Venture Capital in Asia
A Quantitative Look at Asian Investors, Companies & Unicorns
Below is a transcript of the Analyse Asia podcast Episode 36: Venture Capital Asia with Michael Dempsey of CB Insights, hosted by Bernard Leong.
Get our Q1 2015 Asia Venture Capital report.
TRENDS THAT ARE SHAPING VENTURE CAPITAL IN ASIA
Bernard: Welcome to Analyse Asia. The podcast dedicated to dissect the pulse of technology, media and business in Asia. The show is sponsored by idealworldspace.com, which promotes a healthier way of working through the adjustable studying desks and Linkcious, the place where you can sell your products everywhere. Hi, Michael.
Michael: Hey, how's it going?
Bernard: I'm well. How are you doing?
Michael: I'm doing well, I'm doing well.
Bernard: Okay, we are talking to Michael Dempsey, currently with the research and data analytics team in CB Insights. By the way, just before that, you are based in New York, right?
Michael: Correct yeah, we are based in New York.
Bernard: So it's early morning in New York. So maybe a quick first question, how did you get started in the industry?
Michael: Sure, I started in a hedge fund called The Crème Partners. I'm analyst there for two and a half years, doing investments across a bunch of different asset classes, ranging from private equity in South Korea and the U.S. to some derivatives, now also to seed stage, early stage startup investments in the United States.
Bernard: Maybe to help our audience a little bit, tell me a little bit about CB Insights. What does it do? I've been following CB Insights, I can tell you it's a great treasure tool of information. You guys give great analytics and data about the venture capital industry. And maybe tell me who are the founders and where are you guys now?
Michael: So CB Insights is, we call ourselves a venture capital database. In reality we track all private company financings exits and try to quantitatively access private companies using a variety of metrics. The two, it was founded by Anand Sanwal and Jonathan Sherry, and both of them previously helped around American Expresses $50 million Chairman's Innovation Fund. I think their impetus to start the company was, in that position, they were disappointed by the lack of transparency and data around private companies. So like great entrepreneurs do, they decided to build a better solution.
Bernard: And so they setup CB Insights and basically they collect a lot of data. Do you actually collect data from just public sources or do you also go by talking to people within the industry itself?
Michael: We don't do the army of analyst model. We quantitatively and algorithmically collect data across over a 160,000 sources every day. But we do have some proprietary data deals with some venture capital providers, I guess agencies. And then also a lot of venture capital funds will give us their data because it's in their best interest to have their data up to date.
Bernard: So with those data, basically what you do is that you try to calculate the efficiency of venture capital. What kind of insights do you usually draw on? Do you typically just look at exits, valuations in different regions or etcetera?
Michael: Yeah, we look at financing trends and exits, valuations absolutely, who the top investors are, what investors like to invest with other people. So we look at syndicates a lot. We also look at more performance based metrics, so web metrics, understanding what the web traffic is like over time. Understanding who is talking about them on social media, how often they are being talked about.
So we track Twitter mentions and Facebook mentions. We look at news classification as well, so how often they are being talked about in the news, what are they being talked about? Are they partnering with a lot of companies? Things like that. and then we also track job listings so we can see, a job listing increases a good proxy for a healthy company, because if they are growing a lot, they should be hiring a lot. We take a panel of different data points and can drive a lot of different insights around both industries, companies and investors.
Bernard: How did you end up joining CB Insights, and what is your current role there?
Michael: I'm being from the investing side of things. I definitely saw the need in the market place. I knew that I wanted to join a company that was small in terms of how the camp was growing, while still staying pretty industry facings. So CB Insights was perfect. There, I do research and data analysis around all the private company financings, exits and things like that. So I write for a research blog, I help our clients, and I'm generally just keeping my eye on the broader market globally.
Bernard: Which is the reason why I got you onto the show because I've seen a couple of articles from you, talking about venture capital financing in Asia. Presumably you actually collect the data from different sources as you have mentioned earlier. Just looking at the venture capital financing, but let me specifically go into the Asia e-commerce industry which actually exploded in 2014. So there was something about U.S., $11.5 billion raised across 367 equity financing last year. So what are the trends that you see leading up in 2015 for Asia alone?
