Singapore start-up PatSnap turns unicorn with backing from SoftBank, Tencent

PatSnap's founding team with CEO Jeffrey Tiong (2nd from right) . The start-up, founded in 2007, provides data and analytics on intellectual property.
PatSnap's founding team with CEO Jeffrey Tiong (2nd from right) . The start-up, founded in 2007, provides data and analytics on intellectual property.PHOTO: PATSNAP

SINGAPORE (BLOOMBERG) - Singapore-founded PatSnap reached a valuation topping US$1 billion (S$1.35 billion) in a fresh funding round, with SoftBank Vision Fund 2 and Tencent Investment among those backing the provider of patent analytics.

CPE Industrial Fund and existing investors Sequoia China, Shunwei Capital and Vertex Ventures joined the US$300 million Series E round, the software company said in a statement. PatSnap will use the funds for product development and expanding its sales presence.

Joining the list of global technology unicorns, PatSnap is benefiting from a surge in research and development spending, with the United States and China seeking an edge amid heightened trade tensions between the countries. PatSnap's software lets inventors and researchers gain insights into innovations being developed around the world.

"The US-China trade war is essentially about technology and a lot of companies want to know where to invest," Mr Jeffrey Tiong, PatSnap founder and chief executive, said in an interview. "We spent more than 10 years collecting patent data from 140 countries and use artificial intelligence to provide insights."

Founded in 2007, PatSnap - short for patents in a snap - provides data and analytics on intellectual property to more than 10,000 customers including Spotify Technology and Xiaomi Corp. It employs more than 700 people in Singapore, London and Toronto.

PatSnap was started in Singapore, which has long positioned itself as neutral ground, before expanding to China where it now has more than 50 per cent of the market.

Users of PatSnap's software platform can type key words and phrases such as "electric vehicle" for information on companies, technologies and inventors in the space. Its page on Tesla, for example, shows a map of companies connected to the US electric carmaker, with Panasonic Corp coming on top to reflect their battery collaboration.

PatSnap makes money by charging a subscription fee that is typically US$20,000 to US$30,000 a year. Some start-ups pay as little as US$5,000 for limited usage, while large firms can shell out as much as US$500,000. Vacuum cleaner maker Dyson and SZ DJI Technology, the world's biggest maker of drones, are among the clients.

Mr Tiong, 37, got the idea for PatSnap while he was on a year-long NUS Overseas Colleges internship at medical device upstart BioConnect Systems in Philadelphia in 2004. Tasked to evaluate patents, he had to check various government websites and found intellectual property documents arcane. He imagined a software that would help make the process simple and easy to understand.

After returning home and graduating from the National University of Singapore, he founded PatSnap with a $55,000 Government grant and incubation support from NUS Enterprise. 

Mr Tiong also added three co-founders - chief technology officer Markus Haense; vice-president of new ventures Ray Chohan; and senior vice-president of Asia-Pacific Guan Dian.

"The journey has been challenging for PatSnap's founding team," said Mr Chua Kee Lock, managing partner of Vertex Ventures, an early backer that led PatSnap's Series A and D+ financing rounds. "Against all odds, they managed to create a truly differentiating solution."