Are fintech and online businesses better businesses?

[syed putra]

Grab gonna dump me?

 

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Singapore’s Sea said to eye sale of Phoenix Labs to cut costs​

Sea is scaling back its overseas footprint and peripheral businesses amid rising competition and investor skepticism. PHOTO: SEA LIMITED

Jan 26, 2023

SINGAPORE - Sea Ltd is considering the sale of Vancouver-based indie developer Phoenix Labs as the South-east Asian internet giant slashes costs and focuses on its core business, according to people familiar with the matter.
The Singapore-based gaming and e-commerce company is working with an adviser on the potential divestment, the people said, asking not to be named as the information is private. The sale process hasn’t formally started and investor interest has been muted so far, said the people.
Sea, the company behind the popular Free Fire battle royale game, acquired Phoenix Labs about three years ago in a deal that valued the game developer at more than US$150 million (S$197 million). Talks are preliminary and there is no guarantee that Sea will be able to sell the studio for more than it paid, the people added.
The tech giant is now scaling back its overseas footprint and peripheral businesses as rising competition and investor skepticism force the company to focus on profitability, rather than on expanding abroad. In January, Sea’s e-commerce unit Shopee pulled out of Poland, completing its full retreat from Europe.
The company faces increasing pressure to cut costs, with growth in its e-commerce and gaming business slowing after a pandemic-era high. Consumers are pulling back on spending online, as rising interest rates and prices weigh on the economy.
Sea has lost more than US$160 billion of its market value since October 2021 on questions about its money-making prospects.
Last month, Sea founder Forrest Li announced it was freezing salaries for most staff and paying out lower bonuses, bracing for a worsening global economic environment in 2023. That followed deep job cuts in 2022. BLOOMBERG

 

[syed putra]

Onlone businesses are just A hype to attract investors on the tail of google, facebook, Amazon, Alibaba and tencent.

 

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Revenue at Shopee parent Sea may have stalled in Q4​

Shopee is the e-commerce arm of Sea, which will post its fourth-quarter results on Tuesday in the US. PHOTO:REUTERS

Mar 7, 2023

SINGAPORE – Revenue growth at Sea Limited is set to grind to a halt, a dramatic reversal of the triple-digit percentages that once made the gaming and e-commerce giant a symbol of South-east Asia’s Internet boom.
The company is likely to post a 5.8 per cent year-on-year decline in sales for its fourth quarter when it reveals results on Tuesday, based on the average of analysts’ estimates. This would be the first decline on record and reflects a retreat from markets in India, Latin America and Europe, as well as a salary freeze and other austerity measures to drive profitability over market share growth.
Even if Sea squeezes out a surprise revenue gain, it is a painful turnabout for the company, the largest of South-east Asia’s Internet firms and briefly the world’s best-performing stock. Investors two years ago piled into the company, which was backed by Chinese Internet giant Tencent Holdings and riding high on a pandemic-era boom in online use. Then came a post-Covid-19 hangover of rising inflation and worries of a recession that wiped out about US$166 billion (S$223.3 billion) of its value since a peak of US$202.6 billion in October 2021.
Maybank economist Lee Ju Ye said interest rates “will likely stay higher for longer as inflationary pressures persist, creating a challenging year for the Internet sector” in South-east Asia.
Sea investors may not be overly concerned for now about rapidly dissipating growth, and may instead focus on the bottom line on Tuesday. Sea has consistently shrunk losses in recent quarters by undertaking brutal measures, including cutting thousands of jobs and freezing salaries pretty much across the board.
But the revenue decline is emblematic of how investors’ love affair with the region’s Internet firms is cooling rapidly. This decline was encapsulated last year by the collapse of Zilingo, alongside the stunning share sell-offs that engulfed Sea’s peers from Grab Holdings to GoTo Group.
For now, investors will be gauging how well Sea’s units Garena and Shopee rein in costs. But in the longer term, they will want to hear solid plans to recapture some of the heady growth that made Sea a stock market darling in years past.

Bloomberg Intelligence analyst Nathan Naidu said: “The Shopee arm’s market leadership and scale should draw more merchants into higher-margin, transaction-based services, helping raise take rates and e-commerce revenue. These, along with lower staff costs amid job cuts and promotional spending, could reduce Sea’s fourth-quarter net loss to about US$400 million versus fourth-quarter 2021’s US$484.8 million loss.”
Among Sea’s efforts to curb costs is a potential disposal of Garena’s Phoenix Labs unit. Acquired for more than US$150 million in 2020, the Vancouver-based indie developer of monster hunting title Dauntless is getting bought out by its management, GamesBeat reported. A representative of Phoenix Labs, when contacted for comment, said the company does not have any more information to share beyond what has been reported. BLOOMBERG

 

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Some sellers on Qoo10 unable to withdraw earnings from platform​

Sellers on Qoo10 said they are still able to click “withdraw” on their account now, but the funds have yet to be reflected in their bank accounts. ST PHOTO: KUA CHEE SIONG

