VCs bet big on ESG startups – Singapore Business Review

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The number of investments in urban solutions and sustainability has risen 56% in the last year. Aspire, a small and medium enterprise (SME), received $46.38m (US$32.5m), in funding from a series A round. Invisible braces manufacturer Zenyum is closely following, having raised $19.42m (US$13.6m), in series A funding. Zenyum, a manufacturer of invisible braces, is closely following, having raised $19.42m (US$13.6m) in series A funding.
Despite the fact that deeptech startups still dominate the list, this year’s list also shows that investors are now turning their attention to startups that focus on corporate governance (ESG). This is despite the Government’s efforts in Singapore to increase its flexibility. This comes on the back of increasing awareness towards sustainable and environmentally-friendly solutions.For instance, 12th placer SEPPURE offers chemical separation processes that can be done without heat and at 90% less energy. This could potentially save billions of gallons, millions of tonnes of volatile organic compound emissions, as well as billions upon billions of tonnes carbon dioxide annually. Another sustainable startup is abillionveg, a platform that allows users to search for highly reviewed plant-based food and where to find it around the globe.Other noteable startups in the ESG sector are Karana, a Singapore-based food tech company using minimal processed vegetables to create meat alternatives; and Trishaw Treats, which produces snacks out of vegetables and uses packaging means that fully dissolve in 12 weeks.In Enterprise Singapore’s study, investments in the urban solutions and sustainability domain surged 56% YoY during 9M 2019 to $150.4m, which can be attributed to increasing attention on cleantech and sustainability.Specifically, the report noted that there is a growing interest in agri-food tech startups in this sector, where investment reached $28.3m, up from just $0.75m in the same period of 2018. This is in line with the government’s efforts to make Singapore a major food and nutrition hub in Asia. SEEDS Capital, Enterprise Singapore’s investment arm, has appointed seven co-investment partner partners in January 2019. This will help to facilitate more than $90 million worth of investments into agrifood tech startups. Christian Cadeo is the managing partner of Big Idea Ventures, an ESG-focused VC fund. He attributes ESG’s rise to fame to Singapore’s goal to make 30% of its food locally by 2030. “I believe [the ESG sector] will be huge as we are seeing Singapore’s government focus on food as one of the key pillars to security for the country. This initiative is a great opportunity for companies to work towards accelerating the country’s goals. ESG investments are also being recognized by some investors as having a long-term impact. ESG investments are gaining traction as limited partners realize that ESG is an important pillar for long-term growth. While many investments may not tick all the ‘E, ‘S, and ‘G’ criteria, it can lead investors to expand their investments to other criteria,” Ramesh Raghavan, vice chairman of Business Angel Network of Southeast Asia, said. ESG investments are also attracting institutional investors and foundations, such as pension funds. They are more interested in long-term impacts than short-term gains. Cadeo said that even though the VC world is risk-averse, those with long-term vision will see that this is the best time to invest in ESG. “[I]t’s the right time for us in light the global pandemic. Our sector will be the most relevant in terms impact moving forward. “Deeptech remains at the helm

Enterprise Singapore’s latest statistics on the startup scene show that total investments between January and September 2019 reached $13.4b across 437 deals. This is a 36% increase YoY over 2018. It noted that deeptech startups in advanced manufacturing, urban solutions, sustainability, healthcare, and biomedical sciences began to gain traction during this period. There were 76 deals and $416.4m invested in these three domains. This is a 25% YoY increase from $333.8m (2018). However, due to the lack of experienced and qualified investors in the current ecosystem, these three sectors make up only 4% of total capital invested. Wilson Cuaca, co-founder and managing direct of East Ventures, stated that they must find new growth engines. This includes but not limited to regional expansion. “The key focus should be on profitability. Startups must have better capital efficiency in their business models. Raghavan stated that VC funds are low-key and should not be focused on increasing customer acquisition costs.

