Startup Magazine of Hong Kong: Jumpstart Issue 23 (September/October 2018)

EDITOR’S NOTE BEWARE OF THOSE BUBBLING, ANNOYING BUZZWORDS

By Glen Watson

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CCORDING TO Merriam-Webster, a buzzword is defined as ‘an importantsounding usually technical word or phrase often of little meaning used chiefly to impress laymen’ or ‘a voguish word or phrase — called also buzz phrase’. These words can be popular for a period of time, before they aren’t (ie, dot-com bubble).

Here at Jumpstart HQ in HK, we get inundated daily (including weekends) with emails, messages and press releases full of buzzwords, in particular Initial Coin Offering (ICO), Initial Public Offering (IPO), and the blockchain (is there anything that can’t be linked to it? Yes, but you wouldn’t know if from all the buzzing around it).

For this issue, hot on the heels of our May/June FinTech issue, we decided to face these buzzwords head on and see what’s behind the buzz and what’s actually going on in Asia when it comes to these words. Turns out, the answer is: a lot. How the rest of this year and next shakes out remains to be seen, but even the most optimistic aren’t getting their hopes up too high.

But for now, tech companies that did an ICO in 2017 are feeling relieved and probably still celebrating their good timing, while those planning to do an ICO or IPO this year are probably reconsidering, or at least postponing.

Then there’s the blockchain, which few seem to fully grasp yet many want (especially when investing). Major players in China are touting pigs grown on the blockchain (Alibaba), as well as chickens (ZhongAn). As we discovered, it’s gaming that has really pushed blockchain and tokens to the fore.

Blockchain is also important to Andy Ann’s startup NOIZchain, which aims to use blockchain and AI to revolutionize digital advertising. It’s an interesting concept, to be sure. NOIZchain is doing an ICO from the end of August until September 30 and it will be interesting to see how that turns out.

We also hear from Xdite Cheng in Taiwan. She founded the OTCBTC crypto platform and she shares some tips for improving your online security. Zac Cheah’s Pundi X from Indonesia is making great strides this year following its ICO in September 2017, and the token sale – which had targeted raising US$35 million – logged over 6,000 Ethereum transactions and sold out in barely two hours. He admits “we were super lucky” and explains how he’s using the money raised to expand globally.

From Singapore, Julius Tan writes about his startup Electrify that will soon be developing smart contracts for electricity purchases and a new peer-to-peer energy trading platform. The technology will be built on a distributed ledger architecture with all transactions written to the blockchain.

There’s a lot more inside this issue. Grab some earplugs, ignore the buzzing sounds and enjoy.

Glen Watson glen@jumpstartmag.com

Cover photo: Rob Gilbert Photography www.robgilbertphoto.com

Issue 23 | 1

CONTENTS

JUMPSTART magazine SEPTEMBER/OCTOBER 2018 1 Editor’s note GUEST COLUMNS 7 Finding Founders 9 Food, Glorious Food 10 Bracing Asia For The AI Revolution 11 Digital Self Transformation 13 Understanding ICO Caps 14 ‘Connect’ before ‘Convince’ 15 Unjust Rewards 16 NEWS 19 LIFESTYLE FEATURES 22 Capital Ideas

COVER STORY

BUZZ – OR BUST

The Road Ahead Could Well Be Full Of Twists And Turns

By Glen Watson, Editor-in-Chief of Jumpstart

24

26 FEATURE

29

BANNING THE BANNER AD

NOIZchain Using Blockchain & AI To Revolutionize Digital Advertising

By Nayantara Bhat, Editorial Associate of Jumpstart

FEATURE

SOCIAL ENGINEERING ATTACKS

How An Exchange Protects Users’ Digital Assets

By Xdite Cheng, Founder and CEO of OTCBTC

30 FEATURE

POWER TO THE PEOPLE

Singapore’s Electrify Aiming To Democratize Access To Energy

By Julius Tan, Founder and CEO of Electrify

FEATURE

38

GAME ON

Can Gaming Provide The Push Blockchain Needs?

By Matej Michalko, Founder and CEO of Decent

28 32 34 35 36 37 40 42

Musical Showdown: ICOs vs IPOs Pay It Forward Take it EOSIO Cryptic Message Digital Identities A World Of Hurt New Reality EVENTS

Issue 23 Sept/Oct 2018 Managing Director James Kwan Editor-in-Chief Glen Watson Editorial Associate Nayantara Bhat Director of Operations and Strategic Partnerships Anita Chan Associate Director of Content Development Chloe Wong Experience Design Strategist Bertha Chiu Director of Product Development Maggie Lau Community Evangelist (Silicon Valley) Li Xing Chang Founder/Advisor Yana Robbins

Joseph Chow

Advisors Shitiz Jain Leo Ku

Journalists in Residence Sabrina Wang Tieza Mica Santos Faridah Wu Nelson Ng Shona Yang Peyton Ong Quách Toàn Long

Xdite Cheng Magnus Grimeland Tracy Ho Bay McLaughlin

Derek Kwik

Interns Divina Samtani Kelly Cho Huey Wong Jett Li Sherman Mak

Contributors Matej Michalko Steve Safarowic Divya Samtani Sankalp Shangari

Janice Chrysilla Surja Julius Tan Cal Wong

Jumpstart is available at over 1,500 locations in Hong Kong, Bangkok, Kuala Lumpur, Singapore, China, Ho Chi Minh, Jakarta, Manila, Sydney, Melbourne, New York and Silicon Valley.

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Copyright © 2018 Jumpstart Media Ltd. The contents of the magazine are fully protected by copyright and nothing may be reprinted without permission. The publisher and editors accept no responsibility in respect to any products, goods or services that may be advertised or referred to in this issue or for any errors, omissions, or mistakes in any such advertisements or references. The mention of any specific companies or products in articles or advertisements does not imply that they are endorsed or recommended by this magazine or its publisher in preference to others of a similar nature which are not mentioned or advertised. Published articles do not necessarily represent the views or opinions of Jumpstart magazine.

GUEST COLUMN 6 | JUMPSTART SEPT/OCT 2018

GUEST COLUMN

FINDING FOUNDERS ANTLER SUPPORTS LEADERS BUILDING GREAT COMPANIES

By Magnus Grimeland Antler CEO & Founder

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NTLER IS A startup generator focused on investing in people, rather than in ideas or specific categories of products and services.

To that effect, we are industry agnostic and believe in empowering people who have the right skillset, drive and tenacity by giving them the support they need.

Many talented people want to start their own company, but too few pursue their dreams.

Sometimes it’s a lack of a partner who shares a vision and has complementary skill sets, other times it’s a lack of funding and network. With Antler, we want to fix that.

We connect passionate aspiring entrepreneurs, help them find the right Co-founder, and give them access to a network of relevant business and academic experts worldwide. We provide funding from day one to support Founders in building the businesses they will own and run. Specifically, businesses that positively impact local, national and global economies.

ABOUT THE AUTHOR As CEO and Founder of startup generator Antler, Magnus Grimeland leads a global team dedicated to creating a global innovation platform for entrepreneurship. With over a decade of experience, Magnus is most prominently known for co-founding ZALORA. com, where he was responsible for strategic market initiatives and improving the business across SE Asia, the Americas, Europe, the Middle East and Oceania. www.linkedin. com/in/magnusgrimeland953b311/

The rise of mobile penetration and affluence in the region – coupled with the successes of predecessors such as Go-Jek, Grab, Alibaba, Lazada, Zalora and Traveloka – adds to the strong potential for the region to build deep technology companies.

At the same time, Southeast Asia grapples with challenges like underdeveloped infrastructure and logistics, and this is where entrepreneurs can step in to fill the gaps and solve real problems on the ground.

Despite having only launched recently, we received an overwhelming number of applications and our first cohort is made up of talented individuals from 23 countries, including Hong Kong.

In the next two years, we hope to support 100-150 innovative technology companies out of Southeast Asia. We want to see the Founders we’ve recruited build successful technology businesses in the region and through that, positively impact economies. There are plans to expand across Asia, Europe, Africa, the Americas and the Pacific, and to replicate our business model in different markets.

With a founding team of individuals who have all been in startup shoes and have succeeded many times over, we are dedicated to supporting some of the world’s best talent in becoming great Founders of great companies. antler.co Issue 23 | 7

Q&A WITH MAXINE RYAN FOUNDER OF BITSPARK Member of The Hive Coworking Spaces

How did you initially get involved in blockchain?

In 2014, myself and George Harrap started discussing what opportunities there were in Bitcoin. Back then, the easiest activity using Bitcoin was to send money, so we compared the costs between sending money using Bitcoin and sending money using a wire transfer.

We found that the latter was so much more expensive that it was obvious, there was something there.

How does Spark utilize blockchain in the money transfer industry?

The Spark team has built an ecosystem for individuals and businesses that provides every basic financial need without institutions. Everything from exchanging money, to transferring domestically and internationally, customers can do via Spark without any knowledge of how cryptocurrency works. It’s been amazing to see people exchange, send and receive money without needing bank accounts.

What challenges do you face as the Co-founder of a company trying to ‘un-bank the banked’?

What are the most important office features required for a company devoted to blockchain technology?

I think the main challenge is building the banking infrastructure that is needed for our products and services to be accessible worldwide, particularly in underdeveloped parts of the world. We have a global network of vaults, which we call inclusion points, where businesses and physical stores can cash in at. After we tokenize this cash on the blockchain, users can then easily use their digital balance to send or exchange finances using crypto.

Security is number one. Number two would be convenience. Number three and this might be dependent on Hong Kong - is space. I think the Hive, in particular, has the most working space.

Usually, when you go to other coworking spaces it feels really small, but at the Hive I feel like they don’t just focus on how many people they can squeeze into a room.

What made you choose to work in a co-working space?

When we were a two-person-team, it made total sense to just pay a bit of money for a hot desk until we got that investment. When you get that investment, the last thing you want to do is put it into rent. Also, the commitment structure is much more flexible in coworking spaces, making them an easier way for us to handle our growth.

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8 | JUMPSTART SEPT/OCT 2018

GUEST COLUMN

FOOD, GLORIOUS FOOD

AGTECH OPPORTUNITIES IN SE ASIA

By Bay McLaughlin Brinc Co-founder & COO

The farming, fishing and forestry practices [in SE Asia] need to be modernized and made more profitable, while countries in the region must take serious, coordinated steps to reduce food losses and food waste, which is as high as 30-50 percent regarding grains, fruits and vegetables

– United Nations Food and Agriculture Organization (FAO)

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HEN I MOVED TO ASIA in 2014 on a one-way ticket from San Francisco, I had a hunch that the future of innovation was going to move from the West to the East. My company (Brinc.io) and I invest heavily in Southeast Asia and one of my favorite new investment themes is agriculture technologies (AgTech) or ‘What We Eat’. We have eight investments in this space, so far.

SE Asia is critical to the global food supply – producing 85% of the world’s palm oil and 53% of the shrimp, and home to 96% of the world’s farmers. And while you hear a lot about Asia being a mobile-first economy, this vital industry is fragmented and almost completely offline.

We have unique issues in agriculture coming up – like the need to increase our food production by up to 77% to feed an expected 9 billion people by 2050.

So how do we fix these problems?

As I explained in Jumpstart’s last issue, we evaluate all of our investments using the IoT Value Equation that shows the relative impact an investment we make can have on the world.

X (Problem) * Y (Effect) * Z (Duration) = Impact or Opportunity So let’s run it to see the scale of the opportunities in AgTech in SE Asia and how our portfolio teams reduce agricultural waste and increase yields.

