As Alzheimer’s costs soar, startups like Neurotrack raise cash to diagnose and treat the disease

As studies show that early diagnosis and preventative therapies can help prevent the onset of Alzheimer’s, startups that are working to diagnose the disease earlier are gaining more attention and funding.

That’s a boon to companies like Neurotrack, which closed on $21 million in new financing led by the company’s previous investor, Khosla Ventures, with participation from new investors Dai-ichi Life and SOMPO Holdings.

Last year, the Japanese life insurance company, Dai-ichi Life partnered with Neurotrack to roll out a cognitive assessment tool to the company’s customers in Japan.

And earlier this year, the Japanese health insurer, SOMPO conducted a 16-week pilot with Neurotrack, where more than 550 of SOMPO’s employees took Neurotrack’s test and followed the Memory Health Program for four months. Neurotrack and SOMPO are now working to deepen and extend their partnership.

“As the global crisis around Alzheimer’s continues to grow, the private sector is joining government and nonprofits to address the problem in their markets. In Japan, for example, traditional insurance companies are developing novel solutions that incorporate Neurotrack’s products to advance better memory health among its population,” said Elli Kaplan, Neurotrack Co-founder and CEO. “These partnerships are innovative models that we hope to replicate in other markets, enabling traditional insurance companies to create new markets while helping to address the Alzheimer’s crisis. And now they’re also investing in our company so these companies have two ways of doing well by doing good.”

Neurodegenerative disorders are becoming a more serious issue for the island nation — and the rest of the world. In fact, over the weekend the G20 first raised the possibility that aging populations could be a global risk.

“Most of the G20 nations already experience or will experience ageing,” Bank of Japan governor Haruhiko Kuroda, told reporters from Agence France Presse. “We need to discuss problems that arise with societal aging and how to deal with them.”

In the U.S., the estimated cost of caring for Americans with Alzheimer’s and other dementias was an estimated $277 billion in 2018, according to a study cited by WebMD. Roughly $186 billion of those costs are borne by Medicare and Medicaid with another $60 billion in payments coming out-of-pocket. That number could top $1.1 trillion by 2050, according to the same report.

Neurotrack uses cognitive assessments that follow eye movements using the camera on a computer or mobile phone to create a baseline for cognitive functions. The company then uses a combination of brain training and diet, exercise, and sleep adjustments to try and improve cognitive function and health.

Its technology is one of several different approaches startups are taking to try and provide early diagnoses and potential preventative measures against the disease.

MyndYou is another company tackling neurodegenerative diagnostics uses an app to monitor movement among its users. The company assesses that data to determine whether there may be any issues related to cognitive function.  It recently partnered with the Japanese company Mizuho to test its efficacy among Japan’s aging population.

MyndYou partners with Mizuho to expand senior care services assessing cognitive degeneration

Then there’s Altoida, another startup which launched recently to tackle the cognitive assessment market. It uses augmented reality and a series of memory tests to assess brain function and attempt to detect neurodegeneration.

Neurotrack’s technology, based on research from Emory University, has managed to attract more than just Japanese corporations. Previous investors like Sozo Ventures, Rethink Impact, AME Cloud Partners, and Salesforce founder Marc Benioff have also thrown cash behind the company.

To date, the company has raised more than $50 million including $6.8 million in grants from the National Institutes of Health and National Institute of Aging.

The company said its new investment will be used to develop new partnerships in additional global markets and continue research and development.

“One can now feel empowered to test for potential memory decline, given that Neurotrack’s Memory Health Program can help stave off cognitive decline. This fully integrated platform enables users to assess the state of their memory, reduce future risk for decline, and monitor progress in order to take better control of one’s memory health. We combine these tools with deep analytics to further target and personalize, creating a very powerful precision medicine solution,” said Kaplan. “Just as when you go on a diet, you use a scale to provide evidence that you’re losing weight. Neurotrack now has the equivalent of both a scale to measure and the Memory Health Program for cognitive health. This is a game-changer for dementia risk.”