Michael: Obviously that explosion, a lot of it is driven by e-hailing apps and the Uber competitors. So we are seeing a lot that still. KuaiDi Dache raised $600 million in the end of March this year. So we are still seeing that. The Ola Cabs, the same kind of thing. We are also seeing more trends around other on-demand services, whether it's food delivery or manicures, things like that. Just the overall demand space is growing a lot on the Asia e-commerce side. And then we are also seeing a few things around social commerce and social media. So that's something that we are definitely keeping an eye on. And looking at some of these vertical specific social network, things like that.
I think one of the examples that I just noted was a company called, I believe it's pronounced Mmbang, they raised a $100 million Series C in March. They are a social network that's very specifically targeted at mothers. And so yeah, that's definitely one of the trends we are looking at, and we are expecting to see similarly large numbers in 2015 as we did in 2014.
Bernard: You see that there's not going to be a loss of momentum, given that so much has been put into the last year. So are you going to see continuously? Do you think there's going to be more or less or mostly the same?
Michael: I think it'll be at least the same, could be more. I think thus far in 2015, we've seen over $5 billion put in already into e-commerce and mobile commerce in Asia. So I think there's plenty of room and plenty of money that wants to get in still, that I definitely do not see a downturn in 2015.
Bernard: So given that the amount of funding that has exploded across Asia, do you see that Rocket Internet start being able to startup with a lot of these clones of different companies in different geographies, actually increase the amount of equity financing across the region?
Michael: I think with Rocket Internet, there's an interesting threat they pose because they are so great at raising money in such a fast way, that if they see something that works, they are going to really blow that out. And they are also very good at scaling a business quickly. So I definitely think for some investors, they do worry about that. And I think that might be part of the reason why we've seen some very large e-commerce rounds happen this year that are fairly early on.
So that could just be a matter of the investors worrying that they need to put a lot of money into a company to beat a company, like Rocket Internet that can raise so much. So yeah, I think it's a factor. But again, I'm hesitant to say that they are the ones driving a lot of these big rounds, because I think just the macroeconomics opportunities are what is driving a lot of people that come into some of these more hard markets.
Bernard: Specifically what kind of macroeconomics? Is it or so because of the amount of mobile penetration is also increasing in these geographies now?
Michael: Yeah, I think a lot of it is driven by that. So if you look at China, it's a first leader and most Internet users in the world still see decent growth, but it's still below 50% internet penetration. If you move to India, which is I think the third most Internet users in the world, their Internet penetration is below 25% and they are growing at I think 14%, year over year. That's an interesting market because you have great technology, you have a lot of good engineers that are starting there. But then you also have one of the youngest populations in the world by 2020. Pair that with rising middle class, highly dense cities, I think that investors salvaged that opportunity.
On the flipside, you have countries like Vietnam which we've spent a little bit of time looking at. For Vietnam, Internet penetration is still below 50%, but it's high. They are still growing a lot. But I think that we have to start looking at the growth in consumer change of funny behavior.
So e-commerce sales are expected to almost double year over year from 2014 to 2015 there. And that's really I think partially attestment to consumers becoming more comfortable with buying online. So in Vietnam, the consumers aren't as used to buying without touching and seeing, and that's something that's been talked about. Versus India, consumers have been comfortable with that for years just because of infrastructure issues that make it very difficult. They gave rise to grocery delivery and things like that, that are already happening over the phone. So I think that's definitely another kind of interesting data point in that scheme of things.
Bernard: Specifically on the amount of investments in Asia. If you look at by country, China and India, they have the most amounts of equity financings because of their large markets with economies of scale. Whether their Internet penetration is really that high, remains a question. While you also observe things like Singapore, South Korea and Japan, where they are more developed but they have significantly smaller populations. Will the amount of investments from your point of view, cascade down to other kinds of market? It's like a very large market at Indonesia or where they go to is potentially developing markets in Asia, such as Vietnam, which we just mentioned, probably Myanmar, Philippines and Thailand.