Fatimah Mujibah

MAR 11, 2023

SINGAPORE - Some sellers on e-commerce platform Qoo10 have not been able to withdraw their earnings since as far back as a month ago, The Straits Times has learnt.
Mr Jeffrey Quek, who sells construction and household items on Qoo10, said he has more than $12,000 in earnings stuck with the platform since Feb 1.
“This is the longest I have waited for the sum to be reflected in my bank account, and it is quite a big amount,” said the 27-year-old, who last made a successful withdrawal on Jan 25.
Founded in 2010, Qoo10 is run by South Korean e-tailer Giosis Group, in partnership with e-Bay. It offers a variety of products, with notable brands such as SK-II, Coach and Kate Spade.
Earnings on the platform are released into the sellers’ accounts every Wednesday after the platform takes a cut of 10 per cent to 12 per cent.
Sellers can manually request withdrawals of their earnings, and the money is typically transferred to the sellers’ bank accounts within two business days, sellers tell ST.
The sellers said they are still able to click “withdraw” on their account, but the funds are yet to be reflected in their bank accounts.

Mr Quek has sent seven e-mails to Qoo10, and was initially given specific dates by when the money would be reflected in his bank account, with the delay explained as due to a “technical issue”. He has been selling on Qoo10 since 2017 and said this is the first time he has experienced this issue.

Mr Jeffrey Quek’s transaction history on Qoo10 wallet. He has over $12,000 worth of earnings tied up on the platform. PHOTO: JEFFREY QUEK
Another seller, who wanted to be known only as Ms Shan, said she has almost $8,000 tied up in her Qoo10 wallet since Feb 28.
Ms Shan, who has been selling beauty products and household items on the platform since 2011, also experienced a payment delay in January. That month, Qoo10 updated her regularly and attributed the delay to a technical issue.


The 39-year-old received her payment a week later.
When she did not receive her earnings after making a withdrawal request on Feb 28, she contacted Qoo10 via its hotline and e-mail, but was also told that it was because of a technical issue.
“This is my full-time job, and Qoo10 is not providing any proper updates or reasons for the delay. People like me became sellers on this platform as we thought it was a credible platform,” she said.
“It is very frustrating to not receive funds for your items sold, when customers have already received them.”

Ms Shan’s transaction history in Qoo10’s wallet, where she has manually withdrawn the funds but has yet to receive it in her bank account. PHOTO: SHAN
The Straits Times also spoke to two other sellers who have not received their money since the start of this year, and has seen the amounts in their Qoo10 wallets and their correspondence with the platform.
Mr Quek said some of the sellers who have yet to receive their funds have created a group chat to update one another if anyone gets a response from the platform. There are currently nine people in the group, with some waiting for around $3,000 to $4,000 each to be deposited.
In response to ST’s queries, Qoo10 said: “Technical issues causing transfer delays began recently as a result of global expansion and transformation towards creating a Pan-Asia marketplace.
“Part of the transformation involves the integration of payment systems among the company’s group of cross-border partners.”
The firm added that it is working to resume normal operations.
Ms Shan said: “I just want a proper explanation... and I want my hard-earned money back. We sellers have waited long enough, and the uncertainty of not receiving our money is affecting our business too.”

 

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Sea’s path to profit paved with layoffs, single-ply toilet paper​

Under founder and chief executive Forrest Li, Sea in March reported the first quarterly profit in its 14-year history. PHOTO: BT FILE


MAY 15, 2023


SINGAPORE – Just over a year ago, Mr Forrest Li was laid up in bed with Covid-19, fretting about the future of his company, Sea. So he propped himself up on a pillow to hammer out the latest in a series of memos that would change the course of his business – and perhaps the tech industry.
Sea had been a stock market phenomenon, racing to a market capitalisation of more than US$200 billion (S$267 billion) despite huge losses, but the world had changed. Investors had turned against money-losing technology companies. So Sea had to change with it, Mr Li wrote. With a burning fever and nagging cough, the founder and chief executive of the company told his leadership team that it was time to focus on profit and exit India.
That memo kicked off a sweeping overhaul of Sea over the next few months. The company laid off roughly more than 7,500 employees, or about 10 per cent of its workforce, although Sea declined to disclose the actual numbers. It froze pay. Mr Li and his leadership team gave up their salaries altogether.
Business-class flights were banned; everyone would fly economy, no matter how far. Daily meal expenses were capped at US$30, hotels at US$150 a night. Snacks disappeared from offices. Sea replaced the local luxury tea brand TWG with Lipton. In at least some restrooms, two-ply toilet paper gave way to one-ply.
“We cared about every single dollar, every single cent,” Mr Li said at his office in Singapore, his first interview in more than two years. “You can have a big dream and a big ambition, but what if you cannot survive? You always have this kind of noise back in your mind saying we may be running out of money.”
Mr Li’s shock treatment paid off. In March, Sea reported the first quarterly profit in its 14-year history, US$427 million in net income based on GAAP (generally accepted accounting principles). Its stock soared 22 per cent. Last week, it said it would hand out 5 per cent pay rises to most employees. Sea has now more than doubled its market value since November.
Like so many tech start-ups of its generation, Sea had bled red ink for years. In fact, it had lost more than US$8 billion since its founding to pay for growth in its e-commerce, games and finance operations. For now at least, Sea is setting a different kind of example: It is demonstrating that if your underlying business is sound and substantial, you can pull back on subsidies and expansions to break even.

