Welcome back,
We don’t often cover a similar topic two weeks in a row, but mini programs are such a phenomenon in China—apps inside apps that are used by nearly 1B people each month in WeChat alone—that in this case there’s sufficient reason. Last week, we wrote that Apple was cracking down on mini programs from Tencent, ByteDance and others. Now, Tencent confirmed it is in talks to use iOS in-app payments for mini program transactions on WeChat.
It’s tough to know how revenue will be generated, but 30% of a 1B user ecosystem might well be very lucrative in a market that accounts for 20% of Apple’s revenue.
Elsewhere, we look at the mixed bag of earnings for Asian players like Alibaba, Tencent, Grab and Sea; the growing emergence of a Swedish PE fund; SoftBank’s investment success in India; A16z impending new office in Japan and much more.
Catch you next week,
Jon
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Apple could unlock a significant new revenue stream after Tencent revealed it is in talks with the iPhone-maker over using its iOS payment solutions for mini programs, aka apps within apps in China.
We wrote about mini programs last week after Bloomberg reported Apple was looking to cut back on the features that mini programs running in apps like WeChat and TikTok offer in China. Apple, it appears, was concerned that mini apps circumvented its payment solutions meaning that transactions could happen on iOS without using in-app purchases. Now, Tencent Chief Strategy Officer James Mitchell said the conversations are with a view to Apple taking a cut of any mini program revenue.
That’s potentially lucrative given that there are some 7M mini programs in total on WeChat, with close to 1B users—or 90% of the app’s user base—engaging with at least one each month. They vary from cinema bookings, to payments, games, directions and more. That’s important given the increased competition for handset sales in China, led by Huawei and its Harmony OS fork of Android. Apple’s revenue in ‘Greater China’ slipped by 8% year-on-year in its most recent Q2 quarter—the region represents around 20% of all Apple revenue worldwide.
Grab missed second-quarter revenue estimates due to slower growth in its mainstay food-delivery business and foreign exchange headwinds link
Sea reported a higher-than-expected revenue for the second quarter and raised its forecast for e-commerce platform Shopee, but a jump in costs pushed profit below estimates link
Meanwhile Shopee raised the commissions it charges merchants in many core markets by about a third since the start of the year, underscoring its renewed attempt of boosting its bottom line link
Lazada isn’t public but in parallel with Alibaba’s results, Lazada CEO James Dong announced in an internal meeting that Lazada’s monthly EBITDA turned positive for the first time link
Alibaba fell short of both revenue and profit expectations for the June 2024 quarter, struggling with challenges in its core e-commerce business due to increasing competition and cautious consumer behaviour in China link
But the company is making progress on AI—its cloud computing business was a strong performer with its faster revenue growth for 2 years, thanks to triple-digit year-on-year growth of AI link
Ant Group saw its quarterly profit fall by 10.25% link
The fintech giant is in discussions to acquire Chinese online platform Haodf.com to beef up its artificial intelligence services in health care link
JD.com beat estimates for quarterly profit thanks to a focus on cheap goods in line with Temu and others link
Tencent saw its profit jumps 82%, as strong video game and advertising unit growth helped it beat estimates link
Tencent Music reported a smaller than expected fall in quarterly revenue on Tuesday, an increase in paying subscribers for its music streaming platforms offset a fourth straight quarterly drop on account of Beijing’s crackdown on live-streaming link
EQT is a name you can expect to see a lot more of in Asia. The Stockholm-based investment firm has been active in Asia but two recent announcements stood out.
Firstly, it is acquiring PropertyGuru in an all-cash deal valuing the Nasdaq-traded property platform at $1.1B. Earlier, the firm announced it plans to raise a $12.5B fund for Asia, despite the general gloom around investment which has been felt fairly hard in much of Asia.
EQT is focused on investments within technology, services and healthcare that range from $50M-$1B. Its Asia operations are based in Hong Kong where there’s a 160-person team. The firm’s previous Asia fund closed two years ago and was $11.2B in size. PropertyGuru is its splashiest Asia deal to date but there may yet be other major names targeted in the tech space.
SoftBank has taken a lot of criticism over the years but some of its investments in India are doing well. Very well. The Japanese firm’s holdings in Ola Electric, FirstCry and Unicommerce—three companies that recently went public—is said to be worth $2B. And that’s after it took $400M off the table by selling shares to the secondary market from each company.
It hasn’t always been a roaring success. It lost some $150M from Paytm investments, for example. But this savvy dealmaking is proof of why local IPOs are so key. SoftBank is far from alone since India’s tech listing streak is rewarding investors who backed tech stocks. It’s simple but it highlights how essential exits are for luring investors to markets like Southeast Asia.
