures today announced its first three investments into TradeGecko, RedMart and Coda Payments. The investments are in line with Golden Gate Ventures’ ambition to position itself as a Southeast Asian specialist. Golden Gate Ventures’ portfolio now includes startups supporting the growth of e-commerce across Singapore, Malaysia and Indonesia.

Speaking to founding partner Vinnie Lauria, he shared that the team has been consistently traveling to and meeting with startups in Singapore, Malaysia, Indonesia, Philippines, Thailand and Vietnam in search of investment opportunities. Three key factors were drivers of the investment decision. Vinnie shared that they look at the startups’ traction, team and also the fact that their product revolved around the e-commerce industry. Although Golden Gate Ventures does not have a specific focus on e-commerce startups, Vinnie explained that e-commerce startups in Southeast Asia have a higher chance to be successful at an early stage.

According to Vinnie, the team at TradeGecko demonstrated strong technical skills while RedMart had a data-oriented team that employed growth hacking effectively. Other opportunities that Golden Gate Ventures is currently exploring includes content portals with ad-based models and mobile apps with web -based components.

Having being permanently based in Singapore since January this year, Vinnie considers Southeast Asia to be a booming market with more and more quality startups popping up. Hence, Golden Gate Ventures has an aggressive outlook for 2013, with plans to invest in more than 10 startup in the coming year. The Golden Gate Ventures team will continue to focus on the six markets mentioned earlier as they are already finding themselves stretched thin with all the opportunities present.

Vinnie shared his opinions that Singapore still remains a market where it is easy to do business in. And also where a multi-national, multi-background community provides a good pool of talent. Indonesia presents a large market opportunity for startups while founding partner, Jeff Paine, discovered that Thailand’s startup scene is heating up. Golden Gate Ventures is also working with Cradle in Malaysia where the later is providing coaching and mentoring programs to startups in the country.

For startups looking to see which incubator suits them best. Vinnie mentioned that the Golden Gate Ventures has an affinity for business-to-consumer or business-to-small businesses products, as these two categories share similar tactics, market access and cultural understanding which the team has most experience in.

Read the full press release below.

Press Release

****

SINGAPORE – 18 December 2012 – Golden Gate Ventures (GGV), an early stage technology seed fund focused on Southeast Asia, today announced its first three investments into TradeGecko, RedMart and Coda Payments. GGV’s portfolio now spans start-ups supporting the growth of e-commerce across Singapore, Malaysia, and Indonesia.

The investments realize GGV’s ambition to position itself as a South East Asia specialist, operating from a regional hub in Singapore and with strong links to Silicon Valley.

Vinnie Lauria, Founding Partner at GGV, said: “We selected these investees for two reasons. First, for their strength as high-growth start-ups that are already impacting regional buying and selling behaviours positively and expanding e-commerce in Asia. Second, because they plug us into a market of more than half a billion people. Southeast Asia sees 650,000 new internet users come online each month. Smart mobile devices are the future in this part of the world and our portfolio puts us right at the heart of the mobile space.”

GGV’s investment decisions are based on more than a year spent researching the region, meeting start-ups and hosting events across a dozen cities. In that time, GGV’s team has met with over 400 teams, built a community of over 1,800 talented individuals and logged over 500,000 kilometers, sometimes covering 3 countries in the same week. The research has given GGV an unrivalled picture of grassroots market opportunities and challenges across South East Asia.

Paul Bragiel, Founding Partner at GGV, said: “While e-commerce is a strong thread through our first investments, it is only a starting point. We are actively looking across content sites, apps, and B2C services and we are looking in places that other funds are not represented. Many people I talk with in the valley think Asia is just China and India but we see a huge booming market across the region. We are really excited to be at the heart of it.”

Each of GGV’s new investee start-ups rides a wave of change in South East Asia. Coda Payments serves the rapidly expanding universe of online properties that seek to charge their users for content and services. TradeGecko solves as a chronic problem for regional wholesalers who want to connect better with their customers. RedMart enables internet users to buy everyday home essentials online.

While western markets continue to stay flat, Southeast Asia is booming, with some countries seeing double digit GDP growth. GGV has seen a big bump since 2011 in the number of new entrepreneurs pitching quality startups, and expects that trend to continue through 2013. GGV has an aggressive outlook for 2013, with plans for more than 10 investments in the coming year.

Jeffrey Paine, Founding Partner at GGV, said: “With so much activity in the region, I find myself hustling 24×7, and I love it.  I’m meeting inspiring entrepreneurs every day and that gives me the energy to keep moving forward.  Southeast Asia is brimming with smart, talented, and self-driven entrepreneurs. Mix that with double digit growth in the region and the stage looks set for us to create a number of breakout successes over the next few years.  It reminds me of what China was in the early 2000′s. It seems quite fortuitous that we launched our fund in the Year of the Dragon!”

Information For Editors

Golden Gate Ventures – http://goldengate.vc

Golden Gate Ventures (GGV) operates a seed investment program for digital start-up companies that have already launched a product and achieved market traction. With offices in Singapore and San Francisco, Golden Gate Ventures brings access to regional and international mentors, invitations to networking events across the region, and access to an active investor network across Silicon Valley and Asia. Since March 2012, Golden Gate Ventures has been accredited as a Technology Incubation Scheme (TIS) incubator by Singapore’s National Research Foundation.

GGV was founded by 3 former entrepreneurs. In Singapore, Jeffrey Paine ran the Founder Institute and was active as a start-up mentor and investor. In San Francisco, Paul Bragiel sought to build on his success of San Francisco’s i/o ventures model in new markets, and Vinnie Lauria had built Lefora.com, a hosted forum service which grew to over 100,000+ communities and was acquired in 2010. Together the three founders were able to draw together a strong mix of Limited Partners from Silicon Valley, such as Dave McClure (500 Startups), Aaron Patzer (Mint.com), and Russel Simmons (Paypal Mafia and Yelp.com) and from Singapore, such as Darius Cheung (tenCube).

TradeGecko Pte Ltd – http://tradegecko.com

TradeGecko was founded by three entrepreneurs from New Zealand in January 2012. It makes Inventory and Sales management easy for small- and medium-sized businesses. TradeGecko was selected for, and accelerated through, the JFDI-Innov8 2012 Bootcamp program, where its team received intensive mentoring and the business attracted substantial investor interest.

RedMart.com – http://redmart.com/

RedMart.com is a Singapore based online grocer that delivers everyday essentials, such as diapers, rice, soda, and bottled water to busy consumers. RedMart is backed by well-respected investors and advisors, such as Golden Gate Ventures, Toivo Annus (Skype Co-founder), Jason Ackerman (Co-founder and CEO of online grocer FreshDirect.com in US), Boon Ling Yee (Singaporean, former Commercial Director of Tesco China), and Anne-Ev Juette-Enzmann (former Marketing Strategy Director at Tesco Thailand).

Coda Payments – http://codapayments.com/

Coda Payments offers a convenient way for customers to make purchases online using their pre- or post-paid mobile accounts, while helping mobile operators manage a sophisticated margin differentiation program that allows them to better monetize their direct billing capabilities. Coda is active in Indonesia and Malaysia, and headquartered in Singapore.

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Image Credits: Golden Gate Ventures

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