The Herd Of 102 Chinese Unicorns Reveal Three Waves Of Technology

Looking at China Money Network’s China Unicorn Ranking of 102 companies worth a combined US$435 billion, three waves of technology investment jump out. Financial technology is a past wave in terms of opportunity, artificial intelligence is a present wave, while education and healthcare are waves that are only now gaining strength.

Ant Financial Enters Malaysian Market Via 7-Eleven Partnership

Ant Financial Services Group, the financial affiliate of Chinese Internet giant Alibaba Group Holding Ltd., has entered the Malaysian market via a partnership with U.S. based convenience store chain 7-Eleven. Under the agreement, 2,100 7-Eleven stores in Malaysia will accept payments using Ant Financial’s third-party online payment service Alipay.

Will Shared Phone Chargers Be The Next Big Thing In China?

It’s hard to predict which new products will take off and which will flop. The Segway was launched in 2001 to much media interest, but quickly became the subject of ridicule and fell into obscurity. Fifteen years later, the “hoverboard” – essentially a Segway without handlebars – somehow became one of the most sought-after Christmas gifts, with hundreds of factories in China churning out the two-wheeled trendsetter.

China Money Network Launches Its China Unicorn Ranking With 102 Firms Worth $435B

We live in the age of unicorns. Since the term was coined in 2013 by venture capitalist Aileen Lee to describe start-ups valued at US$1 billion or more, unicorns have multiplied with incredible speed. The unicorn, symbolizing the statistical rarity of such successful ventures, has become almost commonplace. With 193 unicorns globally worth US$664 billion in total*, unicorns also reflect the rise of private capital and investor euphoria over the promise of technology, especially in China.

China’s Alipay, Wechat Pay Record $3 Trillion In Digital Payments In 2016

China’s two leading Internet and mobile payment tools, Alibaba’s Alipay and Tencent’s Wechat Pay together enabled US$2.9 trillion in Chinese digital payments in 2016, representing a 20-fold increase over the past four years, says a new United Nations’ study. "There is a quiet revolution underway and we know, firsthand, that our services are making a real difference to hundreds of millions of consumers. But, as this groundbreaking UN report highlights, this revolution is only just beginning," says Eric Jing, CEO …

UN report: Social network payments now reach nearly US$3 trillion in China

Payments on messaging and e-commerce platforms set to increase China’s GDP by $236 billion by 2025, unlocking new economic opportunities for people and small businesses

BEIJING and NEW YORK, April 20, 2017 /PRNewswire/ — A new UN study reveals that Alipay and WeChat Pay enabled US$2.9 trillion in Chinese digital payments in 2016, representing a 20-fold increase in the past four years. The data shows that digital payments, using existing platforms and networks, provide access to a wider range of digital financial services, expanding financial inclusion and economic opportunity throughout China and neighboring countries.

The new report by the UN-based Better Than Cash Alliance, Social Networks, E-Commerce Platforms and the Growth of Digital Payment Ecosystems in China – What It Means for Other Countries, contains key lessons to help other countries include more people in the economy by transitioning from cash to digital payments. This shift could increase GDP across developing economies by 6 percent by 2025, adding US$3.7 trillion and 95 million jobs, according to a McKinsey Global Institute report.

"Social networks and e-commerce platforms are growing in every economy, whether large or small," says Ruth Goodwin-Groen, Managing Director at the Better Than Cash Alliance. "In China digital payments are thriving from these channels, bringing millions of people into the economy. This matters because we know that when people – especially women – gain access to financial services, they are able to save, build assets, weather financial shocks, and have a better chance to improve their lives."  

"Widening access to financial services has always been at the heart of Ant Financial’s mission and we are proud to have empowered more people to save, invest and gain access to capital. There is a quiet revolution underway and we know, firsthand, that our services are making a real difference to hundreds of millions of consumers. But, as this groundbreaking UN report highlights, this revolution is only just beginning. We see tremendous potential to bring many more people into the financial system, in China and markets around the world," says Eric Jing, CEO of Ant Financial Services Group, which operates Alipay.