The Pentagon has decided to remove Hesai, the world’s biggest maker of laser sensors for EVs, from its blacklist of Chinese military-affiliated companies link
Chip tool maker AMEC has filed a lawsuit against the US defence department over suggestions it is tied to the Chinese military, demanding it be removed from a blacklist link
Feng Chen and Tianqiong Xu, a wealthy couple from Frisco, Texas, have been accused by the FBI of orchestrating a $10 million “pig butchering” scam, involving fraudulent cryptocurrency investment platforms that deceived victims into investing their crypto. link
TikTok has added group chats in a bid to increase rivalry with Instagram and other multimedia apps that are popular for messaging link
Huawei is set to launch a new AI chip, the Ascend 910C, positioning it as a competitor to Nvidia’s H100 in the Chinese market link
Chinese robotaxi firm WeRide, which is about to go public, has won approval for test rides with passengers in California link
Chinese EV maker Zeekr says its new battery can charge faster than a Tesla—10% to 80% in 10.5 minutes is the claim link
TikTok has disputed US claims on its close ties in China in a new court appeal link
Routers from China-based TP-Link are a national security threat, according to US lawmakers link
India’s telecom regulator has directed service providers to block all promotional calls—whether pre-recorded or computer-generated—from unregistered senders in a major move “to curb the increasing number of spam calls” link
There’s confirmation of a previous report that Zepto is set to raise another $310M at a $5B valuation—up 40% from its last round closed just over a month ago. link
Wise plans to resume signing up new customers in India for overseas remittances after a pause link
India’s antitrust body has ordered an unusual recall of reports of an investigation that found Apple breached competition laws, after the US giant complained its commercial secrets were disclosed to opponents, including Tinder-owner Match link
Sarvam has launched a voice-enabled AI bot supporting over 10 Indian languages, betting that users would prefer speaking to an AI in their native tongue rather than chatting via text link
Fractal has built India’s first medical LLM Vaidya.ai—it is a general-purpose assistant meant to help users with diagnosis, treatment and medical advice link
Electric scooter maker Ather is now a unicorn after it raised $71M in a new round link
Logistics company Shadowfax is the latest to be linked with an IPO—it could be valued at around $600M link
India’s top court has cleared the way for Byju’s insolvency proceedings link
Binance has resumed operations in the country after a seven-month hiatus imposed by authorities for “illegal” operations link
A look at how Vietnam aims to train at least 50,000 chip engineers and designers by 2030 as industry giants look to the country to offset severe staff shortages in their home markets link
Venture builder Antler is doubling down on Southeast Asia with a new (second) $72M startup fund—it plans to invest $27M on 45 startups within the next 9 months, with a target of 300 startups for the whole fund link
Thailand launched a crypto regulatory sandbox to let digital asset exchanges, brokers, dealers, fund managers, advisors and custodial wallet providers test services in “real-life” context link
Following South Korea’s lead, Singapore intends to ban deepfakes ahead of upcoming elections, despite concerns of curbing freedom of speech link
Singapore-based investment app Syfe raised $27M to quicken its Asia expansion link
Singapore’s biggest bank DBS rolls out blockchain-powered ‘treasury tokens’ pilot link
Worldcoin is bringing its ‘proof of humanity’ (which uses retina scans to produce unique digital IDs) to Malaysia—its a project that provokes considerable concern due to data security and the potential to undermine sovereignty link
Krafton, which runs the insanely popular game PUBG, acquired Tango Gameworks, a Tokyo-based studio that had been owned by Xbox/Microsoft but was about to be shuttered link
Stock trading platform Toss Securities is establishing a New York subsidiary this year to capitalise on growing Korean retail investment in US equities link
The country’s plan to introduce AI-powered digital textbooks in schools has provoked a backlash from parents and academics concerned about children’s overexposure to digital devices and potential misinformation link
South Korean AI chip makers Rebellions and Sapeon agree to merge link
A16z is reportedly planning a Tokyo office but there’s a catch—this doesn’t mean investment in Japan is imminent. Instead, the outpost would be used to help raise investment for A16z funds—it is said to have a number of major Japanese LPs—and enable portfolio companies to expand to Japan more easily. In time, local investments could follow but that’s not something to expect too soon, it would seem link
Preferred Networks, an AI startup valued at $2.1B, is seeking overseas investors for the first time to accelerate chip development link
SoftBank Group is joining South Korean and Thai conglomerates to back a $130M fund focused on quick and sizable investments in AI startups—the fund plans to raise a total of $200M and it will focus on mid-stage startups in AI, quantum computing, healthcare, robotics, and SaaS link
SoftBank reportedly held talks with Intel about producing an AI chip to compete with Nvidia but the plan foundered after the US chipmaker struggled to meet the Japanese group’s requirements link
Foxconn has reportedly built an electric car manufacturing hub in China, but it is said to be almost from scratch in the auto business link
Gogoro has delayed plans to launch in India due to policy uncertainty—instead it has paired with Rapido for a bike taxi partnership link
Blockchain firm Animoca Brands has seen its private market valuation drop by over half, with shares trading on secondary markets at valuations between $1.5B-$3B amid ongoing volatility in the cryptocurrency sector link