Japan has national efforts targeting a reduction in the onset of dementia in 6% of people in their 70s by 2025 (the country has the world’s largest population of the elderly with over 20% of the country over the age of 65). Roughly 13 million people are expected to develop Alzheimer’s in Japan by 2025.

Using augmented reality, Altoida is identifying the likely onset of neurodegenerative diseases

Part of the company’s success in fundraising comes from the results of a preliminary study that showed improved cognitive functions for people diagnosed with some decline in cognitive function after a year of using Neurotrack’s Memory Health Program. The company claims it has the the first fully integrated, clinically-validated platform that can assess a person’s cognition through its cognitive assessment — which can predict conversion from healthy to mild cognitive impairment (MCI) or MCI to Alzheimer’s disease within 3 years at 89% accuracy, and within 6 years at 100% accuracy.

While that kind of assessment is good, Alzheimer’s symptoms can begin to appear as early as 25 years before the onset of the disease. So there’s still work to be done.

“Neurotrack has built an incredible integrative platform that is transforming our battle with Alzheimer’s,” said Jenny Abramson, Founder & Managing Partner of Rethink Impact. “Elli’s two decades of experience in the private sector and in government are helping her scale this solution to the millions of people suffering from cognitive decline around the world. We couldn’t be more excited to continue to support Neurotrack, given both the financial opportunity and the impact they are already having on this critical disease.”

Line teams up with Visa to boost its mobile payment service

Messaging app Line has partnered with Visa to bring traditional financial clout to its mobile payment service.

The deal will see Line Pay become compatible with Visa’s 54 million merchant partner locations worldwide, boosting the service outside of its native Japan, where it has been pitched heaviest so far and where Line claims 80 million users.

The tie-up will allow Line users to use the app’s payment system even where Line Pay isn’t accepted. That’s through a ‘virtual’ visa card that’ll show up in the chat app.

Beyond that, the two sides said they will explore “ways for merchants to interact with the Line Pay service” and its digital wallet. That’s pretty lukewarm, and it’s hard to imagine that it’ll make much of a dent outside of Japan. Line’s three other major markets, in terms of users, are in Asia: Thailand (44 million), Taiwan (21 million) and Indonesia (19 million.)

One intriguing element of the deal involves blockchain, which Line has jumped into with its own crypto token (Link) and a blockchain investment arm. Line said it’ll work with Visa around “new experiences based on blockchain” that could include international money transfers among other things.

Finally, as is often the case with Japanese tech deals, there’s also an Olympics focus — with Tokyo scheduled to host the summer games in 2020.

Mobile payments are one of the Japanese government’s big focuses ahead of the games — organizing its taxis through tech, is another — and, thus, Visa and Line said they plan to heavily promote their ‘cashless’ alliance ahead of 2020.

Line and Visa are far from the first to combine traditional and new payments. Paytm and Uber rival Ola in India have both launched cards in partnership with banks, while cross-border payment companies like TransferWise, Monzo and others have tie-ups with Visa and Mastercard to enable spending.

EV Growth closes $200M fund to cover Southeast Asia’s Series B funding gap

East Ventures has long been known as one of Indonesia’s longest-serving and most active seed-stage investors, but now it has officially moved up the food chain after it announced a final close of its growth fund at $200 million.

Called EV Growth, the fund is a joint venture between East Ventures, SMDV — the VC arm of Indonesian conglomerate Sinar Mas — and YJ Capital, which is associated with Yahoo Japan. The fund was first announced last year with a target of $150 million, but this final close has already surpassed that thanks to contributions from LPs that include SoftBank Group, Pavilion CapitaI and Indies Capital.

EV Growth is already active, with 40% of the fund deployed to date, according to East Ventures’ founding partner Willson Cuaca, who serves as partner for the new fund alongside Roderick Purwana from SMDV and  YJ Capital’s Shinichiro Hori.

