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Asia Tech Review: April 29 2019

Welcome back, Lots happened last week so this is a larger-than-usual ATR. I really enjoy publishing t
April 29 · Issue #112 · View online
Asia Tech Review
Welcome back,
Lots happened last week so this is a larger-than-usual ATR.
I really enjoy publishing this newsletter – it is my way to ensure I kept up with what happened on my beat – and hope it adds value to you, too. Do consider sharing it with friends or colleagues who you think might appreciate it. And do feel free to drop into the Telegram chat group, which is here, to say hello.
Ok, pitch over… on to this week’s update 😀

We still don't know who really owns Huawei
Following the publishing of an explosive paper from two academics – shared in last week’s newsletter – China’s tech industry has been mulling the question of who owns Huawei.
Professors Christopher Balding and Donald Clarke dug into the issue and found that, contrary to what Huawei says, it isn’t the employees.
Now Huawei has spoken and we are all (still) none the wiser, as the New York Times explains.
In a press conference set up with a selection of media, Huawei’s chief secretary spoke for 90 minutes but the ultimate message is that employees are offered a profit sharing scheme but whether they have actual ownership is more complicated.
Huawei is majority owned by its worker’s union, but that has no say over shaping policy and operations. Indeed, employee shares are virtual and CEO Ren Zhengfei has veto over high-level issues such as strategy, new hires, etc. Huawei argued that the union’s main activity is arranging sports events, collecting dues, etc.
Why does this matter?
  • Huawei is often accused of maintaining close links to the Chinese government and the idea of it being state-owned, or partially owned, is sure to raise already high security concerns.
  • Huawei has become so powerful with its role of supplying mobile carrier technology, that many governments are seeking a level of transparency.
  • Critics argue that if Huawei can’t be honest about the basics, i.e. its ownership, what other untruths is it telling?
A tweet from Balding, co-author of the paper that looked into Huawei’s ownership
Employee Owned Balding
Here is a recap of the Huawei issues that I put together. What is notable is that basically Huawei has conceded the factual and legal analysis @donaldcclarke and I did about their ownership. Huawei's defense now is the union only organizes hiking trips
Further reading: If you’re an FT subscriber, the pink paper’s summary (here) is another good read.
Honestbee is in trouble
A lot of what I write at TechCrunch is news-related, so once in a while I get my teeth into something a little deeper: this week that was Honestbee, the grocery delivery startup that operates in 8 markets in Asia.
Grocery delivery startup Honestbee is running out of money and trying to sell
Tech In Asia last week broke news of the company laying off staff and ‘pausing’ operations in the Philippines, one of its major markets. That was a little frustrating as I was working on a story of my own – but fair play to TIA – and ultimately, beyond those layoffs, Honestbee is in a more serious situation.
The company is talking to a range of suitors, including Grab and Go-Jek, over an acquisition because it is close to running out of money. Honestbee confirmed it plans to lay off 6% of its staff and it has ‘paused’ food delivery service in Taiwan and Thailand.
But that doesn’t tell the full picture:
  • Staff in a least one market, Singapore, won’t be paid this month.
  • Suppliers across the region are owed outstanding payments
  • Honestbee closed R&D centers in Vietnam and India
  • A number of top executives have departed in recent months
The crux of the problem is financial. Honestbee is losing $6.5M per month, as of December at least, but it is known to have raised just over $60 million since its 2014 launch. It seems likely, then, that it would have raised more.
But little is known of Honestbee’s financing since all major decisions, particularly around money, are tightly managed by CEO Joel Sng. Current and former employees I spoke to had no idea how much Honestbee has raised to date and, in many cases, even where the money came from.
Formation Group, a VC started by LG scion Brian Koo, is one major investor – its previous Formation8 fund appeared to transferred it stake after shuttering – while Tech In Asia has dug up filings that show Korean chaebols have invested.
I’m an Honestbee customer – and still a fan of the service – but there’s a lot bubbling away here. If you, or someone you know, has more information, please do get in touch. Beyond email, details of how to reach me securely can be found at the bottom of my story here.
Starbucks rival Luckin Coffee files to go public in the US
Surveillance tech built in China is being used extensively in Ecuador link
Huawei went on the offensive with its first ‘quarterly report’ – devoid of full numbers, company said it shipped 59M smartphones in Q1 as overall revenue rose 39% year-on-year to nearly $37B link
Chinese startups are rushing to list on Shanghai’s next tech board link
Didi said it is getting close to break-even link
Tencent has cloned Pokémon Go link
Pinduoduo joins Alibaba on the US government’s naughty list link
Notes on what a “government-led tour” to Xianjing is like link
A list of WeChat words that will trigger censorship link
💸Deals 💸 Douyu, ‘China’s Twitch,’ is raising $500M in a US IPO (link) Tencent invested in an app that teaches China’s seniors to dance (link) Ctrip now owns nearly half of India’s MakeMyTrip (link)
Uber's retreat from India
Subrahmanyam KVJ
"Uber remains deeply committed to the Asia Pacific region..."