Key findings from the report:

  • More people have opportunities to save and invest. Platforms such as Alibaba’s Yu’e bao make investing money into diverse sets of financial products more accessible for low-income populations. This product allows them to invest the money left on digital accounts, leading incrementally to long-term savings. From 2013 to 2016, Yu’e bao has grown to manage US$117 billion and is now serving over 152 million customers.
  • Digital finance helps dramatically increase access to capital for small merchants. As of September 2016, a total of RMB 740 billion (US$107.3 billion) had been lent on the Alipay platform to over 4.11 million small and micro enterprises and entrepreneurs.
  • Big data generated through these platforms helps to build credit-scoring history and boosted access to credit, particularly for low-income financially-excluded populations. For example, Sesame Credit offers an alternative creditworthiness assessment by examining the credit history, financial behavior, contractual capacity, identity, and social networks of users.

The study also found both Alipay and WeChat are expanding beyond China and investing in major fintech and payments providers. They are joined by other major communication platforms, utilizing existing social networks and e-commerce platforms to drive digital payments and financial inclusion. The report found opportunities especially strong in countries with a high smartphone uptake and collaboration between the private and public sectors:

  • In South Africa, 78 percent of all internet traffic takes place over mobile channels – one of the highest rates in the world. However, despite the continued growth of adoption rates, only 15 percent of South Africans reported making a purchase on a mobile phone in the preceding month when surveyed in 2016.
  • In India, both Ant Financial and Tencent have bought into the Indian mobile payments market, which is enjoying rapid growth under new regulation. Ant Financial and Alibaba invested up to $900 million in PayTM, as well as sharing staff and technical expertise. The result: PayTM has grown from 5 million to around 200 million users in just the last few years.
  • Indonesia was the fastest-growing m-commerce market in the world in 2016, expanding 155 percent from January 2016 to January 2017. Some of this growth may be due to the release in 2015 of BBM Pay’s Instant Mobile Payments. The popular BBM chat app has over 55 million users in Indonesia and continues to develop.
  • In South America, markets have the infrastructure necessary to build payment ecosystems similar to those seen in China. Fifty-nine percent of the South American population uses social media, and 52 percent connect with social media over their mobile phone. Yet the digital payments space remains fractured, and no payments provider has linked their service to these platforms in a significant way, or vice versa.

If you would like to learn more, the Better Than Cash Alliance has experts available to comment on the study.

Media contact
Angela Corbalan, Head of Communications, [email protected], (+1) 917 224 9109

The Better Than Cash Alliance is a global partnership of governments, companies, and international organizations that accelerate the transition from cash to digital payments in order to reduce poverty and drive inclusive growth. 
The United Nations Capital Development Fund (UNCDF) serves as the secretariat. 
To learn more, visit www.betterthancash.org, follow @BetterThan_Cash. 

Chinese Bike Sharing Company Ofo Says It’s Worth $2 Billion

Beijing-based bike sharing company ofo is now worth more than US$2 billion, CEO Dai Wei claimed during a media interview. The valuation is about double the company’s estimated worth only 40 days ago when it raised a US$450 million round with a valuation of just over US$1 billion.

Tencent Joins $1.4B Round In Indian E-Commerce Platform Flipkart

Tencent Holdings Ltd, eBay Inc. and Microsoft Co. have led a US$1.4 billion in Flipkart, India’s leading e-commerce platform. The financing round values the Indian online shopping company at US$11.6 billion post-money, below the company’s previous valuation of US$15 billion when it raised a US$700 million funding round in 2015. In addition, eBay announced that it would sell its Indian business to Flipkart, together with its US$500 million cash investments, in exchange for an equity stake in the company, according …

Excon Fuji Securities Report on Alibaba, China’s E-Commerce and the $65 Billion Upside

China’s e-commerce giants, Alibaba and Tencent are set to grab the biggest piece of the pie from what Excon Fuji Securities calls a $65 billion upside

HONG KONG, March 29, 2017 /PRNewswire/ — The link between the next financial crises and the financial technology companies grows are as the later assumes more influence in the industry.