“We thought ‘There’s a gap in Series B in Southeast Asia, many of our portfolio is good so why not do this together?'” Cuaca told TechCrunch in an interview. “SMDV and YJ Capital have been our long-term partners in Japan and Southeast Asia so it’s the perfect partnership… the chemistry is already there.”

“We are more seed and product market fit focused but our two partners bring their capabilities on financial modeling so it becomes a complete set,” he added.

Lofty ambitions: the EV growth team in front of Monas, the National Monument that symbolizes the fight for Indonesia and is one of the tallest landmarks in capital city Jakarta

Beyond chemistry, East Ventures also has a track record.

The firm was one of the first to focus on Indonesia, Southeast Asia’s largest economy, and encourage its companies to dominate that market rather than rapidly expand across the region. East Venture’s portfolio includes unicorns Tokopedia and Traveloka, while ride-sharing Grab and Go-Jek acquired two of its companies, Kudo and Loket, respectively.

According to data from Preqin, the fund is among the top performing in the world. East Ventures is one of six firms worldwide to have three funds ranked in Preqin’s top quartile, that puts it alongside names like Benchmark Capital while it is the sole representative from Southeast Asia in that category.

Cuaca said EV Growth will continue the focus on Indonesia, but he admitted that there is scope to invest outside of the region if the right opportunity pops up.

Operating at seed and further down the investment pipe throughs up the possibility of conflicts of interest. EV Growth is aimed at filling a funding gap that does genuinely exist in Southeast Asia so it is bound to touch on East Ventures’ portfolio companies, but Cuaca is ready for that scenario. While he will source and fetch potential EV Growth deals, he must recuse himself from a decision on any East Ventures company, leaving his partners to make the final call. That’s fairly standard in the investment world, but new to Southeast Asia where growth funds are just taking off.

SoftBank Corp — CEO Masayoshi Son is pictured third from right — is one of the LPs backing EV Growth… and potentially the follow-up that is already being planned

That development is a sign of the maturity of the region’s venture ecosystem, and East Ventures isn’t the only one pursuing a ‘growth fund’ strategy.

Singapore’s Golden Gate Ventures is currently raising a growth fund with Korea’s Hanwha as the anchor LP, while TechCrunch has heard plenty of rumors linking a number of other investors with interest in doing the same, albeit that they are unfulfilled at this time.

It isn’t just new funds that are springing up, those that were once seed-stage investors are also scaling to cover unfulfilled Series B demand. Jungle Ventures, for example, recently hit the first close on its newest fund that’s aimed at $220 million. Others stepping into the void include Vertex Ventures, which has a new $230 million fund.

Added to that, there will be more to come from EV Growth.

Cuaca told TechCrunch that discussions are already underway for a follow-up growth fund with “interest still coming in” from prospective LPs. That makes sense given that the current fund’s deployment is nearly at the halfway point. Watch this space for more.

MyndYou partners with Mizuho to expand senior care services assessing cognitive degeneration

MyndYou, which has developed a technology to assess cognitive degeneration in senior citizens, has partnered with the Japanese company Mizuho Information & Research Institute to test the company’s product for a potential nationwide rollout later in 2019. 

Starting with five cities in Japan over the course of May, MyndYou’s technology will be deployed in homes around Japan to provide remote care and analyze for changes in cognitive function.

The company has a downloadable app that passively tracks movement and monitors conversations for any signs of diminishing brain function.

“What we market today is anomaly detection and this allows us to go into the market without detecting specific anomalies,” says Ruth Poliakine, the company’s chief executive and co-founder. “As we grow and progress we see this going into more specific conditions and early conditions… first we have senior adults getting service.”

MyndYou says it already has over ten occupational therapists that have incorporate use of the MyndYou app into treatment regimes for their patients. That means hundreds of patients are currently testing out MyndYou’s service, the company said.

Partnering with Mizuho opens MyndYou up to a market that is acutely aware of the need to develop services for an aging population.

