Category: Economy
Seattle: An Overlooked AI Hub in the New Tech Economy?
Seattle’s tech leaders claim their city is a hub for AI innovation, but recent assessments of promising AI startups paint a different picture:
- Forbes’ AI 50 list did not feature any Seattle startups, leading to an Axios headline stating, “AI boom’s primary beneficiaries reside in just four states,” with Washington notably absent.
- Bloomberg’s article highlighting “10 AI Companies to Watch Right Now” did not include any Seattle-based companies.
- Insider’s “34 most promising AI startups of 2023” featured only one from Seattle.
- In the latest Y Combinator cohort, only three out of 138 AI-related startups originated from Seattle.
While there were two Seattle companies on the IVP Enterprise AI 55 list, they were overshadowed by Bay Area competitors.
Salesforce CEO Marc Benioff proclaimed, “San Francisco & California serve as the headquarters for AI companies and the talent pool,” referencing the IVP list.
Seattle’s modest presence and limited recognition beyond its borders could hinder its ability to attract leading entrepreneurs and AI executives. This poses potential challenges as the AI industry, fueled by advancements in generative AI, is expected to yield trillions of dollars in economic impact.
Matt McIlwain, managing director at Seattle VC firm Madrona, emphasized that Seattle should be considered “one of the premier centers of excellence for AI.” However, he acknowledged, “sometimes we are too understated.”
Perhaps the city’s AI innovators are quietly at work in Seattle, a place not known for self-promotion.
Ultimately, the perception of Seattle as an AI hub could play a pivotal role in attracting AI talent and bolstering the city’s innovation ecosystem. As Kirby Winfield, founding general partner at Seattle venture firm Ascend.vc, noted, “Perception certainly matters in attracting talent and other resources to a region.”
Heather Redman, managing partner at Seattle VC firm Flying Fish, urged the city to address its underselling of its AI capabilities and prioritize collaborations between the tech and non-tech sectors. She emphasized the transformative potential of AI across various industries and aspects of society.
Seattle’s AI clout
Many acknowledge that Silicon Valley serves as the focal point for AI startups.
According to PitchBook, AI and machine learning companies based in San Francisco raised an impressive $12.8 billion across 219 deals through August, putting their performance in a league of its own. In contrast, Seattle-based AI and machine learning firms secured a modest $170 million in funding across 24 deals during the same period.
Nevertheless, Seattle claims the second spot nationally in terms of AI talent density, a metric that gauges the number of professionals specializing in AI, according to data from SeekOut, a Seattle-based recruiting platform.
Vivek Ramaswami, a partner at Madrona in San Francisco, commented, “Ultimately, what matters most for these startups is the ability to attract exceptional talent and deliver outstanding products. I believe that Seattle stands out among most other cities outside of the Bay Area in this regard.”
Seattle boasts an impressive tech landscape, with cloud computing giants Microsoft and Amazon headquartered in the region, offering vital tools and services that drive AI and machine learning applications. Griffin noted, “The investments made by these two companies in AI are massive by any standard.”
In addition to Microsoft and Amazon, Meta, Google, and Apple maintain substantial engineering centers in the Seattle area, employing thousands of top AI researchers and engineers.
Seattle’s allure extends to academia, attracting prominent AI researchers to the University of Washington’s computer science school and the Allen Institute for AI (AI2). Notably, the AI2 Incubator, which recently secured $30 million for its latest fund, has spawned over 20 AI startups, some of which were later acquired by tech giants like Apple and Baidu.
Seattle’s AI community also received recognition on Time’s recent list of 100 leading AI influencers, with seven individuals linked to the city, including Microsoft’s Kalika Bali, Kate Crawford, Kevin Scott, and Jaime Teevan, sci-fi author Ted Chiang, and UW professors Emily Bender and Yejin Choi.
Ed Lazowska, a longtime computer science professor at the University of Washington, proudly declared, “We are unquestionably an AI hub, particularly if we define it by ‘AI expertise’ rather than just ‘buzzworthy startups’.”
Seattle boasts a thriving AI startup scene, with a multitude of rapidly expanding ventures making their mark. Notable inclusions in this burgeoning landscape, as highlighted in lists such as NFX’s AI Hot 75 and the IA40, encompass a diverse array of innovators:
- Lexion, a legal tech startup.