Palm Oil with Poladrone (poladrone.com)

Precision Agriculture with Habibi Garden (habibigarden.com)

• Inaccurate data results in land mismanagement, creating a 25% inefficiency in palm oil production (X); • Palm oil accounts for 31% of the world’s vegetable oil production and demand will triple by 2050.

Today, palm oil is a US$70 billion industry (Y) annually (Z).

• The Asia-Pacific region has more hungry people than all the other regions of the world combined – more than 550 million.

In Indonesia, 54.6 million tons of farmed food is produced (Y) annually (Z); • Habibi Garden has shown that it can increase vegetable yield by 16% to 200%, while reducing fertilizer and water waste. Let’s take 16% (X) as our conservative estimate.

25% (X) * $70 billion (Y) * 1 year (Z) = US$17.5 billion lost in palm oil crops every year! Palm oil production also has some nasty side effects, like deforestation and species extinction.

16% (X) * 54.6 million tons (Y) * 1 year (Z) = 8.736 million tons of food could be produced annually in Indonesia.

Problems and teams like these keep us jumping out of bed each and every morning. If you want to work on similar problems, help unlock data and improve our lives, please reach out. The future is bright and SE Asia has a HUGE role to play… and so do you!

Brinc.io

ABOUT THE AUTHOR Bay McLaughlin, aka BetaBay, is a Co-Founder of Brinc and the COO. Bay is an active Investor with 50+ portfolio companies, sits on the board of four companies, writes a weekly column for Forbes called This Week in China Tech, and is a professional speaker and KOL for Huawei and Insta360. bay@brinc.io

Issue 23 | 9

GUEST COLUMN

BRACING ASIA FOR THE AI REVOLUTION

EPIC GLOBAL TECH TALENT SHORTAGE AND AUTOMATION WILL IMPACT REGION

By Steve Safarowic

Accelerate Head Of Marketing & Product

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OR ALL OF THE benefits that artificial intelligence will bring to make lives simpler and empower organizations, it also carries a dark side effect that we can’t ignore: a widespread skills misalignment that will lead to a global tech talent shortage of epic proportions.

By 2030, the Asia-Pacific region will experience a labor skills shortage of 47 million people, while 800 million jobs will be lost globally to automation.

Despite a wealth of publicly accessible data available on the matter, many of us don’t seem to get it, or at least want to get it.

It’s easy to overlook the threat of traditional retailers along with their thousands of employees facing redundancy by online delivery, or that about one-third of jobs in finance and insurance will become obsolete.

10 | JUMPSTART SEPT/OCT 2018

Until now, technology has mostly made our lives simpler. Personal and workplace software automate tasks, letting us focus our energy elsewhere.

Upskilling to make yourself future-proof is an obvious solution. However, high-quality tech education is expensive and inaccessible. With Asia expected to suffer an unrealized output of US$4.2 trillion due to a shortage of skilled workers and a notoriously traditional education system to fall back on, disruption is imminently necessary here more than anywhere.

Some governments have begun to acknowledge this by offering continuing education subsidies to residents, while the number of employers upskilling their existing staff has doubled in recent years on account of personnel replacement costs being up to 400% of an annual salary.

ABOUT THE AUTHOR Steve Safarowic is the Head of Marketing and Product at Accelerate, a Hong Kong startup focused on bridging the gap between education and employment in Asia. Accelerate is a TechEd startup that is democratizing education and upskilling workforces en masse.

Driven by growth, Steve has been a strategic contributor behind creative campaigns and brand building for Hardware IoT, SaaS, and Media companies in the Greater Bay Area since 2012. www.accelerating.tech

By Divya Samtani

Ecosystem Explorer @ Mettā

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HESE DAYS, it can seem almost impossible to walk 10 feet without hearing the words digital, innovation, or transformation – often all at the same time.

But when it comes to taking risks and encouraging creativity, I would argue that it has much less to do with a company’s technology, or even its people.

Rather, in order to transform our businesses, I believe that we must first be ready to transform ourselves. I recently travelled to Tallinn, Estonia to attend a revolutionary new education program called Mindvalley University – founded by Vishen Lakhiani, author of “The Code of the Extraordinary Mind” – which takes students on a monthlong journey of personal and professional metamorphosis. Here were 3 key themes that ran throughout the month.

Examine the Invisible

Before we can expect to experience any mental shifts, we must first look at what already exists beneath the surface. As Kwik Learning Founder Jim Kwik explained, accelerated learning is impossible without forgetting two things – firstly what you already know about a subject, and secondly what you believe are your limitations around it. Once you reach that stage, the rewiring of the brain can begin.

Practice Blissipline

Your happiness matters – a lot. This is particularly true if you’re responsible for other humans, but it’s also a prerequisite for sustainable growth and advancement.

It’s the reason that the Mindvalley founder puts ‘blissipline’ or the ”discipline of daily bliss” at the top of his agenda.

On a practical level, blissipline systems can range from simple gratitude and visualization exercises, to hacking state changes in your body and accessing your brain’s beta and theta levels in order to get you into super flow.

Making personal growth your priority will not only help you create the transformation you’re looking for in your business, but will also make the world a stronger and better place for it.

ABOUT THE AUTHOR Divya Samtani is a professional communicator, connector, and content creator. Through her role as Mettā’s

Stop Being So Serious

We all know that perfectionism is the enemy of innovation. But what we often don’t realize is that playfulness can be the solution for it. By incorporating a more playful approach into our lives, we not only energize our spirits, but are able to imagine bigger, more exciting ideas, and explore brand new ways of doing things - like turning your workshops into playshops, or seeing your problems as exciting puzzles instead.

resident Ecosystem Explorer, she works to unite the international startup community by establishing partnerships and knowledge-sharing with entrepreneurial organizations across the globe. www.metta.co

Issue 23 | 11

GUEST COLUMN

DIGITAL SELF TRANSFORMATION

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he year flew by and it’s been an exciting one: building our community by welcoming many new members, organizing interesting and exciting activities and branching out to offer events, travel and an introduction service. We now offer bespoke matchmaking for HK singles too!

Our website has been revamped and is easy to navigate.

We post interesting and engaging articles on all our social media sites daily. We have been interviewed by Maureen Mir on RTHK, and featured in several articles written by the SCMP’s Luisa Tam over the past year. The Mozaic logo

is getting recognition around Hong Kong, and our social media visits have grown exponentially. Now, we also cater to single, English-speaking residents looking for meaningful connections and keen to be introduced to others with similar interests in HK. We tailor our services to the mature crowd who are looking for new connections, friends or just something meaningful to do in their leisure time. Typical events Mozaic hosts include wine tasting dinners, junk trips, weekend hikes, opera evenings, happy hours, TGIF dinners, historical walk & talks, Sai Kung island cruises and cooking classes, to mention a few.

We started meet mozaic in March 2018 as a side business to Mozaic, as we found out that many of our Mozaic members are single. We felt the need to offer them a personalized, offline service designed for the mature HK resident looking to meet a new partner. We take the guesswork out of endless

swiping and surfing online dating sites by personally matching our clients. All of our clients are treated like our friends, and we strive to introduce them to others in our growing community of HK singles. meet mozaic provides discreet, bespoke service to all of our clients by personally interviewing all clients, preparing individualized profile pages and thoughtfully suggesting matches. Over the past months, we have organized intimate speed dating evenings and we are planning many more new and exciting events in the coming year.

Why not join the meet mozaic community of mature, English-speaking HK single residents and let us introduce you to our friends, or join Mozaic to meet other like-minded HK residents? www.mozaiclub.com.hk | www.meetmozaic.com.hk

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12 | JUMPSTART SEPT/OCT 2018

GUEST COLUMN

UNDERSTANDING ICO CAPS TARGETS SAY A LOT ABOUT COMPANY’S INTENTIONS

By Cal Wong

Marketing & Branding Consultant

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LOCKCHAIN COMPANIES have dazzled the mass markets with reports of mega-fundraising efforts.

Uncertainty, volatility and infinite possibilities have fuelled the roughly 685 successful Initial Coin Offerings (ICOs) in 2018. From January to July, the total market capitalisation of ICOs alone amounted to US$17,489,068,062.

With dizzying figures like these, it is important to be informed about any ICO process, including the understanding of ICO Caps.

There are generally three types of caps in an ICO: Soft Caps, Hard Caps, and Unlimited Caps.

Hard Cap ICOs set an upper limit on how much funding they’ll accept. It is a threshold often set in fiat currency terms, or some sort of cryptocurrency, such as Ethereum (ETH). Any funds raised that exceed the predetermined Hard Cap after the predetermined cutoff date is returned to the investor.

On the other end of the spectrum, Unlimited Cap ICOs are willing to take as much in funding as they can get. There are obvious benefits to this: more funds means more room for teams to develop their technology; it also means that all investors’ demands for coins can be met. The downside, of course, is that there is no transparency in unaudited, uncapped ICOs and teams can easily pocket funds with no one the wiser.

Cap targets can say a lot about the intentions of a company. Just as a ‘traditional’ company is expected to explain their targets and calculated reasons for raising capital through an Initial Public Offering (IPO), similar levels of scrutiny should be given to an ICO.

Soft Caps and Hard Caps go hand-in-hand. Soft Caps are often a barometer of a crypto company’s place in the wider ecosystem. In the uncertain market of ICOs, it can be difficult for blockchain companies to understand or gauge interest in their offering, and for many, the soft cap can be the first real indication of acceptance by the market, as well as the minimum amount they will be happy with in order to progress with their technology. Achieving a Soft Cap will trigger the Hard Cap target.

A good example is HARA Token, a utility token created to help Indonesian farmers sell their crops for reasonable prices.

HARA have set their token Soft Cap at $5,000,000, and a Hard Cap of $25,000,000. The social impact token has detailed on their website the reasons for these limits and how these funds will be allocated.

ABOUT THE AUTHOR Cal Wong is a journalist turned marketing and branding consultant who actively advises Fintech and blockchain startups across Asia on growth hacking techniques through content, social and distribution methods. As a former banker, he has always been analytical, and continues to use data to drive both his reporting and consulting. Find him on LinkedIn, or Cal.Wong@prnasia.com.

Issue 23 | 13

GUEST COLUMN

‘CONNECT’ BEFORE ‘CONVINCE’ WHAT OFTEN IS MISSING IN STARTUP PITCHES

By Tracy Ho

Frame & Fame Founder

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HE STARTUP MOMENTUM in Hong Kong and Asia is ramping up. As more startup businesses flourish, more funding sources become available. Still, many budget-tight startups need to fight for the limited resources from angel investors and venture capitalists in order to obtain the funding for expansion, product R&D, etc.

From our recent observations at RISErelated events, demo nights and pitching events, many Founders go on stage without public-speaking experience, and do not enjoy speaking in front of strangers. In addition, some techstartup Founders don’t have any communication or marketing experience.

So many brilliant ideas could be heard in startup pitches if one thing wasn’t missing – a genuine connection with the audience, primarily the investors. You may have heard about the ‘4Ps’ in marketing. These are our ‘4Ps’ for investor pitching:

Perception Comes First

Research shows that it only takes 2 seconds for others to form an impression about us. By the time you present the first line, the investors have decided whether they would entrust their money to you.

Some believe pitching begins when you walk to the stage.

Actually, your game starts when the investors find your website, online profile, search engine results, etc.

Self-checking question: Are you connecting with investors on multiple channels with a clear brand message?

Pictorial Presentation

Our brains process images 60,000 times faster than text, and 90% of information transmitted to the brain is visual. Keep the pitch deck’s text-to-visual ratio to 40/60 or 30/70. Incorporate more graphics, photographs, icons, charts, infographics and videos.

Self-checking question: Are you connecting by telling stories, leading investors to visualize your startup vision and mission?