Roughly one quarter of Japan’s working population will be 75 years-old by the year 2040, according to a recent report.  And dementia is on the rise in the country.

“The number of dementia patients in Japan has reached 4.62 million and is expected to increase even further to seven million, which equals to one in five seniors over 65, in 2025. The disease has become an important problem not only for medical field but also for the whole of Japanese society. As in many cases, patients of dementia receive the diagnosis after the symptom has progressed, making a diagnosis and providing adequate care in the early stage is necessary,” said Hitoshi Morio, Joint General Manager, Innovation & Strategy Division, Mizuho Information & Research, in a statement.

The company charges between $10 and $50 for its service, depending on the use case and the number of patients that are using the technology.

News of the new partnership with Mizuho follows an extension of the company’s seed round, which included Amplifyher Ventures, Female Founders Fund and the angel investor, Howard L. Morgan. To date the company has raised $2.1 million.

“As a New York-based company with proprietary technology developed in Tel Aviv, we have partnered with MHIR to further the global potential for MyndYou,” said Poliakine, in a statement. “Now, the senior adult population in Japan will have access to a technology that can not only reduce readmission rates, but also prolong independence of senior adults, while providing them with personalized, data-driven remote care.”

 

 

Chat app Line is adding Snap-style disappearing stories

Facebook cloning Snap to death may be old news, but others are only just following suit. Line, the Japanese messaging app that’s popular in Asia, just became the latest to clone Snap’s ephemeral story concept.

The company announced today that it is adding stories that disappear after 24-hours to its timeline feature, a social network like feed that sits in its app, and user profiles. The update is rolling out to users now and the concept is very much identical to Snap, Instagram and others that have embraced time-limited content.

“As posts vanish after 24 hours, there is no need to worry about overposting or having posts remain in the feed,” Line, which is listed in the U.S. and Japan, wrote in an update. “Stories allows friends to discover real-time information on Timeline that is available only for that moment.”

Snap pioneered self-destructed content in its app, and the concept has now become present across most of the most popular internet services in the world.

In particular, Facebook added stories to across the board: to its core app, Messenger, Instagram and WhatsApp, the world’s most popular chat app with over 1.5 billion monthly users. Indeed, Facebook claims that WhatsApp stories are used by 500 million people, while the company has built Instagram into a service that has long had more users than Snap — currently over one billion.

The approach doesn’t always work, though — Facebook is shuttering its most brazen Snap copy, a camera app built around Instagram direct messages.

Line doesn’t have anything like the reach of Facebook’s constellation of social apps, but it is Japan’s dominant messaging platform and is popular in Thailand, Taiwan and Indonesia.

The Japanese company doesn’t give out global user numbers but it reported 164 million monthly users in its four key markets as of Q1 2019, that’s down one million year-on-year. Japan accounts for 80 million of that figure, ahead of Thailand (44 million), Taiwan (21 million) and Indonesia (19 million.)

While user growth has stagnated, Line has been able to extract increase revenue. In addition to a foray into services — in Japan its range covers ride-hailing, food delivery, music streaming and payments — it has increased advertising in the app’s timeline tab, and that is likely a big reason for the release of stories. The new feature may help timeline get more eyeballs, while the company could follow the lead of Snap and Instagram to monetize stories by allowing businesses in.

In Line’s case, that could work reasonably well — for advertising — since users can opt to follow business accounts already. It would make sense, then, to let companies push stories to users that opted in follow their account. But that’s a long way in the future and it will depend on how the new feature is received by users.

Seed investor Gree Ventures makes first close of new $130M fund — and rebrands to Strive

There’s big news for one of India and Southeast Asia’s longest-running early-stage investors after Gree Ventures, the fund attached to Japanese gaming firm Gree, announced the first close of its third fund, which is targeted at $130 million.