We'll make the India head as APAC head, who then decides to move on and then hand over APAC ops to another exec who already takes care of EMEA. OK.
Streaming service Gaana now has 100M users and it is moving into video content link
The Vision Fund is reportedly considering an investment in Jio link
Perhaps related, Jio is preparing to move into e-commerce link
A look at how Paytm, an early pace-setter in mobile payments, has struggled to push on despite investment from Alibaba link
ByteDance plans to invest $1 billion in India over the next few years link
Ola may work with Audi and Mercedes on its self-drive (car rental) service link
💸Deals 💸 gaming startup Mobile Premier League raised $35.5M from investors including Go-Jek’s VC arm for expansion into Southeast Asia (link), an offshoot of AI startup Mad Street Den that’s focused on e-commerce, raised $17M (link) Digital health startup Mfine raised $17.2M (link) ZestMoney, which offers consumer loans, raised $20M (link) Routematic raised $2.5M (link) UK-based CDC invested $40M into BigBasket (link)
Nintendo forecasts modest Switch growth as sales overtake the N64
But, in good news for Nintendo fans, Mario Kart is inching closer to mobile after a beta test for Android users was announced – a full release is due this summer link
Sony launched a taxi-hailing service in Tokyo link
Meanwhile, SoftBank and Didi’s ride-hailing service expanded from Tokyo into 13 more cities link
Japan is about to enter a new imperial era, but, perhaps little known, is that it needs to make IT and software updates. The deadline is May 1 so the rush is on! link
💸Deals 💸 SoftBank’s HAPSMobile invested $125M into Alphabet spinout Loon (link)
Samsung delays its $2,000 folding phone after test units break
Samsung is reportedly developing its own blockchain, it may consider issuing its own crypto token link
Southeast Asia
FT parent Nikkei confirms it has acquired Deal Street Asia
Grab’s CTO is leaving for family reasons, there’s no replacement yet link
In turn, Go-Jek hired a former Misfit founder and Facebook country manager as its new lead in Vietnam link
Go-Jek partnered with to add e-commerce in Indonesia link
Meanwhile, Grab launched its ‘super app’ in Singapore – the strategy is already in place in Indonesia link
Grab also announced an investment in logistics startup NinjaVan link
Indonesia’s Sicepat, yet another logistics startup, raised a $50M Series A from corporate backers link (wow, that is a large A round)
Malaysia’s sovereign wealth fund closed its London office amid reports it is cutting costs overseas link
Binance launched a much-anticipated crypto exchange in Singapore, but it is underwhelming link
💸Deals 💸 Saleswhale, a YC graduate that brings AI to sales/marketing emails, raised $5.3M (link) grocery delivery service (and Honestbee rival) HappyFresh raised $20M (link) Philippines-based Ayala is the latest conglomerate in the region to launch a fund, $150M (link)
Elsewhere in Asia
Sir Lanka: The government shut down a range of social media services following the recent terrorist attack link
More: That shutdown indicates how little trust there is in social media link
Outside of Asia Tech
Four leaders of Hong Kong’s 2014 Occupy protests were sentenced to prison link
Twitter said it added the option to report misleading tweets ahead of elections in the EU and India link
Facebook can’t cope with content moderation following the ‘flood’ of non-English languages link
Pollution is impacting tourism potential in some (many?) parts of Asia link
Photo of the week
Yes, more Huawei…
TechCrunch is hiring a senior editor to help run our news team – do note this is a US-based position but you’d get to work with me 😉 link
This is a semi-regular feature when I find opportunities that I think are interesting, none of the above are paid for listings
Upcoming events
  • Splice Beta: May 1-3 in Chiang Mai, Thailand link
  • SaaStock Asia: May 14-15 in Hong Kong link
  • E27 Echelon: May 23-34 in Singapore link
  • Tech Sauce: June 19-20 in Bangkok, Thailand link
  • Innovfest Unbound: 27-28 June in Singapore link
  • Wild Digital: 3-4 July in Kuala Lumpur, Malaysia link
  • Rise: July 8-11 in Hong Kong link
  • Deal Street Asia’s PE-VC Summit: 17-18 September in Singapore link
  • Tech In Asia Conference: 8-9 October in Jakarta, Indonesia link
If you run a tech event not listed here or want to recommend an addition, please email me
That's all for now, see you next week!
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