A few days ago, we reviewed the Southeast Asia predictions, amongst a series of predictions for 2020 we had revealed on the first day of the year.

The global pandemic of covid-19 impacted all the regions, and many of our predictions were accelerated, or derailed, because of it. Here we give the final review/verdict of the predictions we made about India, Middle East, and Chuhai (Chinese companies/entrepreneurs/investors venturing overseas).

As usual, we highlight those we predicted accurately in green, those we got wrong in red, and those which are not clear cut in blue.

Enjoy reading, and happy new year 2021!


      1. The economy recovers but remains challenging, funding for startups continues to flow; exits still rare and far between;
        2019 was a tough time for India’s economy – despite the optimism that gave Prime Minister Narendra Modi a strong second mandate, the growth turned sluggish. Although the $5 trillion economy for 2024-2025 target was unlikely, we expected things to turn out brighter in 2020. Bolder reforms were needed, though.

        However, we did not manage to predict the covid-19 pandemic. This, coupled with the difficulties against further reform and a few riots , made recovery unrealistic.The startup/tech ecosystem went ahead, and nothing much changed – still no notable exits.
      2. B2B business models grow even faster, as cost pressure continues to hit businesses; 
        Sort of, but the theme this year seems to be Jio, Jio and Jio.

      3. General cooling down of Chinese capital in Indian growth/late stage startups – more are monitoring rather than investing;
        There was a general sense of frustration amongst major Chinese tech investors into India last year – we think the key issue was many things, including growth and exit, turned out to require a much longer time horizon than many had anticipated.

        We, however, did not expect the Sino-Indian border dispute to go deadly this year – and the ensuing (two rounds of) banning of Chinese apps shattered the remaining confidence of Chinese tech investors. The inability to travel because of covid-19-induced border closures further complicated the issue.

        We noticed many, who were previously focused on India, have turned their attention to Southeast Asia. We have received dozens of enquiries on that front.

        That said, we do not think the outright ban is sustainable, and one way or another the government will find a way to relax the rules for some. We do not have a timeline in mind for that.
      4. More investment in SaaS, AI, and enterprise companies with global ambitions;
        While Postman is a great (and very inspiring) story – unfortunately we do not think the trend is that apparent.
      5. Big ecommerce platforms take social ecommerce more seriously, through their own ventures or acquisitions;
        As ecommerce grows, how to reliably and consistently acquire and retarget consumers at reasonable costs becomes an increasing challenge. Social commerce, an umbrella term for various models using social networks (existing or online) to promote/sell products, is a way to do it.

        Meesho had a great transaction last year, and a few others joined the fray. This year, Flipkart launched social commerce on 2GUD, an independent app it owns; Facebook, which backed Meesho in 2019, put a lot of emphasis on ecommerce, and Whatsapp orders now are equipped with a potent tool – Whatsapp Pay, which was finally approved.

        There were reports of Amazon entering social commerce over the years, but there does not seem to be anything significant on that front. Maybe Amazon, after all, is a rational company.
      6. Standalone payment companies, including PayTM, continues to struggle – they will be more bullish in lending;
        As mentioned above, Whatsapp Pay is here. And UPI made sure that everyone who owns a use case (and users) can do payment now. GooglePay now leads in number of UPI payments processed, while Flipkart’s PhonePe leads in value.

        Learning from the Ant experience, all mobile payment companies eventually want to become digital finance companies – and lending is where the real money is.
      7. More investment in Cloud Kitchens, adding supplies to delivery platforms and creating new culinary brands;
        Rebel Foods had a good year, from the lockdown demand surge to Wendy’s partnership (to open 250 cloud kitchens) announced at the end of the year. It also announced a funding round of US$50 million led by Coatue earlier this year.

        A few other cloud kitchen operators also announced early stage funding; that is not to include many other traditional players or startups that do not need external capital to start. Food delivery infrastructure enables virtual restaurants and virtual F&B brands – this is the trend we already saw in China far ahead of the invention of the term “cloud kitchen”.

      8. TikTok becomes profitable in India;
        It did not. On the contrary, it has been banned in India since June.

        TikTok was definitely on the right track at the beginning of the year – India was its biggest market, brands/advertisers were taking notice, and Zukerberg felt threatened.