Pace The Race

Never lose track of time in a pitch. Pacing is essential. If you speak too fast, you sound rushed and hasty. Speaking too slow will make you lose your audience. We recommend speaking two words per second, 10 words per sentence and, no more than 10 sentences in a minute. Pause and breathe when you feel you are speeding up.

Self-checking question: Are you providing investors ample time to understand your messages?

Build your brand, own your stage. Be the ‘pitchmaker’ before you approach the target rainmaker.

Frameandfame.com

Presence Needs To Be Present

Executive presence refers to the ability to engage, align, inspire and move people to act. We’ve seen Founders going to pitch competitions or meetings, but we couldn’t feel their energy or see the fire in their eyes. Being humble is great, but you need a strong executive presence to win investors over.

Self-checking question: Are you connecting by engaging with investors, showing your inspiration and motivating them to believe in you?

14 | JUMPSTART SEPT/OCT 2018

ABOUT THE AUTHOR Tracy Ho is a leading personal branding strategist in Asia and Founder of Frame & Fame, an award-winning branding consultancy in Hong Kong that helps entrepreneurs and business leaders be seen and heard developing compelling brand stories, portraits and identity assets. tracy@frameandfame.com

GUEST COLUMN

UNJUST REWARDS THE UGLY TRUTH ABOUT SOCIAL MEDIA INDUSTRY

By Janice Chrysilla Surja

S

OCIAL MEDIA naturally gets more vibrant when there are more users contributing a larger variety of content, creating sustained growth in the social media industry that does not seem destined to deteriorate in the near future. However, here is the ugly truth about the social media industry today: most users do not get the rewards they deserve for generating content.

To social media platforms, usergenerated content is a free source of revenue that multiplies at a rapid pace.

Looking at it from this angle, brands seem to benefit from the free marketing provided by user-generated content at the expense of the users. This is exactly the problem that PINC is trying to solve.

PINC is a social ecosystem built on blockchain technology that allows users to create content and earn cash or tokens from it. This seeks to correct the imbalance where users typically do not get rewarded for generating social media content. This reward system hopefully will incentivize users to continue engaging themselves and others at PINC, thus yielding enough facts and figures for brands to gain insights about their consumers.

In a nutshell, this transparent platform seeks to make sure that everyone – creators, shoppers, brands and analysts – can benefit from one

another’s activities in the platform and that no one is at a disadvantage.

PINC rewards users by assigning points for their activities in the platform, such as liking a post, commenting and uploading content. As the points system is blockchain based, they can be converted into cash or traded on markets as tokens.

PINC is in the midst of preparing to launch its ICO of tokens based on the Ethereum ERC20 standard. These tokens can be bought on the platform, earned from directly interacting within the platform, or acquired from the referral program, giveaways and gifts from other users.

PINC understands that the legitimacy of its tokens is also contingent upon its team members. CEO Sabrina Wang is an avid entrepreneur with a background in fashion, media and technology. With years of experience dabbling in several businesses, she has gained a natural acumen for business and a foothold in the e-commerce world.

Other members of the leadership team include COO Francis Sim, CCO Edmund Lee, CFO Grace Tang and Head of UX Xael Tan. The advisory team comprises of Advisory Board Member Kent Teo, Cryptocurrency Advisor Peter Sin and Business Advisor Haryanto Soemito. www.pincstyle.com Telegram t.me/pincstyle.

ABOUT THE AUTHOR Janice Chrysilla Surja is an undergraduate student at the National University of Singapore majoring in Psychology and Management.

Janice joined PINC as a Community Support Intern in Summer 2018. Janice writes and reads fiction novels in her free time. She is working on her first book (a Japanese teen fiction novel), which will be published in her home country Indonesia, by the end of 2018.

Issue 23 | 15

NEWS

SCHOOLS GET HK$20M RESEARCH GRANT FOR PAYMENT SYSTEMS, BLOCKCHAIN The Hong Kong University of Science and Technology (HKUST) Business School has received HK$20 million from the HK Research Grants Council grant to improve the security capabilities of electronic payment systems. The business school has partnered with the University of Hong Kong (HKU), the Chinese University of Hong Kong (CUHK), and the City University of Hong Kong (CityU) to work on the research project that will also explore blockchain technology applications, and discuss the possibility of Hong Kong’s transformation into a global financial technology hub. www.ugc.edu.hk

CHINA FINALLY TOPS NORTH AMERICA IN ATTRACTING VC FUNDING As investors chase 1.4 billion consumers, China startups accounted for 47 per cent of the world’s venture capital funding in the second quarter – the first time the country has surpassed North America in fundraising, according to a recent South China Morning Post article. The result was helped by a record US$14 billion fundraising round by Alibaba Group Holding affiliate Ant Financial Services. www.scmp.com

TRAX HAULS IN US$125M PRE-IPO Singapore-based Trax operates a computer vision and image recognition platform that caters to food and drink retailers.

It recently raised US$125 million in a pre-IPO round led by China-based Boyu Capital, ahead of a planned IPO in New York within the next two years, according to a Bloomberg report.

The latest funding values the startup at nearly US$1 billion.

Last year, it raised US$64 million in a round led by US private equity firm Warburg Pincus. This round brings Trax’s total disclosed funding up to more than US$280 million. traxretail.com

ASIAN CITIES DROP IN WORLD DIGITAL COMPETITIVENESS LIST The IMD World Competitiveness Center recently released its world digital competitiveness rankings. Singapore has dropped from the number one spot, and is the only Asian country in the Top 10. Thailand, Korea, and Japan moved up the ranks from 2017, while Hong Kong, Taiwan, Malaysia, Indonesia, and the Philippines slipped. www.imd.org 16 | JUMPSTART SEPT/OCT 2018

GOBEE.BIKE FOLDS Despite raising US$9 million in August 2017, Hong Kong-based dockless bicycle rental startup Gobee.bike has withdrawn quickly from the highly competitive and growing industry that is estimated will be worth US$3.6 billion by 2020.

Gobee.bike started operating in April 2017, but on July 10 announced on Facebook that it would be closing permanently.

“Our decision is purely due to our financial situation,” Gobee CEO Raphael Cohen wrote in a post to its more than 9,500 Facebook followers.

Gobee.bike

NEWS

HTC DEVELOPS BLOCKCHAIN PHONE Launching in Q3, the HTC Exodus is being called the world’s first mobile dedicated to decentralized applications and security. HTC has a vision to expand the blockchain ecosystem by creating the world’s first phone dedicated to decentralized applications and security. The HTC Exodus includes an allimportant cold storage wallet. HTC has also partnered with the world’s first and most popular NFT game on the blockchain, CryptoKitties, to exclusively distribute it on selected HTC devices, starting with the U12+ www.htcexodus.com

WEWORK OPENS IN HK’S CITYPLAZA THREE, GETS US$500M IN SERIES B FUNDING WeWork recently launched its third Hong Kong location, WeWork Cityplaza Three in Taikoo, and also announced a US$500 million Series B investment in WeWork China led

by Trustbridge Partners, Temasek, the SoftBank Group, the SoftBank Vision Fund, and Hony Capital to accelerate WeWork’s growth on the mainland. In 2016, WeWork entered the Greater China market with the opening of its first location in Shanghai and currently has 20,000 members in 40 locations in Beijing, Shanghai and Hong Kong. www.wework.com

Issue 23 | 17

LIFESTYLE | PRODUCTS 18 | JUMPSTART SEPT/OCT 2018

It’s annoying when you’ve just settled into the couch to watch a movie and realize that you forgot to turn the lights off. Or when you’re listening to music in the shower and you can’t forward to the next track without stepping out. The Flic button, designed by Sweden-based Shortcut Labs, is here to solve these problems. One press of the button might turn on the air-conditioner. Two taps might order a pizza. It’s a small, weather-resistant button that can make using your connected devices easier than ever. www.flic.io

LIFESTYLE | PRODUCTS

AT YOUR FINGERTIPS

WEAR IT BEST These days, sometimes it can feel like we’re drowning in a sea of people more fashionable than we are. Finding clothing to fit and flatter our bodies can be a challenge, and with summer slowly turning into autumn, there’s no better time to find your style. Ombré, a Malaysia-based startup, is here to be your personal stylist. The app uses your physical traits – height, skin-tone, body shape – to suggest the best styles from your favorite online stores. www.ombre.me

PHOTO EDITING IN A SNAP

The producer of the world’s premium console for editing on Adobe Lightroom, Loupedeck, has introduced the next generation of its flagship product, the Loupedeck+.

While built to improve the editing experience on Adobe Lightroom, it can now also work with another editing software, Skylum Aurora HDR. More integration with Skylum products is in the works. Loupedeck+ is all about creating the easiest editing experience and building an invested photography community. www.loupedeck.com

LOVE AND TRUST IN A DIGITAL WORLD

“Fool Me Twice” comes from the memory chest of Jules Hannaford, an Australian-born single mom who emigrated to Hong Kong and found her way into the confusing – and at times scary – world of internet dating. Hannaford is the creator of the Hong Kong Confidential podcast, and this literary venture shares the hard and valuable lessons she learned through her sojourn into the murky sphere of digital love. “Fool Me Twice” can be found on Amazon in both Kindle and paperback. www.hongkongconfidential.net Issue 23 | 19

LIFESTYLE | PRODUCTS

TAKE THE PLUNGE Swimming alongside the beautiful flora and fauna of the ocean is a beautiful experience, but it can be hard to know where to go. ZuBlu is a platform designed to match your ideal diving experience to a dive site in Asia.

Whether you’re hoping to swim with sharks or float among the most vibrant fish in the sea, ZuBlu can show you where to go. ZuBlu’s platform is a combination of a search algorithm and network of partnerships with resorts, dive experiences, and conservation efforts. www.zubludiving.com

COTTONING ON TO ORGANIC CLOTHING A project designed to arouse public awareness on clean recycling and upcycling, Flappyland works with Taiwanese cotton growers to produce 100% organic cotton clothing.

Textile production is responsible for huge amounts of water and air pollution, so Flappyland helps to inspire “eco warriors” through 5-minute craft sessions, online photo sharing and word of mouth, in addition to simple and stylish t-shirts. The project also upcycles shampoo bottle pumps. www.flappyland.com

TEAM EFFORT Spending an evening out in the open, playing your favorite sport with friends is something many of us can only dream about – plans go sideways, there aren’t enough people to fill up two teams, and friends sometimes live too far away to make it. Enter Rovo, an app that can find players at your skill level in your neighborhood. Not only will you enjoy having full teams and a running record of matches won and lost, Rovo can notify you of games nearby that you might like to join.

Weekends are about to get sporty! www.rovo.co

20 | JUMPSTART SEPT/OCT 2018

Muggo is a high-tech coffee mug with built-in heating technology that keeps your drink at the perfect temperature for as long as you like. Not only that, Muggo can be charged wirelessly so it’s always ready to go. Connect the battery magnetically with one hand, pick your preferred temperature using the touchscreen buttons, then take your coffee or and enjoy it at any time, anywhere. www.ouismart.com

LIFESTYLE | PRODUCTS

DON’T GET HEATED ABOUT LUKEWARM DRINKS

HOME SMART HOME Futuristic images of waking up as the blinds open by themselves and the water heater switches on automatically have become today’s reality. HOMI SmartHome offers end-to-end smart home solutions that integrate over 80,000 different household appliances and the most-popular smart devices. This solution connects all essential household appliances while integrating home monitoring, security and on-demand services into one app, and it’s compatible with most leading voice assistants. www.myhomi.io

Curated experiences with experts and trade masters for your team or clients

Make Hong Kong-style milk tea with an award-winning milk tea master

Learn about traditional Chinese medicine from a seasoned practitioner

Visit inaccessible areas of a village with its Deputy Director of Welfare

To book or for more information, email explore@samtheexpert.com or visit www.SamtheExpert.com

Issue 23 | 21

FEATURE

CAPITAL IDEAS THINGS TO CONSIDER BEFORE DOING A TOKEN SALE OR IPO

By Peyton Ong

I

NNOVATIVE IDEAS can be quickly harnessed through a brainstorming session or even through random ‘aha’ moments, but are soon followed by thoughts like “I don’t have initial capital” or “I failed at previous fund-raising efforts”, driving potential Founders and Entrepreneurs to give up on their ideas.

