Vietnamese e-commerce startup Tiki raised $258 million in a Series E funding round led by AIA Insurance in anticipation of its initial public offering in the US. Other investors participating in the round include UBS London Branch, Mirae Asset-Naver Asia Growth Fund, and Taiwan Mobile, as well as current investor STIC GIGF.
|Tiki is mobilising capital to feed its ambitions over the next five years |
With the fresh capital, the company's value has risen to about $1 billion. Tiki will use the fresh capital to aid its efforts in logistics, such as the development of AI technologies and robotics systems for inventory management, order processing, and delivery. Tiki also intends to provide its users with personalised and easily accessible life insurance coverage.
In July, Tiki and AIA have entered into a 10-year partnership. Accordingly, AIA Vietnam will become Tiki’s exclusive insurance partner, enabling Tiki’s millions of customers to gain access to highly relevant life and health insurance solutions via Tiki’s leading e-commerce platform. The two will also jointly explore collaboration opportunities to meet the diverse and increasing financial needs of Vietnamese people.
Tran Ngoc Thai Son, founder and CEO of Tiki said that the fundraising takes place when the company is planning to go public in the US in 2025. However, the company will push up the plan one year earlier.
Tiki aims for an offshore listing in the US via the a special purpose acquisition company (SPAC) route in order to delve into the massive influx of foreign capital. A successful listing in the US may also attract a flurry of foreign investment in Vietnam's burgeoning technology sector.
Besides Tiki, some local firms like VNG and Loship also look to raise more offshore capital via SPACs targeting the US market. However, the SPAC route for Vietnamese companies going abroad will encounter certain bumps in the road.
According to Kent Wong, partner, head of Banking and Capital Markets at VCI Legal, the SPAC bubble has burst due to growing concerns over explosion of blank check companies and the impact on retail investors.
“The drawback is that Loship, VNG, and Tiki will have to create a lot of hype to draw retail participation in the US in the short term, and not having a recognisable brand in that market will be a disadvantage,” Wong told VIR. “On top of that, they will need a bona fide business plan and solid target companies to merge or acquire with the raised capital.”