One freshly Baked round of layoffs, financial woes coming up

This week's On the Rise looks at Bake’s layoffs, a startup modernizing auto repair workshops, and why Google invested in AI21 Labs. [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 - [Layoffs]( at Cake DeFi - Bengkel Mania’s [attempt to digitalize]( automotive workshops - The reason why Google backed AI21 Labs Hello {NAME} , In 2021, my elder brother invested around US$100 in Dogecoin. It was more like a high-stakes gamble than an investment, but boy did he hit the jackpot. In just a week, he had grown his US$100 to US$1,000, and that’s when he decided to sell his tokens. The motorbike I ride today is partially funded by that gamble. You see, 2021 was the year of crypto craziness, and Dogecoin wasn't the only one with an extraordinary valuation. For instance, take Cake DeFi - now renamed to Bake - as an example. The firm saw the value of its decentralized finance chain token skyrocket to US$1.2 billion in May. However, the drop has been equally dramatic, with the value since falling by 5x to US$240 million. But - and here's where it gets interesting - the company has laid off 34 employees in the past year, while sources put that number closer to 60. The company also has a monthly burn rate of around US$733,000. My colleague Scott goes deeper to understand what troubles are ailing the company in this week’s Big Story. Coming back to my Dogecoin-funded motorbike, one thing that has always frustrated me is that there isn’t proper infrastructure for local automotive repair shops. These motorbike servicing shops feel like they’re stuck in the 70’s or 80’s and run by grease-stained mechanics who barely know how to use a computer. As a result, these stores never seem to have the right parts or the specific brand of engine oil I prefer, which makes getting my motorbike fixed feel like a never-ending story. In our second Big Story, my colleague Shadine unveils how Bengkel Mania is stepping up to digitalize the operations of these MSME workshops. Also, in this week’s AI Odyssey, I discuss Google's recent investment in AI21 Labs and its implications. -- Lokesh  --------------------------------------------------------------- THE BIG STORIES 1️⃣ [Cake Group lays off staff amid revenue decline, denies cost-cutting]( Former employees say the company is bleeding money and cutting staff. It made US$266 million in 2022 compared to US$631 million the year before. 2️⃣ [This Indonesian startup speeds up auto repair shops’ digital transition]( Through its online procurement and invoice-based financing solutions, Bengkel Mania looks to help automotive workshops in Indonesia go digital.  --------------------------------------------------------------- AI ODYSSEY Promising AI topics we’re noticing Can Google's investment revive AI21 Labs? Until ChatGPT became mainstream, AI21 Labs’ Jurassic-1 model [was considered on par]( - or even better - than OpenAI’s GPT-3 model. The former had a staggering 3 billion more [parameters]( compared to the latter. However, with GPT-4 making waves today, the Jurassic-2 – the second-generation large language model by AI21 Labs – seems to have lost its sheen. Jurassic-2 claims to be the [world's most customizable language model](. And with five [APIs]( it gives organizations a platform to build their own applications and services to scale. Amazon currently includes AI21 Labs’ foundation model in its list of options [under Amazon Bedrock](. In its effort to compete against Microsoft’s increasing market share in the sector, Amazon Bedrock launched a fully managed service that offers foundation models from Amazon and leading AI startups through an API. However, the Jurassic-2 model struggles to provide answers to simple queries, unlike GPT-4 which handles them with ease. For instance, when I ask mathematical questions, the Jurassic-2 model often goes way off track. In this instance, the correct answer is 84. But not only does Jurassic-2 get it wrong, it also doesn’t take into account that 150 years is too old for a human. However, GPT-4 gives the correct answer. In another example, I gave Jurassic-2 a python code with a bug, but the model wasn’t able to debug it, something which GPT-4 does easily. I even prompted Jurassic-2 with a code for calculating with zero value in “list_02,” the model overlooks it and provides an answer which isn’t helpful. Recently, [AI21 Labs raised US$155 million in a series C round]( which valued the startup at