Michael: Yeah, we haven't spent as much time covering some of the more developing markets. But I think in general, we will see a cascade in those other markets. You have companies, I believe like Tokopedias serving Indonesia. They've raised over $100 million from Sequoia and Soft Bank. And you have other companies that are emerging to serve these markets on the e-commerce side of things. So I don't think that the funding levels will, at least in the very near future get anywhere close to China and India. But I think that there definitely is an opportunity for those dollars to cascade as you said.
Bernard: Do you think that you will also be cascading also to the same industry as you have observed in both e-commerce and on-demand mobile apps, such as Uber kind of companies?
Michael: Yeah, I think that that would be the first major frontier. In Thailand for example, Lalamove, they raised $10 million Series A this January. They do that on demand delivery, almost like ship in the United States. We also some e-commerce enablement companies like A Commerce, they are serving South East Asia and they've raised, I think $18.8 million to date. E-commerce and on-demand are trends that are happening globally, and I think that those makes sense as the next frontier of those markets as well.
Bernard: Do you find it very difficult to look at Asia venture capital, because in most of the cases where the funding is announced, but the valuation is not announced?
Michael: Yeah, I actually think that at least in China, we've seen valuation numbers coming out more and more recently. But in general with the way venture capital works, you can peg evaluation based on a certain ownership percentage assumption. So I don't think it's that difficult to analyze if you don't have the valuation data, because large financing rounds are strong enough to run down on its own.
Bernard: So you actually saw what that was and tried to figure out what could the valuation of that particular company going to be?
Michael: We can think about it, but we are never going to guess and put out figures about it.
Bernard: So what about other areas beyond e-commerce, beyond on-demand mobile apps for example? Do you see a lot of increase in other verticals such as hardware?
Michael: Hardware, haven't see as much of an increase in. Most of the things that we are seeing really is focused on that on-demand area. So food and grocery is probably one of the more interesting spaces that we've just started looking at more and more in both India and China.
Bernard: Do you think that Uber is going to be in danger because there's GrabTaxi in South East Asia and also there's a merger of Didi Dutcher and KuaiDi Dache into one company, which is kind of having Tencent and Alibaba both ganging up on Baidu?
Michael: I definitely think it makes it difficult for Uber. There's been those numbers thrown that KuaiDi Didi entity controls about 99% of the overall demand for those two taxi apps. I think it will be difficult for them. Having said that, I don't think that they are going to shy away from trying to compete or strike deals with other competitors that are already in those spaces. I believe we had start some rumors about that a few months ago, and we didn't have anything confirmed to my knowledge. It's definitely that they are going to have to deal with, because such a big market for them, if they want to grow into this global logistics type company, it will be important for them.
Bernard: With venture capital they are definitely top firms. So which are the top firms currently dominating the deals in Asia and what are the essential differences that actually set them apart?
Michael: So you have the traditional people who have been there for some time, and that's Sequoia, different Sequoia Capital branches in India and China, and then IDG as well. Their investing strategy has become a little more wide ranging across the deals that they do, because in the U.S., we have a lot more focus on stage VCs. But I think these firms are very entrenched in the market. They probably have such great deal closed that they look at everything across from early to mid-stage, and then they've also done some large nine figure late stage rounds. Alternatively you have Tire Global who's come in and really focused heavily on India. And they originally came in and started doing later stage deals, so they are a big investor in Flipkart, but they've been incredibly active at the early stage lately, investing in over 20 deals, thus far in 2015.
And they are investing across a bunch of different industries, from Ather Energy, which is an electric two wheel scooter company, to Vedantu which is an Ad tech company, to Grow Forward which is the post mates for India company. Everything we've had about them, they put out very fast term sheets and then they are really able to fill out entire rounds, because they move quickly. And I think that the way that that fund I setup, it's such a large fund that they can write these kind of options on these companies with a $5 million Series A investment. And then if it starts really working, they can really follow it on and build on that position to gain a more meaningful equity stake. And they also, I think they don't have any problems raising additional funds. On India, Tiger is definitely unique. More in China have done later stage deals thus far. They were in KuaiDi Dache, Series D and York-Piers Series C.
