Why only fintech players using a digital-first approach will win in SE Asia

This article is from an episode on Asia VC Cast, a podcast hosted by Daniel Song. This is heavily revised from the original show transcript. For the full interview, go here.

Herston Powers is a principal at Tryb Group focused on investments, portfolio management, and investor relations. Previously, he was head of Southeast Asia and India business development at the Bank of New York Mellon. He relocated to Singapore in 2015, leading numerous successful business development strategies throughout Asia Pacific.

Here, he talks about why Tryb believes in application programming interfaces (APIs) so much and how the unique conditions in Southeast Asia affect the growth of financial technology, among other things.

Tell us about your background and how you became a principal at Tryb.

I’m from the US and I moved to Asia about eight years ago, living mainly in Hong Kong and Singapore. Prior to joining Tryb, I worked in banking, helping tech companies get publicly listed on the New York Stock Exchange and Nasdaq.

In 2014, most people in finance started becoming extremely interested in fintech. I helped found a fintech company and invested personally in some.

After a decade of working in banking, I just wanted to move to the other side of the table, and that’s why I joined Tryb.

How does Tryb operate as a fintech investor?

Tryb is one of the only pure-play fintech investors in Southeast Asia. It’s invested in five companies across the region in different fintech verticals. Last year, it had its first exit, which was a Singaporean payment processing company.

Southeast Asia is probably about five to seven years behind China, with respect to fintech adoption and other metrics like the percentage of digital and mobile payment. Indonesia’s GDP per capita is about the same as China back in 2009, but the pace of urbanization, digitization, and mobile penetration is actually stronger.

We really think that fintech is just getting started, and we operate under a mantra that financial services in the region really need to catch up. And fintech is the only way to do that.

One of your investment themes is around APIs becoming the way Southeast Asia communicates. How will APIs impact the growth of fintech?

APIs will have a transformative and probably even stronger effect in all businesses. All commerce in Southeast Asia is poised to be conducted via APIs, with little to no human involvement in the processing of transactions.