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FROM THE EDITOR About Us
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ingapore Business Review is proud to present the 20 Hottest Startups that clinched the largest volume of funding in the past 12 months. Whilst deeptech and fintech startups still reign amongst VCs, startups under the environmental, social, and corporate governance (ESG) sector are clinching more funding. Head over to page 24 and know why they stand out.
AUDITED CIRCULATION: 23,116 ONLINE READERSHIP: 410,000 monthly uniques through Google Analytics The Singapore Business Review is the highest circulating and best read business magazine in Singapore. Our online readership has an average of 215,000 unique viewers, according to Google Analytics. We won the Business Trade Media of the Year Award at the 2017 MPAS Awards. Do reach out to us if you would like us to tell your story to our readers via print & online advertising or events. PUBLISHER & EDITOR-IN-CHIEF Tim Charlton MANAGING EDITOR Paul Howell PRODUCTION EDITOR Nathanielle Punay GRAPHIC ARTIST Mark Simon Engracial II ADVERTISING CONTACT Aileen Cruz aileen@charltonmediamail.com Karisse Coderes karisse@charltonmediamail.com Reiniela Hernandez reiniela@charltonmediamail.com ADMINISTRATION ACCOUNTS DEPARTMENT accounts@charltonmediamail.com ADVERTISING advertising@charltonmediamail.com EDITORIAL sbr@charltonmedia.com
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We also delve into how Singapore’s retail sector is coping amidst the pandemic. Here, we discuss the growing adoption of the online models, but analysts note that physical stores will still remain relevant in the post-pandemic era. To know more about this, flip over to page 22. Further, the labour market is one of the most badly hurt in the past few months as we see the unemployment rate rise. Now that we are in the new normal, will we begin to witness fewer layoffs and if so, could pay hike discussions be back on the table? Roll over to page 32 and learn what HR specialists think. We did not let the pandemic keep us from lauding the deserving companies in our two virtual awards programmes: the SBR Technology Excellence Awards and the Asian Business Case Studies Awards. Find out who the winners are on page 36. Enjoy the issue!
Tim Charlton
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SINGAPORE BUSINESS REVIEW | SEPTEMBER 2020
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CONTENTS
24
HOTTEST STARTUPS 2020 VCS BET BIG ON ESG
08 Businesses lose $473m annually to
16 Check out Shootsta’s new HQ at Mohamed Sultan Road
manual finance and admin processes
09 Negative business outlook eases in Q3: study
10 ‘Hybrid’ events arise as MICE industry
20 Funding rounds intensify as crisis adds up to VCs’ woes
adapts in a socially distant period to do business in Asia
INDUSTRY INSIGHT 22 Will offline stores still play a role?
12 61% of SMEs held high credit risks
32 Pay cuts, salary stagnation await workers in post-pandemic workplace
FINANCIAL INSIGHT
11 Singapore hailed 2nd simplest market
22
INDUSTRY INSIGHT WILL OFFLINE STORES STILL PLAY A ROLE?
SALARY SURVEY
SPACE WATCH
FIRST
20
FINANCIAL INSIGHT FUNDING ROUNDS INTENSIFY AS CRISIS ADDS UP TO VCS’ WOES
RANKINGS 44 Pandemic drives Singapore banks to accelerate digital offerings
48 Auditing services hold accounting firms intact as consulting demand weakens
COVER STORY 24 HOTTEST STARTUPS 2020: VCs bet big on ESG
Published Quarterly on the Second week of the Month by Charlton Media Group 101 Cecil St. #17-09 Tong Eng Building 2 SINGAPORE MARCH 2018 2020 SingaporeBUSINESS 069533 REVIEW ||SEPTEMBER
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News from sbr.com.sg Daily news from Singapore MOST READ
ECONOMY
ECONOMY
Singapore amongst the last to Retailers and F&B outlets now allowed recover from COVID-19: analyst to reopen in Phase 2 Singapore’s economy is slated to be Minister for National Development amongst the last to recover in Asia Lawrence Wong revealed that most excluding Japan (AxJ) from the effects activities will be allowed to open of the COVID-19 pandemic, according once Phase 2 kicks in on 19 June, to a Morgan Stanley report. Joining which includes retail businesses’ the Lion City are Hong Kong, Thailand physical outlets, he announced in a and Malaysia. Morgan Stanley’s press conference. F&B dine-in will be economist Deyi Tan noted that, as one allowed to resume, subject to liquor of the most export-oriented markets sales and consumption ceasing at in AxJ, Singapore’s circuit breaker 10:30 pm. Wong warned that they will measures have led to a double hit on prohibit live music and television and exports and domestic demand. video screenings in F&B outlets.
SHIPPING & MARINE, STOCKS
Sembmarine and SCI to demerge following $2.1b rights issue Sembcorp Industries (SCI) and Sembcorp Marine (Sembmarine) aim to recapitalise the latter through a $2.1b renounceable rights issue, the companies announced in a press release. This will then result in demerger between the two firms via a distribution in specie of SCI’s stake in the recapitalised Sembmarine to SCI shareholders. Upon completion, SCI intends to focus on its core areas of energy and urban development.
MOST READ COMMENTARY Hong Kong’s Possible Loss of Special Status Reiterates Singapore’s Stability BY ERIC CHIN Hong Kong has taken a series of unfavourable hits in the last year, their unfortunate magnitude clear to see for the watching eyes of the world. The latest of which is US Secretary of State Mike Pompeo publicly stating that the country no longer considers Hong Kong to be adequately independent from China. Sadly there will almost certainly be ramifications for Hong Kong’s reputation as a global investment bridge between the East and West.
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SINGAPORE BUSINESS REVIEW | SEPTEMBER 2019 SINGAPORE BUSINESS REVIEW |SEPTEMBER 2020
Why time in the market is better than timing the market BY ADAM REYNOLDS With the current market volatility COVID-19 has reinforced that PEOPLE and general mood of uncertainty are the most important asset of within the economy and society, many all. Businesses right now are more Singaporeans may be wondering if aware than ever how their people it is even a good time to invest at the talent and interactions impact day moment. Whilst navigating the markets to day operations. Human Resources departments are working hard to quickly can be complex for many, especially investors in Singapore who are newer put into place policies and procedures to the markets or those who feel less dealing with communicable diseases so confident to practice self-directed our workforce doesn’t grind to a halt. investing, there is not really good We have had to react and negate the people issues COVID-19 has thrown at us. excuse not to invest. Human Resources: COVID-19 Workforce BY ELLA SHERMAN
SINGAPORE BUSINESS REVIEW | SEPTEMBER 2020
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SINGAPORE BUSINESS REVIEW |SEPTEMBER 2020
DIGITAL - TRAVEL SERVICES
Inside Changi Airport’s Digital Factory of rapid and continous experimentation The airport is pursuing digital enablers to drive continuous innovation and keep pace with the times. sensors, including vibration, temperature and sound, to collect data from the airport baggage handling system. The AI-powered solution aims to proactively maintain the health of the airport’s baggage handling system to reduce the downtime and disruption to passengers. Data models are built to learn, recognise and detect faults. Early warnings are automatically sent to the maintenance team when anomalies and threats are detected.
The DIVA team follows lean manufacturing processes to deliver measurable business outcomes at scale.
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ingapore Changi Airport, voted as the World’s Best Airport for the eighth consecutive time in the 2020 Skytrax World Airport Awards, has established its own internal digital capability that operates like a startup. Aptly named “DIVA”—short for Digital, Innovation, Ventures and Analytics—this Digital Factory was established with a new model to imagine, experiment and co-create digital products and services—from ideation to market launch—using new ways of working. Changi Airport’s very own startup DIVA leverages the combined strength of latest skills and technologies, including design thinking, artificial intelligence, IoT and data science. It fosters a “startup mindset” that brings to life new ways of working and horizontal management. The DIVA team also applies methods and tools to deliver measurable business outcomes at scale, following the blueprint of lean manufacturing processes. “We have set up DIVA to foster a culture of continuous innovation,” said Ms. Lim Peck Hoon, Executive Vice President, Commercial at Changi Airport. “To drive sustainable innovation, we need to be truly inclusive, from the ground staff to the C-suite: anyone from any part of our organisation who is keen to try out a new business idea or an innovative service can come and bring it to
DIVA. If their idea is approved, they will be paired with service designers, data engineers or technologists to form multidisciplinary squads and deliver new products or services,” she added. Customer-centric approach The team performs extensive customer research to understand how the customers act, think and feel at each point of their journey. Since its launch, DIVA has ideated, designed and deployed a series of new digital products and services. As an example, “Changi PlayPass”— Changi Airport’s digital event and activity booking platform that originated from DIVA—elevates the customer experience by reducing some of the friction, such as queues and manual redemption, at Changi Airport and Jewel. This platform also improved event operation efficiency and helped Changi Airport to understand their customers better through real-time data collection.
Showcase of Singapore innovation To remain at the forefront of innovation, DIVA is partnering with the information technology ecosystem to deliver essential services that would meet customer demand. “We are proud to collaborate with Changi Airport to re-evaluate how the airport operates and develops digital solutions to ensure that it remains a world-class leader. DIVA is the first of such capability that Accenture developed in Southeast Asia, and it is a true reflection of Changi Airport’s efforts to keep pace with business disruption and drive Singapore’s Smart Nation vision,” said Ms Teo Lay Lim, Southeast Asia Market Unit Lead and Country Managing Director, Singapore at Accenture. Moving forward, DIVA will continue to serve Changi Airport as its innovation engine to constantly challenge the status quo and make Singapore’s smart city push a reality.
Developing new IP The team at DIVA constantly looks for ways to do things better. For instance, the “Smart Luggage” feature is a unique IoT solution that is designed and custom built with multiple
“Anyone from any part of our organisation who is keen to try out a new business idea or an innovative service can come and bring it to DIVA.” SINGAPORE BUSINESS REVIEW | SEPTEMBER 2020
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FIRST
IMDA established the SG Digital Office to help firms modernise their processes during the pandemic.
Businesses lose $473m annually to manual finance and admin processes
A
company’s failure to digitalise their finance and administrative processes could result to local firms losing $473m a year in GDP revenue, this is according to research by SAP Concur study Finance in the New World of Work. A key finding from the survey revealed that even Singapore witnessed a lag in finance transformation, even as businesses grapple with slowing revenue streams and disruptions to business processes brought forth by telecommuting. Whilst respondents have transitioned to remote working, the survey revealed that many are still relying on manual processes and segmented platforms to submit expenses and claims, contributing to inefficiencies and time wastage. A third of local employees (33%) say they still submit expenses manually by filling out a form and enclosing physical receipts. “Given the current economic landscape, it is crucial for businesses to identify inefficient processes that not only dampen productivity and efficiency but rob employees of their valuable time that could otherwise been spent driving business growth,” said Laura Houldsworth, managing director for South East Asia at SAP Concur. Employees in Singapore spent an average of 2.7 hours per month filing expense claims, 8
SINGAPORE BUSINESS REVIEW |SEPTEMBER 2020
which takes up about a third of a typical workday per month. Managers had it worse, spending 5.5 hours reviewing and approving expense claims, in addition to the 2.7 hours spent submitting their own claims. This adds up to an astonishing 8.2 hours a month, or a full workday for managers. As a result, half of the Singaporean respondents (50%) say they are less than satisfied with their organisation’s expense claims process. A key inhibiting factor in this sentiment is the inability to submit their expenses via a fully intelligent and digital tool. The lack of support for modern payment methods, such as external mobile apps, also another area cited by employees to be inadequate. Over a third of local respondents (38%) indicating a desire for their company’s expense management software to integrate with external apps, enabling added functionality like reimbursement of payments made through super apps. Apart from the day-to-day operations, the lack of modernisation in business travelling also proves to be a huge bugbear.
Amidst the evolving business travelling landscape, digital-first travellers are also seeking the same convenience, accessibility and integrated travel experience as with personal travel. Over half of Singapore respondents (54%) who travel for business cite the ability to personalise all elements of business travel (from flights to accommodation) as the top area for improvement in their company’s business travel management system. Corporate travel systems that enable staff to book flights and accommodations digitally and via mobile, even on their usual personal travel booking platforms and apps, grant employees the flexibility and greater autonomy in business trip decisions, which could lead to more positive business travel experiences. For many organisations, business travel management is piecemeal and disjointed, leaving 32% of employees less than satisfied with the time and effort spent in managing their travels. Travellers also want mobile-based features like real time alerts of danger spots and the ability to make itinerary changes on-the-fly via mobile, as well as integrated and highly personalised business travel management experiences. But for now, remote work will be the default mode of work for many organisations in the foreseeable future. However, the report noted that this impacts the employee’s experiences, productivity and satisfaction. Whilst the majority (59%) of Singaporean respondents said they feel more productive working from home, 40% of employees still cited the loss of productivity during official work hours due to distractions like tending to family matters, as their top challenge. Businesses have the opportunity to make the remote working experience a productive and enjoyable experience, the report said. Key to this is evaluating areas of inefficient or mundane processes such as claims. Survey respondents expressed they want their employers to enable easy remote claims and travel management (21%), improve collaboration (35%), and provide better IT equipment and services (43%). In addition, 61% of Singapore employees strongly link their overall finance and administrative experience and their overall satisfaction of working for their organisations. This suggests that if businesses want to retain their talent, they need to improve their finance
“Given the current economic landscape, it is crucial for businesses to identify inefficient processes that not only dampen productivity but rob employees of their valuable
FIRST and administrative processes. Money problems Since the COVID-19 pandemic struck, a separate study by Workday found that 48% of local organistations have accelerated their digital transformation plans. Despite this, 38% of firms admitted that they eased the pace in such digitalisation plans. Owing to a lack of digital agility, nearly three quarters (71%) struggled to make changes to their financial plans for the year, with almost six in 10 (63%) of companies being unable to realign their organisational structures. In terms of people and processes, over half (56%) of organisations have been unable to track their people’s skillsets to form special taskforces in response to the pandemic. Further, 44% were not able to prioritise managing new approval and business processes. When asked which areas of their business are hit the hardest, Singaporean organisations identified supply chains (44%), sales (42%) and the workplace (40%). The study also found that a short-fall of digital skills has proven to be a significant barrier for organisations in faring better with
Travelers want online booking tools that offer:
Source: SAP Concur
digital agility amidst COVID-19. Over half (54%) of local organisations lack an enterprisewide culture of agility and 52% of the respondents also said that less than half of their people are equipped with digital skills and capabilities. Further, 17% admitted that they have almost no employees who are equipped with digital experience or skills. Workday states that the lack of digital expertise may be due to a prevailing mindset within local companies of not viewing talent as a source of competitive advantage
and therefore not investing in finding and nurturing it. It adds that 81% of Singaporean organisations do not see talent as an important strategic asset and lack the proper tools and processes to manage it. This mindset also has a spill-over effect for organisations’ employee experiences as only 37% see the employee experience as an essential consideration in their decision-making processes and planning. But even as many companies are indeed lacking, the survey notes that 100% of firms see digital transformation as a priority.
SURVEY
Negative business outlook eases in Q3: study
B
usiness sentiment amongst local firms remains downbeat in Q3, even as the business optimism index (BOI) eased to -5.16 percentage points (ppts) from an all-time low of -7.88 ppts in Q2, according to Singapore Commercial Credit Bureau’s (SCCB) Business Optimism Index study. On a YoY basis, BOI fell significantly from +6.91 ppts in Q3 2019. All six indicators are contractionary for Q3, which include the volume of sales, new orders, inventory levels, employment levels, selling price and net profit. The construction, services and transportation sectors are the least optimistic, whilst manufacturing and financial sectors have anticipated a slight uptick in sentiments compared to Q2. Sentiments from the construction sector remained bleak as sales volume worsened from -10 ppts to -20 ppts in Q3. New orders, inventory and employment levels have each fallen from -30 ppts in Q2 to -60 ppts in Q3. Net profit and selling price showed better results but is still in the contractionary zone, up from -30 ppts in the previous quarter to -20 ppts. In the services sector, the volume, net profits, selling price and news orders also remained in contraction but have eased from double-digit figures to single digits over the same period. The employment level inched up to -3.03 ppts from -3.23 ppts, whilst inventory levels also climbed from -29.03 ppts in Q2 2020 to +3.03 ppts.
Source: Singapore Commercial Credit Bureau
The outlook for the transportation sector has deteriorated, with volume of sales, net profits and new orders moderating downwards from 0 ppt in Q2 to -30 ppts in Q3. Selling price and employment levels remain unchanged at 0 ppts, whilst inventory levels reversed from +42.86 ppts to -30 ppts over the same period. The wholesale sector is appearing less weak compared to other sectors mentioned. Its volume of sales and net profit crashed from 0 ppt in Q2 to -17.65 ppts and -5.88 ppts, respectively, in Q3. In contrast, selling price rose from -18.18 ppts and -36.36 ppts in Q2 to 0 ppt in Q3, respectively. New orders remained flat at 0 ppt, whilst inventory levels moderated from +36.36 ppts to +5.88ppts. Business outlook in the manufacturing sector
is in positive territory, with the volume of sales rebounding from -10 ppt to +29.41 ppts, whilst both net profit and selling price rose from -10.0 ppts to 0 ppt. New orders figures also reversed from -10 ppts to +11.76 ppts, whilst inventory levels jumped from -25 ppt to +5.88 ppts. Employment levels also improved from -5 ppts to 0 ppt. Lastly, sentiments in the financial sector improved slightly as its volume of sales and employment levels jumped from 0 ppt in Q2 to +33.33 ppts in Q3, whilst new orders also inched up from 0 ppt to +66.67 ppts over the same period. However, selling price dived from -16.67 ppts to -100 ppts and net profit fell to 0 ppt from +16.67 ppts. Inventory levels remain unchanged at 0 ppt. SINGAPORE BUSINESS REVIEW | SEPTEMBER 2020
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Gastech Exhibition & Conference is one of the major events in Singapore that were postponed.
