Finding your place, and being put in your place


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Good morning Dear Reader,

 

Welcome back to Strait Up, our weekly newsletter that helps you make sense of what’s going on in Southeast Asia.

 

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This week we’re looking at Clubhouse, the audio-only social app that’s gaining strong traction globally. Clubhouse is primarily a place for tech discussions, but in Thailand, it has found itself navigating a new territory: politics.

 

We also have the latest on the Philippines’ prefab home startup Revolution Precrafted, which claims to be a billion-dollar business, but faces a reckoning as irate buyers and partners pursue legal action against it.

Forget tech bros, Clubhouse is a political hot house in Thailand

 

Jon

Image via William Krause/Unsplash

 

Picture the scene: Thousands of people are crammed into a room, hanging on every word of Thaksin Shinawatra, the billionaire former Prime Minister of Thailand who has lived in exile for over a decade after being ousted from power.

 

It’s a scenario that’s unrealistic in Thailand today. This is a country where certain discussions—and people—are taboo. For instance, discussion of the monarchy comes with stiff penalties—potentially decades in prison time—while figures like Shinawatra are enemies of the state.

 

And yet, Shinawatra held court last week in a discussion that thousands of Thais heard in real-time, albeit remotely through Clubhouse, the audio-only social media app that’s making waves worldwide. Six rooms, packed to the maximum 6,000 attendees, heard what was ultimately a non-controversial session from Shinawatra.

 

But the fact he could command the audience in the first place is notable—he may well be more adventurous in terms of content later on.

 

Clubhouse is primarily a place for technology and venture capital industries. There’s a saying: every room on Clubhouse eventually becomes a discussion about startups. It’s a joke, but it rings true.

 

It’s hardly a surprise given that the service was conceived in Silicon Valley, the home of tech and VC, during the Covid-19 lockdown last year. Deprived of their usual meetings and freedom to travel, technology executives and venture capitalists flocked to the app to mingle and talk shop.

The app is known for pearls of wisdom from globally-renowned figures such as investor Marc Andreessen and Tesla CEO Elon Musk. Popular podcaster Joe Rogan also joined recently.

Yet, in Thailand, it has found a very different place of its own: in politics.

 

Its arrival comes at a time of political upheaval in Thailand, where protesters have battled the government for the past year. There have been street demonstrations and arrests—Clubhouse is a new outlet in the arsenal for would-be disruptors of the Thai government.

 

Shinawatra, for example, has some 117,000 followers at the time of writing. Thanathorn Juangroongruangkit, a politician who led challenger party Future Forward until it was shut down by the government last year, has amassed 288,000 followers. Pavin Chachavalpongpun, an academic who has led criticism of the Thai royal family—and seen his Facebook group with over a million members blocked—has quickly gained a following of 312,000.

Thaksin Shinawatra (left, using an alias) and Thanathorn Juangroongruangkit are two ousted Thai politicians who have taken to Clubhouse

 

This is fast growth for an app that only began to get mainstream attention in Thailand in early February. Plus, the app remains exclusive to iOS devices—which accounts for just 25% of all smartphones in Thailand— and admits new users on an invite-only basis.

 

Thailand already has YouTube, Facebook and even newer arrival TikTok for video, but there’s something about the raw and in-the-moment nature of Clubhouse—mixed with the sincerity of voice chats—that is making it a mecca for topics and people who don’t get mainstream media time.

 

 

The government has warned users to watch what they say in the app, while cyber police agents have been deployed to keep tabs on discussions. Given the variety of conversations, that’s quite the challenge. But it may not be for long.

 

Already, elsewhere around the world, audio is popping up in places like YouTube as listeners save insightful talks for posterity. It’s only a matter of time before the same approach is applied by censors or prosecutors. Then there are major security concerns that the company which facilitates the service—US-China-based Agora—could be a security weak point. Potentially, it could be compelled to give up data through Chinese laws. There are also concerns about vulnerabilities in its data security after a third party accessed audio feeds last weekend.

 

For now, though, the Thai government is just keeping an eye (and ear) out.

 

Current Prime Minister Prayut Chan-o-cha—the army leader who led a successful coup in 2014—said he has no time to use the app; although, interestingly, he recently launched a weekly podcast for the public.

 

Prayut may yet change his mind if Clubhouse continues to grow. That’s really the million-dollar question in Thailand, and elsewhere in the world. The app is estimated to have crossed 10 million users worldwide, thanks to sessions by Musk and rapper Kanye West, but social media is faddish, and building enduring appeal once the honeymoon period is over is a huge challenge.

 

That’s a question grappling many. Companies are weighing on allocating resources to a service that could be a flash-in-the-pan, Clubhouse is working to build on its promise—and release an Android app—while Twitter, Facebook and others are building their own rival services.

 

But it says something about today’s digital world that an app conceived in the tech echo chamber is influencing politics on the other side of the world.

 

Clubhouse did not respond to a list of questions from The Ken about its growth in Thailand and policy on censoring users and working with governments.

A Revolution by contractors and homebuyers
 

Jum

 

The chickens are coming home to roost for Revolution Precrafted, which once claimed to be the first billion-dollar startup in the Philippines.

 

It’s been more than a year since The Ken wrote about cracks in the business of the Manila-based prefab home company, which has failed to deliver on promises to customers. Now founder Robbie Antonio faces possible syndicated estafa (or swindling) cases in the Philippines.

 

Antonio—whose family controls publicly listed Filipino real estate developer Century Properties Group—and five employees are being probed by the National Bureau of Investigation (NBI) for allegedly duping contractors and suppliers out of 150 million pesos (US$3 million)
in deals.