This is proving a challenge for rivals. Among Sea’s regional competitors, Singapore’s Grab Holdings is still losing more than US$300 million a quarter, while Indonesia’s GoTo Group’s losses exceed US$250 million. Sea may also cause trouble for global tech giants like Alibaba Group Holding and Amazon.com, which are both seeking growth in emerging markets.
“What you are seeing is a separation of proper, monetisable business models from something that is a work in progress,” said Mr Amit Kunal, managing partner of Growtheum Capital, a private equity firm in Singapore, speaking broadly about the tech industry. “Sea read the market much earlier, took appropriate steps – and delivered.”
Mr Li had a premonition that trouble was coming. Back in November 2021, he hosted his leadership team at his Singapore home for dinner to mark his 44th birthday.

They had much to celebrate. Sea’s shares had surged to a record in October, giving the firm a valuation of more than US$200 billion, aided by a pandemic-induced boom for its online gaming unit Garena and e-commerce business Shopee. At one point in 2020, Sea was the best-performing stock in the world.
But even at the dinner, Mr Li saw ominous signs. He noticed that on Free Fire, the company’s popular multiplayer mobile game with 150 million daily users, people were beginning to spend less time and money as Covid-19 restrictions eased. The celebration turned into a debate about how the world would change after the pandemic.
Then in February 2022, India abruptly banned Free Fire, along with dozens of Chinese apps, amid rising tensions between the two countries. While Mr Li is a Singapore citizen and has based his company here, he is originally from north-eastern China and Tencent Holdings is a major shareholder. It was a huge setback in a key growth market.

In March 2022, when Mr Li talked during a quarterly earnings call about plans to still pursue growth, investors dumped Sea shares. The firm lost more than 45 per cent of its market value in five days. For Mr Li, it was a wake-up call that things were worse than he had thought. That was when he wrote the sombre memo to his team from his sickbed.
Mr Li and his senior team went into crisis mode. They began huddling every month to discuss cash flow projections, along with their regular weekly meetings. They spun through 200 different versions of financial forecasts in 2022, Mr Li said in the interview, akin to rewriting the budget every two days.
In addition to layoffs and salary freezes, Sea pulled out of Europe and most countries in Latin America.
The fallout was traumatic for some. In August, a Chinese engineer posted on his WeChat account that Shopee had rescinded his job offer – just after he landed at Singapore’s airport with his wife and dog. Amid a storm of negative publicity, Shopee apologised and compensated him for his losses.
Employees resorted to taking money out of their own pockets to organise team events to boost morale, according to one employee, who asked not to be named as they are not authorised to speak publicly. Another described the gruelling period as “cockroach times”.
Mr Li leaned on internal memos during the crisis to communicate with employees and explain what he was trying to accomplish. In an all-staff memo in September, he said top management would forgo any cash compensation until the company reached “self-sufficiency”.
“We can now see that this is not a quickly passing storm,” he wrote in a 1,000-word missive at the time. “With investors fleeing for ‘safe haven’ investments, we do not anticipate being able to raise funds in the market.”
At one point, Sea was proud that it could offer employees the fanciest tea in Singapore, among perks commensurate with the tech giants of Silicon Valley, Mr Li said in the interview. Now, he wants to break that mindset: Sea has to compete on cost with the likes of Amazon, where early employees famously forged desks out of Home Depot doors because they were cheaper.
“We are going to continually push down the costs,” he said. “It is not just for saving but for running the business more efficiently. This is going to be the long-term mode for us.”
While Mr Li acknowledged that the road has been difficult, he said he has no doubt that Sea can reach break-even. He said the company’s path, in many ways, traces the precedents of Amazon and its founder Jeff Bezos.
Amazon consistently lost money during its first years as a public company, with Mr Bezos maintaining that investing in growth was more important than quarterly earnings. Similarly, Sea built Shopee by burning more than a billion dollars a year before overtaking local e-commerce pioneer Tokopedia in Indonesia and Alibaba’s Lazada in South-east Asia.
Mr Li argued that Sea has a unique opportunity to bring e-commerce to emerging markets, the kinds of places where Amazon may be at a disadvantage. Success in these countries can depend on serving customers who live on remote islands, finding a payment solution where few people have credit cards or delivering parcels where there are no proper roads or postal codes.
“It is probably hard for the Silicon Valley innovator to think about those issues specifically,” he said.