‘Hybrid’ events arise as MICE industry adapts in a socially distant period
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he meetings, incentives, conferences and exhibitions (MICE) industry is obviously one of the most hard-hit sectors during the COVID-19 pandemic, which has then sparked a domino effect on Singapore’s tourism, hospitality, F&B sectors and tourist-dependent retailers. Although many have already resorted to virtual conferences, some have hinted that the shift is tipped towards a mix of physical and digital. “Since the outbreak, we found that previously developed technologies no longer meet the needs of clients,” Martin Zhao, chairman and CEO of Sino Elite MICE Services, told Singapore Business Review. Zhao shared that in 2019, their business saw a 200% jump in turnover compared to the same period in 2018. The start of 2020 was going well for them as sales in January alone reached one-fourth of the overall 2019 sales. Last year, Sino Elite even introduced various solutions, including digital sign-in systems, micro-site construction, cloud interactive games, cloud lucky draw, and cloud albums. Their push in digitalising events led them to have a lot of new clients, Zhao said. “However, since the outbreak of COVID-19 began in China in February this year, all orders we had confirmed for February, March, and April were delayed or formally canceled,
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SINGAPORE BUSINESS REVIEW |SEPTEMBER 2020
resulting in our company being in the red until now,” Zhao added. Another firm that saw a major change in how they operate is MICE technology provider GlobalSign.in. Veemal Gungadin, founder and CEO of the company, recounted how his teams’ roles shifted. “We had our project management team converted into a customer research team to understand the gaps in the market, and to fully understand customer needs. Our sales team converted into market researchers to understand the market potential and competition. Our marketing team converted into an educational one. There were no more targets about getting leads and numbers. It was all about churning out great, original and thought leadership content that would bring value to customers,” Gungadin stated, adding that his firm even created a new digital event manager (DEM) team. Now, Sino Elite is working on technologies for cloud conferences and digital conference solutions. ITheir clients would previously invite 300 to 600 people to participate in their
physical events, and since everything’s online, the number of viewers can reach more than 1,000, and the cost is only one-tenth of the previous event or even lower. They have built a small live broadcast room in their premises that can accommodate 10 people and signed agreements with several local hotels to provide off-premises broadcast services in order to continue serving their clients without canceling orders. However, they still needed to adjust for their cash-strapped clients. Zhao’s company has tailored several cloud conference packages for clients, with discounts up to 70%, and gave some previous clients use their cloud conference live broadcast service for free. As for GlobalSign.in, they launched GEVME Live, an all-in-one platform for events management and marketing. Apart from the basic elements such as registration, ticket purchasing, email marketing and preevent and post-event surveys, it can now aid in managing webinars, digital conferences, and an online exhibition. Exhibitors may also gain access to a 24/7 digital booth, where they can have one-on-one meetings with leads. Adaptation ahead Both Zhao and Gungadin are expecting Singapore’s MICE industry to evolve, albeit a slow recovery. They said that holding events will likely be a mix of physical and digital components. Zhao said that this will be boosted once 5G communication comes into play and that the sector may still return to its pre-COVID-19 level as there is no new technology that can replace the operation method of the traditional MICE industry yet. “From a research we did, we found out that 40% of people would choose not to attend an event physically in October which is three months away from now. It will take time before people feel comfortable in large gatherings again. But it doesn’t mean that events won’t happen in the meantime. The event industry is going to go through a transformation and more events are going to take place online,” Gungadin added. “Transformation of the MICE industry and business events and the support that will be offered COVID-19 will fundamentally change the way the MICE industry works—from the organisation of events to new safety measures and protocols,” said Singapore Tourism Board’s (STB) executive director for exhibitions and
“It will take time before people feel comfortable in large gatherings again. But it doesn’t mean that events won’t happen in the meantime.”
FIRST conferences Andrew Phua. In preparation for these hybrid events, Phua stated that the MICE industry should opt to consider contactless interfaces or interactions which could include more voice interfaces and fewer touch screens, augmented and virtual reality solutions to deliver personalised and compelling on-demand content, and IoT solutions to capture, track and analyse visitor and delegate data in real time. “This hybridisation of events is likely to take off in a significant way, and some companies have already developed and adopted technologies that may become standard components of future events,” Phua said. Currently, STB is working with stakeholders and the Singapore Association of Convention and Exhibition Organisers and Suppliers (SACEOS) to come up with a playbook to guide the industry on how to leverage technology to deliver events safely and profitably in a post-COVID-19 environment. The government is also offering to subsidise 80% of costs for Singapore-registered companies looking to leverage technology to redesign and innovate their current business models and processes. STB shared that they
The Singapore Tourism Board
will launch the Tourism Transformation Index (TXI) in Q2, a self-diagnostic tool for companies to assess their strengths, identify areas of opportunity and provide recommendations on next steps to take in their digital transformation initiative. However, now that Singapore has been slowly reopening its economy, Phua warns that the activities allowed to resume still depends on the nature of their activities and whether
it is practical to implement the necessary safe management measures. “As we take steps towards embracing what a post-COVID-19 world holds for the MICE industry, we encourage our MICE industry partners to use this downtime to rethink event formats, explore new partnerships and upskill for a post-COVID-19 world. We have to be well positioned and ready to resume business when the time comes,” Phua added.
Singapore hailed as 2nd simplest market to do business in Asia The Lion City scored exceptionally well in its accounting and tax standards.
S
ingapore ranked second amongst the least complex markets to run a business in Asia, according to a TMF Group’s Global Business Complexity Index (GBCI) report. It only lags behind Hong Kong and also nabbed 18th place in the global rankings. The reports noted that the Lion City scored exceptionally well in its accounting and tax standards, ranking 10th simplest in the world, due to its alignment with International Financial Reporting Standards (IFRS), tax clarity and relative ease of filing requirements. Other favourable considerations are Singapore’s competitive corporate tax rate of 17% and double tax agreements (DTAs) signed with over 80 different countries. Additionally, the government’s continued focus on digitisation has resulted in simplified e-filing processes. In terms of managing human resources and payroll, Singapore ranks above average at 28th place globally, all thanks to its transparent employment and payroll guidelines, ease of hiring, and focus on talent. Boosting its available workforce, theTMF Group predicts the local retirement age to be raised in 2022 from 62 to 65 years old, and re-employment age from 67 to 70 years old. For rules, regulations and penalties, Singapore holds the 36th spot worldwide. Whilst its laws are based on a common law framework allowing for transparency and consistency, TMF stated
Source: TMF Group
that Lion City continues to step up enforcement action on basic compliance obligations. Some examples are convening AGMs and filings, which can give a leverage to its business complexity. “Despite these uncertain times, Singapore is still a highly attractive regional and international business hub given the relative simplicity of doing business here,” said Edmund Lee, managing director Singapore, TMF Group.
“Even so, evolving compliance requirements and strict enforcement may make it more intricate to do business than before, and Singapore firms need to better understand the rules of engagement with regulators and integrate them into their policies.” In other APAC jurisdictions, Indonesia is hailed as the most complex market to run a business followed by China, Malaysia and Taiwan. SINGAPORE BUSINESS REVIEW | SEPTEMBER 2020
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FIRST Check out Singapore’s top 10 retailers
NTUC Fairprice Marine Parade
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TUC FairPrice was crowned as Singapore’s top retailer, with its actuals amounting to $2.74b ($1.94b) in 2019, according to Euromonitor’s Top 100 Retailers in Asia 2020 report. Dairy Farm nabbed the top two spot with $1.61b ($1.14b), and Sheng Siong rounded up the top three with $962.4m ($680m). Other retail firms mentioned in the list are Takashimaya, Giosis Group, Alibaba Group Holdings, Seven & I Holdings, Mustafa Holdings, AS Watson Group and Courts Asia. Actuals movements across the top ten have been mixed. Overall, Euromonitor observed that Singapore’s retail sales registered a slight decline in 2019 as the economy continues to look gloomy, and a weaker consumer sentiment from the pandemic is projected to linger into 2021. Currently, retail sales are bolstered by e-commerce sales as consumers continue to perceive the online platforms to provide better cost savings and value for money. The retail landscape is expected to recover slowly in 2021, when the economy is likely to improve and consumers can get their hands on higher disposable incomes, Euromonitor added. Furthermore, the report added that experiential retail is still on the rise as it provides consumers with personalised experiences, which creates better brand identity and relationships with customers. “Despite physical retail stores not performing well, many e-commerce players are taking their business offline too to maintain their growth. Ultimately, Singaporean consumers still prefer to see and feel items before buying and having a physical store allows consumers to do just that,” Euromonitor stated. The report added that offline presence allows e-commerce players to provide value-added services for their consumers and build stronger brand identities that were not possible to do so online. “This is especially common for fashion e-commerce players, such as Love, Bonito and Pomelo, which opened their new flagship stores in shopping malls.”
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SINGAPORE BUSINESS REVIEW |SEPTEMBER 2020
61% of SMEs held high credit risks
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ixty-one percent of small and medium-sized enterprises (SMEs) have demonstrated lower credit ratings by end-2019, which made them more exposed to short-term vulnerabilities in adverse economic conditions amidst the COVID-19 pandemic, according to a survey conducted by Experian. The figure also meant that SMEs were vulnerable in the areas of credit standing, cash flow, liquidity, and liabilities. Such ‘high risk’ SMEs would have had existing access to capital challenges with lenders, given lacklustre trading conditions in 2019 and the companies’ weaker credit profiles. The report revealed that business challenges in 2019 were exacerbated by a weakening manufacturing output, weak discretionary consumer spending and the US-China trade war. As a result, Experian found that sectors with weaker credit ratings are hospitality/F&B (81%), information & communications (72%), commerce-retail (70%), construction (70%) and services (70%). In addition to credit ratings, Experian also analysed the SMEs’ near time financial strength, with short term cash flow and debt exposure a concern for most SMEs. Whilst overall working capital remained positive, organisations in commerceretail, construction, hospitality/F&B, and property appear to be experiencing challenges related to cash flow. Seven out of 12 sectors surveyed registered negative profit margins, which is a concern especially for sectors comprising younger SMEs where their ability to generate returns over time were comparatively weaker. Top challenges SMEs face during the circuit breaker period
Source: Experian
Mall operators are required to give SMEs rental relief.
“Whilst micro SMEs, or organisations with a turnover of less than $1m, usually hold weaker financial positions due to thinner profit margins. Meanwhile, their larger counterparts, or organisations with a turnover of $1m to $10m, were also observed to be struggling with negative margins,” Experian observed. Furthermore, the study added that amongst these high-risk SMEs, 15.5% of such SMEs were deemed the most likely to delay in making payments. Most of these firms were found to be under the hospitality/F&B (36.7%), construction (35.1%) and manufacturing (27.5%), suggesting possible weakness within these sectors. The average length of time on how quickly SMEs pay their debts fell by five days to 33 days in Q1 compared to Q4 2019. In addition, 13% of SMEs’ debts in Q1 were paid in more than 90 days beyond terms, a 19% crash over the same period. “This may reflect a tightening in supplier credit, especially in sectors such as construction (improvement by 14 days) and commerce-retail (improvement by 13 days), where sector confidence is weak, and creditors are following up on payments with greater urgency,” it added.
DIGITAL - REAL ESTATE
Far East Organization’s new digital strategy to drive customer and employee experience It established the Group IT Digital Lab in 2019 to accelerate the digital transformation journey.
Far East Organization’s upcoming smart office at Woods Square, a commercial development in Woodlands Regional Centre
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ar East Organization is a dynamic and diversified enterprise that develops, owns, and manages a diverse portfolio of real estate products in the residential, hospitality, retail, commercial, healthcare and industrial space segments. Since its establishment in 1960, the Organization with 2,500 employees in Singapore, Malaysia and Australia has been contributing to the transformation of Singapore’s urban landscape, with more than 780 developments including over 55,000 homes in the country. Far East Organization currently also owns and manages a multisegment real estate investment and leasing portfolio with a total net lettable area of over 14 million sqft. As the city-state’s largest private property developer, Far East Organization has earned a growing reputation for introducing cutting-edge concepts for the way people live, work and play. Recognising how this is increasingly being shaped and influenced by rapid advancements in digital innovation, the Organization established the IT Digital Lab in 2019 to accelerate its digital transformation journey with a view to reinventing the customer experience, improving operational efficiency, productivity and employee engagement, and harnessing the value and potential of its digital assets. The Digital Lab, a cornerstone of Far East Organization’s IT innovation roadmap, is staffed by a team of driven and talented digital technologists who are
passionate about delivering a digital and data infrastructure to transform the way the Organization builds and operates its technology platform, aligning the team’s capabilities to realise strategic business impact and productivity gains. In less than a year, the nascent Digital Lab team successfully leveraged cloud technologies to build a secure and scalable digital business technology platform. This serves to jumpstart the development and deployment of customised solutions for the business. Aside from launching a digital sales kit to support the sale of residential and commercial properties at One Holland Village Residences and Woods Square, the Digital Lab team developed analytical dashboards to drive revenue management for the corporate real estate leasing business by reducing vacancy levels and optimising rental rates based on competitive market pricing analysis. The team also designed a workflow system to route and capture internal management decisions and approvals involving more than 200 development and investment companies within Far East Organization’s portfolio. This e-Memo system significantly reduced the amount of manual paperwork and resulted in improved communications, knowledge management and efficiency in the Organization’s integrated work processes. Automating manual, repetitive processes within hospitality management, HR and
“Our Digital Lab enables us to capture new value, rapidly turning innovative ideas into tangible solutions that deliver business benefits.”
IT departments, the team also developed autonomous software bots using robotic process automation (RPA) technologies. In recent weeks, the team customised an in-house app to track employees’ work arrangements/locations, temperature and other related health and travel declarations, and to alert the right organisational personnel for action during the COVID-19 pandemic. A similar app is ready for visitors to the Organization’s sales galleries and show units, as part of overall safety compliance. For its achievements in harnessing digital innovation to advance its customer and people strategy, Far East Organization emerged the winner in the Digital - Real Estate category at Singapore Business Review’s Technology Excellence Awards 2020. Far East Organization’s Executive Director and Group Head of HR & IT, Jodie Choo, is heartened by the recognition of the young Digital Lab’s potential. “Our Digital Lab enables the Organization to capture new value, rapidly turning innovative ideas into tangible solutions that deliver business benefits. I thank the team for their efforts and look forward to attracting more talent to bolster our IT digital bench strength. Together with our technology partners, we are excited by the many possibilities to improve our business operations and deliver greater value to our customers and community with speed, quality and agility,” concludes Jodie.
Jodie Choo, Executive Director and Group Head of HR & IT at Far East Organization
SINGAPORE BUSINESS REVIEW | SEPTEMBER 2020
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STARTUPS This startup fills the gap on cybersecurity awareness
Right-Hand’s CEO Theo Nasser
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ybersecurity remains a huge problem in Singapore and its circuit breaker period even made it worse as flocks of vulnerable users are exposed to online threats. But despite using various programmes and services to block out these threats, lack of awareness on how to and why they should prevent such problems still pose a threat. To bridge this gap, cybersecurity platform Right-Hand has come up with a solution that not only detects cyber risks but also educates online users. Right-Hand Cybersecurity provides a SaaS platform to help organisations monitor, measure and mitigate human-induced cyber risks that could lead to a data breach. Theo Nasser, CEO & co-founder of Right-Hand, said that some of their customers shared that there were instances that traditional e-learning videos and on-site training were not effectively influencing positive cybersecurity behavioural change across their workforce because it doesn’t scale across an enterprise; employees wouldn’t take such videos seriously, and it was difficult to measure if the said methods are effective. The startup offers three products that are each sold as an annual software subscription. One is its ‘Compliance Readiness’ product, which automates the creation and delivery of employee assessments based on a customer’s set of corporate policies (i.e., Data Privacy policy) to determine if a user is compliant or not. The second product is ‘Phishing Readiness’, which sends simulated and customised spear-phishing emails to identify users who are most susceptible to email attacks, in order to condition them to be more vigilant. Lastly, their ‘Training Readiness’ product sends customised, gamified and three-minute training modules to educate users on the cyber essentials. “Our Training Readiness product can also be integrated with Phishing Readiness and Compliance Readiness to deliver training modules the moment a user engages phishing email or fails a compliance assessment,” Nasser explained. In March, Right-Hand raised about $1.42m (US$1m) in a seed funding round led by Atlas Ventures. Nasser stated that they will use it to build two new products in 2020, incorporating machine learning and natural language processing into their existing platform. Commenting on the funding round, Atlas Ventures’ investment director Maxim Shkvaruk said that they believe Right-Hand’s products will be in high demand in more developed countries, especially in the US and Europe. “Most companies focus on technical solutions like threat detection systems and firewalls, and neglect to invest in employee cybersecurity awareness.” he said. “We felt that Right-Hand was in a solid position to fill this large, overlooked gap in the market.”
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SINGAPORE BUSINESS REVIEW |SEPTEMBER 2020
IUIGA makes shopping worth every cent and second you pay, is what you get’. Access to quality products and fairer prices remains limited. It is also about nurturing consumers to be more informed buyers,” Jaslyn Chan, chief growth officer at IUIGA Technologies, said. They also have a 30-day return policy and assure that there are additional IUIGA’s chief growth officer Jaslyn Chan return costs or shipping fees included. nce a certain product has Currently, the startup has nine physical been released, it typically goes stores alongside its online platform. through a very long process “Though it might seem counter-intuitive where it needs to reach 10 to 20 stages for a digital-business to open physical from the manufacturers and distributors retail stores as its next step, it made much before reaching a consumer. In the end, sense in reality,” Chan added. the consumer still has to shoulder other Last May, IUIGA bagged $10m in costs incurred, which makes up twoa series A funding led by Konimex thirds of the prices shown in stores. Technologies, the technology investment Disrupting the traditional retail model, arm of Indonesian conglomerate retail startup IUIGA Technologies offers Konimex Group. Edward Setiawan products with price tags displaying Joesoef, Konimex‘s director, says that the real price of a product based on the startup has a robust business model quality by breaking down the ratios of with its hybrid online-offline integration. production costs and markup, even as “We can easily scale the company they directly deal with manufacturers. internationally with a relatively low “Many believe in the notion of ‘What apple-to-apple competition,” he said.
