Thursday 05 October, 2023

Did Grab drive itself into a corner?

We look at Grab’s mass layoffs and the recent developments at Hodlnaut.

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Hello reader,

Whether the saying “underpromise and overdeliver” is actually effective, I’m not too sure, but it applies to almost everything – work, personal relationships, or anything in between.

While this might sound like you’re not being honest about your true capabilities to the other party, I’d say that it’s not about lying to them. Rather, it’s about preventing yourself from overpromising something that you don’t know is even possible.

In other words, the saying is about playing it safe but still going the extra mile.

This was my first thought when I heard the news earlier this week that Grab was conducting layoffs. Its C-suite executives previously said that it was not following in the footsteps of other major tech firms and cutting staff, and yet here we are.

In some ways, the company made a statement that it didn’t fulfill. And yes, while things can change – and there are probably many valid reasons for that – many people won’t see this as just another round of layoffs. Instead, they’ll think of it as Grab being unable to follow through on what it said.

Tough luck.

Today we look at:

Grab joining the growing list of companies that are conducted layoffs this year Hodlnaut possibly getting shut down Other newsy highlights such as StashAway’s latest financial figures and a strategic investment in Viu. Premium summary Grab lets go

Image credit: Timmy Loen

One of the first questions we need to ask about Grab’s layoffs is: Was the move – cutting around 1,000 people – done to achieve profitability? While the situation is surely complex, and there are many questions left to be answered, here’s what we know for now.

For the record: Last September, Grab COO Alex Hungate said that the firm didn’t “see [itself] in that category” of companies that conducted mass layoffs. He added that the firm had not gotten to a “desperate” point of needing to freeze hiring or decreasing its headcount. If the shoe fits: CEO Anthony Tan has said that the retrenchments are not a “shortcut to profitability.” However, based on our rough calculations (using Grab rival GoTo as a benchmark), the company could save around US$14 million from the measure. Other reasons: According to Tan, there are several other factors – not related to profitability – that led to the decision, and one of them was the increasing cost of capital. While that makes sense, several questions remain.

Read more: Making sense of Grab’s surprising U-turn from ‘no layoffs’ stance

News spotlight Goodbye Hodlnaut?

Image credit: Timmy Loen

I almost forgot about what happened with Hodlnaut – it’s been almost a year since it came under interim judicial management (IJM). Things appear to be moving along, as a Singapore court could be deciding whether to dissolve or restructure the firm at a hearing scheduled for August 7.

Past the end point: Hodlnaut halted operations in August 2022 after it lost US$317 million in TerraLabs’ Anchor Protocol. Into the ether: The IJM applied to end proceedings on April 25 – indicating that Hodlnaut would be dissolved – citing an unwillingness on the part of major creditors, including Samtrade Custodian and the Algorand Foundation, to negotiate further on a restructuring deal. Butting heads: 55.8% of Hodlnaut’s debtors – whose claims total around US$304 million – prefer that the company be dissolved. However, the firm’s founders have confirmed that they’ll be opposing the application to shut down the company.

See also: Hodlnaut assets hit by FTX debacle

In partnership with

All eyes on generative AI in Southeast Asia

Even if you’ve been living under a rock, you’ve probably heard of generative AI and how platforms like ChatGPT and Midjourney have taken the world by storm.

In Southeast Asia, generative AI has the potential to be transformative. From startups like Singapore’s MediVR, which is developing “virtual humans” for medical training, and Indonesia’s, which offers conversational AI chatbots, the opportunities for the tech are boundless.

It’s still in its early days, though, and there are plenty of regulatory, ethical, and legal issues that must be addressed before generative AI can take flight.

That said, there’s a lot of excitement surrounding the tech, which is why it was one of the key topics of discussion at this year’s IMDA ATxSummit. The event also covered other topics such as augmented reality, Web3, and sustainability in the tech world.

This year’s edition has come to a close, but the 2024 one is set to be even more eye-opening, so follow IMDA ATxSummit on LinkedIn to stay in the loop.

Quick bytes

1️⃣ Up up and away StashAway’s revenue rose by 13.5% year over year in 2022 to hit US$6.8 million. That said, this figure is lower than the 150% revenue growth it recorded from 2020 to 2021. Last year, the wealth management startup recorded US$20.1 million in losses, a 12% decrease year on year. Expenses fell as well, while the firm’s cash and cash equivalents rose by US$5.7 million, ending with US$21.8 million for the year.

2️⃣ Bringings its “A” game India-based VC firm Avaana Capital has secured commitments for US$70 million in the first tranche of its Climate and Sustainability Fund. This is just a little bit off its goal of raising between US$100 million and US$125 million. The fund is looking to invest in early-stage Indian startups tackling energy transition and resource management, mobility and supply chains, as well as sustainable agriculture and food systems.

3️⃣ What the flux AI firm Flux has raised a US$32 million series B round. The Japanese startup developed a no-code AI platform called Flux AI, which enables businesses to leverage AI technologies without needing prior coding skills or knowledge. Flux will use the fresh funds to hire more engineers and to expand its AI research capabilities and product offerings beyond marketing and advertising.

4️⃣ Upstream money Viu, the Asian streaming platform, has received an initial strategic investment of US$200 million from Canal+ Group, which has the option to inject more capital afterward. The deal gives the investor a 26.1% stake in Viu, and the partnership will allow the streaming firm to leverage the expertise of Canal+, while allowing the investor to make Asia its “next growth engine.”

5️⃣ Making a splash Ripple, the blockchain and crypto solutions provider, has obtained an in-principle approval for its Singapore subsidiary. The approval is for a Major Payments Institution license, issued by the Monetary Authority of Singapore. Ripple will now be able to offer regulated digital payment token products and services in the country.

6️⃣ A new appointment Independent identity provider Okta has appointed a new vice president of presales for Asia Pacific and Japan. Stephanie Barnett will fill the role, leading the firm’s solution engineers, system architects, and technical specialists. She previously worked at IBM, Salesforce and Cloudflare.


Jonathan Chew

Has a strange liking for grabbing tiny plastic things on wooden walls

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