Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Nearly 30 years of experience in the Korean/Asian equity research. Major sectors coverage include the following:
- Technology 
- Consumer 
- Special Situations/Deep Value Plays
- Tender Offers/M&As
- Holdcos/Stubs
- Asian Unicorns/Private Companies

Korea/Asia, Events, IPOs

Asian SaaS Stars: Opportunities, Market Outperformance, & Key Challenges

Duzonbizon: Cloud-Based Software Providing an Edge Amidst COVID-19 Carnage

Thematic (Sector/Industry)

China Internet software and services / Thematic (Sector/Industry)

Driven by world-changing modern technologies such as artificial intelligence (AI), big data, cloud services, and smartphones, one of the most interesting industry sectors globally is China’s enterprise SaaS sector. China accounts for less than 5% of the global SaaS sector but is enjoying nearly double the global growth rate in this sector of nearly 30-35% per year. This pace is expected to continue over the next couple of years. 
There are some major barriers that have prevented SaaS from enjoying even higher growth rates in the past decade, including low labor costs, concerns about storing business information on the cloud, concerns about the lack of adequate protection of intellectual property/software, and requirement of highly rigorous customization for vertically integrated SaaS products. Nonetheless, it is becoming increasingly clear that the benefits are outweighing the negatives of adopting SaaS in China, especially among the millions of small and medium-sized enterprises (SMEs) in China that have greater cash constraints and who are more willing to adopt SaaS systems. Furthermore, the COVID-19 pandemic has accelerated the growth of the SaaS sector in China.
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This report was commissioned by the next-generation investment platform iSTOX, which puts previously out-of-reach opportunities like private equity, hedge funds and private debt in the hands of more investors. To learn more, go to <a href="http://istox.com/" target="_blank" data-saferedirecturl="https://www.google.com/url?q=http://istox.com&amp;source=gmail&amp;ust=1609850951389000&amp;usg=AFQjCNHoQs_JK6S7mrQE5v_VMz3A-kJwpA" rel="noopener">istox.com</a>. 
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Driven by world-changing modern technologies such as artificial intelligence (AI), big data, cloud services, and smartphones, one of the most interesting industry sectors globally is China’s enterprise SaaS sector. China accounts for less than 5% of the global SaaS sector but is enjoying nearly double the global growth rate in this sector of nearly 30-35% per year. This pace is expected to continue over the next couple of years. 
There are some major barriers that have prevented SaaS from enjoying even higher growth rates in the past decade, including low labor costs, concerns about storing business information on the cloud, concerns about the lack of adequate protection of intellectual property/software, and requirement of highly rigorous customization for vertically integrated SaaS products. Nonetheless, it is becoming increasingly clear that the benefits are outweighing the negatives of adopting SaaS in China, especially among the millions of small and medium-sized enterprises (SMEs) in China that have greater cash constraints and who are more willing to adopt SaaS systems. Furthermore, the COVID-19 pandemic has accelerated the growth of the SaaS sector in China.

This report was commissioned by the next-generation investment platform iSTOX, which puts previously out-of-reach opportunities like private equity, hedge funds and private debt in the hands of more investors. To learn more, go to istox.com. 


China Tech: Emerging Enterprise SaaS Companies