According to Justin Hall, principal at Golden Gate Venture, there are still many investment opportunities in Singapore. According to Justin Hall, principal at Golden Gate Venture, many rounds of fundraising go unannounced or are merged into other rounds. “The truth is that there are still many opportunities to invest in Singapore and overseas,” he stated. East Ventures’ Cuaca also noted that funding went to other ASEAN countries, including Singapore. Raghavan, however, observed that overall funding in the ASEAN region, which includes Singapore, declined. Grab and other large firms have raised less capital while startups’ need for funding has also declined. Raghavan also pointed out that WeWork and its fundraising was a significant wake-up call for both investors and startups, and that it was a crucial moment for cash-burning startup. Raghavan stated that investors were also more cautious about jumping in at high valuations after the WeWork saga. Larger startups are more focused on profitability and reducing cash burn. It is difficult to raise capital at high valuations. Smaller startups have realized this and are now focusing on generating capital efficiently. “In 2019, coworking company WeWork pulled out of its initial public offering plan in America because investors began to doubt its profitability. Its valuation plummeted from $67b (US$47b), to $14.25b, and its largest backer Softbank took over Adam Neumann’s position. Raghavan also cited the deteriorating investments in cryptocurrency-based startups. He said that the industry has moved beyond its 2017 hype, and many analysts still consider its regulatory environment unstable. “Poor liquidity, uncertainty regulatory outlook, lack transparency, trust issues, and lack of trust continue to hinder adaptability which is the key driver of growth and there has been very little movement in [the cryptocurrency] sector. The time is critical here. If we have a common regulatory framework, transparent and interoperable exchanges, infrastructure, and exchanges, we will see more widespread network effect. During the Budget 2020 speech Heng Sweekeat, Deputy Prime Minister, Minister for Finance, announced the Startup SG equity scheme. This scheme will see the government co-invest in eligible startups alongside third-party investors. The investment cap for startups in general tech industries is $2m, while deeptech firms could clinch upto $4m in the scheme. SEEDS Capital, SGInnovate and SGInnovate were appointed to manage Startup SG Equity funds. Cuaca is optimistic about Singapore’s startup scene, regardless what industry they are in. He said that most sectors are now growing because the region is at an inflection point. “Anyone who starts in Singapore should quickly see the wider South East Asia and should not stay too long in Singapore.” AspireFounders: Andrea Baronchelli, Stefano Pellegrino, Giovanni Casinelli, Joel Leong, Stefan Hadjidetschev, Thibaud Chommeloux

Funding: Aspire received $46.38m (US$32.5m), in series A funding in August 2019, under the leadership of MassMutual Ventures’ regional division MMV SEA.

Inauguration: January 2018. Fintech Aspire was founded in January 2018 by former Lazada executives. It offers a mobile-first digital account for businesses across Singapore, Thailand and Vietnam. The company is part of the YC Continuity Growth Program Winter 2020. It graduated from Y Combinator Winter 2018. Aspire’s flagship Business Account is designed for startups and small businesses. It can be opened online in just few clicks. The account is completely free and requires no minimum deposit or monthly fees. It includes an instant credit limit to cover daily business expenses, as well as other tools that help business owners manage cash flow. Zenyum

Frederik Krass and Julian Artope are the founders

Funding: Zenyum received $19.42m (US$13.6m), in series A funding from RTP Global in November 2019. This was from Sequoia India and SEEDS Capital.

Start of operations: 2018Dental tech Zenyum offers 3D printed invisible braces for mild to moderate orthodontic issues. The startup offers a digitalised end-to-end treatment system that includes diagnosis and conclusion. It uses 3D technology, from the initial consultation for an intraoral scan and Xray to the final braces. Zenyum’s app allows patients to be monitored by Zenyum partner doctors, who have been trained and certified by the startup. The startup is currently operating in Singapore, Hong Kong, Malaysia, Thailand, and Singapore. It plans to expand to Vietnam and Indonesia as well as Taiwan. Smarten Spaces

Dinesh Malkani and Anushka Verghese were the founders of Prithvi (Harkirat Singh), Shergill

Funding: Smarten Spaces raised $17.13m (US$12m), in a series-A funding round in November 2019. Symphony International Holdings was the leading investor.

Start of operations: 2017SmartenSpaces was founded in 2017. It focuses on digitizing spaces for businesses, commercial real estate, coworking and coliving, as well as warehousing. They use AI & IoT technology for businesses to engage their tenants and employees and manage spaces efficiently. The solution also includes a mobile app that integrates seamlessly with the end-users’ daily tasks. These include booking meeting rooms, ordering food, wayfinding and booking flexible seats. They also allow you to securely invite visitors. Smarten Spaces’ integrated technology platform is designed for space management. It includes full AI capability as well as over 100 reports. They have successfully deployed in India, Singapore, and the US. 4. Quilt.AI

Founders: Angad Chowdhry, Anurag Banerjee

Funding: In November 2019, Quilt.AI received $12.85m (US$9m), in series A funding. Nadathur Holdings led this effort

2018Quilt.AI gives brand and product owners cultural insights into human expressions across a wide range of digital outlets. It uses AI to interpret human conversations and expressions from multiple data sources, including social media outlets, online news and blog text. This allows it to contextualise an understanding of anthropology. Quilt.AI’s proprietary anthropology AI platform is not the only one. It also offers a matching app “Culture.Trace” as well as a search engine “The Wormhole”, both of which use the same intel model to extract insights from digital behaviour. This allows for the creation of detailed guides to cities and matches individuals with similar cultural DNA. The startup is also available in New York City and London. 5. 5.

