High valuation but no EVs: SG firm’s $150m electric problem

This week’s On the Rise analyzes Scorpio Electric’s valuation, beauty commerce firm Raena’s cost-cutting strategy, and Meta’s ChatGPT for music. [Read from your browser]( On the Rise 🚀 Welcome to On the Rise! Delivered every Tuesday via email and through the Tech in Asia website, this free newsletter breaks down the biggest stories and trends in emerging tech. If you’re not a subscriber, get access by [registering here](. --------------------------------------------------------------- IN FOCUS In today's newsletter, we look at: - [Behind the high valuation of an SGX-backed firm’s EV startup]( - Singapore-based social commerce platform Raena’s cost-cutting strategies - Meta gets serious about metal and more with an AI-backed music generator Hello {NAME} With every market testing out where it stands with electric vehicles and with governments giving the industry a push en masse, electric mobility is having an electric moment. That’s an understatement but in the context of today’s big story, I think an understatement serves us just fine. Here’s why: The Singapore-based EV startup under the spotlight today has set its sights high - as high as US$150 million, which is how much the company says its valuation is. Those familiar with Scorpio Electric are likely to say that the firm may not have to sell as many bikes as its competitors since it only deals with premium motorcycles. But the company doesn’t have any motorcycles yet - it says it’s on track to produce and distribute them in the second half of 2023. The delay is particularly striking when one looks at other players in the region that are also working with electric two-wheelers. Singapore’s Ion Mobility has recently raised US$18.7 million in series A money and has brought on board TVS Motors, a mobility giant in India, as an investor. Similarly, Vietnam’s Dat Bike has been striking significant partnerships, like [a deal with Gojek]( so the latter can use its bikes in the country. Both these firms were founded in 2019, two years after Scorpio Electric. Our first big story looks at the company’s valuation and its plans to expand across Europe and Asia Pacific. The second startup we’re taking a look at today also has some impressive figures behind it, and it’s sharing its strategy as to how it got them. My colleague Collin dives into how Raena, a Singapore-based beauty social commerce platform, reduced its costs by 3x since last year and expects to generate operating profits by Q3 2024. As founder Sreejita Deb puts it, “Revenue is vanity. Profits are sanity. Cash flow is reality.” This week, we also dive into the newest kid on the generative AI block, one that’s already made a statement by saying its open source, meaning others can build on and with it. Yes, we are talking about Meta’s MusicGen - more on this below. -- Nikita  --------------------------------------------------------------- THE BIG STORY [The brow-raising $150m valuation of SGX-listed firm's EV brand]( EuroSports Global’s Scorpio Electric says it will start producing and distributing e-bikes later in 2023. But its valuation may need justification.  --------------------------------------------------------------- MAKING WAVES [This social commerce firm cut its costs by 3x - here's how]( After making tough calls, Singapore-based Raena nearly tripled its revenue and improved its gross margins in 2022.  --------------------------------------------------------------- AI ODYSSEY Promising AI projects we’re noticing Let your music play, says Meta As someone who is so tone deaf that she was asked to leave a music class because the teacher couldn’t believe anyone could be so bad at it, I never thought I could create my own music. Decades later, I am sitting in my living room and making music thanks to [MusicGen]( the latest from Meta. One can use both [text as well as existing melody]( to create something new. Meta isn’t the first to try this. Sometime in January, it was announced that Google had [“an impressive new AI system”]( called MusicLM that could generate music in any genre from text alone. But the company thought it was risky to put it out. Now, Meta has gone another step ahead and made MusicGen open source. While I think it’s too early to declare who’ll come out the winner here, [some say]( that Meta’s platform seems to be more consistent when it comes to “creating higher quality audio.” MusicGen was [reportedly trained]( on 20,000 hours of music, which include 10,000 licensed songs and 390,000 instrumental tracks from stick media libraries. The quality of songs being produced with MusicGen will undoubtedly keep getting better. However, we aren’t anywhere close to addressing some of the more ethical questions. These are concerns about artists’ rights, copyright issues, and ethical obligations, most of which have been relegated to the backburner. In an era of deepfakes, I often find myself thinking about how cultural icons long dead and gone would react to a time where pretty much anything is possible, even deepfaking oneself because of a medical diagnosis, like in the case of the [now-debunked]( Bruce Willis incident. Last week, Paul McCartney of The Beatles announced that [the “last” Beatles song]( will be released later this year featuring the voice of John Lennon. While Lennon left the band long before his death, experts have been able to use AI to isolate the late musician’s voice in a way that lets it be used for a brand new track. I suspect this isn’t exactly what Lennon was talking about when he was encouraging others to [imagine]( a world without a heaven or a hell, but I guess anything’s possible in a world where I can use AI to string a few tunes together by just using the right words. -- Nikita  --------------------------------------------------------------- FYI 1️⃣ [A16z-backed Carta to shut India operations, lays off staff]( The California-based firm, which entered the Indian market less than a year ago via an acquisition, will transfer its accounts in the country to its Singapore office. 2️⃣ [From venture building to investments: how SEA’s corporations are innovating]( Traditional VC funding in Southeast Asia took a dive last year, but the fall was much less pronounced for corporate venture capital.  ---------------------------------------------------------------  NEWS YOU SHOULD KNOW Also check out Tech in Asia’s coverage of the emerging tech scene [here](. 1️⃣ [TikTok says Ka-ching]( The short-video platform is planning to invest billions of dollars in the Southeast Asian market. Part of these plans is a US$12.2 million commitment over the next three years to help 120,000 small businesses digitalize their operations. 2️⃣ [Healthcare demands the big bucks]( Private investment firm Recharge Capital, which is backed by the likes of Peter Thiel’s Thiel Capital and the Disney family’s Shamrock Holdings, has closed the first tranche of its US$200 million fund focused on women’s healthcare. The fund will invest in fertility value chains across Southeast Asia, Latin America, Europe, and the Middle East. 3️⃣ [Investor interest in ESG grows stronger]( Indonesia-based VC firm East Ventures, which has seen its assets under management grow to US$1.5 billion in 2022, is prioritizing [ESG]( and sustainability for its investments. Following this, the company has set up a dedicated ESG team to work with portfolio firms for risk and impact management. 4️⃣ [Competition in cross-border jobs platforms is heating up]( Thailand-based GetLinks has acquired Indonesian jobs platform Ekrut. This comes after job postings in Indonesia dropped by 16.1% from January to April 2023. 5️⃣ [SG robotics firm eyes US, European markets]( F&B-focused robotics firm Ross Digital has partnered with the Singapore government to develop technology that will enable robots to learn how to perform tasks in the kitchen such as frying, cooking, and cleaning dishes. The company aims to export this tech to the US and Europe to address manpower shortages in their F&B industries.  --------------------------------------------------------------- That’s it for this edition - we hope you liked it! Do also check out previous issues of the newsletter [here](. Not your cup of tea? 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