While much of Sea’s expansion is in Asian markets like Indonesia, Mr Li also thinks the company has an advantage in Brazil, where Shopee has had success since launching in 2019. With its 214-million population and decent per-capita income, he thinks the country is Sea’s most promising growth market.
“We spent a lot of money when capital was relatively cheap and available, and it is kind of an almost 10-year effort,” Mr Li said of Brazil.
These days, Mr Li said he is splitting his time between Singapore and California to stay close to the “mind-blowing” artificial intelligence (AI) revolution that is taking place in Silicon Valley. He believes AI will play a big role in replacing much of the repetitive work for Sea’s e-commerce, gaming and fintech businesses. Gaming, in particular, is probably ahead of online shopping in terms of how people use AI to develop and play games by making it more interactive and immersive, he said.
As the interview at Sea’s headquarters wound down, Mr Li was asked whether the company will be able to keep turning a profit every quarter. He cocked his head to the side and, with a laugh, said he cannot reveal too much since Sea is in a quiet period ahead of first-quarter results on Tuesday.
But that is not really the point, he added. The key thing is that Sea has been able to demonstrate for employees and investors that it can reach break-even when it has to. So now, it can calibrate growth and profit depending on strategic priorities.
“The numbers show that the destiny is in our own hands,” he said. “We sleep very well now.”
BLOOMBERG

 

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Grab co-founder Tan Hooi Ling to exit her operational roles​

Grab co-founder Tan Hooi Ling currently leads the company's technology and corporate strategy teams, and previously served as operating chief until 2022. PHOTO: GRAB

May 25, 2023

SINGAPORE – Grab Holdings co-founder Tan Hooi Ling is stepping down from her operational roles by the end of 2023, more than a decade after she helped start the Singapore-based ride-hailing and food delivery company.
Ms Tan, 39, will also give up her seat on the board, although she will remain an adviser to the company, according to an internal memo sent to employees on Thursday and seen by Bloomberg News.
She currently leads Grab’s technology and corporate strategy teams, and previously served as operating chief until 2022.
Her exit leaves chief executive officer Anthony Tan steering the company without his co-founder as it fights to reverse years of losses. Last week, its shares fell the most in more than a year after the company reported slowing spending by customers grappling with a higher rate of inflation and rising interest rates.
The two Tans, who are not related, founded Grab in 2012. Ms Tan then left briefly to work at other companies in the United States before rejoining Grab in April 2015. She led various operations and technology teams, and has also served as a member of Grab’s board since its stock market debut in the US in December 2021.
In the memo to staff, Mr Tan said he wholeheartedly supports his co-founder’s decision to “pursue her personal passions at this time”.
A succession plan has been in place for some time, he added.

Grab is battling intensifying competition in South-east Asia’s ride-hailing and delivery markets, with the contenders luring customers with promotions and lower prices.
Grab has been slower to reduce expenses than regional competitors – as Singapore’s Sea and Indonesia’s GoTo Group eliminated thousands of jobs in 2022, Grab refrained from mass layoffs.
The company has predicted it can reach break-even on an adjusted basis in the last quarter of 2023. While it reported a narrower quarterly loss last week, its customers are spending less on the platform than analysts expected. In the first quarter, its net loss narrowed to US$244 million (S$330 million) from US$423 million a year earlier. BLOOMBERG

 

[k1976]

Grab ish a High Tech Company....please repeat 100x after me


https://i.ebayimg.com/00/s/ODY0WDg2NA==/z/OCEAAOSwm3tkEjDH/$_1.JPG

 

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Grab plans biggest round of job cuts since pandemic: Sources​

The layoffs are set to be announced as soon as this week. PHOTO: LIANHE ZAOBAO FILE

June 20, 2023

SINGAPORE - Grab Holdings is preparing its biggest round of layoffs since the pandemic, as the internet company faces stiffening competition in ride-hailing and meal delivery across South-east Asia.
The reductions are set to be announced as soon as this week and are likely to surpass a 2020 round that shrank staff by 5 per cent, or about 360 employees, according to people familiar with the matter. The final number is under discussion and could fluctuate as conditions change.
While Singapore-based Grab leads South-east Asia’s ride-hailing and delivery markets, it has yet to reach profitability as it spends on growth and competition from rivals such as Indonesia’s GoTo Group weighs on prices. Shares of Grab have slumped about 70 per cent since its stock-market debut in New York in late 2021, even as it has reduced its losses and pledged to report a profit on an adjusted basis by the final quarter of this year.
The cuts suggest Grab is succumbing to investor pressure for faster cost reduction. Grab has been slower to slash expenses than regional competitors. As GoTo and Singapore’s Sea Ltd eliminated thousands of jobs last year, Grab refrained from mass layoffs. It added more than 3,000 staff in 2022, largely because of its acquisition of supermarket chain Jaya Grocer, taking its total headcount north of 11,000.
A Grab spokesman declined to comment.
Grab is also facing potentially slowing growth as customers grapple with a higher rate of inflation and rising interest rates. While the company reported a narrower quarterly loss last month, it said its gross merchandise value grew just 3 per cent in the three months through March. That’s down from 24 per cent for the full-year 2022. User growth also slowed as competitors lured customers with promotions and lower prices.
Grab’s adjusted losses before interest, taxes, depreciation and amortization in the first quarter narrowed to US$66 million (S$88.5 million), and analysts are predicting its losses will continue to shrink. On a net income basis, it is further away from profitability. In the first quarter, its net loss narrowed to US$244 million from US$423 million a year earlier. BLOOMBERG

 

[k1976]

Net profit (or rather, loss) margin was -33%. Lose 33 cents for every $1 earned.
Uber still losing billions every year.
Grab also losing money.
Amazon only became profitable after about a decade.