- WellSaid Labs, specializing in speech recognition technology.
- Xembly, a company pioneering the concept of AI ‘chief of staff.’
- Fixie, a trailblazing large language model startup.
- OctoML, a forward-thinking machine learning enterprise.
- CLIPr, a cutting-edge video analysis platform.
Moreover, Seattle’s AI-focused startups extend beyond these select few, with the GeekWire 200 ranking providing additional insights into the region’s vibrant private sector:
- Icertis
- Highspot
- Textio
- Defined.AI
- WhyLabs
In the summer months, several Seattle-area AI startups, including A-Alpha Bio, DropZone AI, and Protect AI, secured substantial capital investments, further fueling the city’s AI innovation ecosystem.
Ramaswami, an advocate for Seattle’s AI prominence, emphasized that the city’s continued elevation as an ‘AI hub’ hinges on both startups and established companies expanding, making astute hires, and delivering top-tier AI products to the market.
McIlwain stressed the importance of effective storytelling for industry giants like Amazon, asserting that it’s crucial for everyone to actively share and amplify Seattle’s compelling AI narrative.
Singaporean Multinational E-Commerce Company Shuts Down Operations In Four Latin Countries
According to multiple sources, Shopee has shut down local operations in four Latin countries, mainly Chile, Colombia, and Mexico, while leaving Argentina entirely.
The Singapore-based company will maintain cross-border operations in the first three markets but cut most of its teams in the countries, affecting dozens of employees. However, this will not affect Brazil, where Shopee has become a dominant player.
In a statement to Reuters, the company confirmed that it would “concentrate on a cross-border model in Mexico, Colombia, and Chile, and close in Argentina.”
As the world continues to transition out of the pandemic, the company’s shares took a tumble to $27 billion. This value is a far cry from its market value during the pandemic, which saw its market value soar to more than $200 billion last October as its gaming and e-commerce units surged in popularity.
Shopee in shutting down operations in these Latin countries saw their decision affected “dozens of employees,” as reported by Reuters.
This is not the first time that Shopee has cut down on jobs. In June, Shopee cut jobs across its e-commerce and food delivery divisions for Southeast Asia and its Latin American operations.
Most recently, the company canceled a slew of employment offers last minute, which garnered attention in China when one worker posted his plight on WeChat after arriving in Singapore.
The user named ‘Lin Ge goes to Nanyang’ said, “I landed with my wife and dog and was told my offer [from Shopee] was canceled while I was still at the airport.”
The cuts from Shopee, owned by Tencent Holdings-backed Sea Limited, have largely affected technology positions in Singapore, where the company is based in Singapore. Sea is one of many tech companies worldwide cutting back amid a slowing global economy and fears of recession.
According to a company representative, “Due to adjustments to hiring plans for some tech teams, a number of roles at Shopee are no longer available. We are working closely to support those areas affected.”
Grab Announces A $988 Million Financial Loss In Q3 Due To A Drop In Ride-Hailing During Lockdowns
The Singapore unicorn expects its SPAC deal to finalize in Q4 of this year.
Grab, the Southeast Asian unicorn reported a net loss of $988 million for the July-September quarter, increased from a loss of $621 million a year earlier, as increased COVID-19 control measures in the area impacted its core ride-hailing business.
The Singaporean digital tech business, a significant startup in the area, offers ride-hailing, delivery, and banking services through what it calls a “superapp” approach.
Singapore, Malaysia, Indonesia, Vietnam, Thailand, the Philippines, Cambodia, and Myanmar are among the countries it operates.
On Thursday, Grab also stated that its proposed merger with a particular purpose acquisition company, Altimeter Growth Corp., located in the United States, “continues to advance and is slated to complete in the fourth quarter of 2021.”
The deal values Grab at roughly $40 billion and allow the business to be listed on the Nasdaq.
Grab said noncash expenditures such as accrued interest, stock-based compensation, and fair value fluctuations on assets account for a substantial portion of the massive loss for the quarter.
However, several Southeast Asian countries took severe restrictions to control coronavirus spread during the three months through September, creating a “difficult operating environment,” Grab said in a statement.