        Many, us included, thought the ban was temporary and could be challenged/revoked/worked around, just like the TikTok ban in the US was. It turned out the authorities in India were quite serious.

      9. More direct-to-consumer brands emerge and grow;
        We predicted this a few times, and unfortunately this is still not happening. Perhaps the focus on essentials for ecommerce this year is part of the reason. Consumer brands that leverage omnichannel are the brightest spot in China this year, by the way.

      10. More entrepreneurs and innovations to revamp mobility, especially for autos and two-wheelers
        It seems the focus is on electric vehicles (EV) – especially two-wheelers. Share mobility startup Bounce announced a US$105m round at the beginning of the year, while Ola revealed plans to set up the ‘world’s largest’ e-scooter plant at the year end. A few other players announced funding inbetween. 


Middle East 

    1. The economy (and Dubai property prices) hits the bottom, and start to rebound;
      When we made the predictions in December 2019, the Middle East was not in a good shape. An economic downturn, coupled with sluggish oil prices and a weakening Dubai property market, costs a lot of jobs, and the income that would go with them.

      We were optimistic that the Dubai Expo 2020 would provide a lift; the developers would finally come together to stop the deterioration of over-supply; and the reforms in Saudi would, while creating competition, provide a refreshing uplift for Dubai as well.

      Then Covid-19 happened, coupled with oil price fluctuations and the rising VAT, changed the priorities.

      There are casualties, notably Awok, but some other more famous ecommerce players also had a close call. Oh, Sprii also collapsed.
    2. Slash of promotions/discounts from major ecommerce giants, including Noon;
      In fact, because of Covid-19 pandemic, ecommerce in the Middle East experienced an unprecedented leap. Promotions and discounts naturally became not that relevant anymore, riding the wave and fulfilling the orders were.
    3. Logistic landscape shifts with consolidation;
      The boom of ecommerce this year, while boosting ecommerce as a whole definitely, has, unsurprisingly, benefited the bigger players more. Only big players have the ability to sustain the infrastructure and also provide the necessary customer satisfaction during peak periods.

      The reborn Fetchr is a mature company run by experienced logistic adults; Agility’s commitment of Shipa continued; Aramex is also gaining traction in the ecommerce game. It is very difficult from the era of booming logistics startups 2-3 years ago.

      Some notable Chinese players in the field descended into infighting, unfortunately.
    4. More Saudi based regional startups emerge;
      While we see a number of Saudi-based startups raising good sums of money – we do not think it is significant enough to be a major trend.
    5. Abu Dhabi attracts more Chinese AI companies (and talent);
      G42 is still active, and some contracts get inked. However, the inability to travel freely has severely limited this trend.
    6. More Chinese VCs active in Middle East raising money from regional LPs and investment in regional deals;
      Can’t travel.
    7. Fintech still grows (very) slowly in the region, global fintech companies lobby for access to regional markets;
      The bright spot (in terms of funding) seems to be Buy-Now-Pay-Later, or consumer virtual credit card services; a few have raised significant rounds, in sync with a global trend after the success of Huabei and AfterPay. It still sits in a regulatory gray area in most markets (and thus easier to push compared to payment, lending and asset management), as in most countries.

      Yes STC becomes a unicorn, but it is part of Saudi Telecom.
    8. Careem mafia flexes more muscle;
      Careem’s former GM for the Riyadh region raised $6.6 million for his B2B startup Sary. This followed Egypt’s MaxAB, which did a $6.3 million seed round last year. In addition, Careem founders and investors made a few investments, into funds and startups, here and there. 

      There should be more.
    9. No more unicorns this year;
      The number of unicorns in the Middle East remains the same.
    10. Startups looking at reforming B2B supply chain finally emerge and gain traction
      Last year’s MaxAB $6.3 million mega seed round mentioned above probably gave the confidence of reforming the B2B supply chain, where we know room for efficiency increase is enormous. The Sary deal, mentioned above, also follows this trend.

Chuhai (Chinese companies/entrepreneurs/investors venturing overseas)

    1. Brands, Supply Chain, Fintech and business models remain the key for Chinese players venturing overseas;
      Brands and supply chain companies (ecommerce logistics etc.) are especially active this year. In the case of Southeast Asia, finally the platforms in the region (especially Shopee) are having enough volume to get some serious attention of large Chinese companies and investors.
    2. SheIn leads all cross border ecommerce;
      During Ramadan in 2020, SheIn was the only cross border ecommerce player with a steady flow of chartered cargo planes into Saudi Arabia; the others are almost all facing uncertainty in both demand and freight capacity.