In the past, traditional methods of fundraising involved equity financing, either from venture capitalists and angel investors, or an Initial Public Offering (IPO) at a later stage of growth. But with the development of blockchain technologies, the hype surrounding the Initial Coin Offering (ICO) has skyrocketed, as ICOs bring fresh hope to Founders who previously might have abandoned their ideas.

Decision Making

Founders take on heavy burdens that can be eased if they choose to do an IPO, where underwriters make strategic decisions on their behalf for a guaranteed capital gain. Token sales, on the other hand, require Founders to make profound decisions right from the get-go, such as conducting feasibility studies to identify objectives, deciding the token sale structure, type of tokens, execution timeline, and so forth. It is undeniably a lot of pressure.

Time And Resources

ICO vs IPO

An ICO or token sale (a term often preferred by legal representatives) is based on blockchain decentralized technology to create tokens that represent a product, which is then put up for sale through a platform.

An IPO, on the other hand, is when startups decide to ‘go public’ by selling shares for the first time. Although both ICO and IPO seem similar in terms of selling something intangible to raise capital, they differ in financing methods and objectives.

Successful ICOs are built to accommodate tokens into their core business idea, the concept being that token buyers can trade the company’s products for their purchased tokens without Founders needing to give up equity. IPOs, however, give up part of the company’s equity to the public and are usually done when a startup has reached a maturity level that portrays substantial traction from a developed product.

22 | JUMPSTART SEPT/OCT 2018

Founders should definitely consider the amount of time needed to do an IPO or token sale. An IPO generally takes 1-2 years to plan and transition into stabilization, while a token sale takes around 6 months to 1 year. Listing on an exchange is an exhausting process involving dozens of steps. Token sales are similar, yet they differ in certain ways, in particular the time commitment Founders need to take on.

Due to increasing awareness of ICO fraud and the inner mechanisms of token sales, buyers have grown more riskaverse. This means that startups need to undertake more labor when preparing the ICO, such as writing up white papers, creating a viable use for the tokens, and organizing community-building activities. This is all part of building trust with buyers. Failure to add value to their projects could result in investors dumping tokens, exchanging them for others of high potential, and causing the startup’s token value to crash.

The decision hinges on the cost. Neither avenue is inexpensive, but token sales are somewhat more of a grey area. The cost of an IPO is fairly rigid since it’s an established process. High underwriting fees are a given since the investment banks do most of the legwork when preparing to IPO. According to PricewaterhouseCoopers, an average of US$7.2 million is needed for going public.

There isn’t an established ballpark figure for the token sale process, but things like PR for pre- and post-sale, legal advisory, hiring good blockchain developers, engagement roadshows, and even technical writing assistance for the white papers are just a few of the (often costly) steps involved in an ICO. Deciding on the right token price and structure can be the crucial difference between a successful ICO and a flop.

FEATURE

Costs And ROI

Legal And Security

Despite developments, token sales remain risky due to their vague framework, as regulators are still trying to catch up to the pace of technology. Token sales are also prone to cybercrime due to the large amount of money that can be raised through a digitized platform. IPOs, on the other hand, are based on traditional financial regulations that offer more security.

The IPO route is secure and stable, but at the cost of a long underwriting and due diligence process.

While token sales are plagued by uncertainty, initiatives to improve the token sale ecosystem have been implemented. More industry leaders are building best practices for the blockchain community, and scam identifiers such as TruStory and MetaCert are creating systems to eliminate ICO scams.

Token sales and IPOs have their respective strengths and weaknesses, but it’s up to the startups to decide which method of capital raising puts them on the right track to move forward.

Risk And Pitfalls

The after-effects of launching funding schemes like these can become a concern in the long term because all future development needs to be more risk-averse and take into account the investors’ profitability. Maintaining transparency throughout the process is the best investor relations approach. Yet, if minor failures occur in between, not only would they face valuation declines, the company’s reputation could take a hit when preparing for further rounds of funding, with all facets of the company exposed to scrutiny and criticism.

Additionally, market conditions are generally subject to some volatility, which highlights the importance for startups to select the right cryptocurrency exchange or stock exchange to list on. Token issuers need to make sure that they create tokens that allow flexibility when exchanging them for more established cryptocurrencies, while IPO issuers need to decide which stock exchange would have investors with the most demand for their shares.

ABOUT THE AUTHOR Peyton Ong is an innovator and design strategist in Kuala Lumpur who is enthusiastic about rethinking and redesigning the different things that matter with lasting and thoughtful new experiences. In addition to working with the SuperCharger FinTech accelerator and leading the KL FinTech Academy, she is a Journalist in Residence for Jumpstart magazine whose writing is inspired by her interest in technology research and background in leading digital transformation projects. peyton@jumpstartmag.com

Issue 23 | 23

COVER STORY

THE ROAD AHEAD COULD WELL BE FULL OF TWISTS AND TURNS

W

By Glen Watson

HAT A DIFFERENCE a year makes. Back in 2017, token sales or initial coin offerings (ICOs) were all the rage and generating vast wealth for the issuers.

This year, it’s a bit of a different story with coin prices tumbling and forecasters warning that they probably haven’t hit rock bottom yet. For those who worked in and survived the ‘dot-com’ boom in the late-90s, the situation in 2018 has a rather familiar feel to it.

Even the mighty Xiaomi – the fourth-largest phone maker – came up flat with its IPO in Hong Kong this summer.

Rather than getting the US$100 million valuation that it was hoping for, the listing generated US$4.7 billion (instead of US$10 billion) to give it a valuation of about US$54 million.

The shares began trading in July around HK$17, rose to about HK$21 and since then have fallen to HK$16.36 on Aug 17.

The company also shelved its issue of Chinese depositary receipts (CDRs) after failing to reach an agreement with mainland Chinese regulators over a number of issues, including the high valuation.

This disappointing result for Xiaomi has other large tech companies in China, Asia and even around the world delaying their plans to go the IPO route.

24 | JUMPSTART SEPT/OCT 2018

But one area that’s still buzzing, at least for now, is the blockchain. One media report recently said that 6X more new Chinese companies with ‘blockchain’ in their names were registered between January and July this year than all of 2017.

Long Blockchain

If it seems like everyone is trying to blockchain everything, you’re right. In December, the Long Island Iced Tea Corp changed its name to Long Blockchain and saw its Nasdaqlisted shares soar as much as 289%, basically doubling the company’s valuation to about US$70 million. It soon soured, and in April Nasdaq delisted Long Blockchain – accusing it of misleading investors and falling below the minimum value of US$35 million needed to maintain its placement. By August, Long Blockchain had a value of about US$5 million – and a subpoena to cooperate in an investigation by the Securities and Exchange Commission.

Rent A Celebrity

Portuguese footballer Luis Figo recently became an ambassador of STRYKZ, a token by Berlin-based Stryking Entertainment for football fans to use in fantasy football

Not In China

The People’s Bank of China basically banned ICOs in September 2017, taking the largest market for token sales out of the picture. In addition to stopping future sales and halting ongoing events, the central bank’s directive also ordered all completed ICOs to liquidate and return funds to investors.

Coins like Bitcoin and Ether tumbled in price, by double digits.

Strangely, Cryptokitties are a big hit in China.

Singapore

Singapore Exchange (SGX) to begin dual-share listings (Singapore). The country’s bourse has introduced rules to allow for the public listing of companies offering dual-class shares, following in the footsteps of its counterparts in the US, Canada, Hong Kong, and elsewhere. The system essentially allows a single business to issue separate groups of shares that have differing features, such as different voting rights, and could prove useful for foreign tech companies and startups looking to list in the city-state.

COVER STORY

matches. He joins Brazilian football star Ronaldinho, English footballer Michael Owen, boxer Manny Pacquiao, socialite Paris Hilton and Academy Award-winning actor Jamie Foxx among the list of celebrities who’re lending their fame and their legion of fans to token sales.

ICO, IPO & BLOCKCHAIN – WHAT YOU NEED TO KNOW

When a private company or corporation raises investment capital by offering its stock to the public for the first time.

Growing companies seeking capital to expand are those that generally use initial public offerings, but large, privately owned companies or corporations looking to become publicly traded can also do them. In an initial public offering, the issuer, or company raising capital, brings in an underwriting firm or investment bank, to help determine the best type of security to issue, offering price, amount of shares and timeframe for the market offering.

Do Squats, Earn Crypto

Animoca Brands subsidiary OliveX (HK) recently struck a deal with “Latgala” OU to integrate the Lympo token in OliveX’s iOS mobile app 100 Squats Challenge.

The July announcement was made at NIFTY (www.nifty.gg), the world’s first dedicated conference and hackathon on non-fungible tokens, blockchain gaming, and collectibles.

OliveX develops and publishes mobile apps, including apps powered by artificial intelligence (AI), that leverage gamification to improve the fitness and health of users.

OliveX’s 100 Squats Challenge is an app powered by machine learning for Apple mobile devices that challenges users to perform squats and tracks their performance using the device camera.

Lympo is a blockchain company developing a platform to reward people for exercising and leading healthier lives.

This year, Lympo established partnerships with one of the most recognizable female athletes in the world – Caroline Wozniacki – and the professional NBA basketball team the Dallas Mavericks. Currently Lympo is expanding into the US and Asian markets.

By the way, you can also earn tokens through something called the CryptoTab Browser – “earn Bitcoins while you browse”. To be honest, it sounds like a scam – “Invite your active friends who will invite their friends - and start making real money!” But hey, it’s hard to tell these days.

There are sites that list failed ICOs, such as deadcoins.com that has just crossed the 900-coin mark… and counting. It has categories such as Deceased, Scam, and Parody. Worth checking it out before you start buying or mining coins.

An unregulated means by which funds are raised for a new cryptocurrency venture... In an ICO campaign, a percentage of the cryptocurrency is sold to early backers of the project in exchange for legal tender or other cryptocurrencies, but usually for Bitcoin.

A digitized, decentralized, public ledger of all cryptocurrency transactions. Constantly growing as ‘completed’ blocks (the most recent transactions) are recorded and added to it in chronological order, it allows market participants to keep track of digital currency transactions without central recordkeeping. Each node (a computer connected to the network) gets a copy of the blockchain, which is downloaded automatically.

Originally developed as the accounting method for the virtual currency Bitcoin, blockchains – which use what’s known as distributed ledger technology (DLT) – are appearing in a variety of commercial applications today.

– Source: Investopedia.com

Issue 23 | 25

FEATURE

BANNING THE BANNER AD NOIZCHAIN USING BLOCKCHAIN & AI TO REVOLUTIONIZE DIGITAL ADVERTISING

By Nayantara Bhat

I

T’S ANNOYING TO check out a pair of shoes on an e-commerce platform and then have the shoes follow you from Google searches to ads on Facebook and Instagram.

Much of digital marketing in past two decades has been defined by cookies and programmatic advertising – using software to purchase digital ads. NOIZchain is a Hong Kong digital marketing company hoping to use blockchain and artificial intelligence (AI) to revolutionize the world of digital marketing.

NOIZchain makes use of an AI chatbot that allows a user to interact with a banner ad, creating a conversation in which the user can engage fully with the brand. Ads created by NOIZchain are able to hold a conversation with users, asking or answering questions to create a comprehensive profile of a consumer’s preferences and spending habits.

