In our review #0000006 this week, we discussed Uber’s potential sale of their Southeast Asia assets to Grab, and why Mike Moritz does not understand about startups in China.
Here are the interesting news for the past week dated 18 Feb 2018:
Uber is preparing to sell Southeast Asia unit to Grab in exchange for stake in company: Sources in CNBC by Alex Sherman
Summary: Uber is preparing to sell its Southeast Asia business to Grab, similar to its deal with Didi in China.
My Perspective: The impact of losing a founder, taking money from SoftBank (who is a shareholder to Didi, Grab and Ola) and the hiring of a professional CEO who promised an IPO and shifting the company towards profitability means that Uber has lost its aggressive edge for global domination. Prior to 2017 before all the negative news showered on the company, everyone feared Uber but now, I doubt that Uber is a real threat. The question to ask: is ride-sharing business now segregated by geography?
What Sequoia’s Mike Moritz doesn’t understand about Startups in China by Benjamin Joffe, partner at Hax.
Summary: Why Mike Moritz’s wishful thinking for Silicon Valley to follow China is misguided.
My Perspective: Ben is spot on in pointing out three things: (a) US technology companies are already having problems operating in China even with Uber who behaved 100% like one and soon the rest of Asia because their failure to localise their products and Chinese companies are starting to shift their narrative across Southeast Asia now, (b) the US media and companies are completely left out of China’s Belt and Road initiative and they are clueless of the massive infrastructure changes that is as important as the Marshall Plan after World War II and (c) China is betting on science and technology while US is regressing and you can see the largest STEM talent coming out from India and China.
It’s Foxconn’s Gou that must change by Tim Culpan in Bloomberg Gadfly
Summary: [Foxconn Founder, Terry Gou] still thinks and manages like a manufacturer. That’s a hinderance.
My Perspective: The most telling data point is that Foxconn has grown more and more captive to Apple even Terry Gou said otherwise and tried to shift the company to focus on other technology fields such as automation, Internet of Things (IoT), artificial intelligence and big data (and we know that they are buzzwords everyone uses).
Zuckerberg’s India Payments Roulette Bet by Andy Mukherjee from Bloomberg Gadfly
Summary: Transactions are the way into content, commerce & financial services.
My Perspective: Facebook have been fumbling in India, from their free basics debacle to not figuring out how to localise or build new products in India. The surprising thing no one has been realising is that Google has learnt their lessons and started a payments service in India called Tez based out of their next billions initiative led by Caesar Sengupta. Facebook Messenger has supposedly the best person to start payments in India, China and rest of Asia and yet today, their chat bots strategy failed miserably. Even WhatsApp is being accused of creating a closed payments system from Ant Financial backed Paytm.
“How Alibaba’s ‘new retail’ is changing the future of retail in China and the world” in Technode
My Perspective: A glimpse into how Alibaba and Tencent are changing how retail works with technology. The way how pop-up stores are opened will shape retail for the next decade. Probably for those in Silicon Valley, it might not be a bad idea to take advice from Mike Moritz to see how this can be copied in the US.
Articles of Interest which I have curated and you should take a look too:
Tim Culpan, “Alibaba’s Ant Strategy Looks a Little Clearer” and “Thanks for the Toshiba Memory. Eventually” (Bloomberg Gadfly)
Liza Lin, “China’s Wanda Sells Cinema Chain Stake to Alibaba” (Wall Street Journal, requires subscription)
Andy Mukherjee, “No More Lies: An Ultimatum for India’s Banks“. (Bloomberg Gadfly)
Tonomi Kikuchi, “Ride-hailing app Grab gears up for payment dominance” (Nikkei Asian Review, requires subscription)
Juro Osawa, “At Tencent, Tensions Rise Over the Future of WeChat” (The Information, requires subscription)