US$1.4 billion. Investors in the round included Google, Nvidia, Samsung Next, and SCB10X. So why has Google invested in the firm when the model can’t give proper answers to prompts? The immediate reason seems to be that the search giant might benefit from AI21 Labs' expertise in providing APIs. In return, the startup could make use of Google's cloud capabilities. AI21 Labs has been using [Google Cloud for years]( making use of services such as Cloud Storage to store linguistic data and Google Kubernetes Engine for its production environment. On the other hand, Google has been testing its Bard API in beta mode for several months now. And while [Google Deepmind excels in addressing significant global issues]( through AI, the team isn't particularly known for revenue-generating solutions. Google could potentially learn from AI21 Labs in this regard. Although the startup's foundation model may not match the capabilities of GPT-4, it does offer creative monetization solutions like providing different, customizable API’s for developers. However, AI21 Labs’ [main source of revenue]( is [Wordtune]( a ChatGPT-like product that spots grammar mistakes, generates content, rephrases sentences for clarity, summarizes work, and adjusts copy to a writer’s tone. The startup offers several other task-specific APIs like those used for paraphrasing, summarizing, grammar corrections, and text segmentations under the brand name of [AI21 Studio](. Combining these with a team of Google researchers can make that product better. -- Lokesh  --------------------------------------------------------------- NEWS YOU SHOULD KNOW Also check out Tech in Asia’s coverage of the emerging tech scene [here](. 1️⃣ [More funds for SEA startups]( VC firm 500 Global has successfully raised US$143 million for its third early-stage fund in Southeast Asia, known as 500 SEA III. The firm is an early investor in companies like Grab, Bukalapak, and FinAccel. 2️⃣ [Oyo captains step down]( Ankit Gupta, the CEO of Oyo India, and Mandar Vaidya, head of Oyo Europe, left their positions within the company approximately six months ago. These changes in leadership come as Oyo prepares for its upcoming IPO. 3️⃣ [Grab adds Web3 features to its app]( Grab has introduced a Web3 feature in Singapore that allows users to obtain NFT vouchers for popular restaurants and services. Once the vouchers are used, holders will automatically receive digital collectibles in their Grab Web3 wallet. 4️⃣ [Japan’s SaaS gets a boost]( Japan-based firm Josys has secured US$93 million in a series B funding round led by Global Brain and Globis Capital Partners. The company plans to double its current 120-member headcount, focusing on hiring in countries like Singapore and Indonesia. 5️⃣ [Vietnam’s EV industry gets more power]( Gojek is teaming up with Vietnamese electric vehicle startup Selex Motors to deploy Selex Camel electric motorbikes for its ride-hailing, food delivery, and logistics services in Vietnam.  --------------------------------------------------------------- FYI 1️⃣ [Why ASEAN’s angel investors are hibernating amid tech winter]( The 2023 Angel Behavior Survey Report by AngelCentral reveals that 31% of the 99 angel investors based in Southeast Asia who participated in the survey have either paused or completely halted their investment activities. 2️⃣ [With Free Fire's return, will Shopee follow suit?]( While Free Fire is making a comeback in India, launching a localized version with partner Yotta, Chinese fast-fashion brand Shein is reentering India through a partnership with Reliance Retail. Will Shopee do the same? 3️⃣ [Solving problems that matter]( A startup is a company that solves a problem. The problem dictates the startup's product, market size, and talent pool. However, is the startup solving the right problem?  --------------------------------------------------------------- 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? You can unsubscribe from this newsletter by going to your “edit profile” page and choosing that option in our preference center. See you soon! [ADVERTISE]( | [SUBSCRIBE]( | [HIRE]( | [FIND JOBS]( P.S. Don't miss out on the biggest tech news and analysis. Add newsletter@techinasia.com to your address book, contacts, or safe sender list. Or simply move us into your inbox. Too many emails? Switch to a different frequency or get new content through our [preference center]( or [unsubscribe](. 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