SIA, Singtel's Innov8 invest in data startup

Singapore

SINGAPORE Airlines (SIA) has made its first startup investment since launching a digital innovation blueprint in January, the national carrier told The Business Times on Tuesday.

It was part of a recent Series B funding round, led by Singtel's Innov8 venture capital arm, that raised A$22 million (S$22.1 million) for tech firm Data Republic. SIA said in a bourse filing that it took a minority stake through the placement of new shares.

A spokesman for Data Republic separately told BT that Singtel has picked up a board seat with its first injection into the startup, but declined to disclose the amounts from individual backers.

SIA has embarked on digital transformation amid operating challenges that sprang a surprise quarterly loss last year and led chief executive Goh Choon Phong to publicly float the possibility of staff cuts. The group told BT last year that it would invest "several hundreds of millions" of dollars into digital schemes over five years.

George Wang, SIA's senior vice-president of information technology, said in a statement yesterday that the Data Republic investment "highlights our commitment to data innovation through a platform which leverages technology to ensure data security and privacy and further enhance our digital capabilities".

Asked how SIA plans to tap Data Republic's offerings, a spokesman for the airline said that one potential growth area is data collaboration, "which would enable organisations to obtain a better understanding of customers' needs and preferences to improve products and services".

Data collaboration refers to analysing separate sets of data whether among internal stakeholders or in tandem with external partners.

Low Pei Han, senior investment analyst at OCBC Investment Research, noted that SIA is not the first carrier to put its money into Data Republic.

Qantas, which has used Data Republic for its Red Planet digital marketing business, took part in an A$10.5 million Series A round in 2016.

"Many large companies have carved out a certain budget to invest in tech startups, such as setting up a venture capital fund to do so," Ms Low said. She also pointed to other digital efforts by SIA, such as blockchain-based mobile wallet KrisPay and the fledgling Krislab innovation initiative.

Data Republic's other Series B investors include ANZ, Reinventure and Ryder Capital's Ryder Innovation Fund, as well as Qualgro, a venture capital fund co-founded by former Innov8 director Peter Huynh.

In response to a query, Singtel said that Qualgro and Innov8 are neither related to nor cross-invested in each other.

Sydney-based Data Republic provides organisations with technology to share data securely and privately. It plans to use the fresh funds to grow its footprint in Asia, where it set up shop in June with a Singapore office.

Singtel shares yesterday fell S$0.02 to S$3.07, while SIA shares firmed by S$0.04 to S$9.56, after the announcement.