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DCI fills access gap in e-commerce data multiple datasets from each e-commerce channel in order to get a holistic view,” Kyriakos Zannikos, founder of DCI, stated. He further shared that their clients often require two types of services. One is category level competitive intelligence data which show their market size and potential, helping DCI’s founder Kyriakos Zannikos identify areas of improvement. The other service they offer consolidation and analysis ata accessibility for e-commerce in of the e-commerce data they already have, Southeast Asia, including Singapore, turning them into insights and actionable is described as fragmented and limited compared to bigger markets such as recommendations. Their platform is offered on an annual China, Europe and the US. Whilst established subscription basis with varying prices as e-commerce giants already have their own category level data with their brand partners clients may customise their solution. “Most of our global competitors have or market research firms, they are reluctant to share this information with smaller players designed their products and services to fit markets like the US, Europe or China, for a competitive advantage. therefore missing certain nuances and Addressing this, Singapore-based startup requirements that are unique in this part Digital Commerce Intelligence (DCI) built of the world. We have built a customised a solution that collects and consolidates solution for Southeast Asia and we are commercial data from various sources and offering it at a more competitive price processes them to fit customers’ needs. point,” Zannikos added. “This is actually a common issue in DCI raised $1m in a seed funding last e-commerce space, mainly due to the fact April, led by Europe-based venture capital that many major e-commerce platforms do not share their category level or competition firm Velocity Partners. The AI-based startup shared that they will soon launch their first data with their brand partners. Even if they service dedicated to shoppers. did, brands would still have to consolidate
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STARTUPS UNL bridges gaps for under-addressed sites
UNL ‘s CCO Mihaela Georgieva
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urrent addressing standards remain limited and are even deemed unfit for the digital economy. What’s more, it turns out that a staggering 75% of the world is poorly addressed, which leaves 4 billion people globally without a physical address. As it remains this way, individuals and locations that do not have a reliable address remain underserved and excluded from economic traffic, as they get restricted from accessing essential services such as emergency help, postal services or even identity. Solving this, mapping-technology startup UNL has created a smart platform for navigation and location-based services
that can give anyone and anywhere a unique, universal address. “To every location, we add a smart layer to make places programmable— building the Internet of Places—powering hyperlocal applications from last-mile delivery to smart city applications. It’s about economic impact and unlocking places to become the gravity points for location-based services,” Mihaela Georgieva, CCO of UNL, said. The platform is identified as an infrastructural technology that can divide parts of the world into a 3D grid of ‘microcells’. UNL then assigns a unique universal location ID to every ‘cell’, which Georgieva describes to be similar to domain names. From there, users and businesses would be able to claim and customise locations, give a customised name, attach and manage metadata and, optimise first- and last-mile navigation. “To this, we add a smart layer to make locations programmable and transactional, turning any location into a point of sale, point of delivery, point of payment and point of experience,” Georgieva added.. UNL secured $2.78m (US$2m) in a seed funding last March, led by elev8.vc.
Entropica Labs aims to pioneer in the quantum computers scene following three avenues on this area: first is applied research, where they investigate and develop algorithms and techniques on the quantum hardware we can access today; second, is on problem-solving, supporting enterprise partners to become quantum-aware Entropica Labs’s CEO Tommaso Demarie and help clients map problems s world events prompt to diverse quantum computing everyone to enter the big frameworks; lastly is on preparing to data scene, classic computers create novel software tools and methods may not be enough to handle this for quantum computers. bulk, but quantum computers can. In “We came to appreciate the comparison to the typical machines, fundamental importance of 1) quantum computers are made to solve understanding how to code and problems in big data whereas the use different quantum computing traditional computers can only store platforms, 2) benchmark these information. Given that quantum machines and 3) have applicationcomputing is still a nascent industry, agnostic software tools and tech startup Entropica Labs aims to be architectures,” said Tommaso Demarie, one of the firms to pioneer in bringing co-founder and CEO at Entropica Labs. that tech to Singapore. In May, the startup raised $2.6m led The Singapore-based startup builds by Elev8 and joined by SGInnovate, VC algorithms, software tools, methods and Wavemaker Partners, the Lim Teck Lee models to make quantum computers Group, V1 Capital, Entrepreneur First useful. Demarie shares that they are and Japan-based TIS Inc.
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How Tinvio automates multiple aspects of supply management
Tinvio’s CEO Ajay Gopal
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etail businesses, especially ones that constantly need to keep their shelves and inventories stocked, such as the food and beverages (F&B) industry, are constantly in touch with their suppliers to keep their business afloat. But as simple as it may seem, the process takes time and is also prone to multiple human errors from order to delivery. Tinvio, a communication and commerce startup, has digitised this experience by setting up a platform where merchants can interact and transact with all their suppliers in one interface. Ajay Gopal, founder and CEO of Tinvio, shared that most restaurant owners take a look around their kitchens, estimate how much they will order and scroll through their Whatsapp in search for different suppliers. The sales representatives of those suppliers will then transfer the details via email into the head offices, before heading into the suppliers’ enterprise resource planning (ERP) system or warehouse management system. Tinvio offers a chat-to-order app that replaces this. It also includes a smart feature where a merchant can review past transactions in a datastructured manner so that merchants do not always need to type in their orders. Users will also be able to track their orders and automate their invoices. They can also make a customised report of their orders through the app. “If you want to place an order, have that clear black-and-white transaction history, report an issue very clearly instead of using a text, let’s use a very structured format so that there’s always visibility, accountability and transparency,” Ajay said. He also added that they’re taking a lot of opportunities from SMEs that are looking to digitise their supply chains, especially when the COVID-19 pandemic kicked in. Most of Tinvio’s clients are in F&B, medical clinics, retail stops and snack shops. Tinvio’s app is free to use unless their clients request a custom workflow. In April, Tinvio bagged $7.65m led by Sequoia Capital’s Surge accelerator programme. This brings its total funding amount to $9.04m (US$6.5m) since they started in July 2019. The fresh funds will be used to add more features in their app, addressing more merchantsupplier pain points such as manual reconstruction of invoices, the use of cash and cheques, as well as the manual search for new suppliers. SINGAPORE BUSINESS REVIEW | SEPTEMBER 2020
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EXCLUSIVE: SPACE WATCH
Check out Shootsta’s new headquarters at Mohamed Sultan Road The company prioritised the functionality of the space for filming purposes.
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ideo technology company Shootsta officially opened its global headquarters in Singapore, located at Mohamed Sultan Road in a historical shophouse, right next to Fort Canning park. Founded in 2015 in Sydney, Shootsta scaled from a startup to a global company, currently servicing 250 clients in five markets across four continents including companies such as Grab, Singtel, Circles.Life, and CitiBank in Singapore. The new space is located on a shophouse which is kept minimalistic and stripped down of interior design. It is also is equipped with sound boards to ensure good sound quality
Mike Pritchett
when filming. The space can also be partitioned into a large breakout area when needed. Like all other Shootsta offices in Sydney, Hong Kong, London and San Diego, the space serves as a place for employees to create, collaborate, and serve clients as well as for clients to film content and attend regular in-person training sessions. Shootsta’s decision to officially make Singapore its global HQ stems from the country’s position as an international hub, said CEO and founder Mike Pritchett. The opening of the office follows Shootsta’s launch of a new digital products suite which is originally intended in H2.
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1 A few of Shootsta team members at work in the spacious open-plan office.
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These are multifunctional open spaces that can be turned into a filming studio or training room for Shootsta clients.
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Adorning the shelves are cute and quirky pieces that reflect inside jokes within the Shootsta team.
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Plants and warm lighting add an earthy contrast to the concrete urban interior of the Shootsta Singapore office.
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The boardroom where every deal is made, every idea is brainstormed and every product is conceptualised. The spiral staircase greets the employees every day as they head into the Shootsta office located in a historical Singapore shophouse.
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SINGAPORE BUSINESS REVIEW |SEPTEMBER 2020
DIGITAL - LIFE INSURANCE DIGITAL - GENERAL INSURANCE
NTUC Income bags two digital awards at the 2020 SBR Technology Excellence Awards The insurer won in the Digital - Life Insurance and Digital - General Insurance categories.
Peter Tay, Chief Digital Officer at NTUC Income
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s one of Singapore’s leading digital and multi-channel insurers, NTUC Income (Income) is driven to innovate and push boundaries to meet the consumers’ rapidly evolving needs. Through strategic partnerships with best-in-class digital ecosystem partners, Income rolled out two novel insurance products in 2019 that take into consideration lifestyle needs and behaviour to transform how consumers engage with insurance, making it simpler, flexible and more affordable. Critical Illness Pay-Per Trip Private-hire drivers form a significant part of the growing gig economy in Singapore. Many worry about falling ill and incurring hefty medical costs, as well as the potential loss of income during this time. They see the value of insurance protection but also worry about the longterm financial commitment, and are often hindered by the lack of affordable and flexible options. Knowing these consumer limiting factors, Income, in collaboration with GrabInsure, launched Critical Illness Pay-Per-Trip (CIPPT), Southeast Asia’s first stackable insurance proposition specially designed to make Critical Illness protection more accessible to Grab driverpartners. CIPPT was designed to offer flexibility in
obtaining insurance by removing the worry about fixed, long-term premium payments (which can be a significant portion of their monthly income) and a complicated application process. With CIPPT, Grab driver-partners pay between S$0.10 and S$0.50 in premium and accumulate insurance coverage that is commensurate with the micro-premium paid after the completion of each trip. For example, a 30-year-old Grab driverpartner, who chooses to pay $0.10 in premium with each completed trip, and makes six trips a day would accumulate S$900 of Critical Illness protection for just S$0.60 on that day. CIPPT allows the insured to maintain an accrued insurance coverage of up to $200,000 on a rolling 360-day period. This means that, should the insured choose to take a break from driving, he remains protected by the accumulated coverage that he had stacked up to the day before he took leave from driving. Since its launch in August 2019, more than 2 million policies have been issued to Grab driver-partners.
Milesurance With the average number of kilometres clocked by private cars dropping steadily over the past decade due to higher reliance on private-hire car services and a more developed public transport system, Income saw an opportunity to redesign car insurance so that drivers can save more when they drive less. This led to the development of Milesurance, Singapore’s first truly usage-based motor insurance, with Carro as its first customer. The key technology behind Milesurance is 4G-equipped vehicular telematics which enables a dynamic premium design, where drivers are charged a unique premium rate based on the vehicle model and individual driving behaviour, besides other criteria such as age and driving experience. All premiums are calculated automatically with data received from the in-vehicle telematics platform and billed to the driver at the end of each month. Milesurance is the next generation usage-based insurance, going beyond tiered pricing to allow drivers to pay for insurance based on the exact mileage driven. Milesurance has provided coverage in excess of 300,000 kilometres since its launch in November 2019. Peter Tay, Income’s Chief Digital Officer, said: “Technology is continually opening up new opportunities for us to reimagine insurance and change the way customers pay for and get insurance protection. Consumers today want choice, flexibility and personalisation in the products and services they engage in, and this includes insurance. The CIPPT and Milesurance are ground-breaking propositions and proof that insurance can be customised to the consumer’s lifestyle. Income will be looking to scale these propositions to bring more choice to consumers so that they can get the insurance they need when they need it as we help to close protection gaps in Singapore.”
Consumers today want choice. CIPPT and Milesurance are proof that insurance can be customised to the consumer’s lifestyle.
RETAIL WATCH
How Handmade Heroes is carving a niche with natural skincare products It has since grown its staff tenfold and expanded its working space by 25 times.
Handmade Heroes founder Lynsey Lim
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ingaporeans are increasingly seeking out products made with environmental sustainability in mind, according to a study by Nielsen, nearly four in five are willing to pay premium prices for products that contain environmentally friendly or sustainable materials. With that, businesses have eagerly grabbed the opportunity to cater to the demands of conscious consumers with a wide range of green products. Amongst these businesses is Handmade Heroes, which started offering natural skincare products in 2015. They aim to solve the pain point on the lack of beauty and wellness products that were both fully natural and at an affordable price. Its products and ranging from lip balms to body scrubs and are all made by the hand in small batches. “Handmade Heroes offers a variety of natural skincare products—from lip balms and shampoo to face masks and hand sanitisers—that are vegan, paraben-free, crueltyfree, and halal-certified. Launched in 2015 in Singapore, Handmade Heroes aims to make chemical-free, quality, everyday skincare accessible at affordable prices,” said Handmade Heroes founder Lynsey Lim. Lim shared that she started the business from her own experiences on being conscious of what goes on her skin and on her interest in natural skincare. However, she found that when looking for organic products, it was either too expensive or that brands that were never “fully-natural”.
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SINGAPORE BUSINESS REVIEW |SEPTEMBER 2020
By selling on Amazon, Handmade Heroes began to see their sales ramp up with a 160% average annual increase.
“Keeping our products affordable has always been a key focus for us. I created Handmade Heroes with the purpose of making natural quality skin care accessible to everyone. With that in mind, we are able to maintain relatively low price points as all of our design, R&D and manufacturing processes are performed and managed in-house. This has also allowed us full control over the quality of our products,” Lim further added. One of their products is their Cocolicious Luscious Lip Scrub is Amazon’s best-selling lip scrub and we’ve been Amazon’s top-selling natural skincare brand since 2016. Some of their best sellers include No-no Nasties Sanitiser, made with ethyl alcohol derived from sugar cane sans any chemicals and artificial fragrances; Butt Kickin’ Deep Detoxing coffee scrub to stimulate circulation and exfoliation whilst improving skin appearance; and Natural Baby Kit, which a nourishing baby care product quintessential for every natural mother and infant. By selling on Amazon, Lim shared that they began to see their sales ramp up with a 160% average annual increase. This allowed them not only to expand internationally, but also to tide through current market uncertainties. Currently, they closed their production facility since 20 March and opted for her employees to work-from-home. However, they were still able to operate and sell online. “Being listed on Amazon’s marketplace helped us to achieve high growth. Amazon opened new markets to us, including the US, UK and Germany, and allowed us to scale our business. As such, we have been leveraging Amazon’s fulfilment services to deliver across the world. Prior to listing on Amazon, we were only selling in the local Singapore market,” Lim commented. Currently, more than 80% of Handmade Heroes’ sales comes from Amazon and have since grown from a twoperson team to a 20-member company. The firm also made expansions in their working space and facilities by 25 times from when they first started. “Our whole process, from start to finish, is in-house— from research and development (R&D) to manufacturing to quality control” Lim added. In addition with their small batch manufacturing, she claims that they were able to react and improve our products quickly based on our customers’ reviews and feedback. Recently, they received their halal certification this year, which will then allow them to tap into more growing markets such as Indonesia and the Middle East. “Securing the halal certification was a challenging process as the standards to fulfil are very high. For starters, we need to ensure that all of our ingredients are halal-certified, and our processes abide by the strict requirements,” Lim recounted. Currently, she revealed that they invested heavily into equipment in order to create a new product pipeline.
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SINGAPORE BUSINESS REVIEW | SEPTEMBER 2020
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FINANCIAL INSIGHT: VENTURE CAPITAL understand what the business will look like post pandemic.” Not only that, startups should also expect the fundraising rounds to take longer than the usual investment process. For instance, Daoud explained that they’d prefer meeting startup founders in person to assess the ones they haven’t previously known or heard of before. “As a result, our investment process may take longer than usual. Founders should be prepared for longer timelines as investors build the comfort they need to back a new team,” she added.
RWDC nabbed $188.42m in series B funding whilst Circuit Breaker measures were in place.
Funding rounds intensify as crisis adds up to VCs’ woes Investors are expecting a bulk of changes in the ‘new normal’, which will make it more challenging for startups to secure funds amidst uncertainties.
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uring the first five months of the year, some of Singapore’s startups still managed to clinch investments despite trying times. One of the latest and notable movement on this scene is involves biotech startup RWDC Industries, which just closed its series B funding round of $188.42m (US$133m) from Vickers Venture Partners, energy and resources company Flint Hills Resources, CPV/CAP Pensionskasse Coop, and International SA. A few weeks prior to that, early-stage venture capital fund Accelerating Asia closed it latest accelerator programme, awarding startups $225,000 each including iFarmer, Numu, IZY.ai and Priyoshop. But despite these positive developments, more difficulties lie ahead for those looking to close funds as venture capital (VCs) firms have added a new criterion to their investment mandate—“what kind of impact will COVID-19 have on this model or service?” “How they answer will dictate whether an investor commits now, or waits until the pandemic passes,” Justin Hall, partner at Golden Gate
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VCs are currently focused on advising their portfolio companies on managing cash flow, and supply chain or demand bottlenecks.
Ventures, told Singapore Business Review in an exclusive interview. Some VCs are also applying revisions to their investment theses. One of them is Monk’s Hill Ventures, building a thesis and conviction based on how consumers and business behaviours might shift amidst the “new normal” after COVID-19, shared Michele Daoud, partner of Monk’s Hill Ventures. For specific potential investments, Monk’s Hill Ventures stress-tests a company’s thesis during the downturn and goes back to first principles to question the startup founder’s underlying assumptions. “We take the time to understand the founder’s rationale for raising capital now, as well as whether the capital will be used for survival or to capture growth during COVID-19. We also look to understand the business model’s dependence on future capital raises and what the path to break-even looks like,” Daoud added. “We build various scenarios as to how the potential investment may play out given different recovery scenarios, and work with the entrepreneur to
‘Raise to survive’ Even though there is a lot of startup movement going on and VCs are still looking for startups to invest in, VCs strongly advise startups to focus away from top line growth and to focus more into profitability and extending their runway. “VCs are currently focussed very much on advising, hand holding their portfolio companies in managing the cash flow, supply chain or demand bottlenecks. If startups can survive this demand and supply shock, VCs believe that they can grow and raise capital at better valuations in a years’ time. Reducing the portfolio risk by active management with the companies is one of the important functions currently for many investors,” vice chairman of Business Angel Network of Southeast Asia (BANSEA) Ramesh Raghavan said. Monk’s Hill Ventures’ Daoud adds that capital management, rainmaking ability, and a heightened sense of urgency are critical survival tools for entrepreneurs so that they can roll out plans based on different scenarios, optimise for underlying capital efficiency, and pave a path to profitability without relying on new external funding rounds within the next 12-18 months. “Founders and CEOs need to adapt swiftly and over communicate with their teams to protect their employees and ensure smooth business operations. It is critical for them to be decisive and adopt flexible policies whilst keeping close tabs on their different markets and
how the environment is evolving week after week,” Daoud said. But as for the ones that had recently bagged investments, these startups now have a runway to continue their services to clients. Zhaotan Xiao, RWDC President for Asia Pacific, notes the importance of the investments in building production capacity as the company is currently focussed on facing the growing demand for polyhydroxyalkanoate (PHA), which is the biodegradable substitute for everyday-use plastic. On the same note, hospitality tech startup IZY.ai’s co-founder and CEO Gerry Mangentang said that investment will help them shape their products to help their clients adapt to the new normal. The startup said the investment has helped them particularly through digitisation of all their services and internal operating processes as hotels are looking for tech solutions that can help them boost their ancillary revenues, and make up for the
Venture capital firms have added a new criterion to their investment mandates— what kind of impact will COVID-19 have on this model or service?
current losses, as well as maximise internal efficiencies. “We have actually received an increase in terms of demand of our product. This is also why we are still acquiring hotel clients during the lockdown through video calls which is a chance from our original sales process which included site visits,” Mangentang adds. Rainbow after the storm Despite all of the changes the “new normal” will bring. Startups and VCs remain positive in Singapore’s and APAC’s ennvironment. Startups say that Singapore and Southeast Asia as playing an important role in their success. BANSEA’s Raghavan expects that deeptech, fintech, healthtech, and digital transformation businesses will take continue to take centre stage as businesses now try to digitise whatever they can to reach clients. “Things will change for sure. Some new opportunities will rise, whilst some others will diminish. My general take would be that startup
valuations and traction targets/KPIs will be re-evaluated and re-adjusted with the main underlying idea going back to the very basic principle of business which is monetisation,” IZY.ai’s Mangentang stated. “Path to profitability and ‘achieving cash flowpositive’ will definitely be the key questions to be tackled which will surely affect a lot of other business aspects such as marketing spending”. Looking ahead, startups are still searching for new opportunities that might emerge during the pandemic, are on a lookout on what comes in a post-pandemic era. “The COVID-19 crisis has also given us an opportunity to rethink our priorities and startup founders, investors, and stakeholders like the policymakers need to understand those priorities better” said Fahad Ifaz, co-founder and CEO of iFarmer said. “Businesses have to take the opportunity to leverage this growth in digital space and design products and features to enhance the services further,” he added.