Gree has been a fixture in Southeast Asia since 2012, but now the firm is rebranding to Strive (or “STRIVE” to quote the press release) for the new fund. Rebrandings often seem token, but, in this case, it makes a lot of sense to stop being called Gree (“GREE”) because the company is just one LP of many.

“People often confuse us as a single LP fund,” Nikhil Kapur — who has been promoted to partner — told TechCrunch in an interview. “But we’re quite independent from Gree, plus we’re not a corporate fund and we’re not investing in gaming.”

Indeed, in this case, the fund is talking to non-Japan-based LPs for the first time over potential participation. Confirmed LPs include past backers SME Support JAPAN — which is part of the Ministry of Economy, Trade and Industry of Japan — Gree itself and members of the Mizuho Financial Group. Opening the doors to prospective LPs in Southeast Asia is about adding “more local networks in these markets,” Kapur explained.

Those details, it is very much business as usual for Strive, which is putting the focus on B2B. Kapur said that 60-70 percent of past investments have tended to be on B2B deals, but now fund three is — for the first time — almost entirely dedicated to that segment.

Southeast Asia has seen some seed investors move further down the chain — Jungle Ventures’ new fund is targeting a $230 million final close, while Golden Gate Ventures’ third fund is $150 million while it also has a ‘growth fund’ aimed at $200 million — but Strive is sticking to early stage.

As seed funds go, $130 million is a lot but there’s plenty of nuance to that figure — it won’t all go to early-stage checks.

The fund is split across India, Southeast Asia and Japan — with around half of that allocation estimated for deals outside of Japan. That leaves around $25 million for ‘first checks.’ Kapur said that the outlined goal is to find 20 startups to back, and then double down on them with that follow-on capital. Interestingly, he said that there’s no hard allocation between the three focus regions and follow-on capital is allocated freely to those companies which are performing well and ready to grow, irrespective of geography.

The Strive team

Looking more closely at India and Southeast Asia, Kapur and investment manager Ajith Isaac pointed to increased synergies between the two regions. Indeed, large Southeast Asian players like Grab and Go-Jek have tapped India’s talent pool and located their R&D centers and engineering teams in the country, while Indian startups area increasingly foraying into Southeast Asia for market expansion.

“We see these regions not remaining separate in the near future… [and] becoming very intertwined,” Kapur said, pointing out that in venture capital firms like Accel and Lightspeed and following Sequoia India and investing directly in startups in Southeast Asia.

“The region will become very much interlocked and there’s a gap in people who can bridge it… that’s where we see a differentiated value-add on our side,” he added.

Southeast Asia itself has matured immensely since the Gree fund’s early days, but Kapur and Isaac — investment manager Samir Chaibi is the third member on the non-Japan side of the fund — maintain that there’s still “a gap in terms of institutional capital on seed stage” in some verticals where angel investors are helping new ventures get off the ground with first checks and early backing. That’s where the new Strive fund is keen to make its mark.

The fund, which has traditionally been very lean in terms of personnel, will also bulk up its own numbers. Kapur said he is hiring local teams in India and Indonesia with a viewing to growing the non-Japanese headcount to six people by the end of the year.

Sharp will resume selling its smart TVs in the US this year

Good news for U.S. consumers, the smart TV market is about to get more competitive after Sharp announced plans to resume selling TVs in America before the end of this year.

The Japanese firm quit the U.S. in 2015 when crumbling finances threatened its very existence. It was bailed out by Hon Hai Precision — the Taiwanese manufacturing firm better known as Foxconn — in a $3.5 billion deal that attracted controversy inside Japan, where a home-backed agreement had been preferred by many. Still, under new management, it is seeking expansion to continue its rebound.

Sharp sold its license to China’s Hisense when it exited, and this week it said that it has struck a deal to regain it, although the terms have not been disclosed.

That relationship is certainly frosty: Sharp sued the Chinese firm, which is state-owned, alleging that it had put Sharp’s badge on sub-quality products. The suit was dropped at the beginning of last year. Sharp said at the time that it intended to return to the North American market itself, and now it has the deal it required.