There is opportunity cost in investing in fintech start-ups and unicorns.
And also risks.
We hear only of the success stories, but not the 90% which failed.
Might as well buy blue chips, enjoy modest but steady capital gains and dividends.
Take profit 10 years later and then buy these fintechs (Sea, Uber, Grab) when they are established and profitable.
The total return may not be worse off than investing in these fintechs from the start.
That is, if you are lucky enough to be able to be among the initial investors.


Shopee parent Sea's sales double as Asian shoppers go online in pandemic

Revenue rose to US$1.6 billion (S$2.12 billion) in the last three months of 2020 from US$777.2 million a year earlier.PHOTO: SEA LIMITED

3 MAR 2021

SINGAPORE (BLOOMBERG) - Sea Ltd expects e-commerce revenue to double in 2021, sustaining its torrid pace of growth as South-east Asia's most valuable company counts on regional online shopping demand to persist after the pandemic.

Revenue rose to US$1.6 billion (S$2.12 billion) in the last three months of 2020 from US$777.2 million a year earlier, Singapore-based Sea said on Tuesday (March 2) in a statement.

Net loss widened to US$523.6 million from US$283.8 million, as fourth-quarter sales and marketing expenses climbed 95 per cent to US$665.2 million, led by digital financial services.

Sea, backed by Tencent Holdings, has emerged as a stock-market sensation since its initial public offering in New York in 2017, as investors bet the company can establish itself as a leader in e-commerce and gaming in South-east Asia. Among companies valued at US$100 billion or more, the stock is the No. 1 performer in Asia since the start of last year and only trails Tesla globally.

It's also trying to establish fintech as a third growth driver. Sea said on Tuesday it's acquired 100 per cent of Composite Capital Management, a Hong Kong-licensed global investment management firm. With the acquisition, the company is establishing Sea Capital, a platform to manage its overall investments.

The pandemic is helping to spur demand at Sea's e-commerce business Shopee, with fourth-quarter sales increasing 178 per cent to US$842.2 million. Sea forecast 2021 revenue at Shopee of US$4.5 billion to US$4.7 billion, up from US$2.2 billion in 2020.

Hit mobile game Free Fire is fueling growth at Sea's digital entertainment service Garena, whose sales last quarter rose 71.6 per cent to US$693.4 million. Sea forecast Garena's annual bookings - sales plus changes in deferred revenue - will increase to US$4.3 billion to US$4.5 billion in 2021.

Its e-wallet service gained traction, with payment volume exceeding US$2.9 billion for the quarter and US$7.8 billion for the full year. Sea is trying to build financial services into its third growth pillar.

For 2020, Sea posted total digital entertainment bookings of US$3.2 billion.

Annual revenue at Garena rose 77.5 per cent to US$2 billion.

Sea's American depositary receipts closed up 1.49 per cent at US$250 in New York on Tuesday.

Yeah, only for the smart brains with good satik business ideas

 

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Singapore's Grab cuts 1,000 jobs, or 11% of workforce​

Grab reported a quarterly loss of US$250 million but said revenue in the first quarter of this year rose 130.3 per cent from a year ago. ST PHOTO: MARK CHEONG

June 20, 2023

SINGAPORE - Singapore-based Grab Holdings, South-east Asia’s leading ride-hailing and food delivery app, is cutting 1,000 jobs or 11 per cent of its workforce, its chief executive officer said on Tuesday, citing the need to manage costs and ensure more affordable services long-term.
In a letter sent to employees late on Tuesday and seen by Reuters, Mr Anthony Tan said the cuts, the biggest since the start of the pandemic, were not “a shortcut to profitability” but a strategic reorganisation to adapt to the business environment.
“Change has never been this fast. Technology such as generative AI (artificial intelligence) is evolving at breakneck speed. The cost of capital has gone up, directly impacting the competitive landscape,” he said in the letter.
“We must combine our scale with nimble execution and cost leadership, so that we can sustainably offer even more affordable services and deepen our penetration of the masses.”
Mr Tan said that even without layoffs, Grab had managed costs and should hit its target for group-adjusted earnings before interest, taxes, depreciation and amortisation break-even in 2023.
The “super app”, founded in 2012, offers deliveries, rides and financial services in eight South-east Asian countries, including Indonesia, Malaysia, the Philippines, Singapore, Thailand and Vietnam.
Its shares were up 4.7 per cent pre-market after Mr Tan’s announcement to staff. The stock had climbed as much as 5.6 per cent pre-market, extending earlier gains on a Bloomberg News report of the cuts.