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INDUSTRY INSIGHT: RETAIL
NTUC Fairprice launched its mobile grocery service “Fairprice on Wheels”.
Will offline stores still play a role? Retailers are still expected to continue developing their physical stores post-pandemic.
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hough reports have shown that consumer demand shifted largely from offline to online during the circuit breaker measures, many e-commerce players are still finding growth opportunities from brick-and-mortar stores. According to a report from Euromonitor International, offline presence still allows e-commerce players to offer value-added services for their consumers, whilst also building stronger brand identities, which was not possible to do through online means before. This has particularly been the case for fashion e-commerce players, such as Pomelo and Love, Bonito, which opened their new flagship stores in shopping malls. “Although the circuit breaker put a pause on physical stores, offline will still be highly relevant after the pandemic. Retailers operating on omnichannel will have a competitive advantage over retailers that are solely online due to services such as click-andcollect and experiential retail that 22
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consumers value,” Euromonitor International’s analyst Clare Lee commented. Physical stores can work in synergy with their online platform to drive sales as they provide different sets of functionalities, Lee explained. Retailers are also expected to continue developing their physical stores post-pandemic.IGD’s senior retail analyst Soo-Eng Tan noted that FairPrice and Dairy Farm have been rolling out initiatives over the last two years to enhance the shopping experience in their physical stores. He cited FairPrice Xtra in Vivocity and CS Fresh in Great World as prime examples of how large format stores can transform to drive new shoppers and meet new missions. “Increased ready-to-eat options, dine-in areas, oyster bars, exciting counters and better fresh produce are some key highlights in these stores. We will likely see some of these great elements being rolled out to other stores,” Tan said.
Physical stores can work in synergy with their online platforms to drive sales as they provide different sets of functionalities.
Despite opportunities offline, sales for Singapore’s physical retailers might still struggle to pick up quickly due to the travel restrictions that are in place, Lee said. This is especially the case for the luxury retailers, who rely heavily on tourist spending. “As for locals, we do not expect consumers to bounce back quickly when spending returns to preCOVID level once the restrictions are over,” Euromonitor’s Lee added. E-commerce struggles Some e-commerce retailers still face challenges from logistical problems and struggles to meet the huge demand, IGD noted. Skincare brand The Soap Haven shared that they were unable to fulfil their online orders for a short period, as their physical retail locations in Singapore were all shut. The company’s fulfilment warehouse was also forced to close for a short term during the circuit breaker measures. “But thankfully, that is all now operational on a positive note,
INDUSTRY INSIGHT: RETAIL Top 10 Companies within Retailing in Singapore
Bernard Tay
Source: Euromonitor
because we are mainly internet based and disruption is relatively minimal compared to brick and mortar retail stores,” co-founder Jason Tay shared during the inaugural Amazon Singapore Online Seller Summit. Nail beauty brand Rui Smiths also faced issues in managing inventory. “Supply from China was halted earlier in the year but that has resumed thankfully, now international shipping takes longer, and it’s more expensive,” founder Debbie Cai said. RedMart, operated by Lazada, also temporarily reduced the range of products available to cope with the high demand for essential goods. “With the influx of new staff, it is hard to ensure that the handling and delivery process is well executed, and there are no automation or tech solutions in this area,” IGD’s Tan said. Despite all these issues, retailers are still thriving on e-commerce platforms. For instance, Tay said that The Soap Haven’s online sales nearly tripled from February to May this year. “I’m truly grateful to businesses and individuals who are helping one another get through this. I have been very lucky as with most of us to still be able to run our business, on the laptop from home, thanks to Amazon,” Rui Smiths’ Cai shared. In response to this surge in demand, all the major players have been ramping up their resources to expand capacity. FairPrice hired and trained about 150 staff as pickers and packers, and it has increased its
Clare Lee
capacity for orders by 25% and looks to expand it by another 30% in the next growth phase. This is also the case even for those outside essential retail. “Many nonessential retailers have taken this opportunity to build up their online presence as they are expecting a shift in consumer behaviour—to acquire new online shopping habits. Also due to the uncertainty of when the pandemic would end could affect the opening of their offline stores,” Lee commented. Offering experience to consumers As retailers flocked to the online space, retail digitainment has gained ground, according to a report from Knight Frank. This refers to content driven by live streamers who entertain and interact with their followers during the process of selling their products.
Seah Kian Peng
Soo-Eng Tan
“Companies are increasingly looking to hire influencers or key opinion leaders to sell their products online, with some investing in their own in-house ecosystem of live streamers supported by a team of sales and marketing specialists to create a hybrid online selling platform,” the report stated. For example, Shopee Live offers tools for sellers to engage with their customers via live stream features with full control of the engagement process to promote their products, interact with their audience and encourage purchases through the experience. In May, Tekka Online Market, a pilot initiative by the Infocomm Media Development Authority (IMDA) in partnership with live stream auctioneer Max Kee from Lian Huat Seafood, was launched. The initiative enabled sellers to introduce and showcase their fresh produce via live streaming to interested buyers. The retail digitainment industry has also spurred local educational institutions, such as Nanyang Polytechnic’s Singapore Institute of Retail Studies (NYP-SIRS) and the Singapore Media Academy (SMA), to launch a joint Professional Certificate in Digital Retail Entertainment. “Retailers must leverage on these opportunities available in the market to transform rapidly and efficiently to avoid being a casualty in the economic upheaval,” Knight Frank said in the report.
Redmart and ComfortDelgro teamed up to offer grocery delivery services.
SINGAPORE BUSINESS REVIEW | SEPTEMBER 2020
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HOTTEST STARTUPS 2020
Neobank startup Aspire clinched the top spot with a $46.38m funding led by MMV SEA.
VCs bet big on ESG startups Investments in the urban solutions and sustainability domain surged 56%.
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eeptech and fintech startups are still considered as ‘favourites’ by most venture capital (VC) firms, but an increasing awareness on environmental sustainability has created another trend as VCs are beginning to turn their heads to startups under the environmental, social and corporate governance (ESG) catgeory. In the ninth edition of Singapore Business Review’s 20 Hottest Startups, it was the small and medium enterprise (SME)-focused neobank Aspire that clinched the top spot, with $46.38m (US$32.5m) in funding from a series A round. Following closely is invisible braces manufacturer Zenyum, having secured $19.42m (US$13.6m) in a series A funding. Closing the top three is proptech startup Smarten Spaces, with its $17.13m (US$12m) funding in November last year. Other startups that joined the ranks include Quilt.ai ($12.85m), Sleek ($7.14m), eko.ai ($5.71m), Syfe ($5.42m), Draper Startup House
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($5m), Yours ($5m), Travelstop ($4.28m), Osome ($4.28m), SEPPURE ($3.64m), atlan ($3.57m), CHILD Health Imprints ($3.28m), abillionveg ($3.14m), Keyless ($3.14m), gush ($3m), Novelship ($2.93m), COVE ($2.86m), and Hydroleap ($2.6m). These startups nabbed this year’s spotlight as it secured the largest amount of investments from Q2 2019 up until Q1 2020. ESG grabs spotlight Even though this year’s list shows that deeptech startups are still dominant, given the Government’s efforts to boost the flexibility of its operations in Singapore, investors are turning their heads to startups that are focussed on ESG. This comes on the back of increasing awareness towards sustainable and environmentallyfriendly solutions. For instance, 12th placer SEPPURE offers chemical separation processes that can be done without heat and at 90% less energy. Another
The ESG sector is going to be massive as we are seeing that Singapore government is focused on food as being one of the key pillars for security for the country.
sustainability-focussed startup is abillionveg, a platform that allows users to search for plant-based food. In Enterprise Singapore’s study, investments in the urban solutions segment and the sustainability domain surged 56% YoY during 9M 2019 period to $150.4m, which can be attributed to the increasing attention on cleantech and sustainability. Specifically, the report noted that there is a growing interest in agri-food technology startups in this sector, where investment volume reached $28.3m, up from just $0.75m in the same period of 2018. Christian Cadeo, managing partner at ESG-focussed VC fund Big Idea Ventures, is attributing ESG’s rising fame on Singapore’s goal on making 30% of the region’s food home-grown by 2030. “I think [the ESG sector] is going to be massive as we are seeing that Singapore government is focussed on food as being one of the key pillars for security for the country. Because of this initiative, the future is bright in terms
HOTTEST STARTUPS 2020 Singapore ranked 8th place in APAC startup ecosystems rankings
Source: StartupBlink
of companies that can work towards accelerating the country’s goals to achieve this.” Apart from this, some investors are beginning to see ESG investments’ long-term impact. “ESG investments are gaining traction because many of the limited partners have realised that for longterm growth, ESG is an important pillar and whilst many investments may not tick off each of the ‘E’, ‘S’ and ‘G’, starting off with at least one criterion, it can lead to expanding the investment to others,” vice chairman of Business Angel Network of Southeast Asia (BANSEA) Ramesh Raghavan commented. Engagement from foundations and institutional investors, such as pension funds, is also starting to become more interested in long-term impact over short-term gains as well. “I think even on a macro basis the VC world is on a risk-off environment, but VC that have the long-term foresight will realise that this is the optimal time to make investments in ESG,” Cadeo continued. “[I]t is the right opportunity for us in light of the global pandemic that our sector will be the most relevant in terms of impact moving forward.” Deeptech still at the helm In Enterprise Singapore’s study, total investments from January to September 2019 hit $13.4b across 437 deals, jumping 36% YoY from 2018. It noted that deeptech startups under advanced manufacturing, urban solutions and sustainability, and healthcare and biomedical sciences started to gain traction during this
period, with investments in these three domains amounting to $416.4m across 76 deals. This represents a 25% YoY uptrend from $333.8m in 2018. However, these three sectors only make up 4% of the total capital invested due to the current ecosystem’s lack of lead investors with the expertise and experience to back deeptech startups. “They must find new growth engines, including but not limited to regional expansion,” co-founder and managing director of East Ventures Wilson Cuaca commented. “The key focus is a road to profitability and startups should show much better capital efficiency in their business models. Keeping customer acquisition cost low and not looking for growth for growth’s sake will be key,” Raghavan added. Apart from these figures, the same study mentioned that the number of investments made into digital tech startups skyrocketed 91.7% YoY to 278 deals, from 145 deals over the same period last year, which accounts for 93.2% of the total quantum. VC funds go low-key Golden Gate Venture’s principal Justin Hall said “many fundraising rounds go unannounced, they’re lumped into other rounds, or there are any other number of reasons that might affect total funding. The truth is that the number of investable opportunities in Singapore and abroad has continued unabated.” East Ventures’ Cuaca added that investments went seemingly down in Singapore as it went to other emerging markets, such as Indonesia. In contrast, Raghavan observed
The Singapore government is still launching programmes to support deeptech startups, including the Startup SG Equity scheme.
that overall funding in the ASEAN region, including Singapore, went down. Larger firms such as Grab have raised less capital, whilst startups’ need for financing also dipped. Raghavan also noted that issues around WeWork and its fundraising became a major wake-up call for investors and startups alike, noting that it was a big moment for cashburning startups. “The WeWork saga also made investors a bit more cautious in jumping in wildly at expensive valuations,” Raghavan said. “Larger startups are focused on turning to profitability and less cash burn. Smaller startups have realised that raising capital at extended valuations is not easy anymore and are therefore focused on generating traction in a capital-efficient way.” Another issue BANSEA’s Raghavan cited was the souring investments on cryptocurrency-based startups. The industry has gone past its 2017 hype and its regulatory environment is still deemed unstable by many analysts. “Poor liquidity environment, uncertain regulatory outlook, lack of transparency and issues of trust continue to hamper adaptability which is the key driver for growth and there has been little movement in [the cryptocurrency] space. Time is of the essence here and if we get a common regulatory framework and transparent and interoperable exchanges and infrastructure we will see improvement in more widespread network effect and growth,” Raghavan further explained. On the other hand, the Singapore government is still launching programmes to support deeptech startups. During the Budget 2020 speech, Deputy Prime Minister and Minister for Finance Heng Swee Keat announced the Startup SG Equity scheme, where the government will co-invest into eligible startups, alongside private third-party investors Moving forward, Cuaca maintains a positive outlook on Singapore’s overall startup scene. “Most sectors are growing now because the region is hitting an inflection point,” he said. “Anyone who started in Singapore must quickly see the broader South East Asia and shouldn’t stay in Singapore too long.” SINGAPORE BUSINESS REVIEW | SEPTEMBER 2020
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HOTTEST STARTUPS 2020 1. Aspire
2. Zenyum
Founder(s): Andrea Baronchelli, Stefano Pellegrino, Giovanni Casinelli, Joel Leong, Stefan Hadjidetschev, Thibaud Chommeloux Funding: Aspire secured $46.38m (US$32.5m) in series A funding in August 2019, led by MassMutual Ventures’ regional arm MMV SEA. Start of operations: 2018
Founder(s): Julian Artopé and Frederik Krass Funding: Zenyum bagged $19.42m (US$13.6m) in series A funding in November 2019 from RTP Global, Sequoia India, TNB Aura, and SEEDS Capital. Start of operations: 2018
Founded in January 2018 by former Lazada executives, fintech Aspire is serving a new generation of digital-savvy businesses with a mobile-first digital business account across Singapore, Thailand, Vietnam, and Indonesia. The company graduated from Y Combinator Winter 2018 batch and it is part of the YC Continuity Growth program Winter 2020. Aspire flagship Business Account, targeted at small businesses and startups, can be opened online in just a few clicks. Creating an account is free-of-charge, with no minimum deposit and no monthly fees.
Dental tech Zenyum offers 3D-printed invisible braces targeted at mild to moderate orthodontic problems. The startup offers a digitised end-to-end treatment process of diagnosis to treatment conclusion. It uses 3D technology from initial consultation of an intraoral scan and X-ray to the final braces. Via Zenyum’s app, patient progress can be monitored 24/7 by Zenyum’s doctor partners, who are screened by the startup’s training and certification programme. The startup currently operates in Singapore, Hong Kong, as well as in Malaysia and Thailand. They have plans to expand to Vietnam, Indonesia, and Taiwan.
3. Smarten Spaces
4. Quilt.AI
Founder(s): Dinesh Malkani, Anushka Verghese and Prithvi (Harkirat Singh) Shergill Funding: Smarten Spaces raised a total of $17.13m (US$12m) in a series A funding in November 2019, with Symphony International Holdings as its leading investor. Start of operations: 2017
Founder(s): Angad Chowdhry, Anurag Banerjee Funding: Quilt.AI received $12.85m (US$9m) in series A funding in November 2019. This was led by Nadathur Holdings Start of operations: 2018
Smarten Spaces was founded in 2017, focussed on digitising spaces for enterprises, commercial real estate, coworking, coliving and warehousing. They use AI & IoT technology to let businesses engage their tenants and employee community, and manage spaces effectively. The solution includes a fully-integrated mobile app for end-users to seamlessly perform daily tasks. These include book meeting rooms, order food, wayfinding, book flexible seats, securely invite visitors, community engagement, and much more. They have successful deployments in the US, Singapore and India. 26
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Quilt.AI provides brand and product owners with cultural insights into human expressions found on a broad range of digital outlets. It uses AI to read human conversations and expressions across multiple data sources, such as social media outlets, online news, blog text, and search engine trails, to contextualise an anthropological understanding. Aside from its proprietary anthropology platform, Quilt.AI also has matching app “Culture.Trace” and search engine “The Wormhole”, which uses the same intel model to draw insights from digital behaviour to match individuals with the same cultural DNA, and to present detailed guides into cities. Besides Singapore, the startup operates in New York and London.
HOTTEST STARTUPS 2020 5. Sleek
6. Eko.ai
Founder(s): Adrien Barthel, Julien Labruyere Funding: Sleek raised $7.14m (US$5m)m in a seed round in December 2019, led by investors Fabio Blom and Pierre Lorinet. Start of operations: 2017
Founder(s): James Hare Funding: Eko.ai bagged $5.71m (US$4m) in funding in January 2020, co-led by Sequoia India and EDBI. Start of operations: 2017
Sleek brings corporate services online by acting as an online secretary. It remotely manages the complete process of incorporating companies within neighbouring countries to Singapore—from registration up to the grant of employment passes and work visas for assembling companies’ teams. The startup’s online platform also manages company books, including accounting, payroll, bookkeeping, and tax advisory services. Sleek is an ACRA-certified Filing Agent, member of the Singapore Corporate Secretary Association, and affiliated with the Institute of Singapore Chartered Accountants.
Born out of a collaboration amongst clinician scientists, sonographers and deep learning experts, health technology platform eko.ai uses machine learning to automate heart ultrasounds. The company works with artificial intellingence decision tools to deliver a complete echo analysis. Eko.ai develops these tools to assist research teams who aim to add echocardiography to their AI tech stack. Its automation software provides teams with machine learning-ready research databases, as well as a suite of ready-to-use models, segmentation tools, and validation cohorts to help hospital systems that are seeking to boost productivity outcomes for their patient populations.