Sources told Reuters that the firm may also be considering other markets in the Americas beyond the U.S, Hisense also acquired its rights for that region, but the U.S. market is obviously the headline expansion.

For now, Sharp said it will bring TVs to market that combine 5G, AIoT — a buzzy acronym that stands for ‘artificial intelligence of things’ — and 8K/4K picture quality. We’ll have to wait for more on what the exact product line-up will look like.

Startups Weekly: Will the Seattle tech scene ever reach its full potential?

Greetings from Seattle, the land of Amazon, Microsoft, two of the world’s richest men and some startups.

I’m always surprised the Seattle startup ecosystem hasn’t grown to compete with the likes of Silicon Valley — or at least Boston and New York City — since the dot-com boom. Today, it’s the strongest it’s has been due to the successes of companies like the newly minted unicorn Outreach, trucking business Convoy and, of course, the dog walking startup Rover. But the city still lags behind, failing to adopt the culture of entrepreneurship that defines San Francisco.

I spent a lot of time wondering why it hasn’t reached its full potential. Is it because Microsoft and Amazon pay their employees so well they don’t have the same urge to build something from the ground up? Is it a lack of access to capital? Is the city not attracting top talent? If you have thoughts, send them my way.

“We think part of the issue is a lack of capital and a lack of help,” Rover and Pioneer Square Labs co-founder Greg Gottesman told TechCrunch earlier this year. “If we can provide a little bit of both of those things, we can really put Seattle where it deserves to be, should be and will be.”

Despite its shortcomings, there is still some action in the city I want to highlight this week. A same-day delivery business, Dolly, is on the rise. The startup told me on Thursday it had raised a $7.5 million round from Unlock Venture Partners, Maveron and Jeff Wilke, the chief executive officer of Amazon Worldwide Consumer. Maveron, if you remember, is the VC fund co-founded by Starbucks founder Howard Schultz.

In other Seattle news, Madrona Venture Group, a well-regarded fund, raised an additional $100 million this week. Typically, Madrona focuses on companies based in the Pacific Northwest, but this fund will deploy capital throughout the entire U.S. Hmmm, that’s not necessarily a good sign for Seattle founders, but great progress for the ecosystem nonetheless.

If you’re interested in learning more about Seattle tech, I’ve covered it a bit because it’s my hometown! Start with this story, which dives deep into a Seattle accelerator that’s working hard to encourage entrepreneurship in the city. Alright, on to other news.

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IPO corner!

WeWork: The co-working giant now known as The We Company submitted confidential IPO documents to the SEC, the company confirmed in a press release Monday. Is this the next massive startup win or a house of cards waiting to be toppled by the glare of the public markets? TechCrunch’s Danny Crichton investigates.

Slack: The business is in its final steps toward a much-anticipated direct listing, with one source telling TechCrunch the listing will be complete within 45 days. The WSJ reported this week that Slack will make an online presentation to potential shareholders on May 13. This week, we dug deep into Slack’s S-1 and decided to evaluate just how well the tech press, us included, did in covering the company. For the most part, the tech press did decently well, except for one curious, $162 million gap.

Uber: Finally! That ride-hailing company is going public next week. That latest news? Uber co-founder Travis Kalanick won’t be ringing the opening bell. Uber would not be where it is today without Kalanick, but him being there would surely be a reminder of Uber’s rocky past.

Beyond Meat: Shares of the company surged up 135 percent in their market opener last week, valuing the company as high as $3.52 billion. Volatility was so high on the company’s stock that the Nasdaq had to pause trading of “BYND” shares.

Micro-mobility instability:

Ofo has run into its fair share of issues, laying off hundreds of workers, shutting down its international division and more. Now, you can buy a piece of the startup’s history.