Then if we are looking at some of the more emerging markets, East Ventures is one of the most active, early stage funds, and they are very active in Indonesia and Thailand and Singapore. And then you also, you can't not mention 500 Startups because they are investing all over the place and they've defiantly picked up their investing activity in Asian tech companies in the past year or so.
Bernard: How about Soft Bank?
Michael: Soft Bank is definitely interesting with the way that they are doing a lot of these corporate minority rounds. And I think they are in between of what a traditional corporate VC might be and then what Tire Global would be. So they definitely have a lot of cloud and they are making noise, but they just aren't as active in terms of number of deals as these other funds.
Bernard: Because I was reading an article from John, who's also a guest on the show, and he was identifying all the taxi apps, and he points to most of them having linkages to Soft Bank in one way or another. So I don't know, do you see them more like a corporate VC rather than a traditional VC in your perspective?
Michael: Yeah, they definitely have that; there were those rumors about them creating that coalition global taxi app company that they had invested in all. They are definitely more strategic I think, than just an investor, that's why you see a lot of these later stage corporate minority deals, but they are not just venture investments. And so I just think of them as a little more strategic than a traditional VC.
Bernard: I see, because they also did at Tokopedia, the $100 million round. And also Flipkart and Housing.com which they recently voted out the founder, it depends on whose version of the story you believed in. So they are everywhere as well, but I think maybe from what you are saying is that their footprint is not large enough.
Michael: I think people definitely, everyone knows them. I'm just speaking more on a pure activity, the amount of companies and things like that. They are just not quite at the same pace as the others.
Bernard: So do you foresee more private equity firms, investment banks, hedge funds or institutional investors coming into the Asia market?
Michael: Yeah, absolutely. I think the best example of that, might be CO2, which is another ex Tiger Cub Hedge fund. They haven't been that active in Asia's tech scene previously, but they did both of those deals that Tiger was in, the KuaiDi Dache and the York-Pier deal, as well as another one. And so I think you could see increased activity from them as they build out their venture investment strategy. And yeah, in general, I think as a lot of these companies that are taking off or continue to raise more and more capital and stay private longer, it's the same trend you are seeing in the United States. I think that you are going to see a lot of these pre-IPO type investors want to come in, take equity stakes and companies, and really fill out some of these larger rounds that some venture investors just might not be as comfortable in doing or their fund structure might not support.
Bernard: I've been even seeing investment banks like Goldman Sachs coming into a Singapore FinTech company, but not really. It's based in Singapore but it's actually global FinTech company with 55 million. Do you see them actually going even downstream to a Series A, Series B or Series C?
Michael: I think for a company like Goldman Sachs, I could definitely see Series C. To be at the early stage, I think you would have to be strategic. I know that, I think the way Goldman operates is they have a lot of different groups that are investing in startups and they are independent from each other. It's hard to say exactly what they view as strategic. It's definitely possible.
Bernard: So for example in the Indian VC financing, I saw your analysis that the U.S. based investor market share is actually getting lesser and lesser, and there's also the talent flow from U.S. back to India is getting larger, so with firms from other parts of the world getting into India. So why is that happening? Is it because of the investment climate or is it that the scene is really growing from your viewpoint?
Michael: I think it's the scene is growing. We've have an analysis coming out that I just did. There's actually more U.S. VCs that made an investment into just more broader Asian tech companies in 2014 than in any of the previous five years, there were over a 120 of them. And I think in 2015, it's very possible we past that number. The scene is just getting bigger, and thus the percentage is coming down. But the amount of U.S. VCs that want to get in and U.S. investors in general, I think is growing. And you have some of these VCs that are doing pretty large deals. For them, that might be an interesting entry point, because you have little more fundamentals, you have little more to go off of, and you have to worry less about navigating some of the cultural and some of the unknowns and more qualitative aspects of things. And then as they become more familiar with the market, you could see them going to more traditional early stage investments.