Digital advertising is measured in clicks, with ad campaigns centering around gaining the maximum number of ‘impressions’. But NOIZchain CEO and Founder Andy Ann says that such campaigns are at the end of their lifetime – it’s too easy to create bots to click ads and generate revenue, defrauding brands that are paying ad publishers for clicks.

“Now the future is, we have run a campaign for two weeks, we have 50 million conversations with our customers,” he says.

NOIZchain’s model also makes sure that users are compensated for holding a conversation and giving up their data. Consumers can earn NOIZ tokens, which can be redeemed for incentives and discounts or paid forward to social impact organizations and charities. The tokens redeemed for vouchers are also paid forward to charities, instead of remaining with the advertisers and publishers.

26 | JUMPSTART SEPT/OCT 2018

“Advertisers already spent their advertising budget.

There’s no reason for us to give them back the token, which has a dollar value,” Ann says. “Publishers have not earned more, advertisers have not spent less.”

Ann has worked in AdTech for 17 years and has plenty of experience in adapting marketing to meet the needs of the ever-changing tech industry. In 2007 when the smartphone revolution began, Ann launched Hotmob, a mobile advertising solutions provider. A few years later, with the rise of platforms like Facebook and Twitter, he expanded the platform to social media. NOIZchain launched in 2017 to combat the unsustainable amount of ad fraud and growing numbers of clickbots.

FEATURE

“Many brands, although they are spending triple digits on increasing their [marketing] in the digital space, what we see is the conversion rate is coming down,” Ann says, adding that with bots making up a majority of the clicks on digital advertisements, $100 put into a marketing budget doesn’t go nearly as far as it did before.

Ann and NOIZchain are relying on the unique characteristics of blockchain to help solve the problem, alongside its AI chatbot Nikola that is named after the prolific inventor Nikola Tesla (1856-1943).

“With AI, there’s a lot of fraud prevention – if you want to defraud us now, you can’t just build a clickbot and keep on clicking to fraud the money,” Ann says. “You have to create a conversation, you have to go through our algorithm of the AI conversation in order to fraud for more money. We’re making the work more difficult.”

With data protection regulations becoming more of a concern with the introduction of the European Union’s General Data Protection Regulation, any service that attempts to obtain data from consumers is having a tough time. However, Ann is confident that data privacy won’t be an issue.

“The users own their own data. They have the choice to decide whether to sell it to the advertisers,” he says. “So that’s the beauty of blockchain, right? It’s not centralized, it’s not stored in our own data storage, and it’s not sold to the advertiser.”

NOIZchain isn’t alone in the industry when it comes to using blockchain to change the digital ad marketplace, but Ann says it is the only startup to focus on the user side. Competition aside, the company’s main challenges come in the form of optimizing its tech.

NOIZchain needs the right blockchain to be able to handle millions of transactions as the company scales, and to that end the company has partnered with enterprise-grade blockchain company NEM, in addition to ERC20.

Localizing the Nikola chatbot by training it in multiple languages is another challenge that will require time and dedication. In addition,

NOIZchain also faces an uphill battle when it comes to adoption – it will take time to convince advertisers and management that paying for clicks is no longer an efficient policy.

At the heart of NOIZchain’s philosophy is a desire to build a strong community of users who hold and use NOIZ tokens, contributing to social welfare and proving that cryptocurrencies can be commercialized very quickly.

“We believe the world in the old days was all about product services and brands,” Ann says.

“Now, it’s about community and culture. And it’s all about the power of collaboration, rather than one company owns all.” www.noizchain.com ABOUT ANDY ANN Andy has 17+ years’ experience in digital media. In addition to being a serial entrepreneur and angel investor, he is the Founder and CEO of NDN Group, a digital conglomerate heavily invested in mobile advertising networks, social networking, big data, artificial intelligence and advertising technology. Andy has also been actively involved in multiple Hong Kong and Silicon Valley incubators, including Google EYE, 500 Startups, Founders Institution, Entrepreneurs’ Organization and KPMG.

Issue 23 | 27

FEATURE 28 | JUMPSTART SEPT/OCT 2018

FEATURE

SOCIAL ENGINEERING ATTACKS

By Xdite Cheng

OTCBTC Founder & CEO

B

LOCKCHAIN IS ONE OF the most popular topics in the tech community. Instead of opening a crypto exchange or issuing a digital coin, the most profitable business in the blockchain industry, in my opinion, is to hack it. Therefore, to run a blockchain exchange, besides being in the right place at the right time, one has to be technically savvy since exchanges often fall prey to cyber attackers.

Generally speaking, there are two types of cyber attacks.

The first targets IT system flaws that have to do with the software. The second is social engineering attacks that involve the users.

Social engineering attacks are malicious activities accomplished through human interactions that use psychological manipulation to trick users into making security mistakes. According to Imperva’s Incapsula.com web app security site, these are some common mistakes:

1. Giving away the E-wallet password because the user wants to get an airdrop (free coin), or let others open their wallet.

2. Failing to keep track of one’s password and getting attacked by username enumeration. Hackers may try to access user information in Website A and manipulate it to log into Website B. 3. Accidentally logging into a scam website and revealing the password.

4. Downloading .pdf or .docx attachments from phishing emails that come with Trojan horses. These malicious computer programs will then access the users’ personal information such as banking information, passwords, or personal identity.

Translated by Kelly Cho

Users should do the following to enhance awareness and the skills to protect their information:

1. Use iPhone, Mac, and Chrome browsers.

2. Check if the website URL is correct, and make sure it begins with ‘https’. Use different passwords for different websites.

3. Be careful of emails, even from people you know well – do not open them rashly.

4. Enable 2-Step Verification (two-factor authentication) on email accounts.

Since not everyone has enough information about security awareness, defending against social media scams is always easier said than done.

As an operator of the exchange, the challenge we face is how to prevent hackers from further prevailing if our users have already been attacked. In addition to the mainstream safety measures deployed by most exchanges, OTCBTC has an internal control mechanism that detects suspicious events and actively blocks them.

For example, when a user transfers digital assets to a wallet address with high-risk, if it is found that an inactive user suddenly transfers a large amount of digital assets, he or she will be redirected to human customer service to confirm the withdrawal. If multiple users are logged in as a unified IP, we will quickly freeze all related accounts. There are many other security features on the exchange, including risk control, token listing, and employing the help of professional security companies.

In short, I hope this article encourages readers to improve their awareness of financial security. At the same time, the OTCBTC team will spare no effort to create a secure and reliable world-class cryptocurrency trading platform.

Our next goal is to launch an enterprise-level OTC trading function – OTC Cloud Service – so that more companies can build OTC trading systems with our help. www.otcbtc.com

ABOUT THE AUTHOR Xdite Yi-Ting Cheng is the Founder and CEO of OTCBTC, an over-the-counter crypto exchange based in Taiwan. She is a veteran in the blockchain industry, a well-known growth hacker, and won the Facebook hacker marathon in 2012. Xdite has more than 10 years’ experience in technology development, and has served as technical director of medium and large-scale international development teams.

Issue 23 | 29

FEATURE

POWER PEOPLE to the

SINGAPORE’S ELECTRIFY AIMING TO DEMOCRATIZE ACCESS TO ENERGY

By Julius Tan

Electrify CEO & Founder

I

MAGINE A marketplace of candy merchants, with stalls so neatly arranged that you are able to immediately identify your favorite sweets and how much they cost. This marketplace welcomes merchants from all over the country, with each vendor bringing a wide selection of candy of all kinds.

Best of all, the marketplace also allows people who made candy at home to sell their excess sweets at the market.

Receipts at this marketplace are carved into chains of magic blocks owned by everyone at the marketplace that cannot be changed. That way, nobody at the market will ever get cheated.

Electrify functions much like the aforementioned marketplace, except that we will soon be developing smart contracts for electricity purchases and a new peer-to-peer energy trading platform. The technology will be built on a distributed ledger architecture with all transactions written to the blockchain.

ICO A Natural Step

In the case of Electrify, an ICO represented a natural step as a token economy was central to the functioning of our electricity smart contract and P2P energy trading platform, which is built on the blockchain. We recently raised US$30 million in less than 10 days through the sale of our ELEC tokens.

In a bid to ensure good behavior, we require energy producers to deposit tokens when they list. Beyond that, a token sale was also critical in helping us to quickly establish a community of users, which was invaluable in speeding up the realization of the ecosystem.

Through tokens, we’re seeking to empower our users with a means of participation in the process. The idea is that when users fund the development of a project, the interests of the project builder and user are aligned. This may not always be the case in traditional venture funding scenarios.

30 | JUMPSTART SEPT/OCT 2018

Traditional Backers, Too

However, the strategic value and access that traditional venture backing can bring cannot be understated. We made sure to engage institutionalinvestors during our fundraise.

These include organizations such as Global Brain, a leading Japanese venture capital firm, and Thailand-based OmiseGO, a business-tobusiness e-wallet payment provider.

Democratizing Energy

Electrify’s long-term vision is fundamentally about democratizing access to energy. Having spent the bulk of my career in the energy sector, I saw how the industry was highly reliant on manual processes and physical records, mired in complexity and inefficiency in terms of time and money. I quickly came to the realization that these issues could be mitigated through digitization, optimizing processes and lowering costs.

At the same time, I observed that regional energy markets were steadily undergoing deregulation, opening the markets to competition and enabling consumers to purchase electricity from privatized energy companies. However, the conventional structure of power markets today poses challenges for small-scale producers in terms of accessing trading and settlement facilities. Entry into power markets for distributed energy sources has become economically unsustainable as they struggle to engage consumers in the same way as larger generators.

These observations ultimately formed the basis for Electrify – a transparent, cost-effective and simple way for consumers and producers of any scale to meaningfully participate in energy markets. As far as we are aware, no other company is offering a similar product to Electrify’s – a peer-to-peer energy trading platform operating on the main grid.

FEATURE

Government Oversight

While many have championed an unregulated space without government intervention as being integral to the success and appeal of ICOs, it doesn’t mitigate the fact that the lack of government oversight increases the potential for less-savvy investors to be preyed upon.

In this regard, Singapore has some of the most forward-looking regulations for cryptocurrencies/digital tokens in Asia Pacific.

Regulations such as those introduced recently by the Monetary Authority of Singapore are a heartening sign that authorities are starting to recognize that ICOs are here to stay and are introducing measures to weed out the bad actors. We have been careful to design our token as a necessary facilitator of the network’s utility, without consideration of securitization.

We heartily applaud the authorities’ national approach to this space.

Expansion Plans

Beyond ICOs, the Asia Pacific energy sector is also anticipated to offer many growth opportunities for us, with energy demand in the region anticipated to almost double in the coming years. There is also an overall move towards deregulation of energy markets in Asia Pacific, with major economies such as Japan and Singapore having embarked on the

“

The idea is that when users fund the development of a project, the interests of the project builder and user are aligned

”

liberalisation of their energy markets.

With energy efficiency likely to be a top priority, deregulation is also on the cards for the Philippines, China, and Vietnam.

As we expand our presence overseas, we anticipate encountering nuances across geographies, with each country having its own unique policy framework. To mitigate such regulatory risks, we will engage local authorities along with local partners prior to our formal entry into each market.

The first step to any successful venture is a willingness to take risks. For long-term sustainability, it is critical for startups to be supported by a capable team; that is, like-minded people and mentors/advisors that believe in the same vision for the company. Paired with intelligent execution, it is entirely possible for innovative ideas to be brought into reality.