      SheIn this year is probably having a gross sales of close to US$10 billion – you figure out how much the Nanjing-based company should be valued.

      SheIn is also gaining traction in Thailand, where fashion ecommerce is already being hotly contested.

      SheIn is finally gaining some attention in China in the last quarter of the year. Many aspiring cross border companies are using SheIn as a role model in their pitch.
    3. TikTok becomes profitable in certain markets, headwinds remain;
      TikTok encountered massive headwinds in the US and India, two most important markets; the distraction probably delayed profitability for a while.
    4. Big companies take a second thought about India;
      Yes we are talking about big Chinese companies – check out the review of predictions for India. 
    5. Alibaba consolidates global strategy, Meituan becomes more active;
      Yes for Alibaba, unfortunately the consolidation did not mean more commitment – it has been distracted by its priorities in China, first optimistic (Ant IPO) and then not so optimistic (what happened after IPO was shelved);

      Meituan could have become more active globally, and its founder spent some time in Indonesia at the beginning of the year.

      However, pandemic became a big distraction – it managed to grow the business in China very well in this however, turning net profitable.

      Meituan has also become a role model for many local service/food delivery companies globally.
    6. More Chinese entrepreneurs with international exposure go overseas; VCs start to believe that Alibaba/Tencent experience is no guarantee for success in overseas markets;
      Unfortunately, even Yiming Zhang, Founder of TikTok made a new year wish to travel more – the pandemic made it impossible for almost all.

      The second part of this prediction turned out to be true – many VCs investing in cross border deals are telling us while Alibaba/Tencent experience is definitely a plus, that alone does not give the extra boost of confidence in succeeding in international markets.
    7. More Chinese VCs set up presence in Singapore, and start looking at local deals in Southeast Asia; and they continue to bitch about high valuation;
      Unfortunately many who had plans to set up in Singapore just did not have the ability to do, thanks to the travel bans brought by Covid-19 pandemic; while a few (Ondine for example) are very actively looking at deals in Southeast Asia, many other big names could not execute because of the lockdowns. Many announced deals were already in the pipeline before the pandemic;Yes, valuation is still a point that many bitch about.
    8. More Chinese VCs active in Middle East raising money from regional LPs and investment in regional deals;
      Can’t travel, unfortunately. State-owned companies are continuing their projects in the Middle East though, with their staff vaccinated as early as August.
    9. Africa fever cools down;
      Transsion ecosystem is going well, while many others regret setting up in Africa without fully understanding the continent. Lack of competition is no guarantee of success.
    10. Latin America is still too far – and opportunistic; Fintech, logistics and content remain the leading sectors getting Chinese attention
      This is exacerbated by the inability to travel. That said, lots of fintech, especially lending, players are exploring Mexico en masse, having been blocked out of China, India and Indonesia (and not able to figure out Africa). A few content players are exploring Latam market, and of course with the strong competition from TikTok and Netflix.

Thanks for reading The Low Down (TLD), the blog by the team at Momentum Works. Got a different perspective or have a burning opinion to share? Let us know at [email protected].


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Jianggan Li is the Founder & CEO of Momentum Works. Prior to founding Momentum Works, he co-founded Easy Taxi in Asia, and served as Managing Director of Foodpanda. The two years running Rocket Internet companies has given him a lifetime experience on supersonic implementation, and good camaraderie with entrepreneurs across the developing world. He holds a MBA from INSEAD (GMAT 770) and a degree in Computer Engineering from Nanyang Technological University. Unfortunately he never wrote a single line of code professionally - but in his first job he was in media, travelling extensively across Asia & Europe, speaking with Ministers & (occasionally) Prime Ministers. Apart from English and his native Mandarin, he is also fluent in French and conversational in Cantonese & Spanish. He tried to learn Latin (for three years) and Sanskrit (for six months) as well. In his (scarce) free time, he reads, travels, hikes and dives. Pyongyang, Tehran & Chisinau are among the interesting cities he has been to.