In other micro-mobility news, Lyft’s head of scooter & bikes Liam O’Connor, who was hired to help transportation company Lyft build its bike and scooter operations, has left after seven months with the newly-public company. TechCrunch’s Ingrid Lunden has the scoop. Plus, Bird, the electric scooter unicorn doing its best to overcome regulatory barriers, has made its way back to San Francisco. Bird is using its business license in San Francisco to introduce monthly personal rentals in the city. The program enables people to rent a scooter for $24.99 a month with no cap on the number of rides. We’ll how that goes.

WTF?

For some reason, people are giving Magic Leap more money. The company has secured another $280 million in a deal with Japan’s largest mobile operator, Docomo. Do you know what that means? The developer fo AR/VR headsets has raised a total of $2.6 billion. We’re just as confused as you.

Brand new venture capital funds:

Unshackled Ventures raised $20 million. 

Jungle Ventures closed on $175 million.

And Toyota AI Ventures launched a $100 million fund.

Startup Capital

Uber investors exit

I have the inside story on Menlo Ventures early Uber stake and TechCrunch’s Connie Loizos goes deep with early Uber backer Bradley Tusk.

Extra Crunch!

This week, we offer TechCrunch Extra Crunch subscribers exclusive tips on building extraordinary teams. Plus, the final piece in TechCrunch’s Greg Kumparak’s series on Niantic, the fast-growing developer of Pokemon Go. If you recall, we’ve captured much of Niantic’s ongoing story in the first three parts of our EC-1, from its beginnings as an “entrepreneurial lab” within Google, to its spin-out as an independent company and the launch of Pokémon GO, to its ongoing focus on becoming a platform for others to build augmented reality products upon.

If you enjoy this newsletter, be sure to check out TechCrunch’s venture-focused podcast, Equity. In this week’s episode, available here, Crunchbase News editor-in-chief Alex Wilhelm and TechCrunch’s Danny Crichton chat about updates at the Vision Fund, Cheddar’s big exit and more of this week’s headlines.

Samsung Ventures’ first investment in Southeast Asia is HR startup Swingvy

Samsung Ventures, the VC arm of the Korean electronics giant, has made its first investment in Southeast Asia after it backed HR startup Swingvy.

Singapore-based Swingy’s service provides HR services, payroll and insurance for SMEs on a freemium basis. The company announced this week that it raised $7 million that was led by the Samsung arm with participation from Aviva Ventures — from insurance firm Aviva — and Bass Investment. Existing investors Walden International and Big Basin Capital, which financed a previous $1.6 million round, also took part.

Founded in 2016, Swingvy claims to work with over 5,100 companies across Singapore, Malaysia and Taiwan. Those customers, some of which do not pay, have a cumulative user base of over 100,000 employees.

“Our target customer is SMEs not enterprise,” Jin Choeh, who is CEO and one of three Swingvy co-founders, told TechCrunch in an interview. “There are some local players, some legacy players and some startup competitors, but generally we saw that there’s no market leader for HR tech in Southeast Asia.”

The service itself covers areas such as an employee directory, processes for leave, performance management, company calendar, HR reporting, payroll and benefits. On the latter, Swingvy offers health insurance through partnerships with third-parties — Choeh said it is a licensed insurance agent. He said that new features coming soon include claims (for expenses and payments) while further down the line will be monthly insurance and corporate cards.

It is quite common for HR and other ‘base-level’ SME services to develop marketplaces that match their customers with third-party providers — we’ve seen that in Japan among very mature players, for example — but Swingvy isn’t going down that route. Choeh explained that it will consider offering its own services in areas where it believes it can give value to customers and control the quality and experience directly.

More broadly, the startup is aiming to triple its customer base to 15,000 this year thanks to this new injection of capital.

The initial focus is on hiring — Swingy plans to grow its headcount of 23 to over 60 this year — and more “aggressive” sales growth. That’ll mean bringing in a dedicated sales team, increasingly online advertising spend to reach new customers and being more visible around event marketing.

“Sales and marketing has been less than 10 percent of our spend,” said Choeh. “We’ve proved our model is quite cost efficient and we believe it is time to raise sales and marketing efforts.”