Chinese fintech is becoming the next big thing. With estimates $65 billion in sales by 2020, Tencent Holdings and Alibaba Group Holding are said to bag more than 50% of the market share, adding 60% to their market valuation.

Charles Hall, Director of Corporate Equities at Excon Fuji Securities said "this is not a blue-sky scenario; the $65 billion is the result of assuming only 10% market capture rate," Tencent and Alibaba’s value could increase by $326 to $391 billion, assuming they will capture 50%-60% of the $65 billion and a valuation multiple of 25 times earnings, according to Excon Fuji Securities.

Excon Fuji Securities expects the online payments market to increase by fourfold to $29.3 billion (CNY202 billion) by 2020. Tencent and Alibaba have a firm grip on the market, with 33% and 55% market share respectively. Online payments are already 50% of the fintech market.

Alibaba and Tencent can analyze consumer data acquired from online transactions to determine creditworthiness. Only 29% of the Chinese residents have credit rating as of now. Cross-selling is another benefit of online payments as consumers buy their cloths and groceries, and pay their utility bills online. Small businesses are also taking advantage of the online payments, 15% has borrowed online through e-commerce.

Corporate loans with 69% share of the lending market are keeping government owned banks busy and have no interest in consumer and small business loans, apart from mortgages, which account only for 15% of the market.

Tencent and Alibaba must play nice with the big banks, for a consumer to open a bank account, they must show up at the branch in person, this makes it difficult for Alibaba and Tencent to acquire consumer deposits and use it to extend loans. Although they have their own Internet banks, this comes as part of the government efforts to discourage Internet companies from taking too much financial risk.

Daniel Sharp, Head of Corporate Trading at Excon Fuji Securities noted "It is worth mentioning that even though Alibaba has the bigger market share now, Tencent is better positioned to take advantage of the China’s fintech boom. Alibaba owns only one-third of Ant Financial, Alibaba’s financial arm."

About Excon Fuji Securities
Excon Fuji Securities is a long-established private international investment brokerage. Providing private retail and corporate clients a broad range of financial markets and instruments. With over $7 billion (USD) under management and growing, our vision is to become a renowned industry leader in investment services throughout North America, Europe, Asia-Pacific and Australasia. 

Media Contact | Wayne Price, Research Director, Excon Fuji Securities
Email: [email protected], [email protected], Contact: +1 647 243 2974

Didi Ponders SoftBank-Led $6B Investment As China’s Ride Share Giant Suffers Volume Declines

China’s Uber equivalent Didi Chuxing is considering whether to take a US$6 billion investment backed by SoftBank Group Corp. – which could be the largest private fundraising for an Internet company anywhere, anytime – as the Chinese ride sharing giant suffers volume declines after regulations were rolled out across the country.

Chinese Bike Sharing Company Youon Bike Makes Second Bid for Shanghai IPO

Jiangsu province-based bike sharing company Youon Bike is making another try for an initial public offering on the Shanghai Stock Exchange, seeking to raise RMB598 million (US$86 million) by issuing 24 million shares. An earlier application was rejected in 2015. Founded in 2010, Youon Bike received an undisclosed amount of money from Ant Financial, the financial services affiliate of Alibaba Group Holding Ltd., and IDG Capital. However, Youon plans to end the funding, according to its IPO prospectus. The company …

Alibaba Doubles Down On Tech Research To Serve 2 Billion Customers Globally

Chinese Internet giant Alibaba Group Holding Ltd. plans to double down on technology research and development to strengthen its core competence and support its vision of serving two billion people in the future. The e-commerce company unveiled its grand plan at its inaugural tech summit, called "New Technology, New Future" held at its Hangzhou headquarters on March 9, with over 5,000 engineers in attendance. Jack Ma, Alibaba’s executive chairman, reiterated his expectation that Alibaba will become the world’s fifth-largest "economy" …