Electrify.asia

ABOUT THE AUTHOR Julius Tan is the CEO & Founder of Electrify, an energy retail marketplace based in Singapore. Its next move is a new energy marketplace based on blockchain technology, which enables peer-to-peer trading from small-scale producers such as residential rooftop solar and wind turbines.

Issue 23 | 31

FEATURE

PAY IT FO POST-ICO, PUNDI X EYES EXPANSION AND INVESTMENT OPPORTUNITIES

By Nayantara Bhat

T

UCKED AWAY AT A small stall in a section of Hong Kong’s massive RISE conference in July, Pundi X looks like just another startup in the crowd. But Pundi X has been making waves in the startup ecosystem: the hope is that people without bank accounts will soon use Pundi X’s technology to make day-to-day purchases using cryptocurrencies.

Pundi X aims to accelerate the transition to cashless payments in places like Indonesia, where vast chunks of the population remain unbanked.

It also has global ambitions. This summer, the startup began shipping out the first of the 5,000 pre-ordered XPOS point-of-sale devices to customers around the world.

Over the next three years, Pundi X plans to roll out 100,000 XPOS systems, along with its complementary XPASS card that works like a debit card – customers pay for goods using the cryptocurrency they load onto it.

Pundi X had an ICO in September 2017, and the token sale – which had targeted raising US$35 million – logged over 6,000 Ethereum transactions and sold out in barely two hours.

The ICO’s success can be attributed in part to its superb timing. Crypto fever was at a high in September 2017, with the price of Bitcoin in the early stages of its historic ascent to US$20,000 in December. Since then, Bitcoin and other currencies have experienced intense volatility, which Pundi X Founder Zac Cheah is glad to have missed out on.

“We were super lucky,” Cheah says. “Even today, the landscape has changed such that the projects people proposed last year are not as

32 | JUMPSTART SEPT/OCT 2018

exciting or capable of attracting investment this year.”

The ICO has given Pundi X a definite boost.

Industry players and crypto enthusiasts now have their eyes on Pundi X as a frontrunner in the Southeast Asian cryptocurrency space. “Back then, people didn’t recognize us, but nowadays people recognize XPOS devices which makes us really happy,” Cheah says.

Pundi X experienced some issues with adoption, since cryptocurrency is still a wild card for most merchants, but that seems to be changing.

“We find people who want to use crypto and want to use blockchain in their coffee shops, in their car retail, anywhere, coming to us,” he says.

“People actually reach out to us to acquire our XPOS and XPASS.” One such restaurant is Locofama, in Hong Kong’s Central district. Pundi X approached Locofama for trialing the XPOS device during RISE, and Founder Larry Tang says it was a very quick conversation.

“We always think about the future of food, the future of capitalism, and having something like this – I see it as a huge milestone, a new chapter,” says Tang, who hopes that Locofama will be the first HK restaurant to usher in a transition to cryptocurrency payments.

However, Pundi X still faces a roadblock in the form of looming regulatory barriers. Late last year, the Indonesian central bank banned the use of cryptocurrencies as a medium of payment.

However, Cheah is confident that Indonesia will relax its views on cryptocurrencies, and was

FEATURE

ORWARD quoted in June as saying that Pundi X would be pushing forward with deployment regardless of the ban.

“What the bank has said is actually to make sure that bitcoin or other crypto assets don’t replace the [Indonesian rupiah] as a form of payment,” he says. “So in that sense, it’s not a ban, per se.”

Parallel to the expansion plan, Pundi X is also keeping an eye out for investment opportunities. Having enjoyed the benefits of a soldout ICO and XPOS pre-orders, Cheah says that the company is looking at how it can support other blockchain companies and eventually become an industry leader comparable to Google or Intel.

“I think we want to be part of the ecosystem in the sense that when blockchain growth stabilizes, we want to be at the table when the dust settles,” he says.

Cheah’s advice to startups looking to raise via ICO is modeled on what Pundi X is trying to do – create value from the tokens and from the business. According to Cheah, a crucial step in deciding whether to hold an ICO is how the token or coin could be tied to the core business. This is something that’s often ignored when setting up an ICO – it’s a much more straightforward way of raising capital as compared with the traditional venture capital route, which can lead to overconfidence.

“Investors today are smarter than investors last year and they really want to look at real utility use cases of the token,” Cheah says.

Pundi X’s ultimate mission is to make crypto mainstream.

“How do we make it accessible to the average consumer, someone who isn’t tech savvy?” Cheah says. “We bring it into the retail environment and – above all – make it simple.” pundix.com

ABOUT THE AUTHOR Nayantara is a Reporter for Jumpstart in Hong Kong who is passionate about innovation, social enterprise, and alternative finance. She’s a hobbyist photographer and is currently on the lookout for the best burger in Hong Kong. nayantara@jumpstartmag.com

Issue 23 | 33

FEATURE

TAKE IT EOSIO BLOCK.ONE’S EOS VC INVESTING US$1B IN BLOCKCHAIN COMPANIES

By Glen Watson

B

LOCK.ONE IS THE publisher of the EOSIO blockchain software protocol and seller of the EOS Token, a topfive cryptocurrency by market cap at approximately US$4 billion. The Cayman organization employs over 200 people globally, with offices in Hong Kong, California, and Virginia.

In December 2017, Block.one committed to investing over US$1 billion in the EOSIO platform through the EOS VC venture arm that has announced deployment of capital through partnerships, including with: Derek Rundell of Eric Schmidt’s TomorrowVentures, Michael Novogratz’s Galaxy Digital, Finlab AG (ETR:A7A), Michael Cao’s EOS Global, and City of London-based SVK Crypto.

About EOS VC

The EOS VC program offers developers and entrepreneurs the funding they need to create community-driven businesses leveraging EOSIO, which launched in May 2017. It provides support through venture capital partnership funds that primarily aim to achieve sustained utilization of the EOSIO ecosystem by investing in a concentrated and diversified portfolio of blockchain-focused companies building on the EOSIO software.

EOS VC is targeting game-changing blockchain-based products and entrepreneurs across the globe. It has so far allocated approximately US$700 million through VC partnerships in the United States, Europe and Asia.

“Our partnerships and investment efforts through EOS VC are critical in driving adoption and innovation in the EOSIO ecosystem. We are committed to supporting companies that want to build businesses and DAPPs on the platform,” says Block.one Group President Rob Jesudason, the former CFO of Commonwealth Bank who joined Block.one this year.

34 | JUMPSTART SEPT/OCT 2018

The EOS VC initiative is also dedicated to fostering a global network of individuals from a number of disciplines through regular developer community engagement events. This includes participation in a global series of Block.one hackathons that aim to discover and encourage the most innovative EOSIO projects.

The hackathon series kicked off in Hong Kong June 9-10, followed by events in Sydney, London and elsewhere.

Former Jefferies Asia CEO Mike Alexander joined this summer as CEO of the EOS VC venture capital arm. Based in Hong Kong, Alexander will serve as a member of the Block.one Executive Committee. He is responsible for managing direct venture investments and EOS VC partnerships, with a focus on sourcing and investing in projects developing on the EOSIO ecosystem. Block.one’s CEO is Brendan Blumer, and the CTO is Daniel Larimer.

“Blockchain will have a transformative impact on most industries in the coming years and will redefine operating models by streamlining businesses, while also reducing cost and risk,” says Jesudason. “Block.one’s technological innovation enables fast, low-cost, and scalable blockchain performance and is laying the groundwork for mass adoption of these new technologies.”

Alexander has extensive experience in investment banking and is well-respected in the financial services industry in Asia.

“Block.one is shaping the next generation of technology and the internet,” says Alexander. “The vision of its Founders has resulted in it being one of the fastest-growing organizations in the world and I am excited to be joining. The company’s unique position as the publisher of the EOSIO open-source code means that it is poised to lead the way in investments related to the burgeoning platform.”

Block.one | EOS.io

FEATURE

CRYPTIC MESSAGE LINE LAUNCHES USER-FRIENDLY AND SECURE CRYPTO EXCHANGE

By Kelly Cho

B

UILDING ON the success of its messaging app introduced in 2011, LINE’s diverse offerings now include unique and secure financial services with the July launch of its BITBOX cryptocurrency exchange.

Unlike LINE, which is based in Japan, BITBOX is headquartered in Singapore and offers at least 30 cryptocurrencies – including Bitcoin, Ethereum, Bitcoin Cash, and Litecoin for users around the globe (except in Japan and the US). It also supports 15 languages, excluding Japanese.

“With BITBOX, we intend to have an exchange that is easier to use, while also ensuring we provide extremely strong levels of security,” says LINE CEO Takeshi Idezawa.

LINE’s Advantage

With approximately 200 million monthly active users worldwide, LINE has built its reputation as a successful global messaging platform. “This brings credibility to BITBOX as a cryptocurrency exchange, something many of the other players lack,” BITBOX Project Manager Edward Lee says in a recent interview with Bitcoinmagazine.com.

He adds that by incorporating LINE’s rich insights into UI and UX design, BITBOX has an intuitive and easy-to-use layout for the exchange platform. BITBOX’s main goals are to provide a user-centered experience and first-rate customer support.

Ensuring Security

Another major focus of BITBOX is to provide the highest levels of security and transparency. In view of this, LINE is integrating the technology offered by BitGo, the market leader in cryptocurrency security, which launched the first multi-signature wallet in August 2013. Multi-signature, three-key management is an advanced security configuration that ensures the safety of assets by avoiding any single point of failure. The BitGo wallet pairs seamlessly with BitGo’s cold storage (storing Bitcoins offline) custody. Asset transfer is then made simple and secure.

“LINE and BitGo are both leaders in our industry and this partnership with BITBOX is an important step in bringing institutional investors the security, compliance, and custodial solutions they need,” says BitGo CEO Mike Belshe.

“Together, BITBOX and BitGo are committed to providing the most secure and reliable user experience in the digital token ecosystem.”

Leadership Goal

BITBOX is trying to provide a userfriendly service for those who may feel intimidated by the world of cryptocurrency. The launch of BITBOX is more than just a response to the increasing global demand for trading cryptocurrencies – LINE’s long-term goal is to establish itself as a FinTech services leader. www.bitbox.me Line.me

ABOUT THE AUTHOR Kelly Cho is an Editorial Intern at Jumpstart. She studies English Literature at The University of Hong Kong, and is also passionate about music and technology. kelly@jumpstartmag.com

Issue 23 | 35

FEATURE

DIGITAL IDENTITIES SINGAPORE’S LALA WORLD CREATING FINANCIAL ECOSYSTEM FOR MIGRANTS AND UNBANKED

By Sankalp Shangari LALA World CEO & Founder

T

HERE ARE ABOUT 1.7 billion people in the world who are unbanked, and almost all are adults living in the developing world. Many of them are migrants who lack reliable identification, credit history or may be faced with unreliable intermediaries. Rather than looking at piecemeal solutions, LALA World is creating an entire financial ecosystem for this group.

Digital Identities

Building the ecosystem on blockchain technology, LALA World looked at the root problems migrants and the unbanked faced. The first problem that blockchain can help with is identification.

As a decentralized ledger, blockchain can establish digital identities for an individual and make that verification available to others, securely. In fact, when confronted with an influx of refugees, Finland did precisely that using blockchain technology.

Once identification is solved, many things we take for granted as basic human rights will suddenly become available.

Next, we built our ecosystem - credit scores, cards, transfers, peer-to-peer and direct lending, bill pay, pensions & saving, insurance - revolving around this digital identity.

We’re also continuously adding new functionality to the ecosystem, such as peer-to-peer and direct lending.

Driving adoption for LALA World will keep the ecosystem vibrant and viable. We are doing this through global partnerships, leveraging existing infrastructure, engaging in partnerships with corporate houses and with NGOs, government, local companies and with distributors.