7. Syfe
8. Draper Startup House
Founder(s): Dhruv Arora Funding: Syfe secured $5.42m (US$3.8m) over a seed round in July 2019 led by UK-based VC fund Unbound. Start of operations: 2018
Founder(s): Vikram Bharati Funding: Tribe Theory raised $5m (US$3.5m) in last January from American venture capital investor Tim Draper. Start of operations: 2018
Fintech Syfe is a digital wealth manager that adopts a riskmanaged passive investing approach through its proprietary investment methodology “ARI’’ or Automated Risk-managed Investments, which combines the Global Market Portfolio (GMP) and Risk Parity Portfolio (RP) methods. By combining these methods, the client portfolio is said to be three times diversified across assets, countries, and sectors. Syfe runs over 10,000 simulations daily to stress-test portfolios and undertakes extensive backtesting, with detailed results that extend beyond 15 years. The company recently launched its REIT-focused wealth manager, Syfe REIT+.
Draper Startup House (DSH), formerly Tribe Theory, serves as an entrepreneurial ecosystem in the form of hostel accommodations targeted at entrepreneurs and startup teams. Alongside accommodations, DSH locations provide support to entrepreneurs in the form of custom programming, access to venture capital funding and DSH locations, serving as an avenue to submit pitch decks to the Draper Venture Network, which is said to have 23 global funds. DSH has eight existing international locations, including Bali, Singapore, Yangon, and Estonia as well as in Manila and Lisbon, with two more locations in Bangalore. The startup targets to enable 1 million entrepreneurs by the end of 2030. SINGAPORE BUSINESS REVIEW | SEPTEMBER 2020
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HOTTEST STARTUPS 2020 9. Yours
10. Travelstop
Founder(s): Navneet Kaur, Shivam Sharma Funding: Yours bagged $5m (US$3.5m) in a seed round in October 2019, backed by Surge, Global Founders Capital, Kindred Ventures, as well as an undisclosed celebrity fund. Start of operations: 2018
Founder(s): Altaf Dhamani, Prashant Kirtane, Vijay Aggarwal Funding: Travelstop secured $4.28m (US$3m) in a pre-series A seed funding in July 2019, led by Silicon Valley-based VC firm Accel. Start of operations: 2018
Founded by former Uber employees, Yours uses an assessment tool to recommend a personalised mix of Yours skin care products based on the customer’s lifestyle and environment. Consumers no longer need to try out multiple skin care products and their skin care products claim to be non-toxic and environmentallysustainable. The startup also offer a subscription service to women Yours Autopilot, which updates the customer’s skin care regimen based on changing lifestyle and skin conditions and delivers product refills on a scheduled basis.
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Tourism technology startup Travelstop is an integrated travel management tool targeted at startups and SMEs that do business travel. The platform consolidates travel booking management, expense reporting and data-driven insights and gives a real-time view of travel and expense spending, and users gain access to organisation-wide data to assist in cost-saving decisions. It also has a feature for business owners, helping them track their employees and keeps tabs on expenses at a department or an individual level.
10. Osome
12. Seppure
Founder(s): Victor Lysenko Funding: Osome bagged $4.28m (US$3m) in funding November 2019, led by Target Global, with participation from Phystech Venture and AdFirst. Start of operations: 2017
Founder(s): Amir Hooshang Taheri, Mohammad Hossein Davood Abadi Farahani Funding: Seppure bagged their latest funding of $3.64m (US$2.55m) in August 2019 from a seed round led by SOSV. Start of operations: 2018
Osome offers paperless registration services to both local and foreign companies in Singapore. It acts as companies’ 24/7 online assistant for administrative tasks of accounting, and HR. It can also cover foreigners’ incorporation to the Singaporean workplace via management of nominee director, office address, and employment pass assistance. Osome’s platform is based on artificial intelligence and leverages the use of bots to streamlines its services. Users set up an account, have conversations with a chatbot which is later joined by an agent, then sends over all related documents.
Chemtech Seppure creates a nanofiltration solution for chemicals that replace the traditional energy-intensive chemical separation and purification process, which a slew of industries from food and pharmaceuticals to petrochemicals, rely on. It can do so without heat and at 90% less energy, which can potentially conserve billions of gallons of water, millions of tonnes in volatile organic compound emissions and billions of tonnes of carbon dioxide emissions in a year. The tech is funded by the National Research Foundation of Singapore at the National University of Singapore.
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HOTTEST STARTUPS 2020 13. atlan
14. CHIL
Founder(s): Prukalpa Sankar, Varun Banka Funding: Atlan garnered $3.57m (US$2.5m) in a pre-series A funding led by early-stage venture fund WaterBridge Ventures. Start of operations: 2018
Founder(s): Harpreet Singh, Ravneet Kaur, Dr. Gautam Yadav Funding: CHILD Health Imprints (CHIL) has raised a total of $3.28m (US$2.3m) over a seed round. Its latest investors include Seeds Capital and HealthXCapital. Start of operations: 2018
Information technology startup Atlan reduces the collaboration overhead amongst data teams through data democratisation, helping teams to work seamlessly on data projects. It democratises both internal and external data, whilst automating repetitive tasks.The company caters to more than 200 teams in over 50 countries and some of its clients include Unilever, Milkbasket, Barbeque Nation, and Mahindra Group. Headquartered in Singapore, Atlan’s operations extend to New Delhi and Bengaluru in India, San Francisco in the US and Nairobi in Kenya.
Healthtech Child Health Imprints (CHIL) uses data analysis to reduce prematurity risks amongst infants. CHIL created a platform based on IoT for neonatal intensive care units (NICUs) which monitors the early onset of morbidities. The technology captures real-time clinical data from the connected devices, laboratory results, and bedside clinical observations. A key feature in the platform is a surveillance device called NEO, which is able to track the early signs of morbidities and length of stay using predictive analytics. The platform also prevents medication errors by automating doctor and nursing progress notes.
15. abillionveg
15. Keyless
Founder(s): Vikas Garg Funding: abillionveg has raised a total of $3.14m (US$2.2m) in its seed funding round last August 2019, led by 500 Startups. Start of operations: 2017
Founder(s): Andrea Carmignani, Fabian Eberle Funding: Keyless has raised a total of $3.14m (US$2.2m) in a preseed funding round last June 2019, led by Gumi Cryptos Capital and participated by Ripple Labs, Blockchain Valley Ventures, and LuneX. Start of operations: 2018
Upon the rising trend of veganism and environmental sustainability awareness, abillionveg is a platform that only shows where to find plant-based offerings around the globe. Users are also free to drop their reviews in the platform, as some restaurants lie about their food being purely vegan. abillionveg pledges that for every review, they will donate a few dollars to various animal sanctuaries. The startup is partner to over 50 organisations around the globe committed to advocating plant-based living. abillionveg claims that their app is seeing 40-50% monthly growth across Singapore, Hong Kong, Australia, Canada, the US and the UK.
Composed of an international team of entrepreneurs, scientists and professionals, Keyless has built a privacy-first biometric authentication and personal identity management platform that eliminates the need for businesses to centrally store and manage passwords, cryptographic keys, and other authentication data. Keyless’ solution is based on over 10 years of research at the intersection of cryptography and biometrics. It prevents cyber-attackers from accessing critical information and ensures compliance with privacy regulations, including GDPR. SINGAPORE BUSINESS REVIEW | SEPTEMBER 2020
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17. Gush
18. Novelship
Founder(s): Lester Leong, Ryan Lim Funding: Gush raised $3m (US$2.1m) in July 2019 from property group City Developments Limited (CDL). Start of operations: 2017
Founder(s): Chris Xue, Richard Xia Yang Funding: Novelship secured $2.93m (US$2.05m) in August 2019 from Global Founders Capital. Start of operations: 2017
Singapore-based startup gush is creating sustainable paints and advanced building materials, as it seeks to help prevent health complications due to indoor air pollution. Its flagship product, gush cair interior paint, is said to purify the air by eliminating 99.9% of bacteria, regulate humidity and prevent mould. It also has no volatile organic compounds (VOC) and releases negative ions which have health benefits such as neutralising free radicals and promoting blood circulation. To date, gush paints have been used in more than 600 residential and 60 commercial projects in Singapore and the region, with most delivery rooms in Thomson Medical painted with their brand.
Novelship acts as a “gatekeeper” for authenticity and product condition, aiming to improve the trust between buyers and sellers. It is an online shopping platform for resellers of authentic sneakers and streetwear, where they check the quality and originality of all products before shipping them. They examine the logo placement, serial numbers, manufacturing codes and inside stitching of the product. It also acts like an auction marketplace, where buyers can request for a product and state how much they are willing to pay for and purchase it at its lowest asking price, whilst sellers may choose which price they want for the item.
19. COVE
20. Hydroleap
Founder(s): Guillaume Castagne, Luca Bregoli, Sophie Jokelson Funding: COVE has raised a total of $2.86m (US$2m) over a seed round in September 2019. Start of operations: 2018
Founder(s): Dr. Mohammad Sherafatmand Funding: Hydroleap bagged a total of $2.6m (US$1.9m) in their latest funding in November 2019, led by Wavemaker Partners and participated by Seeds Capital and 500 Durians. Start of operations: 2018
Housing startup COVE promises to handle everything from booking a unit to furnishing. COVE says it can offer cheaper prices and also provides an all in fee which includes furnishing, utilities, weekly housekeeping, cleaning supplies and wi-fi connection. What’s more, the average monthly cost it offers as $1,700, which can be 6% cheaper than a flatshare and 45.51% cheaper than a studio apartment. The platform has 3D tools that digitises everything for interested tenants and also uses a matching algorithm that aids in managing thousands of properties across Southeast Asia.
At Hydroleap, the goal is to make wastewater treatment cheap, environmentally-friendly, and easy. This is achieved by replacing expensive chemical treatment with a smart electrical treatment. It is well designed for wastewater from construction, food and beverage, oil and gas, tannery, mining and semiconductor industries. It is an automated modular system that does not need any chemicals to perform and can be scaled economically with ease to meet the needs. This technology can replace the expensive and nonsophisticated process of chemical pretreatment and could be the right process prior to the membrane/filtration stage.
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SALARY SURVEY
The Ministry of Manpower has been advocating flexible work measures, launching the Work Life Grant to further encourage firms.
Pay cuts, salary stagnation await workers in post-pandemic workplace Salary hikes will be few and far between as firms grapple with COVID-19’s sudden impact. But it’s not all doom and gloom as some sectors began to feel the need to expand their staff count.
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hen Ryan first heard about layoffs due to the coronavirus pandemic, he did not feel concerned about losing his job. As a veteran worker in the food industry, he had worked in the same company for over a decade and believed that the firm could ride the storm out. The last time the company experienced a downturn, it managed to keep its staff on reduced pay; he thought the same scenario would play out now. He was wrong. Ryan’s work began drying up in March; by mid-April, the company informed him that he was getting laid off. For the first time in almost ten years, Ryan found himself unemployed. “For the meantime, I can use my savings and will apply for aid whilst sending out one application after another,” he says. “I’m going to do some courses on SkillsFuture too.”
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The coronavirus pandemic has radically affected employees across the globe, and workers in Singapore are definitely no exception. “Many companies, particularly in industries and sectors that have been adversely impacted by COVID-19 and related measures, have been deferring or re-evaluating talent hire plans. These actions are taken in the immediate to mid-term to manage or mitigate the impact of the pandemic on their businesses and in the longer term to enable them to better assess the outlook and review and reflect on the significance of government subsidies on their businesses,” commented Celeste Ang, principal at Baker & McKenzie.Wong & Leow. As firms adjust to the new normal, experts warn that salary growth will generally be off the cards this year, and employees will bear the brunt as
It is unlikely that workers will see much salary growth this year.
businesses scramble to implement cost-cutting measures. Still, a few bright spots can be seen where hiring activities will press on, albeit at a severely reduced pace. Pay cuts, not pay hikes At the beginning of the year, industry watchers predicted that demand for industry professionals will continue to grow. Modest salary increases were likely, with the employment market showing signs of cautious optimism. However, COVID-19’s sudden impact has thrown these positive forecasts far out the window. “It is unlikely that we will see much salary growth this year given many businesses across various industries and sectors have been significantly impacted by the effects of the pandemic (for example, those in the retail, food and beverage, and travel/
SALARY SURVEY Net hiring outlook for Singapore (Q1, 2010 to Q3, 2020)
Celeste Ang
Source: ManpowerGroup Singapore
tourism industries),” Ang warns. She adds that many companies across various industries are implementing cost-saving measures, including interim leave arrangements and salary reductions across all levels of employees. “It is likely that these cost-saving measures will remain in place with variations depending on recovery outlook for the rest of this year. At the moment, these adjustments are temporary,” she says. This sentiment was echoed by Rob Bryson, managing director at Robert Walters Singapore. “Our general expectations are that there will be very limited, if any, salary growth this year in the Singaporean market. Even firms with strong results will not see significant salary increases as they will stay in line with the wider market,” he observed. “The industries that have been heavily impacted are tourism, aviation and retail, food services and events. These are likely the industries that will suffer with the deepest pay cuts and layoffs this year.” For instance, Singapore Airlines’ management staff suffered pay cuts ranging from 10% to 30%, whilst other employees were obliged to take a week of unpaid leave each month. Meanwhile, senior employees of SIA Engineering Company took pay cuts ranging from 5% to 25%, whilst staff on re-employment contracts were furloughed. Salary increments and promotions have also been halted across the board. The news came after the flag carrier revealed that it is cutting 96% of its capacity and grounding almost 94% of its planes. Other companies that rolled out
Linda Teo
pay cuts include BreadTalk Group, which has reduced senior and middle management’s pay by 10% to 50% for three months until June. Grab also reduced its senior management’s pay by up to 20%, whilst property developer UOL revealed that its managers have taken a salary reduction of up to 18%. The Ministry of Manpower’s Q1 2020 Labour Market Report reported that reductions in employment were mainly seen in wholesale and retail trade, F&B services and accommodation. “We have already seen significant reductions in these industries. The Singapore government has offered businesses subsidies to help support them through challenging times; however, these support measures are limited and will not be perpetual and may not in themselves be sufficient to ensure survival of those businesses severely impacted. Unless consumer demand and economic activity pick up and government subsidies continue at reasonable levels, we can expect to see more cost-saving measures being implemented,” Ang notes. Staff who have been laid off or furloughed can expect redundancy or retrenchment benefits, but the scope of these packages will vary depending on the employer. “Firms can and do offer separation packages dependent on a wide variety of factors. At the very least, it is expected that firms, where they have funds available, will at the very least act in accordance with MOM guidelines on layoffs,” Robert Walters’ Bryson said. Ang agrees. “Generally, separation
Nilay Khandelwal
Rob Bryson
packages for employees who have been made redundant or are laid-off employees are a matter of contract and/or as negotiated and agreed between the employee and the employer. The vast majority of employers will offer redundancy or retrenchment benefits to employees who are laid-off in situations of excess manpower,” she remarked. Further, Ang highlighted that the Singapore Tripartite Partners, which consist of the Ministry of Manpower, the National Trades Union Congress and the Singapore National Employers Federation, have strongly encouraged employers to take a longterm view of their manpower needs and responsibly implement various cost-saving measures. “Employers must ensure that their employees are treated with empathy and dignity and the retrenchment exercise is conducted having regard to the Tripartite Advisory on Managing Excess Manpower and Responsible Retrenchment, including in respect of fair selection of employees for retrenchment, early consultation with unions (where applicable), early communication to the affected employees and employment facilitation for affected employees.” A few bright spots persist Still, it’s not all doom and gloom for the job market. A few industries are expected to weather the storm better than others, with selective hiring seen in some sectors. “At the moment, businesses are trying to retain and right-size their existing workforce and are engaging in targeted hiring in areas where talent is most needed. Of course, there are certain industries and sectors, for example, information and communications technology, which have experienced opportunities and hiring plans are still fairly active for companies in these industries and sectors,” Ang notes. Nilay Khandelwal, managing director at Michael Page Singapore, says that there will be some exceptional sales professionals who will need to be awarded generously despite the pandemic. “Perhaps not in the same quantum as before, but firms need to ensure that they are driving the same revenue for the companies. SINGAPORE BUSINESS REVIEW | SEPTEMBER 2020
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SALARY SURVEY Technology, semiconductors and biomedical in Singapore, and in some cases e-commerce, will be most positively impacted,” he adds. Whilst mid-career professionals may see a slump in job opportunities, Khandelwal noted that midcareer job seekers will see a more streamlined hiring process as firms seek to fill business-critical roles. “In certain sectors we see a positive track for consumer electronics or semiconductors, which are all good areas of focus. In totality for midcareer professionals, the number of opportunities is definitely lower. However, within the number of opportunities, whatever is there, the interview process moves quite fast because these are all business-critical roles,” he further explains. For candidates, this means deciding quickly and not second-guessing their choices. “From a candidate standpoint, you will have to decide very fast, make up your mind and there will be an offer before you even realise. Quite a lot of people are not travelling, so top decision making has been a lot faster. Sometimes candidates are caught off guard at the job offer stage. They actually need some time to digest and have cold feet from moving to another industry because of the market situation,” Michael Page’s Khandelwal noted. Fresh graduates, meanwhile, must take advantage of opportunities that will prepare them for the eventual economic recovery. “Graduates might have a certain ‘“wishlist’ of companies they aspired to get into upon graduation. However, graduates have to be flexible now and keep an open mind. Some have realised the gravity of the situation right now and probably are taking the right call. Based on GFC experience, one thing to avoid will be to let go of a few opportunities because they were not in their ‘A-list’. Look most carefully at those options that will give you a chance to learn new things, explore new areas, and grow as a person,” Khandelwal added. Ang agrees, noting that graduates must make the most out of the SGUnited Jobs Initiative and SGUnited Traineeships Programme, which are designed to create many 34
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jobs over the next year. “This is part of the Resilience Budget to create more opportunities for jobseekers and employees affected by the COVID-19 situation. Under the SGUnited Traineeships Programme, over 280 organisations across the private sector, the government and institutes of high learning have offered more than 4,000 traineeship opportunities under the programme. With this, fresh graduates will have opportunities to help them prepare for the eventual recovery phase,” Ang commented.
Most HR consultants expect some form of flexibility to come in as the workforce returns to a traditional work routine.