Founders: Adrien Barthel, Julien Labruyere

Funding: Sleek raised $7.14m ($US$5m), in a seed round that was led by Pierre Lorinet and Fabio Blom.

Start of operations: 2017Sleek acts as an online secretary and provides corporate services online. It manages the entire process of incorporating companies in neighbouring countries to Singapore, from registration to the grant of employment passes or visas for assembling teams. The online platform of the startup also manages company books, including accounting and payroll bookkeeping, as well as tax advisory services.6 Eko.ai

James Hare, founder

Funding: Eko.ai, co-led jointly by Sequoia India (EDBI), secured $5.71m (US$4m), in January 2020 funding.

2017: Start of operations The company uses AI decision tools to provide a complete echo analysis. Eko.ai creates these tools to aid research teams looking to add echocardiography into their AI tech stack. The startup’s automation software allows teams to access machine learning-ready research databases. It also provides a suite ready-to use models, segmentation tools and validation cohorts that can be used by hospital systems to improve productivity for their patient populations.7. Syfe

Dhruv Anand, founder

Funding: Syfe secured $5.42m (US$3.8m), in a seed round that was led by Unbound, a UK-based VC firm.

Start of operations: 2018Fintech Sife is a digital wealth manager. It uses a risk-managed passive investment approach through its proprietary investment method “ARI” or Automated Risk Managed Investments. This combines the Global Market Portfolio’s (GMP), and Risk Parity Portfolio’s (RP) methods. The client portfolio is three times more diverse across assets, countries, sectors by combining these methods. Syfe runs more than 10,000 simulations per day to stress-test portfolios. It also undertakes extensive backtesting with detailed results that go beyond 15 years. Syfe REIT+.8 is a REIT-focused wealth management system. Draper Startup House

Founder: Vikram Bharati

Funding: Tribe Theory was funded by Tim Draper, an American venture capital investor.

Start of operations: 2018Draper startup house (DSH), formerly Tribe Theory serves as an entrepreneurial environment in the form hostel accommodations for entrepreneurs and startups. DSH locations offer support to entrepreneurs in the form custom programming, access capital funding, and DSH locations. They also provide an avenue for pitch deck submissions to Draper Venture Network’s 23 global funds. DSH currently has eight international locations, including in Bali, Singapore Yangon, Estonia, Manila, Lisbon, and two additional locations in Bangalore. 8. Yours

Founders: Navneet Kaur, Shivam Sharma

Funding: Yours secured $5m (US$3.5m), in a seed round in October 2019. It was backed by Surge and Global Founders Capital, Kindred Ventures as well as an undisclosed celebrity investor.

2018 – Start of operations Yours Autopilot, a subscription service for women, offers Yours to customers. It updates the customer’s skin-care regimen based on changes in lifestyle and skin conditions, and delivers product refills on an ongoing basis. Travelstop

Founders: Altaf Dhamani, Prashant Kirtane, Vijay Aggarwal

Funding: Travelstop received $4.28m (US$3m), in a pre-series A seed financing in July 2019, under the direction of Accel, a Silicon Valley-based VC firm.

Start of operations: 2018Traveltech. Travelstop is an integrated tool for business travel management that targets startups and SMEs. The platform consolidates expense reporting, travel booking management, and data-driven insights. Travelstop provides a real-time view on travel and expense spending and allows users to access organisation-wide data to help with cost-saving decisions. Osome

Victor Lysenko, founder

Funding: Osome secured $4.28m (US$3m), in November 2019, under the leadership of Target Global with participation by AdFirst and Phystech Venture.

2017Osome launched operations. It offers paperless registration services for both local and international companies in Singapore. It acts as a 24/7 online assistant for companies, handling administrative tasks such as accounting, taxation and payroll. It provides assistance with employment pass assistance and management of nominee director. Osome’s platform uses bots to streamline its services. Seppure

Founders: Amir Hooshang Taheri, Mohammad Hossein Davood Abadi Farahani

Funding: Seppure received their latest funding of $3.64m ($US2.55m) from a seed round managed by SOSV in August 2019.

Start of operations: 2018Chemtech Septpure develops a nanofiltration solution to chemical separation and purification that can replace the traditional, energy-intensive process. This solution is used by a wide range of industries, including food, pharmaceuticals, and petrochemicals. The chemtech has developed a filtration technology that doesn’t require heat and uses minimal energy. The National Research Foundation of Singapore funded the technology, which was developed by Dr. Farahani (CEO at the National University of Singapore).13 atlan

Founders: Prukalpa Sankar, Varun Banka

Funding: Atlan received $3.57m (US$2.5m), in pre-series A funding from WaterBridge Ventures, an early-stage venture capital fund.

