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Happily ever after fairy-tale wedding

S'pore startups report big gains from exit deals

[SINGAPORE] Global corporates have splurged over US$458 million snapping up as many as 20 Singapore startups in the last two years alone.

Such fairy-tale endings - slang in the startup world for a happy exit story - were happening at the rate of about one a month.

Apart from being swept off one's feet by a princely buyer, a "fairy-tale ending" can also mean an IPO (initial public offering).

The most recent buyout - that of gaming startup Nonstop Games by Candy Crush Saga maker King for US$100 million - saw the local company become part of a global gaming giant with much bigger resources in terms of talent, marketing and distribution: a sweet deal indeed.

Likewise, other startups have also reported improved financials, good working relationships and exciting expansion plans.

Said vacation rental platform travelmob: "Our revenue has grown over 400 per cent since we were acquired, mainly on stronger awareness of our brand across Asia-Pacific. We're also seeing double-digit growth in travellers from the EU and Americas, both of which are HomeAway's stronghold markets."

The Singapore startup was acquired by Home- Away - a Texas-based, Nasdaq-listed vacation rental marketplace - for US$12.5 million in July last year.

John Weimer, vice-president of HomeAway APAC, said: "HomeAway has acquired over 20 companies in nearly 10 years. I can tell you most acquisitions either fail or get off to a bad start because of poor execution of a good integration plan. But with travelmob, this was not the case."

From the start, Home- Away had intended for travelmob to operate independently, so it retained the latter's talent and technology.

travelmob CEO Turochas "T" Faud said: "The acquisition structure has allowed us to be a separate entity within the Home- Away family. It is by design so that we're not bogged down by a larger corporate structure and remain nimble."

Techsailor, which was picked up by India's digital services provider TO THE NEW for an undisclosed amount last year also enjoyed similar growth and autonomy.

Leon Leong, co-founder of the digital marketing startup, said: "We're expanding our team, market reach and product offerings at a much faster pace. Revenue has jumped 50 per cent year-on-year . . . and we're entering new Asian markets. In fact, we just moved into our new and much larger office, whose open concept makes it easier . . . to interact."

Techsailor, like travelmob, said it has always operated as an agile, family- like team, and that has not changed since the acquisition. It added that TO THE NEW works with the energy and excitement levels of a startup, creating synergy between the two firms.

The same can be seen for homegrown video streaming platform Viki, which was bought by Rakuten for a whopping US$200 million last September, in what is the biggest known exit for a Singapore startup in the last decade.

On its experience working with the Japanese e-commerce giant, Viki's founder Razmig Hovaghimian said: "You know, our culture - putting people, ideas, innovation and disruption first - really hasn't changed because from the start, ours and Rakuten's are very aligned."

In agreement, Toru Shimada, CEO of Rakuten Asia, said: "Rakuten does not acquire companies that aren't a cultural fit. Like Rakuten . . . Viki is also passionate about education . . . in fact, I recently heard that of the 200 or so languages available on Viki, 50 are endangered and Viki is using its platform to help preserve these languages."

Today, the startup is part of Rakuten's digital content business, one of the Internet giant's fastest growing business units.

Said Mr Hovaghimian: "The acquisition has allowed Viki to leverage relationships and resources from across all of Rakuten's business units, work with video-streaming counterparts such as Wauki.TV and ShowTime, and even help shape Rakuten's US$1 billion acquisition of (chat app) Viber!"

Even with their exits, all these startups remain active in the local startup scene, regularly hosting and guest-talking at entrepreneurship events, and mentoring junior startups.

travelmob continues to work from Blk71 (a building popularly known as Singapore's startup hub), while Viki maintains that, as its roots are in Singapore, it will always be part of the ecosystem here.

Said CEO Mr Hovaghimian: "If (anything), our acquisition helps to prove that great startups - and exits - can happen in South-east Asia, and we're thrilled to have been part of that."