Yeah, and I think in general, India we've talked about, there's just so much opportunity there. Although macroeconomics factors make really appealing to international investor. And I know on the e-commerce side of things, Amazon tried to come in and do something around grocery delivery. But they struggled a little bit due to just the infrastructure issues, and they are not used to servicing markets in that on-demand way. They don't have as great infrastructure as the United States in terms of city to city and building up those having spoke models. So I think that that might give some powers to some outside companies, but huge opportunity is just so enticing.
Bernard: There's also a very interesting thing that happened in India recently, where one of the CEO of an Indian conglomerate actually invested in Siemon for example. So are you going to see a lot more emerging market investments activity? let's say for example in India, a guy investing in a Chinese company coming to India, and a Chinese guy investing in an Indian company going into maybe other markets.
Michael: It's definitely possible. I think it plays into the globalization trend which is obviously a kind of overblown talked about thing. But it could make sense as you build up these larger e-commerce markets. And if you as an investor there start to notice that consumers across multiple countries are sharing similar behavior patterns, it would make sense to start making those investments. You could even theoretically start seeing MNA around, from international buyers coming into these markets as well.
Bernard: So they actually buy up those companies that are actually similar to them but dominant in a particular geography?
Michael: It's almost a Rocky Internet model just at a bigger scale. That's what Rocket Internet has been doing with their global online take away group, just buying up any food delivery or food ordering service in emerging market that they want to get into and then rolling in this large entity.
Bernard: But I guess the question is that, like the discussion that's ongoing in the U.S., whether companies are becoming more and beginning to be more overvalued. Are you seeing the same trend in Asia as well?
Michael: I think again if there's definitely a lot of people who want to get in, and so that will drive up valuations. There's just been a lot more funds that are being raised. And I worry that more funds could equal more competition obviously, and then you'll see people driving up later stage valuations. But it's hard to say without knowing a lot of the fundamentals on how, especially on the e-commerce side, what the revenue is, because the only real data points we've grown is their gross merchandise value. And a lot of the story being sold now is just massive growth, massive opportunity. But I think a lot of investors might underestimate understanding the market and the scaling of these companies that really haven't been around for that long, and really there isn't playbook or a large number of companies that they can look to. In China, there definitely is more. But you could see companies beginning to be overvalued.
I know Jing Peng, they had hired banks to look at an IPO but they ended up holding off because private investors were offering better valuations. But having said that, they are valued more at a higher valuation than Yelp which is their U.S. competitor, but they also have more active users than Yelp, so it's definitely interesting.
Bernard: One reason for this increase in venture capital comes because of Rocket Internet except maybe excluding China I guess, because China has also built up its own Internet scene with very, very strong foundations, like Alibaba, Baidu and Tencent they call the BAT.
Michael: In India, again, I also don't know how much Rocket Internet impacts that scene. But in the emerging markets I think, they definitely pose a threat in some areas like the fashion e-commerce spaces and the food ordering and food delivery. Just because as we talked about earlier, they are so great at raising a lot of money quickly and really scaling out of business or rolling an existing entity into this big machine that they have and then that becomes a lot harder to compete against as an early stage company that's trying to grow.
Bernard: I actually always have this fear about Rocket Internet, because I was looking at their S1 followings for their IPO in Germany, and it looks as that on average most of the IBITA earnings before tax is actually somewhere between -20% to -50%. In simple words what I am saying is that for every dollar I invest in, the customer is actually making 20 cents or 50 cents more than for a dollar. It worries me that it could lead to some form of catalyst who, I wouldn't say above all us, but that's the fear is looking into these markets. Am I just being overly pessimistic or maybe the story is much more than that?
