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Australia's Data Republic raises A$22m in Series B round led by Singtel's Innov8; SIA takes stake in the tech startup
AUSTRALIAN tech startup Data Republic is set to grow its footprint in Singapore with the help of fresh funds from investors such as Singtel's Innov8 and national carrier Singapore Airlines (SIA), the firm has said.
Sydney-based Data Republic said on Tuesday that it has raised A$22 million (S$22.1 million) in a Series B funding round led by Innov8 - Singtel's corporate venture capital arm, which has a US$250 million war chest.
The fresh investment has given Singtel a seat on the board, Data Republic separately told The Business Times (BT), but it declined to disclose the amounts invested by individual backers.
Other investors named were existing shareholders Qualgro, a venture capital fund co-founded by former Innov8 director Peter Huynh, as well as ANZ, Reinventure and Ryder Capital's Ryder Innovation Fund.
SIA said in a separate bourse filing that it has picked up a minority stake in Data Republic through the placement of new shares, in what it billed as "a move to further enhance its digital capabilities". The airline said that it will work with Data Republic and other partners "to provide organisations with a practical means to collaborate and innovate at speed".
Citing a data breach at rival Cathay Pacific Airways, where the personal information of 9.4 million passengers was stolen, OCBC senior investment analyst Low Pei Han told BT that "it is perhaps of little surprise that companies want to ensure that they are adequately prepared to cope in an increasingly digitalised world".
George Wang, SIA's senior vice-president of information technology (IT), also said in a statement that the carrier recognises the growing role of data in giving organisations a better understanding of customers' preferences.
"Our investment in Data Republic highlights our commitment to data innovation through a platform which leverages technology to ensure data security and privacy and further enhance our digital capabilities," he added.
SIA said in mid-2017 that it would double down on IT spending in the face of tough operating conditions, committing "several hundreds of millions" of dollars over five years.
On the heels of a surprise loss for the January-to-March period, SIA chief executive Goh Choon Phong had also told the press that layoffs were not off the table.
OCBC's Ms Low noted that SIA is not the only carrier to have invested in Data Republic, with Australia's Qantas already on board. Qantas, which taps Data Republic's technology for its Red Planet digital marketing business, was part of an A$10.5 million Series A funding round in 2016 that also featured lenders National Australia Bank and Westpac Banking Corp.
"Many large companies have carved out a certain budget to invest in tech startups, such as setting up a venture capital fund to do so," Ms Low said.
"For SIA, it has introduced KrisPay, a blockchain-based mobile wallet linked to its customer loyalty programme, and it also released an API (application program interface) suite to the developer community this year via the KrisConnect Program.
"Krislab, a startup incubator, is another recent initiative and we understand the group is hiring IT personnel to help support the IT/tech sandbox environment of SIA."
The airline, which has been putting out hiring advertisements for technology development and research executives, describes SIA Krislab as an innovation centre.
Two-year-old Data Republic provides technology services for organisations to share data securely and privately. It expanded into Asia with the opening of an office in Singapore in June.
Paul McCarney, CEO of Data Republic, said in a media statement that the support from the two Singapore blue chips "demonstrates the growing importance of privacy and the increasing global need for technology which supports secure, inter-organisational data sharing across markets".
"We welcome our new strategic partners and thank existing investors for their continued support of Data Republic's technology and vision," Mr McCarney added.
K Ajith, director of Asia transport research at UOB Kay Hian, said in a comment to BT: "There is no reason to believe that the startup will not be able to enhance or speed up SIA's digital transformation programme in the areas of data security and data analytics."
SIA opened down by S$0.04, or 0.42 per cent, at S$9.48, after the announcement, while Singtel opened flat at S$3.09.