There’s no immediate plan to expand to new markets, but the Swingvy CEO said his company is eyeing potential expansions in 2020. Potential countries include Thailand, Vietnam and Japan, he said. Indonesia — Southeast Asia’s largest economy and the world’s fourth most populous country — is also under review, but Choeh said his team is aware that it is hyper-competitive while the market for paid SME products is particularly challenging.

What of the relationship with Samsung? For now, the relationship is financial rather than strategic, but Choeh admitted that there could be opportunities to work closely together in the future.

Grocery startup Honestbee makes layoffs and cuts costs as it prepares to raise more money

Asia Pacific grocery delivery startup Honestbee has confirmed it is suspending business in half of the eight markets it operates in and laying off 10 percent of its 1,000 staff. The cost-cutting appears to be part of belt-tightening ahead of a planned new injection of funding, TechCrunch has come to learn.

According to a statement shared today, Honestbee is “halting our services in Hong Kong and Indonesia” while its business in Japan and the Philippines — and some partnerships in other countries — will be “temporarily suspended” while an internal review is conducted. It also operates in Singapore, Taiwan, Thailand (where it has paused its food delivery service) and Malaysia.

One of the big concerns around Honestbee’s future is its lack of financing, as TechCrunch reported last week. The company has raised around $60 million in disclosed funding from investors, which does not match its currently monthly losses of around $6.5 million. A source told TechCrunch that Honestbee is expecting to win new financing by the middle May and that will give it a further year of runway. However, it is unclear what investor is providing the money and exactly how much it might be. The source suggested it may be Formation Group, which has backed the company since its $15 million Series A round was announced in October 2015.

An Honestbee spokesperson declined to comment on the company’s funding plans.

Beyond the cash burn, we reported that the company has unpaid bills owed to a range of suppliers and partners across its eight markets. Honestbee said last week that it would layoff six percent of staff but we reported at the time that more terminations were planned — today’s statement confirms that the number is indeed higher than first disclosed.

We also wrote that four-year-old Honestbee had told staff in Singapore, its HQ, that it would not make payroll on time this month. The company said today that is not true. Sources told TechCrunch that Honestbee told staff last week that management in Singapore would not be paid on time, but an update this week communicated that the payment would not, in fact, be delayed after all.

New funding may stave off the need to sell the business, but Honestbee’s ongoing talks with suitors — which we reported have included ride-hailing firms Go-Jek and Grab — are ongoing. Possible outcomes could include the company’s selling its local operations in some markets in Southeast Asia to streamline its costs. One thing we do know from today is that it will continue with its Habitat supermarket, which combines on- and offline retail and is likely to be capital intensive.

Here is the full statement from Honestbee:

In 2015, honestbee started in Singapore with the mission of providing positive social and financial impact on the lives and businesses that we touch. Today, we are a regional business committed to making great food experiences accessible to customers across Asia.

Over the past four years, we have demonstrated commitment to our staff, partners and customers, and continue to innovate and improve our business to stay relevant in today’s rapidly-changing business environment. The launch of habitat by honestbee in Singapore last October marks the next phase in our evolution as a food company.

As part of an ongoing strategic review of our business, we are halting our services in Hong Kong and Indonesia, as well as our food vertical in Thailand. Our services in Japan and the Philippines, along with specific partnerships in others markets are also temporarily suspended as part of this review. This is necessary to help us focus and align our regional business, and more importantly, to enable us to better meet our customers’ needs. The status of honestbee’s business in the remaining markets stands unchanged.

Some roles within the organisation will no longer be available. Approximately 10% of our global headcount in the organisation are affected.

There have been media reports regarding payroll delay for our employees. We would like to stress that this is untrue. We will ensure that all employees across all markets, including Singapore, are paid in a timely manner.

In addition, we are also committed to fulfilling our financial obligations to all Bees, partners and vendors.

For context, our original report is below:


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