According to the company, revenue fell 9% to $157 million in the third quarter “as a result of the predicted fall in mobility owing to the severe lockdowns in Vietnam,” according to the company.
Revenue from the ride-hailing business fell 26% to $88 million, while revenue from the delivery business increased 58% year on year to $49 million.
Financial services revenue, such as its e-wallet, climbed 11% to $14 million.
The accounting revenue for Grab is shown net of incentives for drivers, retailers, and customers.
Consumer incentives more than quadrupled to $271 million in the third quarter, indicating a competitive business climate in the region.
Due to its delivery and banking services growth, its gross merchandise value (the entire value of transactions completed through Grab’s platform) climbed 32% to $4 billion in the quarter.
“Despite severe lockdowns in Vietnam and heightened limitations across the region in the third quarter as a result of COVID-19, we performed successfully on our superapp strategy and produced excellent growth,” said CEO Anthony Tan in a statement.
“With a recovery insight and the progressive reopening of economies giving tailwinds to our company, we are doubling down on investments that will help us grab a larger part of the possibilities before us and open up new addressable markets for Grab, such as grocery.”
Separately, Tan stated during an investor webcast that the firm anticipates a significant rebound in the ride-hailing sector in the fourth quarter, particularly in Indonesia, Malaysia, and Vietnam, as vaccination rates rise in the area.
Vietnam to Asses Cryptocurrency Development Through Central Bank
Nikkei Asia reported that the government of Vietnam has assigned its central bank in the R&D of its very own blockchain-based digital currency. The policy came forth in Prime Minister Nguyen Xuan Phuc’s Decision 942, which outlined the government’s approach to digitalizing the country with virtual currency based on blockchain technology by 2030.
According to Nikkei, Binh Nguyen Thanh, a coordinator at RMIT University Vietnam’s FinTech-Crypto Hub, said that the government authorities will have more control over the virtual money than having it be left to decentralized software and private enterprises. Thanh quoted, “I think they will look at how the experiment in other countries goes.” As back in October 2020 last year, Cambodia launched a state-backed digital coin called “Bakong,” while neighboring countries like Cina and Thailand are reported to have similar thoughts.
He further explained that in Vietnam, cryptocurrency is as it is, will remain in the grey area of an obscured regulation. Dabbling in bitcoin and applying it as a means of payment is a violation of the law and may be subjected to administrative or criminal sanctions.
Alibaba Cloud Plans to Invest US$1bn in Asia Pacific Countries in Support of Developing Talent Pool
Alibaba subsidiary, Alibaba Cloud announced its plans to invest USD $1billion across several Asia Pacific countries in developing a digital talent pool and empower the growth of 100,000 startups in the technological field. Current disclosed countries to be involved in the investment plans are Malaysia, the Philippines, Indonesia, and Singapore.
The investment strategy is part of Alibaba Cloud’s AsiaForward core project, DigiTalents Forward with a focus on infrastructure, technological innovation, and talent development to help in the economic growth of the local arena. AsiaForward has two more projects under its wing being AI Forward, and DigiEntrepreneurs Forward.
Alibaba will partner with Handsprofit, Malaysia in developing its very first international innovation centre in the country. This will become an opportunity for Malaysian startups, and SMEs a platform for innovation opportunities. The platform will be offering various cloud technology, leadership training, and venture capital networking.
The data centre investment in Indonesia will be the third launch by Alibaba Cloud that offers database, security, network, machine learning, and data analytics services. It is mentioned that the new centre allows better support for local businesses in adopting cloud technology and encourages Indonesia’s push for a digital community.
As for development in the Philippines, the first data centre is estimated to be launched by end of 2021. Similar to the development plans of Malaysia and Indonesia, it will be a huge support for the digitalization of local businesses through services such as elastic compute service, database, global network solution, content delivery network, and storage services. This establishes Alibaba Cloud’s stand on prioritizing the country’s banking, fintech, retail, logistics, education sectors, and others.
In Singapore, Alibaba Cloud plans a kick-off of the DigiTalents Forward program. This is said to be a collaboration with Singapore’s School of Computer Science and Engineering, and NTU-Alibaba Singapore Joint Research Institute at the Nanyang Technological University. Programs will include the focus of various AI courses under NTU’s MiniMasters program.