 

Revolution’s idea was to sell luxury prefab homes designed by world-renowned architects and artists including Zaha Hadid, Jean Nouvel, and David Salle. It gained attention in 2017 when, just two years after its foundation, it claimed to be the Philippines’ first unicorn following an undisclosed investment round.

 

According to local media firm ABS-CBN, nine contractors and suppliers have complained that Revolution lured them into a scheme where they were assured contracts for Revolution projects if they paid the startup 10% of the contract’s value.

 

The complainants are involved in construction, furniture, and fixtures supplies. They claim Antonio’s company did not honour their contracts and failed to procure supplies. Revolution, too, failed to secure the necessary government permits for the projects, they allege.


The Ken previously reported that Revolution Precrafted was building houses that didn’t match its prefab description

 

The Ken learned that Revolution homebuyers are also talking to the NBI about their grievances. In last year’s story, we reported that several disgruntled buyers had started to seek payment refunds, saying that the model houses that Revolution had constructed looked nothing like the prefab homes presented when they signed up. Instead, the homes seemed to have been largely built using traditional construction materials and methods. The turnover of the homes to buyers has been greatly delayed, too.

 

 

As complaints versus Revolution started surfacing, The Ken found from company insiders that Antonio had already actively pursued other business ideas. The creation of Resident Holdings, which houses Revolution and over a dozen other firms with names beginning with the letter R, was a clear sign that Revolution’s concept was not panning out as planned.

 

These companies also face complaints. Radiant Beauty Selection Corp (a shopping site for celebrity-endorsed cosmetics and beauty products) and Resurgent Corporation (direct marketing services) stand accused of running away with more than 20 million pesos (US$410,000) in money from two suppliers.

 

In a statement released on Monday, Revolution claimed it and its two affiliates “continue to comply with their agreements.” Here’s more from the statement:

The company (Revolution) is ready to settle legitimate obligations which have fallen due and has no intention to renege on these legitimate contractual claims.
 

The company is likewise in the process of collecting what is due them from those that have also defaulted in their obligations to Revolution.

 

The pandemic has activated force majeure stipulations in our contracts and has caused issues with our business transactions as it did with other industries. However, Revolution CEO Robbie Antonio and his companies Resurgent and Radiant are still viable and active.

A Filipino lawyer who used to work in the government told The Ken that the matter could be investigated via the newly created Department of Human Settlements and Urban Development. In the past, real estate regulators have revoked or suspended the licences to sell for developers who failed to deliver projects in accordance to approved plans and within the time specified. It can order them to refund customers.

 

Without any action from the regulatory body, the lawyer said buyers’ and contractors’ recourse is to file criminal cases before the courts, or reach a settlement with Revolution. The highest form of estafa—syndicated estafa—is defined as swindling committed by five or more people. It is punishable by life imprisonment, or even death, under Philippine laws.

 

It remains to be seen how involved Antonio’s family will be in resolving the cases. Initially, it seems that the family business is disassociating itself from Antonio in order to insulate the publicly listed firm from Revolution’s woes.

 

Antonio also stepped down as co-managing director and member of the board of Century Properties, a company founded by his father. Accepting his resignation, Century Properties said Antonio needs to “focus on addressing the pressing issues in his own company and its allied businesses.”

 

Revolution’s future appears to be hanging in the balance. The saga is far from over, and it’s one to keep an eye on.

SEA Briefs
 

Nadine

 

Facebook says it’s banning all military and military-linked accounts indefinitely in Myanmar. This follows a military coup a few weeks ago. The social network is taking a stance, but could Facebook itself face a ban in Myanmar now that the military is in charge?

 

Indonesia is desperate to attract more foreign investment, but policies are only slowly trickling in. The latest saw the government release a list of 245 “priority” industries eligible for incentives. Projects worth over US$710,000 can qualify for task breaks, fast-tracked licensing, and guaranteed access to energy and raw materials.

 

Indonesia’s online travel unicorn Traveloka is preparing a fintech play to boost its prospects prior to a prospective listing. The company let go of staff last year as Covid hit revenue. It claims revenue has rebounded, and now it plans to invest in building out “Buy Now, Pay Later” financial services.

 

The Singapore Stock Exchange (SGX) is preparing a new platform for its listed companies to focus on sustainability (ESG) reporting. Companies must already disclose current and future environmental, social and governance risks, but the platform will add transparency and standardisation.

 

TransferWise—which is now just “Wise”—is expanding its regional footprint and hiring at least 70 people in Singapore. It wants to go deeper into cross-border money transfers in Asia, an opportunity that head of APAC, Venkatesh Saha, sees as largely untapped because the focus has been on domestic issues so far. Saha previously spoke to us about how Wise became profitable.

Something for the weekend
 

Ben

 

Did you know that fruit water—just pieces of fruit in water—helped sell WeWork to customers? I learnt this and more from podcast Foundering’s WeWork episode, which drilled down into its culture and what happened before, during and after its implosion.

Image via Jon Russell/Flickr

 

Other tidbits include how community managers would “activate” a space before potential investors visited to give WeWork the veneer of a vibrant workspace. Or how WeWork’s breakneck expansions often caused many problems, like opening a new space with no doors, or worse, no toilet. Plenty of things to not do when running a business.

 

With insights from former employees, facets of CEO Adam Neuman’s thinking are explored, and the podcast touches on his up and down relationship with SoftBank supremo Masayoshi Son. The podcast has plenty of schadenfreude, but it provides a fascinating inside look at WeWork’s early years.

That’s all for us this week. We’ll catch you again on Sunday for our recap of this week’s stories. Or maybe we’ll see you on Clubhouse!

 

 

Strait Up is a weekly newsletter that cuts through the noise of the week to give you the need-to-know business, tech, and startup analysis. This is a paid newsletter that’s available exclusively to premium subscribers of The Ken Southeast Asia
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