One of our partners MI-gram – along with Bestinet (which is also our shareholder) – has distributed 68,000 SIM cards in Bangladesh. These SIM cards can act as electronic identification (EKYC) and drive adoption in the ecosystem.

International School, ClothesBox Foundation, Cynopsis Solutions, Ethos, iomniscient, MiGrams, Rebit, SmartPesa, Stellar, Tasstech and World Education Placement Services amongst others.

Today, LALA World is an established and fast-growing Asian technology company that uses blockchain to create a connected financial ecosystem for the unbanked, undocumented, migrant labourers and refugees around the world. Unlike other blockchain startups that focus on geography or product, LALA World looks at the situation of the ecosystem to put the migrant at the center of the solution.

With a presence in five countries, over 100 global partners including government agencies, a working global wallet and a scalable business model, LALA World is creating a social business that makes it profitable to reinvest into the social ecosystem. www.lalaworld.io

ABOUT THE AUTHOR LALA World CEO and Founder Sankalp Shangari’s personal experience as a migrant student in the UK – where he was pursuing Masters in Finance

Credible Team, Clear Strategy

We have a team of passionate bankers, blockchain experts and technologists, as well as an advisory board that includes Ari Paul and Richard Rofe. We also have partnerships with Bestinet, Blocksocial, Cambridge 36 | JUMPSTART SEPT/OCT 2018

degree from the CASS Business School – inspired him to tackle the problems faced by migrants, such as difficulties in cross-border remittances.

Coupled with his work experience at Macquarie, Deutsche Bank and JP Morgan Chase in London and Singapore and his passion for Blockchain technology, Sankalp seeks to use technology to make a social difference.

FEATURE

BITMEX CEO ARTHUR HAYES IS NOT A BIG FAN OF ICOS

By Nayantara Bhat

S

EYCHELLES-BASED cryptocurrency derivatives trading platform BitMEX made headlines in June for recording over 1 million Bitcoins traded in the space of 24 hours.

Now, trading volumes on the platform are regularly crossing US$4 billion per day.

CEO Arthur Hayes runs the company alongside CTO Samuel Reed and CSO Ben Delo. The three Co-founders set up Bitcoin Mercantile Exchange – or BitMEX for short – in 2014 and they aim to make it the largest exchange in the world by trading volume.

BitMEX differentiates itself from competitors by trading exclusively in financial contracts (as opposed to trading coins) and only handling Bitcoin.

Hayes’ predictions for the Bitcoin price have been widely quoted: he foresees a further fall in price before a sustained rise, which may continue to the point where one Bitcoin could cost US$50,000. “I think this rally is a dead cat bounce,” Hayes says. “I am not convinced traders have experienced enough pain until we test US$5,000.”

Since BitMEX doesn’t allow the participation of US-based individuals, it’s likely that much of the staggering trade volume on the platform was driven by Asian investors.

“In many Asian countries, retail investors have very limited choices for where to invest their money,” Hayes says, listing expensive property and domestic equity as examples. “The advent of 24/7 trading, and the ability to trade using small amounts of capital appeals to the Asian retail investor.”

Interestingly, BitMEX has not held an ICO. Hayes takes ICOs with a healthy dose of skepticism, and argues that they are essentially a new form of private placement – a settingaside of shares for private investors – which poses some risks when it comes to exiting.

“The VCs structuring these deals are in for a world of hurt, as they will be unable to find a greater fool to unload their bags onto,” he says, adding that ICOs participants are the same group of High Net Worth Individuals and hedge funds, which could result in markets crashing if investors rush to exit all at once. His advice to Founders planning to hold an ICO is – do it fast.

“It is very rare that you can raise enormous sums of non-dilutive capital with such flimsy fundamentals,” he says. “Don’t miss your chance.” www.bitmex.com

ABOUT ARTHUR HAYES After obtaining his BA in Economics from the Wharton School of Business at the University of Pennsylvania in 2008, Arthur Hayes moved to Hong Kong where he worked as an equity derivatives trader for Deutsche Bank and Citigroup for 5 years. Arthur was the head ETF market maker at both firms. Formed in January 2014, BitMEX is a P2P crypto-coin trading platform that gives retail investors access to the global financial markets using cryptocoin products.

ICOs participants are the same group of High Net Worth Individuals and hedge funds, which could result in markets crashing if investors rush to exit all at once

Issue 23 | 37

FEATURE

GAME ON CAN GAMING PROVIDE THE PUSH BLOCKCHAIN NEEDS?

By Matej Michalko Decent Founder & CEO

W

HILE CRYPTOCURRENCIES like Bitcoin and Ethereum have dominated media headlines in the past couple of years, the lack of a ‘killer app’ has so far prevented a blockchain-based platform from permeating consumers’ lives.

All this talk about cryptocurrencies certainly has played a vital role in bringing the concept of decentralized tech into the mainstream. But such currencies are far from replacing traditional fiat instruments – after all, it’s not very practical to buy your morning coffee with Bitcoin just yet.

At the moment, blockchain lacks a product akin to how smartphones and e-commerce helped catalyze the near-ubiquitous use of the Internet today. But this elusive product may be hiding in plain sight: consumer gaming.

This industry is a natural fit for virtual coins, tokens, and other digital methods of storage and transaction. Gamers typically earn virtual rewards for completing tasks or emerging victorious. Such rewards – in the form of in-app currencies – can be used to level up the battlefield, build fortifications, or even exchange for real-world cash.

By some estimates, the global gaming industry is expected to grow to US$180.1 billion by 2021. Mobile games will account for US$106.4 billion 38 | JUMPSTART SEPT/OCT 2018

of that pie, or approximately 59 percent, and mobile is not eating away at the share of PC, handheld, or console gaming – all three have posted healthy year-on-year growth.

The gaming industry is taken very seriously in Southeast Asia, which is host to 9.5 million eSports enthusiasts – not including the vast Chinese market. The size of the industry globally was estimated to be US$655 million in 2017, a figure that grew 102 percent from 2015.

China’s dominance in eSports and mobile gaming, exemplified by Tencent’s bold forays in the sector, are expected to drive further growth. In fact, Tencent’s increasing propensity to invest outside of China and its partnerships with players like Garena will undoubtedly result in further mainstreaming of virtual gaming currencies.

FEATURE

So how does Blockchain fit into all this?

The first, and obvious point of reference is that most avid gamers and eSport enthusiasts are between the ages of 21 and 35. They’re early adopters of all things tech, and if blockchainpowered solutions can make it easier to trade with each other, then it’s a relative no-brainer.

Some early players, such as FirstBlood – an Ethereum-based decentralized eSports platform – are testing the waters. Users can set up and bet on games without needing a bank account or credit card, removing barriers to entry and bringing into play the 438 million unbanked individuals in Southeast Asia alone.

Interoperability is another area blockchain startups can target. At the moment, virtual currencies in games operate in silos. You might be able to trade with another registered gamer or spend for in-game upgrades, but that’s about it.

Coins are restricted to the publisher that created them – without an immutable, decentralized intermediary it’s impossible for a single currency to emerge that could potentially be used across an entire industry.

Singapore-headquartered Enjin is a startup that focuses on ownership and trading of virtual goods, a market that was estimated to be worth nearly US$50 billion globally in 2015. If done right, this could very well spawn a robust community that combines gaming and cryptocurrencies – with the net result of complementary industries such as hardware manufacturers and live-streaming platforms latching on.

The use of blockchain makes even more sense when you think about the potential payouts for each gamer, on a daily or weekly basis. While eSports is a niche area and payouts are large, there’s only a trickle of events each year and rewards are top-heavy. For gaming to be considered a ‘killer app’, it has to be ubiquitous.

Ordinary gamers don’t practice and train the way eSports practitioners do; they’ll play during the morning commute to the office, in short spurts during lunch hour, or even while answering the call of nature. If rewards for winning games were paid out in fiat currencies, then banking fees and slow rates of transfer would simply kill all incentive due to their relatively miniscule amounts. But a blockchain-powered system would eliminate these inefficiencies by providing real-time settlement with negligible cost.

Building this vision requires an ecosystem. That’s not something done overnight or in the absence of trust. But the opportunities are vast and real.

If Cryptokitties can almost choke the Ethereum network, this means there’s already plenty of interest for decentralized collectibles.

ALAX is a blockchain mobile game distribution platform

ABOUT THE AUTHOR

that is a joint venture between my blockchain technology

Matej Michalko is the Founder and CEO of Decent

business Decent and app/game distribution platform

and a blockchain pioneer with over 7 years of Bitcoin,

Dragonfly that aims to provide a platform for content

blockchain and cryptocurrency experience. Matej

creators and gamers, including unbanked consumers

organized China’s first international Bitcoin conference

worldwide. The ALAX partnerships means Decent’s

and also founded and led many Bitcoin, blockchain

proprietary blockchain technology will be rolled out

and cryptocurrency conferences such as Bitcoin Expo,

immediately to Dragonfly’s 100+ million active users.

Central European Bitcoin Expo, and BTC2B Congress.

www.decent.ch

Matej founded the world’s first Bitcoin marketing

www.alax.io

agency, as well as the first cryptocurrency e-gaming consulting firm.

Issue 23 | 39

FEATURE

CAPSL CHOOSES ICO ROUTE TO FUND AR/VR FUTURE OF ESPORTS

By Jett Li

L

IKE MANY budding entrepreneurs and experienced Founders who use Initial Coin Offerings (ICOs) and cryptocurrency to power their companies and projects, former Zynga China Executive Producer Paddy Markham started CAPSL Entertainment in 2016. CAPSL is a gaming and eSports company that aims to provide a platform for fans to enjoy the experience through the use of Virtual/Augmented Reality (VR/AR) technology.

Markham chose to base CAPSL in Hong Kong due to it being ‘the heart and soul of the games industry’, as well as a premier location for budding entrepreneurs due to its large startup community.

Most Founders would immediately begin development and marketing in order to get their company out there as soon as possible, and to do so they would require funding or investments. This is where CAPSL differs. While Markham did consider traditional crowdfunding methods such as IPOs, he also recognized the potential and versatility of ICOs.

To Markham, the ICO is not just a way of fundraising, it is also a way of distributing tokens to users who will use them on CAPSL’s platform. Through these token sales, it will be possible for CAPSL to achieve its goals: allow users to connect to and view eSports in a way they were unable to previously, increase game studio growth, and help amateur competitive gamers to establish their careers.

The long-term goal of CAPSL is to introduce VR/AR technology to eSports.

“VR is still a nascent market in terms of adoption,” Markham says. “However, a combination of home VR experiences and location-based experiences (LBEs) such as VR Arcades are set to change what consumers expect from immersive play. That obviously translates to competitive play, and we see the rise of a new generation of VR eSports stemming from that.”

By 2020, CAPSL expects there to be around five new VR-based eSports set up, and a healthy community surrounding each one. In order to achieve this, CAPSL plans to do three things with its platform: ensure that players will not be scammed and are able to securely monetize their gaming skills through smart contracts and blockchain technology, actively protect players through a decentralized player ID with complete ownership and control over it, and ensure that all virtual goods on the platform are minted with CAPSL’s tokens.

Currently, CAPSL is working on securing partners and launching the beta version of the platform. In the near future, you can anticipate the rise of an entire VR eSports industry – with CAPSL leading the crowd. www.capsl.cc

ABOUT PADDY MARKHAM With 18 years’ product experience and having led Zynga’s Chinabased mobile studio of 50+

New Reality 40 | JUMPSTART SEPT/OCT 2018

people, overseeing six globally recognized game titles – including Zynga’s first mid-core mobile title, War of the Fallen – Paddy started CAPSL Entertainment in 2016 with the vision to ignite the next generation of e-sports heroes. CAPSL is launching a revolutionary competitive gaming platform, merging eSports with blockchain-powered tournaments in AR & VR.