Hybrid work on the table A hybrid work arrangement will likely be embraced by many companies as the economy slowly restarts. “After speaking to companies and professionals, we do expect some form of flexibility to come in as we go back to work. We have the global example of Twitter allowing their employees to work from home indefinitely, and we have seen more of that coming from the tech firms, where you can actually get your work done when being remote and that puts a bit of a question mark on office space. That has started conversations between players in the market as to whether or not to downsize offices,” Michael Page’s Khandelwal says. However, don’t expect many companies to imitate Twitter in implementing a permanent workfrom-home arrangement. “Cases of companies allowing most employees to work from home permanently are rare. Even for employers who Net hiring outlook across for Q3 2020
Source: ManpowerGroup Singapore
are open to telecommuting they might not totally shift to remote working permanently. Instead, they are more likely to offer a hybrid work arrangement where staff can opt to telecommute on a regular basis,” observes Linda Teo, country manager at ManpowerGroup Singapore. Looking beyond the pandemic Firms will need to adjust as authorities mandate physical spacing of at least one metre apart at work stations and common areas, staggered work hours and breaks, and shift in mindset and ensure regular cleaning and controlling access to the workplace. “We are likely to see a change in density in the office with workstations spread out to comply with 1-metre distancing, physical movements of workstations and furniture in common areas and meeting rooms and physical barriers or demarcations around the workplace, common areas and meeting rooms. The situation may be different for specific workplaces like factories, worksites and others which may have to fulfil additional requirements,” Ang says. Teo agrees, adding that companies that want all employees to be physically in the office may need to rent more office space or rent a separate site. In terms of office culture, Khandelwal notes that there will be growing pains as firms and workers adjust to the new normal. In the meantime, employees have no choice but sit and wait for the situation to improve.
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EVENT COVERAGE: TECHNOLOGY EXCELLENCE AWARDS
Find out who reigned at SBR Technology Excellence Awards
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s the city state gradually reopens, Singapore Business Review did not let the crisis thwart the second edition of the SBR Technology Excellence Awards in recognising to companies with the most disruptive products and solutions that have successfully transformed industries and business models. Digital awards presentations and interviews were held on the week of 3-5 June, whilst studio awards presentations and interviews were scheduled on 16, 17, and 18 June, conducted by SBR’s managing editor, Paul Howell. Nominations were deliberated by an elite panel that includes Daryl Pereira, KPMG’s Head of Cyber; Cheang Wai Keat, Ernst & Young’s Head of Advisory Services in Singapore and ASEAN Technology Consulting Leader; Chin Chee Choon, Nexia TS’ Advisory Leader and Assurance Director; Rizwi Wun, RHTLaw Asia’s Partner and Acting Head of Intellectual Property and Technology Practice Group; and PwC’s Carolyn Chin-Parry, Managing Director and Digital Accelerator Leader.
Singapore Business Review congratulates the following winners: Analytics - Semiconductor AEM Holdings Limited Digital - Personal Insurance AIA Singapore Connectivity - Building Services & Facilities Armstrong Fluid Technology AI - Manufacturing Aspen Technology, Inc. Cybersecurity - IT Services BeyondTrust AI - Internet/New Media BIGO Technology Pte Ltd Digital - Travel Services Changi Airport Group Analytics - Food & Beverage Ebb & Flow Group Digital - Data Center ENGIE Southeast Asia Pte Ltd Digital - Business Services EZ-Link Pte Ltd Mobile - Transportation EZ-Link Pte Ltd Digital - Real Estate Far East Organization Hardware - Transportation HID Global Hardware - Transportation Secur Solutions Group Cloud - Cybersecurity Horangi Cyber Security Big Data - Advertising iClick Interactive Asia Group Limited Infrastructure Technology - Financial Services IPC Systems, Inc. E-Commerce - Startup Kaddra Pte Ltd Information Management - Logistics Konica Minolta Business Solutions Asia Pte Ltd 36
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SIEM - Computer Software LogRhythm Software - Marine Services MariApps Marine Solutions Fintech - Consumer Services MoneyOwl Pte Ltd Fintech - Payments NETS Digital - General Insurance NTUC Income Insurance Co-operative Limited Digital - Life Insurance NTUC Income Insurance Co-operative Limited Information Management - Electronic Manufacturing OSI Electronics Pte. Ltd. IoT - Transportation Overdrive IOT Pte Ltd AI - Consulting PALO IT Singapore Data Centre - Airline Perpetuuiti Technosoft PTE E-Commerce - Health Products & Services Philips Electronics Singapore Pte Ltd Fintech - Startup PIVOT Fintech Pte. Ltd. Information Management - Computer Software Quest Software Infrastructure Technology - Computer Software Quest Software Blockchain - Financial Services Ripple Cloud - Startup Sansan Global IoT - Energy SensorFlow Enterprise Software - Data Analytics SIFT Analytics Group Digital - Furniture and Fixture Silversea Media Group AI - General Insurance Sompo Holdings (Asia) Pte. Ltd. Connectivity - Telecommunications SPTel Pte. Ltd. Digital - Insurance Broker Symbo Computing - IT Services TES Gaming - Human Resource Technology The Talent Games IoT - Building Services & Facilities TIQRI Corporation Private Limited Fintech - Trade Finance Triterras Fintech - Banking TurnKey Lender AI - Healthcare uCare.io Pte. Ltd. (UCARE.AI) Network and Broadband - Telecommunications VIAVI Solutions Digital - Marine and Offshore Engineering Wärtsilä Acceleration Centre Robotics - Logistics YCH Group Pte Ltd Software - Startup Zave Pte. Ltd. Blockchain - Pharmaceuticals Zuellig Pharma
AEM Holdings Limited
AIA Singapore
Aspen Technology, Inc.
BeyondTrust
BIGO Technology Pte Ltd
Changi Airport Group
EZ-Link Pte Ltd
EZ-Link Pte Ltd
Far East Organization
HID Global
iClick Interactive Asia Group Limited
Kaddra Pte Ltd
Konica Minolta Business Solutions Asia Pte Ltd
LogRhythm
MoneyOwl Pte Ltd
NETS
NTUC Income Insurance Co-operative Limited
Overdrive IOT Pte Ltd
Quest Software
Sansan Global
Secur Solutions Group
Silversea Media Group
Sompo Holdings (Asia)
SPTel Pte. Ltd
TES
uCare.io Pte. Ltd. (UCARE.AI)
VIAVI Solutions
Wärtsilä Acceleration Centre SINGAPORE BUSINESS REVIEW | SEPTEMBER 2020
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EVENT COVERAGE: ASIAN BUSINESS CASE STUDIES AWARDS
Meet Southeast Asia’s game changers at SBR’s Asian Business Case Studies Awards
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his year’s awards did not fail to deliver a fresh new batch of solutions that should certainly be on every company’s wishlist as enterprises re-evaluate and forge partner ecosystems to grapple with the health and economic crisis. Singapore Business Review once again hailed extraordinary companies and their noteworthy solutions at the fifth edition of the Asian Business Case Studies Awards, which was held in a webinar format on the 1st of July, as the Lion City and the rest of its peers softly reopen their economies The first award went to CrimsonLogic subsidiary and Singaporeheadquartered Global eTrade Services (GeTS Asia Pte Ltd) who banked on its deep domain knowledge in the logistics trade to answer the pain point for payments startup Thunes. GeTS Asia helped Thunes build a vibrant ecosystem made up of shippers, freight forwarders, as well as financial institutions through CALISTATM. Complementing this of course is CALISTATM Insights—a middleware solution created to harness intelligence and data for the logistics and financial industry. Thunes, French slang for money, partnered with GeTS to process a little over US$6 billion of transactions to date, and now operates in over 80 economies around the world covering over 60 currencies. GeTS is looking to further leverage upon Thunes’ cross-border capabilities to meet its ever evolving logistics use case. Thailand’s Pantavanij, meanwhile, delivered on its procurement capabilities as companies try to reduce business costs and source elsewhere. Founded in 2001 and with 12 markets across South Asia, Pantavanij developed one of Asia’s best electronic procurement (eProcurement) and online auction (eAuction) platforms to ease the supply chain for the largest companies in telecommunication, banking and insurance, retail and distribution, energy, manufacturing, and education. This is what a 19-year partner in the telecom sector said about Pantavaniij, “Out of the total corporate procurement spending of US$2.7b, we spent approximately US$2.2b in 2019 through Pantavanij’s platform.” Pantavani’s eProcurement platform already adopts RPA for procurement, as well as best practices for eAuction preparation and negotiation, along with artificial intelligence, to procure commodity products at the right volume and quantity, and with the right supplier at the right time. Boosting its ASEAN presence, Pantavanij has recently opened a new facility in Ho Chi Minh City, as a testbed to leverage its expertise and deliver its tried-and-tested eProcurement and eAuction platforms to a new market, particularly in Vietnam where clients share similar procurement challenges with Pantavanij’s existing Thai clientele. Rounding out the top solutions was none other than StarHub, who listened in and touched on the grassroots cultural fair Singapore Night Festival (SNF) to provide geomobility analytics capabilities for the National Heritage Board, as they identified interests, preferences and activity through all the sound and noise. With its data analytics solution, the 2019 edition of the Festival reached out to over 400,000 visitors who attended the festival over 600,000 times, 38
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educating NHB with a more holistic understanding of its festival audience. “For instance, geomobility data has shown that the MRT stations surrounding the festival grounds are potentially a key catchment area for new audiences,” noted Deputy Director for Festivals and Precinct Development, David Chew, in a statement. Recruitment agency Hays Singapore says that the telecom industry is seeing increased hiring demand across the board, in the areas of engineering, marketing, IoT, analytics and cloud technology, as the pandemic proves the sector critical in enabling businesses and individuals to stay connected. The winning innovators present their remarkable case studies in pages 39, 40, and 42.
GeTS Asia
Pantavanij
StarHub
TELECOMMUNICATIONS CASE STUDY OF THE YEAR
Credits: National Heritage Board
Tech meets art with StarHub’s groundbreaking telco analytics Here’s how the National Heritage Board leveraged StarHub’s expertise to promote the Singapore Night Festival
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or over a decade, the National Heritage Board (NHB) has been using face-to-face surveys to obtain audience insights about the Singapore Night Festival (SNF), its signature arts and cultural festival in the vibrant Bras Basah. Bugis district. But when SNF 2019 rolled around, NHB decided that it was time to trial other sources of data so as to gather better insights about the festival. Through SmartHub, StarHub’s analytics division, NHB gained insights on visitor segment profiles and geomobility behaviours of SNF attendees. “We provided NHB with a simple and accurate means to counting footfall across festival zones, to corroborate existing methods of visitorship counting. Due consideration was also given to differentiate between actual attendees with longer dwell times and passers-by transiting through the zones, without further investment in hardware for NHB,” said Kelly Yoong, Head of SmartHub at StarHub. Utilising geomobility solutions StarHub used its geomobility capabilities to inform NHB about
This pilot study with SmartHub has enabled NHB to understand the behaviours of residents with regards to their support of arts and culture.
the broad interests and mobility trends of the attendee segments. As a result, NHB was able to better understand and assess crowd flow patterns for crowd control and event planning and marketing strategies. “SmartHub enabled NHB to draw richer insights about our festival attendees, which include broad dwell trends of our festival attendee segments, visit trends across our festival dates and physical grounds, as well as broad demographics
Understanding the audience
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martHub has enabled NHB to corroborate other modes of event attendance counting. With its data analytics solution, SNF 2019 reached out to over 400,000 visitors who attended the festival over 600,000 times, building a more holistic understanding of its festival audience. “These insights would then inform the curation and planning of future editions of the festival in terms of the content themes and physical siting of artworks and experiences to draw visitors,” NHB’s David said. Benefiting other industries, StarHub’s
for segments of attendees,” noted David Chew, Deputy Director for Festivals and Precinct Development at NHB. “These data, especially when augmented with one another, provided NHB with a rich portrait of our current festival attendees and a more accurate profile of them.” The core of SmartHub’s geomobility capabilities lies in its Grid360 data product, which analyses anonymised mobility metadata to infer islandwide footfall coverage. “When profiled across time, we obtain geomobility patterns and insights beyond simple footfall counting. Our DeepSense data product allows us to discover and obtain group insights about interests, trends and patterns of various online personas and consumer segments,” Kelly explained. David agreed, adding that StarHub’s analysis has given NHB new and actionable insights on the marketing strategies for future SNF editions. “Geomobility data has shown that the MRT stations surrounding the festival grounds are potentially a key catchment area for new audiences,” he said. “These insights will not only inform NHB’s selection of spaces to programme for but also the type of experiences we develop for future editions of the SNF. This pilot study with SmartHub has enabled NHB to better understand the behaviours of residents with regards to their support of arts and culture,” he said.
capabilities and insights are diverse, representative, and pervasive, making its services applicable to all businesses that want to obtain deep behavioural insights on their target consumers for better marketing returns, through better audience reach, or offer more compelling services or products that appeal to their interests and lifestyle.
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Pantavanij’s strong team helps companies function more efficiently by connecting them with the right partners.
Providing eProcurement to boost profits and efficiency for Asia’s largest firms Its end-to-end services yield massive cost savings for multinational clients from various industries.
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n efficient procurement system is crucial in significantly reducing costs for any business. This is why Pantavanij, a leading Thai company founded in 2001, has dedicated itself to developing one of Asia’s best electronic procurement (eProcurement) and online auction (eAuction) platforms. Pantavanij provides end-to-end services, securing the entire purchasing process from online information requests to online purchase, purchase document management, and online invoicing. It also provides in-depth spend analysis and provides real-time insight into all of a client’s data. “We serve leading large to small companies from various industries, such as telecommunication, banking and insurance, retail and distribution, energy, manufacturing, and education in 12 countries across South Asia. We help them to achieve higher business efficiency and profits, by giving cost savings without compromising the quality of their product and services,” explained Apisit Kuparatana, Managing Director at Pantavanij. Process efficiency Among Pantavanij’s satisfied partners is one of Thailand’s leading telecommunications providers. Pantavanij has worked with the leading telco for over 19 years, providing
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With eProcurement data analysis and our cost-saving methodology, the customer can enjoy increased profits from smart cost savings.
dedicated service to increase procurement efficiency and cut costs. “Out of the total corporate procurement spending of US$2.7b, we spent approximately US$2.2b in 2019 through Pantavanij’s platform,” noted a representative from the telco company. Pantavanij automates all processes by replacing the traditional manual processes and paper works, which leads to cost and time efficiency. It also offers transparency of all spending transactions, improves analysis through centralised data management, and minimises error and waste through a real-time DASHBOARD for decision making. “The eAuction
Apisit Kuparatana, Managing Director at Pantavanij
EPROCUREMENT CASE STUDY OF THE YEAR platform shortens negotiation time and provides up to 30% cost savings, whilst staff productivity is improved by giving them more time for strategic tasks, conducting strategic sourcing, and improving supplier relationships,” the representative added. Pantavanij also provides an Online Supplier Registration Platform, which ensures that suppliers comply with the Dow Jones Sustainability Index (DJSI). Suppliers can also submit invoices anytime via an automated invoice management system. “Without solid support from Pantavanij, we would not achieve our business goals. Over the past 19 years, Pantavanij is not only our service provider for eProcurement but also our main business partner for procurement excellence and sustainability,” the representative said. Mastering procurement Most organisations are experiencing severe competition from a procurement standpoint as maintaining profit margins has increasingly become challenging. In their quest to reduce the cost and improve the profit margin, businesses cannot afford to compromise on quality and lose out to the competition. Pantavanij’s eProcurement, on the other hand, helps these companies to retain the quality of their product at lower costs and helps them function more efficiently by enabling them to collaborate with other companies and merchants located in different countries. CPF, one of the world’s leading agro-industrial and food conglomerates based in Thailand, perceived trust and adopted Pantavanij’s eProcurement and eAuction platform. Through day-to-day operations in different business units across nine countries, Pantavanij was in charge of digitising and centralising their full source-to-pay process, increasing visibility and controlling overconsumption, and turning the procurement function into a profit generator. As a result, CPF realised tangible outcomes for many years, including single-digit cost savings. Despite having year-over-year significant revenue growth and cost savings realised, CPF aims to optimise spending by extracting procurement data over the past 3 years to analyse further. With seasonal, perishable and variable products, the competitive procurement process may incur significant costs if the process is handled inefficiently. To help put ease in the supply chain, Pantavani’s eProcurement platform improves process efficiencies and helps customers achieve bottom-line savings. This yields a higher return on investment at economical prices, whilst appealing to the specific and local requirements of the clients. Pantavanij brings a niche quality in its eProcurement application, which is embedded with the company’s knowledge and experience of the industry. Managing costs Pantavanij consultants and CPF procurement specialists jointly identified 12 major product categories which resulted in additional double-digit cost savings for 2019, compared to the previous year.. “We identified cost-saving approaches and handpicked the appropriate levers out of 30 levers for each subcategory. We implemented RPA adoption for the procurement process, as well as best practices for eAuction preparation and negotiation, along with AI support, to procure commodity products with the right volume, quantity, and quality, matching them with the right supplier at the right place and time,” Apisit explained. In addition to the cost savings realised, CPF has developed staff’s skills and knowledge as well as procurement best practices which help to drive a long-term transformation and achieve a sustainable cost reduction and profit for the organisation.
Inroads into Southeast Asia Compared to many companies in Europe or America which invested heavily into lowering procurement costs, only a few large ASEAN companies have implemented similar measures. This may be due to the high adoption cost of eProcurement, limited number of information, experienced experts, and limited knowledge about successful cases. In line with its goal of boosting its ASEAN presence, Pantavanij has recently opened a new facility in Ho Chi Minh City, Vietnam. Clients in Vietnam share similar procurement challenges with Pantavanij’s existing Thai clientele, allowing the company to leverage its expertise and deliver its tried-and-tested eProcurement and eAuction platforms to a new market. “Vietnamese companies need assistance and advice for their procurement teams and strategic suppliers. Hence, Pantavanij’s end-to-end completed cloud-based platforms with supplier database, experienced eProcurement advisor and support, and a reasonable investment amount have received a warm welcome from the Vietnam market to date,” Apisit noted. Streamlined for SMEs Pantavanij’s services are not only suited for large businesses. It can also provide significant cost savings for small and medium enterprises, which often have less purchasing power and a smaller number of quality suppliers to work with. “Normally, each large client has their own unique procurement process and techniques, while smaller clients seek a standard procurement practice to have better procurement efficiency,” Apisit noted. “Our eProcurement and eAuction platform provides functionalities and information such as sourcing function, large trusted supplier community, price submission and evaluation, auctioning function, and historical purchase data. We can fill up those gaps and empower them to purchase quality products at negotiable prices from trusted suppliers.” Moving forward, Pantavanij intends to extend the reach of its eProcurement and eAuction platforms to a greater number of ASEAN companies, which share many similar requirements, to significantly increase their procurement efficiency and cost savings. SINGAPORE BUSINESS REVIEW | SEPTEMBER 2020
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EPAYMENTS CASE STUDY OF THE YEAR
Chong Kok Keong, CEO of Global eTrade Services
Easing payment transactions with real-time insights Thunes partnered with Global eTrade Services to ensure the seamless transfer of funds between different currencies through the CALISTATM platform.