In May, Grab reported a quarterly loss of US$250 million (S$336 million), but said revenue in the first quarter of 2023 rose 130.3 per cent to US$525 million from a year ago.
In February, it issued an upbeat forecast for full-year revenue for 2023 and brought forward its profitability timeline.
The US-listed Grab’s last job cuts were in 2020, when 360 people were laid off in response to the impact of the pandemic. The company had 11,934 staff as at the end of 2022, including about 2,000 from its acquisition of a grocery chain that year, its latest annual report said.
In September last year, it said it had no plans to undertake mass layoffs despite the weak market.
In December, Mr Tan told staff that the company was freezing most hiring and pay rises for senior managers, as well as cutting travel and expense budgets. REUTERS

 

[syed putra]

Who cares! They made the money when it got listed.
When grab was myteksi in jiu hu, it was profitable. And traditional taxi drivers earned more than normal. Later they got greedy and override those taxi drivers for privately owned cars.

 

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Carousell well-capitalised, with ‘healthy’ narrowing of losses: CEO​

Sharanya Pillai

Sep 22, 2023

SINGAPORE - Online classifieds operator Carousell remains well-funded by its investors, and an initial public offering (IPO) is not the only option to raise capital, said its chief executive Quek Siu Rui on Friday.
“We’re so well-capitalised now that it gives us the ability to stay focused on execution,” he said when asked about the company’s plans for an IPO.
“When the time comes for us to think about capital raises, we will look at all options, IPOs being one of them. But there are also many other capital-raising options,” he added, noting that the company has the support of long-term investors.
Mr Quek was speaking to reporters at the launch of Carousell’s new headquarters at Block 79 in Ayer Rajah Crescent. The company had previously started operations a short distance away at Block 71 in 2012, and later moved to Keppel Towers in Tanjong Pagar, followed by Rochester Park.
Founded by Mr Quek and two of his university friends, Carousell is one of Singapore’s most publicised tech unicorns. It was last valued at US$1.1 billion, while raising US$123.5 million (S$169 million) between 2021 and August this year, according to data platform VentureCap Insights. Its major investors include Norway’s Telenor Group and South Korean Internet company Naver.
An IPO has been on the cards for Carousell, with the company previously said to be in talks to merge with a United States-listed special purpose acquisition company L Catterton Asia Acquisition. But discussions reportedly ended amid macroeconomic uncertainty and valuation concerns.
Carousell is also unprofitable, which adds to the challenge of going public amid weak sentiment. Its revenue grew 66.9 per cent to US$82.5 million in 2022, regulatory filings show. But losses widened to US$63.1 million, from US$41.9 million the previous year.

That said, Mr Quek expects losses to narrow this year. “While we continue to grow our revenue very healthily, we’re also actually seeing a very healthy decline in our losses this year,” he said at Friday’s office launch, declining to share a specific timeline for profitability.
Carousell laid off 110 staff last December, or 10 per cent of its workforce, with Mr Quek admitting then that he was “too optimistic about the pace of our impact versus our increase in investments”.
Its recent acquisitions include second-hand fashion retailer Refash and sneaker marketplace Ox Street. Carousell also teamed up with Temasek unit Heliconia to acquire control of Laku6, which uses artificial intelligence to inspect the condition of second-hand mobile phones.
Mr Quek is now focused on further integrating these acquired units into the company. The new office, called Carousell Campus, includes inspection facilities for mobile phones, sneakers and luxury bags – segments in which the company hopes to grow its footprint.
Acknowledging the challenging economic climate, he said: “We remain cautiously optimistic, and we are also remaining very prudent in terms of how we invest and spend.” THE BUSINESS TIMES

 

[syed putra]

An IPO has been on the cards for Carousell, with the company previously said to be in talks to merge with a United States-listed special purpose acquisition company L Catterton Asia Acquisition.

These SPAC's make the most money

 

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Singapore’s Sea swings back to loss after new rivals take a toll​

Sea had overhauled its business to focus on profitability earlier this year. PHOTO: SEA