Michael: No, I don't think you are being overly pessimistic at all. That's relates to what I was touching on before. The story here for a lot of these markets is growth. And it's just we have growth in users, we have growth in baseline/topline numbers, but the profitability aspect is still not figured out in a lot of these companies. And so there definitely is a scenario where a few of these companies that have raised $100 million or more, just can't figure out how to build a sustainable, scalable business. And Rocket Internet with the way they roll up these entities, might be there is a possibility, yeah, that they are building this house of cards of growth, but not an ability to scale these businesses across all the markets that they are trying to attack.
Bernard: And also I think, I'm actually seeing a lot of local companies are now fighting them back. I'll give you a very interesting situation in Indonesia. The Lippo Group which is a conglomerate, has launched a MatahariMall, which something like they put in $500 million to tackle against Rocket Internet, a sudden hiring of everyone, even hire off the e-commerce CEO for Indonesia. They hire off some of the best entrepreneurs who were founders in Singapore to join them. That local pushback that you actually would see this competition actually moved up even more. There is this pessimism that actually is growing with Rocket Internet so called growth.
Coming back to this, with so many unicorns now, the probability of exit via MNA would be far lesser. Do you see more companies going IPO or as similar to what happened in the 1999.com era or the risk is actually mitigated by private exchanges, such as SecondMarket where companies can be kept private for a while with liquidity for founders and employees from the investors wanting to buy?
Michael: I think you are going to see more IPOs, but I still also believe there's a lot of MNA that happen. We've been looking at some of these the unicorn data. India, they've gone 400 unicorns in the last 12 months to track all these unicorns globally. They have seven in total right now. Five companies from China have become unicorns in 2015, and there's over 12 right now. And so it's definitely hot and definitely heating up. I think a lot of the A list in China, a lot of the big players that you talked about, Tencent, Baidu or Alibaba, things like that, they still have a lot of fair amount of cash on hand, so they could acquire some of those companies if they see it as a strategic way. So MNA definitely still could happen, as we talked before with these companies crossing borders and investing in other entities.
I don't know a lot of the government restrictions on some of the foreign investments and foreign majority stake ownerships, so I can't speak to that. But theoretically you could see some of these larger conglomerates entering other markets in Asia and acquiring some of the "unicorns". In terms of SecondMarket, I don't know if SecondMarket is really driving of the liquidity interest founders or employees. I think that a lot of that is actually happening outside of the public eye from other institutional players. Neval Ravikant of Angellist I believe wrote a post about this few months back about how there's a lot of secondary market transactions happening that aren't really being talked about. Even if you look at some of these bigger companies, Flipkart, they are a definite IPO candidate, but their founder and CEO has said, their IPO could happen in the next two years. Well Meituan, they are considering an IPO but they also are waiting till at least 2017.
So in the near future, I don't know if we'll see a ton of IPOs. But it will be interesting to see how the market develops and especially in China where pubic markets are on such a run. If anything were to have a downturn and bring down valuations in public markets, how that might put a pause on a lot of these potential tech IPOs.
Bernard: And then would you see the venture capital industry becoming more localized? Because I think as you have mentioned, so far of all the only type of global Sequoia and probably the Soft Bank being very, very vocal in the market. Would you see, I think Xcel has some presence in China but I think mostly in India as well? Would you see brands of venture capital from Silicon Valley actually branching out?
Michael: Yeah, I mean right now would be that time that when we are going to start seeing that, which points to the U.S. VCs are increasingly investing in Asian tech companies, there a point I threw out earlier. And again I think on the early stage side, there's still is definitely a level of expertise that needs to be had there and that's why you see some of the more entrenched player doing early stage deals. I don't know if you are going to see an early stage micro VC in the U.S., come over and start investing in Asia. In that sense, yeah, I believe that can still stay localized, but mid and later stage, companies want to get their feet wet and these markets are only starting to learn about them and become global firms. I definitely think we could see that.
Bernard: I'm actually looking forward to seeing interesting hauls in Asia.
Michael: Yeah, it's a matter of time.
Bernard: Yeah, I'm just waiting for that to happen. But I guess, what keeps you excited? What are the most interesting things that you are seeing in this first half of 2015?