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ayments startup Thunes has a bold aim—to bring financial services to everyone, including the 1.7 billion unbanked adults in emerging economies. The fintech company, whose name is slang in French for money, provides payment solutions for companies dealing with consumers, often across borders. It had not always been a smooth business journey. The tracking of cross-border payments had been manually intensive and timeconsuming. Harnessing Data: CALISTA™ Insights Thunes teamed up with Global eTrade Services (GeTS) on CALISTA™, a global supply chain orchestration platform, to enable the seamless transfer of funds between different currencies. With transaction-level data from CALISTA™ Insights, Thunes was able to automate the tracking of payments on CALISTA™. CALISTA™ Insights also improves data visibility in the verification of company information and payment 42
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Using data modelling and analytics, GeTS has streamlined the datasets into real-time infographics which can be easily understood
transactions, which is critical for Thunes. As a subsidiary of CrimsonLogic, GeTS has deep domain knowledge in trade and has built a vibrant ecosystem comprising shippers, freight forwarders, as well as financial institutions through CALISTA™. CALISTA™ Insights is a middleware solution created to harness the knowledge and data. This facilitates instant access
A game changer
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he introduction of CALISTA™ Insights has been a game changer, providing partners with realtime visibility of trade movements, thus making financial services more holistic and integrated. Thunes has processed over US$6 billion to date, and now operates in over 80 economies around the world covering over 60 currencies. GeTS is looking to further leverage upon Thunes’ crossborder capabilities to meet our logistics use-case. “Thunes is very excited to work with GeTS to further develop CALISTA™ and
to trade, logistics, and freight aggregated data for businesses to leverage on market insights in real-time. Admittedly, that large dataset of up to 140 trade-specific fields is unwieldy for the average user. But by using data modelling and analytics, GeTS had streamlined the datasets into real-time infographics which can be easily understood. The resultant trade data is irrefutable, and hence suited for verifying the transactions performed by the business entities that Thunes seeks to facilitate. CALISTA™ Insights offers a rapidly customisable solution because its platform provides a full suite of REST APIs—a type of interface that is particularly flexible for handling different data formats—that can be readily integrated into their customers’ platforms. Whilst there are similar product offerings in the market, only CALISTA™ Insights provides transaction-level data, as well as the visibility of trade activity to track the start and end points of a trade order for which a payment is made. CALISTA™ users are notified when the payments they make reach the beneficiary. They can also track their transactions in realtime, which is crucial for the timely release of their warehouse space, goods and services.
enhance its leading position”, said Tan Aik Boon, Chief Commercial Officer of Thunes, adding that this partnership signifies the company’s credibility with existing clients and the logistics industry.”
CALISTATM Insights improves data visibility in verifying company information and payment transactions.
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RANKINGS: BANKS SURVEY
Maybank Tower
Pandemic drives Singapore banks to accelerate digital offerings In the face of a crisis, the finance sector is scrambling. It needs to be both quick and creative.
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he pandemic has been challenging for Singapore banks as they navigate their way through economic disruptions and changing demands. In addition to implementing new work arrangements, banks also have to deal with their exposure to particular sectors which have been severely hurt by the crisis. But how has the banking industry been coping, and what have they learned from this so far? Singapore Business Review’s annual Bank Rankings for 2020 revealed notable changes amongst the top banks in terms of employee numbers. DBS retained its number one spot with an employee count of over 12,000 as of April this year. OCBC jumped four spots to clinch second place with 10,032 employees. UOB fell one spot to third place but still maintained their employee count above 9,000. Standard Chartered, which shared the third spot with Citi 44
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a year earlier, slipped to fourth with 9,000 employees. Rounding off the top five is Citi with 8,500. Despite benefitting from a relatively stable economic and political environment, banks still have to navigate a rough operating environment brought about by the pandemic. In particular, Singapore’s three major banks – DBS, UOB and OCBC – are in danger of asset quality and profitability losses due to their exposure to a decaying playing field, according to a Fitch Ratings commentary. Whilst the cracks may start to show in 2021, forecasted impaired-loan ratios are sitting at around 2.5%, higher than the current 1.5% impaired-loan ratio. In early July, Fitch Ratings released another commentary placing the three banks on the negative rating watch due to the pandemic and the impact of the limited headroom in their viability-driven ratings. Further
The crisis has instilled an urgent need for banks to be proactive and agile in times of these unforeseen circumstances.
slowdowns or weaker recoveries in key operating markets may put additional pressure on their operating environments, it warned. If anything, CIMB Bank Singapore chief executive Victor Lee told SBR that the crisis has instilled an urgent need for banks to be proactive and agile in times of these unforeseen circumstances amidst the pandemic. “We need to adopt an agile way of working, such as conducting online workshops, looking into business process reengineering and complimentary virtual learning so that our teams are constantly upskilling in order for the transformation journey we embark on,” Lee explained. Even if CIMB’s commercial banking segment has been rather resilient, its SME clients have been thoroughly impacted. In order to help their clients cope with loan restructuring, the bank has put
RANKINGS: BANKS SURVEY Singapore banks: Q1 2020 net interest margins (NIMs)
Victor Lee
Source: DBS Group Research
in place several measures such as deferment extension on both principal and interest until December 2020. Back in February, it rolled out its C-19 programme where eligible enterprises can avail of loans up to $5m, along with a 2-3% interest rate over a five-year period. It has also increased its e-supply chain financing programme with a limit of up to $100m (US$71.6m) in order to grant a sufficient working capital financing support for the suppliers community on the platform of CIMB’s e-procurement service provider partner. Digitisation If there’s anything remotely positive about the current situation, it is that it has fast-tracked the adoption of digital payment methods, with the Lion City being considered as a trailblazer and a model across Asia Pacific. Singaporeans are now increasingly favouring contactless payment methods over cash, with 81% believing it is a better and cleaner way to do payments, according to a Mastercard survey. On top of that, a SingSaver study revealed that 80% of Singaporeans will stick to online banking even after the pandemic subsides. Interestingly, 69% aged 54 and older have gotten comfortable with using online banking tools, the same percentage as those aged 35 to 44 but slightly higher than those aged 44 to 55 (67%). The Monetary Authority of Singapore (MAS) is expected to hand out up to five digital banking licences to 14 eligible applicants this
year. Traditional banks don’t seem to be too fazed by the incoming competition given that the sector is a “hard ground” for digital newcomers, a UOB Kay Hian analysis report noted, but a Moody’s report believes that small foreign-owned lenders may have a hard time adjusting. “Digital literacy is clearly on the rise, and it is heartening to see that all age groups are picking it up fast. I don’t think that it will lead to the death of cash transactions, but I believe that the adoption of cashless transactions will surge, as customers are concerned about the hygiene levels when dealing with cash,” Lee said. He also added that customers are also savvier when it comes to cashless payments and they trust that banks and merchants alike will implement tight security measures to ensure security on personal data.” In order to fulfill their customers’ need for digital services, CIMB has partnered with local chatbot provider Pand.AI to develop its own chatbot named Eva that will assist business owners on enquiries regarding financial schemes that will help them through the crisis. As most of their banking products and services can be accessed online, they have hired a team that will look into any gaps in their digital services that need to be improved. “What works for us is that most of our products and services can be accessed online, and with only two branches, customers can bank with us on their mobile phones from anywhere that is convenient for them,” CIMB’s Lee commented.
Maybank Singapore has also been taking advantage of the digital advent, being aligned with the Smart Nation initiative. The bank has granted initiatives to promote their online services such as cash rewards, waiving of fees for outgoing FAST and PayNow transfers. To help businesses accept PayNow payments, the bank has collaborated with Liquid Group for an all-in-one QR payment terminal for merchants to generate a dynamic QR code for each customer to scan and pay using PayNow. Nevertheless, both lenders recognise that not everyone may be receptive to the digital disruption. There will still be people who are sceptical about cashless payments due to security and data protection and would rather stick to using cash. Sharing this sentiment, Maybank believes that education about cashless payments is indeed vital in ensuring safe digital transactions. “Whilst we recognise the mature customer segment may prefer cash, the younger segment prefers to tap a bank card or scan their mobile phones to make a payment. Our aim is to ensure that no customer is left behind in this digital age by making our services user-friendly and educating our customers on how to transact digitally safely,” Manybank’s spokesperson added. Road to recovery As the circuit breaker period eases, banks are eager to return to some semblance of past normalcy whilst maintaining contingency measures adapted as response to the pandemic. Branches are being cleaned and disinfected and customers are reminded to observe physical distancing measures. Staff are going back to their offices, albeit slowly and limited in number. Looking forward, CIMB will embrace what it calls the “CHIDA approach”, Lee said, meaning that the bank will take on a “customerobsessed, high-performing, have integrity” attitude. Maybank will gradually scale up operations in addition to reopening some branches, as well as the resumption of select wealth and investment services, the the bank’s spokesperson stated. SINGAPORE BUSINESS REVIEW | SEPTEMBER 2020
45
RANKINGS: BANKS SURVEY 2020 RANK
BANK
NUMBER OF EMPLOYEES (2020)
COUNTRY HEAD
2019 RANK
NUMBER OF EMPLOYEES (2019)
1
DBS BANK
>12,000
Shee Tse Koon
1
11,693**
2
OVERSEA-CHINESE BANKING CORP
10,032
Samuel Tsien
4
6,700
3
UNITED OVERSEAS BANK
> 9,000
Wee Ee Cheong
2
> 9,000
4
STANDARD CHARTERED BANK
9,000
Patrick Lee
3
9,000
5
CITI SINGAPORE
8,500
Amol Gupte
3
9,000
6
HONG KONG AND SHANGHAI BANKING CORPORATION
3,550
Tony Cripps
5
3,391
7
J.P. MORGAN CHASE & CO.
3,000
Edmund Lee
6
3,000
8
MALAYAN BANKING (MAYBANK SINGAPORE)
2,000
Dr. John Lee
8
2,000
9
CIMB BANK
1,300
Victor Lee
9
1,270
10
CREDIT AGRICOLE CORPORATE AND INVESTMENT BANK
1,220
Jean-Pierre Michalowski
10
1,178
11
BANK OF CHINA
955
Cheng Jun
14
580
12
RHB SINGAPORE
737
Danny Quah
12
722
13
MIZUHO BANK
>700*
Guan Yeow Kwang*
13
700
14
STATE BANK OF INDIA
140**
Kishore Kumar Poladusu*
15
140
15
ICICI BANK
110
Anupam Verma
16
111
16
BANK OF INDIA
77**
17
77
17
UCO BANK
42**
18
42
TOTAL
62,363
LEGEND *DATA FROM BANK WEBSITE OR MAS **DATA RETAINED FROM PREVIOUS TABLE/RANKING
46
SINGAPORE BUSINESS REVIEW |SEPTEMBER 2020
Geetha Nagarajan*
Rajeev Gupta*
61,604
Sompo Holdings (Asia) Pte. Ltd. | 50 Raffles Place, #11-03 Singapore Land Tower, Singapore 048623 | https://www.sompo-asia.com @Sompo Holdings (Asia)
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@SompoAsia
SINGAPORE BUSINESS REVIEW | SEPTEMBER 2020
47
RANKINGS: ACCOUNTING SURVEY
KPMG Singapore
Auditing services hold accounting firms intact as consulting demand weakens Compliance work remains their strongest suit, but changing client needs evolved how they do it.
A
s businesses shift their financial plans to make sure that their cash flow will be able to withstand another few months of impact from the COVID-19 pandemic, accounting firms are still lucky enough that some services, such as auditing, remain essential and are enough for them to stay strong amidst the storm. However, as their clients’ growth plans are thwarted, the demand for other services, such as M&A advisory has taken a severe hit. In Singapore Business Review’s 2020 edition of the annual Accounting Rankings survey, PwC continues to take the helm in terms of having the largest number of employees in the industry, with around 3,700 employees as of 31 March, compared to 3,300 employees in the same period in 2019. EY came in second place with about 3,500 and outranked third placer KPMG with 3,164 employees by one spot. Deloitte ranked fourth 48
SINGAPORE BUSINESS REVIEW |SEPTEMBER 2020
with around 2,900, and rounding up the top five is RSM with 1,005. Overall, the 32 largest accounting firms in Singapore have over 18,000 employees in 2020, higher than the 16,400 recorded last year. Late to recover Even as most of these firms saw an uptick in staff numbers, the future is not as sunny, as the accounting sector is projected to recover later than the economy itself, Deloitte’s CEO Cheung Pui Yuen. “The cycle of the professional services sector often works on a different timing to that of the economy—as we are engaged in advance, meaning that when the slowdown hits we still have engagements to complete. But during the slowdown, organisations reduce their spending on professional services, and as a result, the professional services sector often
The cycle of the professional services sector often works on a different timing to that of the economy.
recovers later than much of the economy. Even as businesses open up in Singapore and around ASEAN, we therefore continue to plan cautiously,” Cheung explained. Apart from this cycle, accounting firms are facing a lot of changes as the demand for accounting services have also shifted. Max Loh, managing partner for Singapore and Brunei at EY, stated that clients are curtailing discretionary spending in transactions and certain segments of consulting. As a result, Cheung added that some organisations chose to defer consulting projects, whilst some chose to carry out transformation projects during the time of low demand. But as some businesses are entering their recovery modes, he expects increasing demand on assurance, restructuring and insolvency, risk, technology (especially digital and ecommerce) and human capital consulting. “The type of deals start to change.
RANKINGS: ACCOUNTING SURVEY M&A volumes and number of deals from 2011-Q1 2020
Cheung Pui Yuen
Source: Refinitiv
Now we’re working on more things involving restructure or capital raising as opposed to an M&A type of deal. There’ll be plenty of businesses that will be sort of forced into recapitalisation transactions or consensual restructuring,” said Andrew Thompson, Asia Pacific head of private equity and head of deal advisory at KPMG. Comprehensive auditing The most common—yet vital—type of services are keeping accounting firms afloat, given that compliance services, like audit and tax, will always be required. However, firms revealed that there have been a lot of struggles in this area as well. Accounting work has always been a mix of digital and physical elements prior to the events of the pandemic, all thanks to the constant push on digitalisation. Deloitte’s Cheung said that, even if much of their professional work and the execution of audit procedures can be done remotely, there are still some processes that cannot be digitalised. “For example, audit fieldwork such as inventory observation of our client sites and systems still requires physical presence and this poses a lag in our response to completing engagements during the current COVID-19 pandemic. For some of our technology projects in areas like cybersecurity or digital strategy, access to the client’s systems onsite is also a critical requirement,” Cheung said. Some firms have imposed measures for clients requesting for a face-to-face interaction. EY’s Loh
Max Loh
shared that for in-person meetings in the office, they are encouraged not to exceed 10 persons and the duration should be limited to 60 minutes. Meanwhile, teams working at client premises are expected to continue to observe the client’s protocols. Furthermore, smaller accounting firms are likely to struggle more, unlike the Big Four who are consistently creating technology to ease their operations. Wayne Soo, managing partner at Fiducia, stated that clients still do it the old school way where they would bring all of the supporting documents to their office. And now, their clients capture the documents through their smartphones and source documents using optical character recognition (OCR technology), upload it into their cloud accounting software and grant accountants online access into their accounts to review, amend and finalise the accounts. Aside from tech adoption, auditors are expending more effort in the areas of management judgement. “Impairment and going concern assessment to ensure that the financial information presented by companies to their investors and stakeholders is reliable, and comprehendible. When information is not readily available or reflective of market conditions, additional corroborative evidence would need to be obtained,” Lee Sze Yeng, head of audit at KPMG, said. Lee also noted a couple of things that auditors need to take in mind in adjusting their work. First is the fact that it’s no longer business-asusual with restrictions pertaining
Lee Sze Yeng
Andrew Thompson
to carrying out physical stock takes and sighting of physical documents, as well as greater estimation on uncertainties. Whilst alternative procedures involving digital processes made it possible, this also meant that robust analyses will be performed by the companies. and a greater challenge is to be posted by those charged with governance and the auditors over matters such as impairment and going concern assessment. Setting realistic timelines are also a must, especially when clients are experiencing delays in closing their books, coupled with the additional procedures that the management and auditors have to perform. “All parties involved need to be understanding and willing to flex their processes where it allows,” Lee said. Lastly, Lee stated that auditors need to view and review information with a balanced and objective point of view. “For example, it is understandable that financials will need to draw attention to the uncertainties faced at present, and it is equally important to not overreact or sound false alarms if the companies have sound fundamentals,” he explained. More risks to come Accounting firms assure that they understand the financial strain their clients are facing. For instance, EY has created their “Enterprise Resilience Framework”. They use this to identify nine areas that businesses can address to build a structured and comprehensive approach to business resilience, Loh shared. “Whilst companies are looking to cope with the immediate demands of the pandemic, it is important that they look beyond the ‘now’ and into the ‘next and beyond’ phases and reposition themselves for growth when the economy eventually picks up. For example, besides the more visible disruption of production and supply chains, as well as customer uncertainty, there are more risks and c hallenges regarding crisis management and people,” Loh added. Some firms like Fiducia are willing to make adjustments on fees. Soo shared that they have already reduced their fees to accommodate clients whose businesses were impacted. SINGAPORE BUSINESS REVIEW | SEPTEMBER 2020
49
RANKINGS: ACCOUNTING 2020 RANKING
ACCOUNTING FIRM
2020 TOTAL STAFF
NO. OF ACCOUNTING PROFESSIONALS
1
PwC Singapore
3700*
<3,000
2
EY (Ernst & Young)
3,500*
2,700*
3
KPMG
3,164
1,400
4
Deloitte & Touche
2,900
<2,900
5
RSM
1,005**
<1,005**
6
BDO LLP
560
521
7
Baker Tilly
315
285
8
Foo Kon Tan
290**
(did not disclose)
9
Nexia TS Public Accounting Corporation
265
235
10
Mazars
245
220
11
Crowe Horwath
240
<240
12
Moore Stephens
215
160
13
Kreston Ardent CAtrust (A merger between Ardent and CA Trust)
168
155
14
RT
140*
45
15
PKF-CAP
115
110
16
UHY Lee Seng Chan & Co.