EVENTS | PREVIEW

DEEP TECH SUMMIT SLUSH SINGAPORE September 14 Zepp@Bigbox Singapore Slush is a global series of startup events where entrepreneurs and tech talent connect with renowned investors, executives, and media from around the world. The events are organised in Helsinki, Tokyo, Shanghai, and Singapore. Slush is all about celebrating technology and entrepreneurship in the form of a festival and a conference. This year’s speakers in Singapore include Antler Founder & CEO Magnus Grimeland, TenX Cofounder & President Julian Hosp, and Golden Gate Ventures Co-founder Paul Bragiel. Last year, Slush Singapore gathered 3,000 attendees, 360 startups, 250 investors, 300 volunteers and 90 speakers. singapore.slush.org

September 18 Marina Bay Sands Expo and Convention Center, Singapore This full-day conference connects thought-leaders and industry practitioners specialising in areas such as artificial intelligence, blockchain, MedTech, and venture building. Presented by SGInnovate – a private company that backs deeply technical founders – Deep Tech Summit 2018 will cover themes including AI across industries, future of work and talent development, blockchain beyond FinTech, venture building and deep tech investments, medtech innovation, and technology and society. deeptechsummit.com

TECH IN ASIA TOKYO September 20-21 Shibuya Hikarie

OPEN FUTURE FESTIVAL HK September 15 PMQ/Qube, Hong Kong Hosted by The Economist, Open Future Festival is a livestreamed event taking place simultaneously in Hong Kong, London and New York. The festival will explore the most urgent issues of our time, including the future of freedom, individual rights, trade and technology. Participants will be able to engage in lively talks, interactive exhibitions, immersive experiences, debates and networking. The Economist’s editor-in-chief, Zanny Minton Beddoes, will publish an essay on the future of liberalism in September to coincide with the festival. www.economist.com

Japan’s startup scene is maturing and its technology has been widely lauded as innovative and dynamic, but much remains to be learned about this unique and burgeoning ecosystem.

Attendees will hear fresh and updated insights on the latest tech, especially AI, blockchain, hardware and FinTech. It is also a great opportunity to build quality connections with over 2,000 startups, investors, developers, and the wider tech community. It will feature prominent speakers from LAUNCH, Reddit, Salesforce, BuzzFeed Japan, Bukalapak, and more. www.techinasia.com/events/tokyo

HKTDC STARTUP ZONE October 13-16 Hong Kong Convention and Exhibition Center As a focal point of the HKTDC Hong Kong Electronics Fair (Autumn Edition) 2018, the Startup Zone covers topics including smart home, wearable electronics, 3D printing, IoT devices, and more. It will feature a series of events such as startup pitching, seminars, entrepreneur’s sharing, and product launch. Last year, the fair attracted 3,710 exhibitors, and 60,000 buyers from 139 countries and regions. Be sure to visit the Jumpstart Pavilion! www.hktdc.com 42 | JUMPSTART SEPT/OCT 2018

@ GITEX TECHNOLOGY WEEK October 14-18 Dubai World Trade Center

EVENTS | REVIEW

GITEX FUTURE STARS

The 38th GITEX Technology Week includes the Oct 14-17 Future Stars startup event that boasts 18 different sectors, hundreds of influential investors and pitch competitions of an incredible scale. New startup sectors this year include AgroTech, Social Impact, Blockchain, Artificial Intelligence, and SportsTech, in keeping with recent trends in the industry. Last year, over 250 investors attended the show – combined with the explosive pitching competitions, there were numerous opportunities for startups to engage with venture capitalists and big-name investors from all over the world. www.gitexfuturestars.com www.gitex.com

Issue 23 | 43

EVENTS | PREVIEW

FINTECH WEEK October 29-November 2 Hong Kong/Shenzhen

GLOBAL SOURCES STARTUP LAUNCHPAD October 18-24 AsiaWorld Expo, Hong Kong Held during the Global Sources Mobile Electronics fair, October’s Startup Launchpad will focus on The Future Of Retail Conference that revolves around two main topics: Investment in retail tech, as well as Emerging retail technologies and their real-world applications. Over 50 pioneering retailers, investors and startups will be invited and exchange knowledge about how to navigate the future of retail. launchpadhk.com

This cross-border financial technology event takes place in Hong Kong, Asia’s financial capital, and in Shenzhen, China’s Silicon Valley. It has attracted more than 8,000 senior executives and featured over 200 of the world’s top FinTech founders, investors, regulators, and academics. This year, FinTech Week will cover topics such as artificial intelligence, online banks, blockchain and distributed ledger technology, and FinTech in China. www.fintechweek.hk

ECO EXPO ASIA October 25-28 AsiaWorld Expo, Hong Kong

MONEY20/20 CHINA November 14-16 Hangzhou International Expo Center A leading trade fair for the environmental protection industry, the 13th edition of Eco Expo Asia a returns with a fresh new theme – “Waste Less Save More for a Low-carbon Future”, to echo with the Municipal Solid Waste Charging Scheme rolling out in 2019. It is jointly organised by Messe Frankfurt (HK) and HKTDC, with the aim to increase awareness of current pressing environmental issues and also to facilitate the exchange of technology and solutions from around the world. ecoexpoasia.hktdc.com 44 | JUMPSTART SEPT/OCT 2018

Hangzhou Money20/20 China – the latest edition in the Money20/20 global portfolio – represents the largest FinTech investment market in the world. Companies from China and international markets will have an unparalleled opportunity to acquire necessary information about what makes China’s FinTech industry so progressive. It aims at creating a platform for Chinese and international delegates to connect, inspire each other, and explore business opportunities. www.money2020.com

Issue 23 | 45

JUMPSTART KIDS

Summer 2018

This year, I was excited to offer the kids the experience to see what different startups and entrepreneurs do and to do it in a fun way. I liked seeing the kids actively participate and learn something new. We had amazing partners who were able to offer the kids food, transportation, and unique activities such as beatboxing and VR and see how it related to entrepreneurship.

Managing Director

James Kwan I’m very happy that we had the opportunity to offer this special experience. It is one I wish existed when I was younger – to see and learn what various businesses and entrepreneurs do. It was very exciting to see the kids look on in amazement at how these things related to entrepreneurship, as well as how entrepreneurship can impact their lives and the possibilities open to them.

Director of Operations and Strategic Partnerships

Anita Chan Jumpstart Kids is a week-long summer program for Kidtrepreneurs age 8 to 12 that helps them harness their inner entrepreneur through a non-traditional and hands-on curriculum.

This year, two sessions were hosted in Hong Kong featuring 18 startups – the first in English, the second in Cantonese.

Throughout both weeks, the startups led creative workshops to introduce the much-needed skills to start successful businesses, with topics ranging from design-thinking, financial wellness, and coding to robotics. The kids were encouraged to tackle creative challenges, push-forth their innovation and enhance their collaborative skills, all in the most unconventional and fun way possible. Jumpstart Kids is a fun program designed to inspire today’s children for the future, and all profits generated were donated to charity. www.jumpstartkids.hk 46 | JUMPSTART SEPT/OCT 2018

Thank you everyone who helped and contributed to this meaningful initiative! I strongly believe that children are instinctively creative and curious. With Jumpstart Kids, we provide them with a platform where they can learn and have fun in a laughter-filled environment! Every student is a winner – we couldn’t be more proud!

Associate Director of Content Development

Chloe Wong

FEATURE

Special Thanks kelly yang

the

project

Abtitu

Brave Soldier Venture Capital

BSD Academy

Clean the World

EONIQ

Gaifong

HelloToby

The Kelly Yang Project

The Wave

Mochy Kid

MinorMynas

Move It

Mr. Reply

Next Chapter

Origami Labs

Planto

PlayZmith

Plum

Pokeguide

Sam Experiences

SAMV

Spaces

SPCA

Uber Issue 23 | 47

EVENTS | REVIEW TECHSAUCE GLOBAL SUMMIT June 22-23 Centara Grand At Central World, Bangkok Over 10,000 attendees, 200 speakers, 200 investors and 100 volunteers from across 30+ countries were involved in the third edition of Techsauce Global Summit. This years’ event wrapped up being the biggest yet, and drew a high level of female participation. Speaking about the event, Techsauce Co-founder Oranuch Lerdsuwankij says: “This year’s event was amazing; it featured speakers that Techsauce has never seen before. Attendees have doubled, we have more International speakers from larger companies and the audience is increasingly corporate in nature. This was also the first year we discussed food, agriculture and healthcare and we also dedicated two stages to blockchain and energy.” summit.techsauce.co

JUMPSTART JULY/AUG ISSUE RELEASE PARTY

July 25 Spaces Lee Garden Three, Hong Kong To celebrate the release of our July/Aug TravelTech issue, we organized a great party that included a fireside chat with Rebecca Leung from KKday and Maggie Lau from Sam Experiences discussing their interesting journeys and how their companies are transforming the travel industry. Our guests enjoyed the delicious and healthy food provided by Knead, Portuguese red wine from Red Mountain, and 12Noon’s coldpressed juices and cocktails. www.jumpstartmag.com

RISE HONG KONG July 9-12 Hong Kong Convention and Exhibition Center The fourth RISE event held in Hong Kong welcomed 15,774 attendees from 102 countries and more than 700 startups, as well as attendees, speakers, investors, media from around the world and major companies such as Google, Amazon, Microsoft, Mercedes-Benz, IBM, Cisco, and Huawei. The speakers included former NBA player Metta World Peace, Ethereum Co-founder Joseph Lubin, ZhenFund CEO & Partner Anna Fang, Tinder Founder Sean Rad, Grab Co-founder Tan Hooi Ling, LINE Corp CEO Takeshi Idezawa, Hong Kong Chief Executive Carrie Lam, Mercedes-Benz Cars Chairman of the Board Dieter Zetsche, Sophia the Robot, and hundreds more.

Next year’s RISE Hong Kong will take place July 8-11. www.riseconf.com 48 | JUMPSTART SEPT/OCT 2018

BETATRON DEMO DAY August 2 Hong Kong Stock Exchange Betatron held its Demo Day for the 10 startups in Cohort 3 at the Hong Kong Stock Exchange, with a total of 675 people registering for the event. Each startup delivered a five-minute pitch showcasing their business and the traction they’ve been generating. The startups received a US$30,000 investment and were guided through an intensive four-month period to refine their business model and fast-track them, grow, scale and raise their first institutional funding round. The startups also got free office space in the Betatron Lab at naked Hub. www.betatron.co

FEATURE Issue 23 | 49

#gitexfuturestars

WHEN

WHERE

Dubai 14-17 October World Trade 2018 Centre

The fastest growing startup event in MENA & South Asia Young and thriving startup community? Check. A booming tech-buying base fueled by the region’s #1 tech event, GITEX Tech Week, happening next door? Check.

A future-driven, innovator-friendly region? CHECK. This is where the world’s most imaginative ideas are seen live in action, where technologies like blockchain and AI go beyond being buzzwords to become business realities, and where industries evolve in real-time.

Believe it, live it at GITEX Future Stars 2018.

Check Out Global & Mena Startups From 50+ Countries across 19 Tech Sectors

Blockchain

Digital & Social Media

Mobility

Immersive Tech

Education

Environmental & Social Impact

Healthcare

REGISTER TO VISIT

www.gitexfuturestars.com

Agro-Tech

Robotics

Artificial Intelligence (AI)

Software

Consumer Tech

Space Tech

Tourism & Hospitality

Sports Tech

Creative Economy

Women in Tech

Fintech & Ecommerce

Smart Cities & IoT

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