Michael: I think some of the interesting things we've seen, at least out of China, there's been multiple large deals in Ad tech, and that's something that we hadn't seen much of historically. But you had 17why.com again, and I apologize for butchering these annunciations.
Bernard: No worries over that.
Michael: They raised a $100 million at a $600 million valuation from DST and some other investors. Yuantiku who raised $60 million over a $360 million valuation from IDG and Matrix. They are all looking at Ad tech in different ways, but it's all mobile ad tech plays. You have gamification around Ad tech; you have the big massively open online courses, so that's definitely that we are tracking in just more of these mid to late stage growth deals that are happening there. Alternatively in India, you have something that I've been tracking, has been the grocery delivery and food delivery market. Just because there's a lot of interesting consumer behavior, things that really lend itself to that, it exploding in the next year or so in India, and it's the things talked about.
Consumers don't really need to see or touch the things that they buy online. The infrastructure is pretty difficult as it is now. So there's a lot of opportunity for people to want to order things online and have it delivered to them, and the growing middle class definitely helps that. But across all of Asia, I think generally what we are seeing is, what we are seeing the U.S, this thought process around on demand services more and more. So in the U.S we've seen all sorts of insane on-demand concepts get funded. And we are starting to see that in Asia. We are starting to see food delivery and groceries which make sense and laundry delivery and last mile shipping services. And now we are even starting to see manicure and beauty on demand, getting funding in the just the past two quarters. So that's definitely something to keep an eye on and something that could be start to become a global trend as opposed to more than just taxi focused and U.S. focus trend.
Bernard: Do you also foresee that anything that is now a startup from U.S. will accelerate much faster?
Michael: Into Asia?
Michael: We've seen a few things in the used car marketplace in Asia. And we just had in the U.S., I think BP is rumored to be raising or has raised a $2 billion valuation, $2 billion more valuation. So having said that, that market is very big in the U.S., but in terms of venture back companies, there haven't been as many large high valued companies. And then in China, we've seen a few already, so that's something that's interesting.
Bernard: You are based in the New York and you are in the hall of the financial capital in the U.S. What is the most exciting thing about the Asian market that U.S. based investors are looking out for?
Michael: To continue to hop on it, I think it's just opportunity. Macroeconomics demographics just led itself so well to tons of huge companies being built over the next five or ten years. And that's really interesting from the U.S. perspective where the growth story in terms of mobile is still there, but in terms of the demographics and the consumers in general, it's not at nearly the same level of potential growth.
Bernard: Asia has four billion population, so the scale is much bigger on that. I guess I will probably have to talk to you again in probably another time, probably half a year to a year's time.
Bernard: But tell my audience, how do they find you?
Michael: I write at cbinsights.com/blog, that's where we do our research briefs. And we have a great team there that does a lot of great stuff. My, you can follow me Twitter @mcdempsey. I blog personally as well as michaeldempsey.me. So all of those things you should check out. Number one, CB Insights, there's a lot of great stuff there. We are putting out a Q2 Asia tech report in a month, that will have a lot of other great data. And then also a venture capital report that will focus on just some of the more broader global trends as well.
Bernard: Let me know that I will definitely share with the audience once it's out through all or channels in Analyse Asia. You can also find me bernardleong.com or @bleongcw, or subscribe to us on Twitter @analyseasia A-N-A-L-Y-S-E Asia, or come to our website analyseasia.com. You can listen to use through iTunes, Stitcher and SoundCloud. And of course leave a review, one star to five star, we really welcome that. So once again Michael, thank you so much for coming onto the show.
Michael: Yeah, thank you very much. And I just want to add one more thing. Subscribe to our newsletter, cbinsights.com/newsletter. You'll get all of our research briefs. We sent three new briefs three times a week, so you get really nine high quality, high value research reports.
Bernard: I definitely endorse that, because I'm one of the readers of your insight as well. But thank you so much coming on to the show, Michael.
Michael: Yeah, thank you, I really appreciate it.