Nov 14, 2023

Sea swung back to a loss in the third quarter, hit by flagging consumption and intensifying competition from Alibaba and TikTok on its home turf.
The stock fell 11 per cent in pre-market trading in New York after the company posted a net loss of US$149 million (S$202.8 million), compared with a profit of US$322 million the previous quarter. South-east Asia’s largest internet firm reported a 4.9 per cent rise in sales from a year earlier to US$3.3 billion, versus the average estimate of US$3.2 billion.
The results may stoke concerns that the US-listed company is sacrificing margins to stave off a charge from ByteDance’s TikTok and Alibaba Group Holding’s Lazada, or newer entrants such as PDD Holdings’ Temu. Sea plunged its most on record after founder Forrest Li declared in August his company will invest more in online retail arm Shopee and live-streaming to counter those platforms, which are appealing to younger shoppers.
Till recently, Sea’s strongest markets including Indonesia seemed under siege from TikTok and a new breed of video-oriented shopping services, which used popular influencers to sell a range of wares to an engaged, growing online population. But in September, Jakarta effectively forced TikTok to shut its shopping service, acting on a growing backlash from smaller merchants against the Chinese-owned platform.
Investors have been looking for clues since then on whether that abrupt exit will rekindle Sea. Before Indonesia, the market feared the Singaporean company – which reported more than a decade of losses after its 2009 founding – will sink back into the red. Compounding the situation are expectations that South-east Asia’s internet economy will log its slowest growth on record this year, the result of an economic downturn with uncertain outcomes.
Sea’s other big business, the gaming division centred around Garena, has shrunk rapidly in 2023 given a lack of new blockbuster titles. But it recently restored its marquee title Free Fire to Indian app stores after a surprise 2022 ban.
Mr Li’s company had overhauled its business to focus on profitability earlier this year. Sea embarked on an aggressive cost-cutting drive to reach profit, pivoting to a focus on the bottom-line as revenue growth decelerated from the triple-digit percentage rates it enjoyed as recently as two years ago. The company froze salaries and slashed hundreds of millions of dollars in expenses to achieve positive cash flows.

To jumpstart growth, Mr Li said in August he intends to ramp up investments into e-commerce arm Shopee. He is stepping up efforts to build out its live-streaming arm, an offensive move that could erode margins and trigger a price war with TikTok and Alibaba. He argued that was necessary to defend its market share.
Beyond deep-pocketed competitors Alibaba and ByteDance, local rivals such as GoTo Group are also piling the pressure on Sea. GoTo, owner of Indonesian e-commerce contender Tokopedia, almost doubled its net revenue during the June quarter. BLOOMBERG

 

[LITTLEREDDOT]

Shopee-owner Sea shares plunge after company posts surprise loss of $202.8 million​

Sea's shares sank 22 per cent on Tuesday after the company posted a net loss of US$149 million for the third quarter. PHOTO: SEA

NOV 15, 2023


SINGAPORE – Shopee-owner Sea swung back to a loss in the third quarter, hit by flagging consumption and intensifying competition from Alibaba and TikTok on its home turf.
The US-listed stock sank 22 per cent to US$35.87 per cent on Tuesday after the company posted a net loss of US$149 million (S$202.8 million), compared with a profit of US$322 million the previous quarter.
South-east Asia’s largest Internet firm reported a 4.9 per cent rise in sales from a year earlier to US$3.3 billion, versus the average estimate of US$3.2 billion.
The results may stoke concerns that the Singapore-based company is sacrificing margins to stave off a charge from ByteDance’s TikTok and Alibaba Group Holding’s Lazada, or newer entrants such as PDD Holdings’ Temu.
Sea plunged its most on record after founder Forrest Li declared in August his company will invest more in Shopee and live-streaming to counter those platforms, which are appealing to younger shoppers.
Till recently, Sea’s strongest markets including Indonesia seemed under siege from TikTok and a new breed of video-oriented shopping services, which used popular influencers to sell a range of wares to an engaged, growing online population.
But in September, Jakarta effectively forced TikTok to shut its shopping service, acting on a growing backlash from smaller merchants against the Chinese-owned platform.

Investors have been looking for clues since then on whether that abrupt exit will rekindle Sea.
Before Indonesia, the market feared the Singaporean company – which reported more than a decade of losses after its 2009 founding – will sink back into the red.
Compounding the situation are expectations that South-east Asia’s internet economy will log its slowest growth on record in 2023, the result of an economic downturn with uncertain outcomes.

Sea’s other big business, the gaming division centred around Garena, has shrunk rapidly in 2023 given a lack of new blockbuster titles.
But it recently restored its marquee title Free Fire to Indian app stores after a surprise 2022 ban.
Bloomberg Intelligence analyst Nathan Naidu noted that Sea’s marketing costs surged 12.4 per cent year on year in the third quarter, after declining for a fourth consecutive quarter in the second quarter, versus single-digit growth in gross merchandise value and revenue.
“Top-line growth should speed up in the fourth quarter on incentive and marketing spending to entice shoppers and live streamers, costs that could intensify as it regains lost market share and captures year-end shopping demand.” he said.
Mr Li’s company had overhauled its business to focus on profitability earlier in 2023.
Sea embarked on an aggressive cost-cutting drive to reach profit, pivoting to a focus on the bottom line as revenue growth decelerated from the triple-digit percentage rates it enjoyed as recently as two years ago.
The company froze salaries and slashed hundreds of millions of dollars in expenses to achieve positive cash flows.
To jumpstart growth, Mr Li said in August he intends to ramp up investments into Shopee.
He is stepping up efforts to build out its live-streaming arm, an offensive move that could erode margins and trigger a price war with TikTok and Alibaba. He argued that it was necessary to defend Shopee’s market share.
Beyond deep-pocketed competitors Alibaba and ByteDance, local rivals such as GoTo Group are also piling the pressure on Sea.
GoTo, owner of Indonesian e-commerce contender Tokopedia, almost doubled its net revenue during the June quarter. BLOOMBERG