108
88
17
Lo Hock Ling & Co.
95**
(did not disclose)
18
Audit Alliance LLP
94
88
18
Grant Thornton Singapore
94
80
20
HLB-Atrede LLP
93**
86**
21
Cypress Singapore PAC
89
86
22
Precursor Assurance PAC
80
69
23
BSL Group
72
64
24
Fiducia LLP
60
60
24
Heng Lee Seng
60**
(did not disclose)
26
ROBERT YAM & CO PAC. (renamed from Robert Yam & Co.)
57
47
27
Helmi Talib & Co
56
48
28
Infinity Assurance
53
45
29
Reanda Adept PAC
52**
48**
30
Kreston David Yeung PAC
46
32
31
Pinebridge LLP
48
43
32
3E Accounting
45**
(did not disclose)
TOTAL
18,024
LEGEND Figures are up-to-date as of 31 March 2020 *estimated figures **retained from 2019
50
SINGAPORE BUSINESS REVIEW |SEPTEMBER 2020
RANKINGS: ACCOUNTING 2019 RANKINGS
2019 TOTAL STAFF
MANAGING PARTNER
1
3,300
Yeoh Oon Jin
3
close to 3,000
Max Loh
2
3,048
Ong Pang Thye
4
2,600
Pui Yuen Cheung
5
1,005
Paul Lee
6
500
Fankie Chia
7
300
Joshua Ong
8
290**
Kon Yin Tong
9
263
Henry SK Tan
12
201
Denis Usher
10
240
Tan Kuang Hui
11
<215
Neo Keng Jin
Ardent: 21 CA Trust: 24
Ardent: 75 CA Trust: 55
Terence Ng Paul Tan (co-founders)
13
120
Ravi Arumugam
15
100*
Michael Chin
14
107
Lee Sen Choon
16
95**
Lo Wei Min, Pearlyn
18
88
Bernard Lee
19
82
Jeff Vibert
17
93
Andrew Tan Beng Hwee
20
79**
Lok Lai Cheng
21
75
Tan Khoon Guan
21
75
N Vimala Devi
23
60
Wayne Soo
23
60**
Michael Heng
22
61
Robert Yam
24
55
Helmi Talib
25
53
Kuah Hong Woon
26
52
Vivienne Chiang
27
47
David Yeung
27
47
Edd ie Lee
28
45**
Lawrence Chai
TOTAL
16,443
SINGAPORE BUSINESS REVIEW | SEPTEMBER 2020
51
ANALYSIS: ECONOMY
Drug maker Pfizer, which produces in Singapore, stated in a media report that they’ve seen a “tremendous increase in demand” for anti-infectives.
Pharma performance leads Singapore to a U-shaped economic recovery About 90% of businesses are projected to take a full return to normalcy in two to three quarters.
S
ingapore released its Q1 detailed GDP and April industrial production data, both of which came in better-thanexpected at -0.7% and +13% YoY respectively, according to an Bank of America (BofA) report. The highly-volatile pharmaceutical sector has also emerged as an important lifeline, preventing a far sharper plunge in activity. Excluding pharma, BofA estimated Q1 GDP would have contracted by 2.6%, whilst the April industrial production would have fallen by 10%. BofA believes that the risks are now broadly balanced and thus leaves its -5.7% 2020 GDP growth forecast unchanged. Manufacturing is expected to grow 7% and will likely help to partially offset the sharp declines expected in services and construction. However, Q2 is expected to be the main drag as BofA predicts a 30% QoQ crash in GDP,
52
SINGAPORE BUSINESS REVIEW |SEPTEMBER 2020
followed by a gradual recovery as the economy gradually re-opens. “Our growth profile is closer to a ‘U’ than a ‘V’, but we note that a stronger-than-expected pharma performance could swing it towards the later. Nevertheless, with the labour-intensive services and construction sectors expected to take a longer time to recover, we continue to expect significant pain in the labor market in the quarters ahead. However, the extraordinary fiscal and credit support should help to cushion the fallout,” the report stated. Having adjusted their expectations to a historical drop in economic activity this year, clients are increasingly interested in the shape of the likely economic recovery. “Our current forecast is much closer to the ‘U’ or tick-shape path, whilst the materialisation of upside risks could swing it closer to the ‘V’ profile. However, GDP growth
Excluding pharma, BofA estimated Q1 GDP would have contracted by 2.6%, whilst the April industrial production would have fallen by 10%.
would look quite undistinguishable in all of these scenarios. This happens as growth switches from a negative reading in Q2 to positive in Q3 and stays above-trend for a number of quarters,” BofA notes. It added that such lofty readings primarily reflect the fact that the economy is bouncing back from very-depressed levels in 2Q and underscores the importance of considering the level of GDP. “In line with guidance from the government, we assume that around 75% of the economy is able to resume normal operations from June vs. around 50% during the circuit breaker months (April-May). This share is expected to reach close to 90% from July, with a full return to normalcy two-three quarters away at best,” BofA explained. This positive outlook was thanks to the government’s $33b worth of new support measures.
ANALYSIS: ECONOMY The unparalleled fiscal support is expected to result in an overall deficit of $74.3b, or 15.4% of GDP.
U-shaped recovery ahead for Singapore
Source: BofA Global Research
Monetary policy to be likely flat Following the latest support, the total fiscal support hits $93b, which is almost 20% of GDP. The large Budget support, in addition to MAS’ press comments that the monetary policy stance remains “appropriate”, is firmly in line with the official view that it is the “primary role of fiscal policy in mitigating the economic impact of COVID-19”. However, BofA noted that whilst it is still premature to even rule out
further easing by MAS, their baseline is now for an unchanged policy stance, or a 0% appreciation slope, this coming October. Furthermore, the unparalleled fiscal support is expected to result in an overall deficit of $74.3b, or 15.4% of GDP according to MOF estimates. The record deficit will be financed using the $52bn drawn from past reserves, in addition to the around $19b surplus that the current government had accumulated over
during the FY2016-2019. Donald Chua, BofA’s ASEAN property analyst, expects the potential passing of the new Bill to exert more near-term cash-flow pressure on retail landlords. He estimates that SME tenants on average make up around 40-50% of retail landlords’ tenants by net lettable area, implying potential an additional half-month rebate to be borne by the landlords. Longer-term, the bill to co-share the financial burden should be positive for the survivability of the SME tenants. “The level of mandatory rent reliefs for qualifying SME tenants in the industrial and office properties is expected to be smaller compared to retail, given i) more industrial and office tenants will be back to work from 2 June and ii) many of such tenants are not as financially reliant on the physical real estate,” Chua commented. The report “Singapore Economic Watch: It’s not always bad news” was released on 27 May 2020.
SINGAPORE BUSINESS REVIEW | SEPTEMBER 2020
53
LEGAL BRIEFING
COVID-19 Act acts as a lifeline for contracts Apart from protecting business deals, it also gave the Health Ministry more power to make control orders.
I
n light of the economic impact of the pandemic across various sectors, the parliament passed a wide-ranging bill on 7 April to provide temporary relief from certain types of legal action to companies that are unable to fulfil contractual obligations for an initial period of six months. It also introduces provisions in holding meetings, whilst abiding with the safe distancing measures. Following the Unity, Resilience, and Solidarity Budgets, the COVID-19 (Temporary Measures) Act of 2020 covers agreements made before 25 March, as well as obligations to be performed on or after 1 February. Amongst other things, the act prohibits landlords from terminating a lease due to non-payments and protects those who have placed deposits for events. It will also only apply to contracting parties that are unable to perform their contractual obligations due to the pandemic. It covers six types of contracts in summary. These are: (1) leases and licenses of non-residential property, (2) construction-related contracts, (3) event- or tourism-related contracts, (4) hire purchase or conditional sales agreements, (5) certain secured loan facilities for local enterprises (at least 30% owned by Singapore citizens and/or permanent residents with a group turnover of not exceeding $100m in the previous financial year), and (6) options, sale, and purchase agreements for the purchase of housing accommodation, Rajah & Tann’s Vionne Tu explains. How can this law address the possible implications of the measures to landlords and tourism-related contracts? As the measures provided under the act alleviates the financial difficulties of tenants, Geraldine Ong, Baker McKenzie Wong & Leow head of the real estate practice, principal, notes that rent deferment measures under the act are a necessary intervention to the business ecosystem in this unprecedented time of crisis and economic disruption. However, qualifying landlords are correspondingly protected under the 2020 Supplementary Budgets as well as other government measures. The rent deferment measures under the act are also only temporary. However, Ong also reminds that it do not offer all tenants a free pass to absolve contractual obligations, she added. In relation to event and tourism-related contracts, if a party is unable to fulfil its contractual obligation due to a material extent by a COVID-19 event, and has served a notification for relief in accordance with the act, the other party cannot take or continue certain types of legal action against it during the relief period, according to Tay Peng Cheng, joint head - energy, projects and construction practice at WongPartnership LLP. The act provides that these deposits placed with vendors cannot be automatically forfeited on the basis of the customer’s inability to perform due to a COVID-19 event, once a notification for relief is received. Companies which are unable, due to a material extent by a COVID-19 event, to provide refunds of deposits paid can serve a notification for 54
SINGAPORE BUSINESS REVIEW |SEPTEMBER 2020
Retailers in malls are one of the main beneficiaries of the act.
relief to buy themselves time during the relief period. However, if a notification for relief is served by the service provider and the contracting parties are in disagreement over the deposit or refund, either party may make an application to an assessor appointed under the act to make a determination on the issue. Geraldine Ong
Sim Kwan Kiat
Tay Peng Cheng
Vivien Yui
What is the limit to the flexibility in holding meetings? “A physical meeting is not permitted unless the meeting is critical to the operations of the permitted enterprise business or for the professional or vocational training, testing, certification or accreditation of its permitted enterprise employee,” said Vivien Yui, joint head - employment practice at WongPartnership LLP. However, when a physical meeting is necessary, the attendees should abide with safety measures. In addition, employees deployed to work in two or more groups should not meet to minimise physical interaction, whilst any participant who exhibits symptoms should not attend the meeting and should be immediately isolated or leave the workplace. Meanwhile, Rajah and Tann’s Tu added that meetings in relation to insolvency matters of a company, a variable capital company or limited liability partnership, bankruptcy matters of an individual, general meetings and meetings of companies, business trusts, management corporations, subsidiary management corporations, and governing bodies of a registered society or union, are all required to be conducted by electronic means between the period 27 March and 30 September. What other issues does this law cover? Apart from the temporary suspension of contractual obligations of specific contracts, the COVID-19 Act has also made temporary changes to the bankruptcy and corporate insolvency regime, according to Rajah and Tann’s Tu, extending the time frame to set aside statutory demands from 21 days to six months. Further, the act empowers the Minister of Health to make control orders, including restricting movement of and restrict the operating hours.
SINGAPORE BUSINESS REVIEW | SEPTEMBER 2020
55
HR BRIEFING
‘New normal’ calls for more flexible means HR firms highlight the importance of employees’ mental well-being.
A
s the circuit breaker period gradually comes to an end, Singapore companies are steadily bringing back their workforce to the office. Firms started doing staggered and rotational shifts every couple of days a week per employee to practice social distancing measures, whilst some continue to work from home. In Bain & Company’s study, many CEOs reported that the lockdown has been liberating as organisations have changed their systems so that they can continue serving customers. “We expect to see continued large investments in digitalisation and working-from-home tools and equipment, much greater flexibility on remote working, greater empathy and attention to mental wellbeing and understanding of other pressures in employees’ lives outside work,” said Rob Bryson, managing director, Robert Walters Singapore. In particular, HR firms noted that employees’ mental and emotional well-being should be their main focus as they transition back to working in the office. “One of the factors to consider in Singapore is that employers need to understand their employees are actually keen to come back, and that you will also find people who are not mentally ready to come back and work from an office. I think organisations in Singapore need to acknowledge and be ready for that,” said Nilay Khandelwal, Michael Page Singapore‘s managing director.
Glassdoor hailed HP as the best firm to work for in Singapore.
between the company management and staff.
Grant Torrens
Companies need to ensure that their communication to and with staff is exemplary, particularly during this transition. Some employees are concerned about their own safety or the safety of their loved ones. Working parents also have additional responsibilities, especially when their children might be doing home-based learning in the early weeks. Further, many employees are finding it hard to draw the line between work and personal matters, and may have struggled with juggling both. Others feel isolated and find it difficult to communicate and collaborate between teams, clients, as well as suppliers. This requires companies to be flexible, empathetic, and bold in putting additional effort into reaching out to their employees. Managers and leaders alike should also adapt to a new way of managing their teams to speak to their employees about their concerns. Some companies are offering employees support and expert advice to focus on mental health and well-being, as people working from home experience a lot of anxiety. Regional director for Hays in Singapore, Grant Torrens, explained that employers should not place pressure on employees to come back to work, more so force them to deny having to come back into the office. This also further puts more emphasis on the importance of communication 56
SINGAPORE BUSINESS REVIEW |SEPTEMBER 2020
Nilay Khandelwal
Rob Bryson
Improved transparency Ensuring that employees can come back to work effectively requires a lot of pre-planning and preparation both for the employers and employees themselves. Hays’ Torrens noted that preparing a step-by-step guide that shows what will happen and communicating it to the company is the most important. In some cases, offices may not have enough space for social distancing or an area that will allow them to operate at a safe distance, giving more reason for some to continue to work from home. For those employees, most companies should have either a working-from-home or information communication policy in place, outlining the procedures and the policies that employees need to follow to secure privileged data and protect their business in general at the same time. “Companies need to ensure that their communication to and with staff is exemplary, particularly during this transition, to ensure minimal confusion and assure employees that the transition back to the workplace has been well-planned and thought through,” Robert Walters’ Bryson further commented. Additional expenses are also to be expected for companies as they step up their efforts to ensure that employees can return to work in a safe environment. “Many offices will obviously have cleaning personnel, but they’re going to have to enhance that by disinfecting all those highly touched areas multiple times a day, so that will no doubt probably incur additional costs as well,” Hays’ Torrens further points out. Some companies are also found to be providing shuttle services for their employees to come back to work so that they can avoid contact during public transport. Michael Page’s Khandelwal further noted that companies should also hold small group sessions with various people to ensure that people stay connected across the wide business instead of a large town hall setting.
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LEGAL TECHNOLOGY FEATURE
SmartLaw Pte Ltd to make legal services accessible to anyone It leverages AI, and data science to assist lawyers and clients.
their properties to explore betterment of their lives, whether to start a business or otherwise. This in turn, obviously has a huge economic impact. SmartLaw’s two key offerings are : a) Predictor which leverages data science and legal domain expertise to build smart solutions that assist lawyers and clients to predict sentencing outcomes of complex litigious matters in an unprecedented few minutes. b) e -Discovery which uses NLP (Natural Language Processing) for lawyers to extract past precedents and verdicts which are relevant to their cases in split seconds. In addition, it provides ancillary services for visitors/clients to the site by leveraging from several online services, which in the past may have required a visit to a law firm. Dr Anton Ravindran talks about his experience in the start-up ecosystem and SmartLaw’s offerings in the legal sector
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martLaw Pte Ltd Founder CEO Dr Anton Ravindran’s entrepreneurial ventures started nearly two decades ago. “After working for some of the leading global MNCs in the tech world, I took the plunge to pursue my passion/interests,” he said. Since then, he has been part of the startup ecosystem in the region. “My first startup where I spent the most part of my early years for nearly a decade and won several awards included Entrepreneur of the Year, Enterprise 50 Awards etc. I also sit on the board of other start-ups particularly involving AI while mentoring others,” he added. Dr Anton notes that the legal profession is a laggard with respect to leveraging technology particularly from AI and machine learning (ML) and there is some inherent inertia to change and AI is not yet ubiquitous. Hence, plenty of opportunities to make legal services efficient by leveraging AI and go beyond mere automation. “However, there are a few leading legal tech firms in the US, Canada, and UK who have gained some traction but they have yet to become unicorns like our road hailing companies which are less complex applications from a technology and domain perspective,” he added. In Singapore, government has
undertaken initiatives to support and nurture local legaltech firms. Dr Anton believes that more can be done from an execution standpoint as his own personal attempts to explore the FLIP program was a challenging experience and there were delays. “However, response from IMDA has been encouraging and supportive. “Though the government has initiated several programs and is actively promoting entrepreneurship in the legaltech sphere, execution is obviously in the hands of the people tasked with the effort who may not be fully attuned with the government’s vision, which is why more ground up activities maybe needed”, he said. Advances in legaltech will certainly “democratize” law as technology will lend reach to legal expertise for rich and poor alike. More money will no longer necessarily mean access to better lawyers and better justice. Less than 50% of people in the world have access to legal systems. According to studies, more than half the world’s population don’t even have title deeds to their properties. This has corresponding effects as they similarly cannot even leverage from
AI paving the way Dr Anton believes that the future is here and now, and it lies in AI. The first generation of technology for the legal profession provided functions such as word processing, accounting systems, and email. This progressed to where clients and lawyers could do filing online, document management systems and as a result of the pandemic, even quickly moved to online court hearings. However, Dr Anton notes that there is no intelligence involved and these are largely automating their operations. The future will be where lawyers, judges and machines work side by side in analyzing complex legal issues, drafting documents, predicting sentencing outcomes, etc. “Technology will lead to manifold improvements in terms of efficiency for the legal profession in the areas of better analysis, predictions, and eDiscovery amongst others and emerging specialties such as legal engineering will become mainstream,” he added. SmartLaw said it will continue to invent and introduce new LegalTech solutions by leveraging AI and ML for other areas of law in Singapore and in other jurisdictions in the coming months.
Technology will lead to improvements for the legal profession in areas of analysis, predictions, eDiscovery, etc. and emerging specialties will become mainstream SINGAPORE BUSINESS REVIEW | SEPTEMBER 2020
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