Atlan, an 2018IT startup, reduces the collaboration overhead between data teams by data democratisation. This allows teams to seamlessly work on data projects. It automates repetitive tasks and democratises internal and external data. Unilever and Milkbasket are just a few of the clients. Atlan is based in Singapore and has operations in New Delhi, Bengaluru (India), San Francisco, and Nairobi. CHIL

Founders: Harpreet Singh, Ravneet Kaur, Dr. Gautam Yadav

Funding: CHILD Health Imprints has raised a total amount of $3.28m (US$2.3m), over a seed round. Seeds Capital and HealthXCapital are its latest investors.

Start of operations: 2018Healthtech Children Health Imprints (CHIL), which uses data analysis to reduce infant mortality risks, is now operational. CHIL developed a platform that uses IoT to monitor the early onset and progression of morbidities in neonatal intensive care units. The technology collects real-time clinical data from connected devices, laboratory results, as well as bedside clinical observations. NEO, a surveillance device that can track early signs of illness and length of stay using predictive analysis, is a key feature of the platform. The platform prevents medication mistakes by automatically recording the progress notes of nurses and doctors. It also displays the infant’s post-discharge prescription data, encouraging vaccinations until adolescence.15 Vikas Garg, abillionvegFounder

Funding: Abillionveg raised $3.14m (US$2.2m), in its seed round of funding last August 2019, which was led by 500 Startups.

Abillionveg launched in 2017. It was created to help vegans and others who are concerned about the environment. You can also leave reviews on the platform. Some restaurants lie about being vegan. Abillionveg promises that for every review they receive, they will donate a few dollars each to animal sanctuaries.15 Keyless

Founders: Andrea Carmignani, Fabian Eberle

Funding: Keyless raised $3.14m (US$2.2m), in a pre-seed round of funding last June 2019. It was led by Gumi Cryptos Capital, Ripple Labs and Blockchain Valley Ventures.

2018 – Keyless’ privacy-first biometric authentication platform and personal identity management platform was created by an international team of scientists, entrepreneurs, and professionals. This platform eliminates the need for businesses or organizations to centrally store and manage cryptographic keys and passwords. Keyless’ unique technology is the result of more than 10 years of research in cryptography and biometrics. Keyless prevents cyber-attackers accessing critical information. It also ensures compliance with privacy regulations including GDPR. Keyless guarantees seamless user experience across platforms and devices. Gush

Founders: Lester Leong, Ryan Lim

Funding: Gush was funded by City Developments Limited (CDL) for $3m (US$2.1m).

2017: Gush, a Singapore-based startup, began operations. It creates sustainable paints and advanced building materials in an effort to prevent indoor air pollution from causing health problems. Gush cair interior paint is its flagship product. It purifies the air by eliminating 99.9% bacteria, controlling humidity, and preventing mould. It is free of volatile organic compounds (VOC), and releases negative ions that have health benefits, such as neutralizing free radicals and encouraging blood circulation. Gush paints have been used in over 600 residential and 60 commercial projects in Singapore, the region. Most Thomson Medical delivery rooms are painted with their brand. Novelship

Founders: Richard Xia Yang, Chris Xue

Funding: Novelship received $2.93m (US$2.05m), in August 2019, from Global Founders Capital.

2017Novelship’s operations began. It acts as a “gatekeeper” to verify authenticity and product condition and aims to increase trust between buyers and sellers. It is an online shopping platform that allows streetwear and authentic sneakers resellers to check the quality and originality before shipping their products. They inspect the logo placement, serial numbers and manufacturing codes, as well as the inside stitching. It can also be used as an auction marketplace where buyers can request a product and indicate how much they are willing and able to purchase it at the lowest price. Sellers may choose the price they prefer. COVE

Founders: Guillaume Castagne, Luca Bregoli, Sophie Jokelson

Funding: COVE raised $2.86m (US$2m), over a seed round in September 2019.

COVE, a housing startup, has just launched operations. It promises to manage everything, from booking a unit to furnishing. COVE claims it can offer lower prices and offers an all-inclusive fee that includes furnishing, utilities and weekly housekeeping. COVE’s average monthly cost is $1,700. This is 6% less than a flatshare, and 45.51% less than a studio apartment. 20. HydroleapFounders Dr. Mohammad Sherafatmand

Funding: Hydroleap secured a total of $2.6m ($US1.9m) in their November 2019 funding led by Wavemaker Partners. They were also joined by 500 Durians and Seeds Capital.

Start of operations: 2018At Hydroleap, the goal is to make wastewater treatment cheap, environmentally-friendly, and easy. This is accomplished by replacing costly chemical treatment with smart electrical treatment. It can handle wastewater from the construction, food, beverage, oil and natural gas, tannery and mining industries. It is an automated modular system, which does not require any chemicals and can be scaled up to meet your needs. This technology could replace the non-sophisticated and expensive process of chemical pretreatment. It could also be used as a precursor to the membrane/filtration stage.