 

[LITTLEREDDOT]

Temasek-backed Carsome cutting hundreds of jobs to reach profit​

Carsome Group is eliminating positions across South-east Asia, with Indonesia and Thailand the hardest hit. PHOTO: CARSOME MALAYSIA/FACEBOOK

NOV 16, 2023

Carsome Group, which operates a South-east Asian used-car online marketplace, is cutting hundreds of jobs to reduce costs as it works to reach profitability ahead of a potential stock-market listing.
The company is eliminating positions across South-east Asia, with Indonesia and Thailand the hardest hit, people familiar with the matter said. Carsome has scaled down its operations significantly in those two markets, which it entered in 2017, the people said, asking not to be identified as the plans aren’t public. It has about 4,000 employees.
Malaysia’s most valuable technology start-up last year delayed its dual listing plans in Singapore and the US on concerns that deteriorating macroeconomic conditions could dent its valuation. The company expects to break even this year and is set to achieve its first full year of profitability in 2024, chief executive officer Eric Cheng said in July. Carsome is preparing to be ready for an initial public offering, and when there is a window, the company can list quickly, he said at the time.
Carsome “makes adjustments to its workforce where necessary,” the company said in an emailed response to questions, declining to comment on specific numbers. “We remain committed to investing in all of our current markets and plan to accelerate profitable growth in 2024,” it said.
Higher interest rates combined with slowing economic growth and geopolitical tensions have hurt market sentiment and weighed on first-time share sales. Carsome raised US$290 million (S$391.5 million) early last year at a valuation of US$1.7 billion in a series E round led by the Qatar Investment Authority as well as 65 Equity Partners and Seatown Private Capital Master Fund, both of which are backed by Singapore’s Temasek Holdings.
Founded in 2015, Carsome has expanded into Indonesia, Thailand and Singapore. The company works with more than 13,000 dealers and sold more than 150,000 cars last year, according to its website. BLOOMBERG

 

[k1976]

Car ish a Grade AAA asset ONLY in Isle of Paradise mah..tiagong many many cannot sleep well and wet dream every nite

 

[LITTLEREDDOT]

Grab shares plunge after poor outlook clouds first buyback plan​

Grab expects a 14 per cent to 17 per cent rise in sales to US$2.7 billion (S$3.6 billion) to $2.75 billion in 2024, lagging behind the US$2.8 billion projection. PHOTO: REUTERS

FEB 23, 2024

Grab Holdings’ shares slid the most in more than nine months after the ride-hailing leader forecast 2024 revenue below analysts’ estimates, suggesting a deeper-than-anticipated slowdown in its core online business.
The Singapore-based company, which competes with GoTo in mobility and services such as meal delivery, expects a 14 per cent to 17 per cent rise in sales to US$2.7 billion (S$3.6 billion) to $2.75 billion in 2024. That lags behind the US$2.8 billion average analyst projection. The disappointing forecast overshadowed plans to buy back as much as US$500 million of stock and its second straight quarterly profit on an adjusted basis. Its shares fell 8.4 per cent in New York, the biggest decline since May.
After years of spending to gain market share and fend off competition, Grab is taking steps to become a more financially mature company. It is focusing on the bottom line following a period of swift expansion into markets from Malaysia to Thailand. Like its backer, Uber Technologies, it has slashed jobs and reined in spending to pivot toward profitability. Uber also announced its first buyback in February.
The effort coincides with a dramatic slowdown in growth from past years, underscoring the impact of economic uncertainty and competition. Revenue rose 30 per cent in the December quarter, its slowest pace of growth since at least 2022.
The challenging market has forced Grab and its rivals to consider aggressive options. Grab and GoTo have in 2024 revived discussions about a merger of their core businesses, Bloomberg News has reported, an alliance that could help stem spending to chase consumers across the region. Grab had also been linked to talks to take over the foodpanda brand in several markets, but negotiations fell through because parties could not agree on deal terms.
On Feb 22, it reported US$35 million in adjusted earnings before interest, taxes, depreciation and amortisation, lagging estimates for US$38.9 million. The company posted its first profit on that basis for the September quarter.
Grab also reported positive free cash flow for the December quarter, though again on an adjusted basis. And it reported an US$11 million net income – its first – though much of that stemmed from a one-time accounting gain.

Executives expect revenue to accelerate from 2025 as new initiatives they’re developing take hold, in areas from digital finance to their core delivery services. Grab, which has partnered with financial services firms for online lending and banking in Malaysia and Singapore, expects revenues from that slice of the business to ramp up in coming years.
Grab chief executive Anthony Tan told analysts on a conference call: “We’ll see improvements in the cost structure of our business as they start to generate revenue, especially from our banking, and as we start to scale loans even further.
“We are incubating growth with a lot of initiatives.” BLOOMBERG