News from around the world – May 14


A roundup of news from the startup world:


China’s tech startups allow sleeping at work, but at a price
“If you do work in one of these environments and are complaining about the extra hours you put in every day, then you should count your blessings. Chinese tech startups are growing at a blistering rate, and these companies can’t hire talents quick enough to satisfy their labor demand. To compensate, Chinese IT engineers and programmers are turning their office into their workweek home. Employers are encouraging workers to set up cots so they don’t have to go home to get a quick shut eye. Some companies have even installed bunk beds, and having their employees stick around the office 24/7 to get work done. Even naps are allowed during regular working hours.

Startups in Asia Face Tougher Environment
Just like their counterparts in Silicon Valley, startups in Asia are facing a tougher fundraising environment as weakness in the global economy and volatility in China’s stock market have made venture capitalists more cautious.

The US Defense Department is expanding its efforts with tech startups   
The U.S. Department of Defense is expanding its work with tech startups, bringing tech executives to work at its Silicon Valley lab and planning a new office in Boston to tap into research happening in that area. The expansion follows the early success of the Defense Innovation Unit Experimental (DIUx) office, an 8-month old Silicon Valley incubator that is a key part of Secretary of Defense Ash Carter’s push to rebuild ties between the military and tech industry. Those ties weakened in recent years as a new breed of Internet startup began innovating more quickly and effectively than companies the DOD has worked with for decades.

Korea Opens Its Doors and Wallet to Startups Eying Asia
Korea will host the K-Startup Grand Challenge, an all-expenses-paid acceleration program for 40 high-potential startups from around the world this autumn. For startups selected for the acceleration program, the government will cover living expenses and flights to Korea, and provide office and lab space in a new $160 million startup campus near Seoul. Applications are open now and run through June 14. The government will further provide them with offices and lab space in its $160 million Startup Campus in Pangyo. The campus is within walking distance to the R&D labs of many Korean tech giants, which have signed on to mentor the startups. It is also just 14 minutes from Gangnam by subway.

Finalcad Takes Part in Slush Asia to Accelerate Growth in the Region
FINALCAD, the French startup providing mobile apps and predictive analytics to the construction industry, will take part in Slush Asia held in Tokyo on May 13-14, 2016, the largest international startup event in Japan. By meeting key investors and media from all over Asia, FINALCAD will take advantage of Slush Asia to accelerate its business development in the region. FINALCAD will capitalise on this initial experience by taking part in Slush Asia held in Tokyo on May 13-14, 2016. As the largest international startup event in Japan, Slush Asia is expected to gather over 6,000 attendees from all over the world to Tokyo. This will include an expected 600 startups, 300 investors and 400 journalists to take part in the event.

SEA VCs see falling valuations as investors grow cautious amid external economic headwinds
The Southeast Asian venture capital (VC) space is seeing a downward adjustment of valuation, as tougher economic environment dampened investor confidence. The Malaysian Private Equity & Venture Capital Association (MVCA) chairman Amin Shafie, who is also a partner at Intres Capital, said the region is starting to see startups raising downrounds. From the companies Shafie has come across, he sees a drop of about 20 per cent in valuation from last year. He noted that mature startups are unlikely to enjoy the high valuations they secured in previous private funding rounds when investors were more optimistic. Shafie pointed out that tides have been changing since the third quarter in 2015.

L’Oréal invests in beauty tech startups to blaze forward with digital innovation

L’Oréal will work with incubator Founders Factory to become its partner for investments in beauty tech startups as the cosmetics business looks to setup the right arm’s length approach to innovation. The world’s biggest cosmetics company is all too aware of the challenges to drive material innovation and its latest venture aims to help solve two of the most complicated – talent and executive level support from both start-up and brand. Both have already been explored to some extent via the company’s own technology incubator in San Francisco which has spawned a several innovations including a virtual make-up coach Makeup Genius. Now, under the new partnership, L’Oréal and Founders Factory will invest and grow five early stage startups and co-create two new companies from scratch every year. here Should You Start Your Tech Company?

VirusTotal policy changes spark outrage among newer tech startups
Cyber-security is set to lose access to the information-sharing database VirusTotal in what has been deemed by some to be an attempt to lock out new entrants into the cyber-security arena. On May 4, VirusTotal said it would cut off unlimited access to companies that do not share information with the database. The changes were met warmly by some companies like Trend Micro who published the company’s support soon after announcement. A colder response came from other, newer companies who felt they were being muscled out of VirusTotal.

Where Should You Start Your Tech Company?
San Francisco may be home to the most tech startups, but a report published Wednesday ranks Boston as the best place for brand-new tech companies to find success. The study, conducted by the U.S. Chamber of Commerce and Washington, D.C.-based tech incubator 1776, analyzed 25 U.S. cities for factors that enable and support entrepreneurship, and included perspective from 330 startup leaders. Cities that ranked highest in the index had thriving tech entrepreneurship communities with access to funding and talented workers, along with strong engagement with local institutions like government, universities and corporations,

New StartMesh fund raising $20m to back startups
Australian tech startup advisory group StartMesh will raise $20 million for a new fund to back early stage startups after being encouraged by tax incentives in the government’s National Innovation and Science Agenda. The organisation, which was launched in 2014 by three former startup founders Richard Webb, Paul Devereux and Matt Youill, will structure its fund as a so-called early stage venture capital limited partnership (ESVCLP,) which attract favourable tax treatment since the government’s announcement last December. The company is being advised by global law firm Norton Rose Fulbright as it seeks to raise the fund and structure it to provide a diverse portfolio.

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