Gearing up for the weekend? Check out these ecommerce headlines first.

1. Marketplace raises funding to help small businesses buy from Chinese manufacturers

Singapore-based online marketplace Tjaara received an injection of US$1.2 million from Senjō Group, a Singapore-headquartered payments operator and fintech investor.

Tjaara was incorporated in Singapore in August 2016. It’s a marketplace that connects manufacturers and foreign companies to wholesalers and small businesses. Merchants use Tjaara because they usually can’t afford to buy from manufacturers directly. There is also a significant language barrier, as a lot of those manufacturers are in China.

Read the rest of the story here


2. Sagawa to buy Vietnamese delivery service

The Sagawa group will acquire Phat Loc Express, Vietnam’s fifth-largest delivery service, gaining a foothold to expand operations nationwide as online shopping continues to grow. Japan’s SG Holdings, the parent of Sagawa Express, will buy all of Phat Loc’s shares from management.

SG Holdings teamed with major Vietnamese real estate and retail company Vingroup in November. The Japanese business will deliver products for the group’s supermarkets and convenience stores.

Read the rest of the story here


3. Singapore is beating Hong Kong in Asia’s fintech race

Interviews with fintech entrepreneurs and business consultants show that while Hong Kong is making strides to catch up, Singapore has the lead — in part because its government was quicker in recognizing the industry’s potential. In a February study commissioned by the U.K. government, Ernst & Young LLP ranked the Southeast Asian city fourth among global fintech hubs, while Hong Kong came seventh.

Read the rest of the story here

Southeast Asia in 2010 started to experience an ecommerce boom with the likes of Ensogo, Rocket Internet’s Lazada and Zalora, Groupon, etc. It seemed to be at the height of its peak with money pouring in, mergers and acquisitions happening every day, and Amazon finally moving in to capture the region’s potential but amid these buzzworthy headlines, down rounds plagued startups such as Lazada, were sold for scraps like Zalora Thailand, or shut down completely, such as Ensogo.

What happened? Smaller startups began venturing into other fields providing human resources (Getlinks), car wash services (Wash Mobile), recruitment (JB Hired), agriculture (EverGrow), hardware (DriveBot), and more. It seemed that startups were shifting focus to offer niche services to carve out their own demographic in a saturating market but could they sustain themselves?

A Sustainable Model: Fintech

Across the region and even in once-upon-a-time unicorns such as Flipkart and Snapdeal, news reported large reductions in hiring, peaking salaries, and a slowdown in capital flow shadowed the once profitable businesses VCs banked hard on. The customer behavior in Southeast Asia, more specifically trust, is simply not mature enough.

It also cannot be denied that a capital and inventory intensive model requires deep pockets. After running a successful ecommerce company in Thailand for three years, I realized it was necessary to go back to the basics, to start a business model that encompassed the three components of sustainability:

  1.       High margins
  2.       High customer lifetime value (LTV)
  3.       Low customer acquisition cost

A business with these characteristics usually has a strong foundation and presents a good investment opportunity because it shows promise for profitability down the line. While ecommerce does have low customer acquisition due to the nature of retail and lower commitment products, such as retail and consumer goods that are being sold, it severely lacks in margins and customer LTV (lifetime value).

Margins are often eroded away by high operation costs, packaging, shipping, and inventory while LTV is nullified by heavy competition as most ecommerce companies do not have exclusivity on products and pricing. After all, it isn’t in the best interest of product owners and manufacturers to only distribute their products through one single channel.

Fintech on the other hand, a recently booming industry, does not suffer from these disadvantages. Like most tech companies, there is no inventory to hold, the margins are much larger and once you have acquired a customer, you have an 80% renewal rate for at least the next four years (Bangkok Insurance’s internal data). By building better fintech, it would change the behavior of consumers in Southeast Asia and eventually fuel the growth of ecommerce in the region.  


Lack of Innovation: More Room to Grow?

Fintech is ripe for entrepreneurs because existing legacy players such as Viriyah and MSIG in the market lack innovation. Companies like Bangkok Insurance, HSBC, and other traditional financial institutions are only beginning to realize the magnitude of the tech wave that has hit the world.

As the saying goes, it is hard to steer big ships, and ships seldom get bigger than the companies that make up our financial industries. These companies earn a vast majority of their profits from traditional channels, leaving the unexplored to opportunistic entrepreneurs like myself with and many others who have managed to convince investors for support.

A recent report from Accenture found that global investment in fintech has skyrocketed from $930 million back in 2008 to over $12 billion by the beginning of 2015. Europe experienced the highest growth rate with an increase of 215% to $1.48 billion in 2014. Globally, fintech startups have raised investments totaling $19 billion according to a insight report published by Citibank. This has begun to eclipse other startup sectors as it continues to grow.

Challenges of Fintech

The next big thing does not come without its own challenges. Fintech startups need to realize very early on that there are many rigid regulations which were not created with innovation in mind. For example, in Thailand, selling insurance online requires a business to report to at least three different governing bodies all of which have their own set of rules to abide to. This increases admin work for small companies and also requires legal knowledge that most new companies lack.

Companies are also not allowed to call a customer to confirm purchase as that would be considered “telemarketing insurance sales” and requires a different license. One of the biggest challenges for fintech companies is encouraging users to trust young companies with their financial information, savings, and future to adopt its products and services.

It takes time and a lot of marketing dollars to explain to customers who you are and why they should trust you with their money. These challenges do get easier as more startups enter the space and educate their audience through smart marketing initiatives.

Rabbit, a company based in Thailand, is the first integrated online/offline payment platform in Thailand accepted in multiple retail stores, restaurants and used for public transportation. Its partnership with LINE earlier this year means over 5 million users are slowly allowing their financial information to be connected to some sort of a tech platform.

“This joint partnership [Rabbit LINE Pay] will strongly support government policy in driving Thai people into a cashless society,” says Nelson Leung, chief executive officer of BSS Holdings, the operator of Rabbit card.

Influence from neighboring countries such as Singapore and Malaysia, a lot of which have already set up country specific ‘sandboxes’ to trial for fintech regulations, are also moving towards a cashless society to drive the realization that there is a need for innovation in the financial sector.

Ecommerce is a big marketbut until the shopping habits of Southeast Asians are shifted to online spending habits, it can never reach its full potential. The emergence of fintech and its supporters mean that by building the fundamentals, companies in the entire ecosystem can benefit from its success. 15 years ago, people would call a travel agent and ask them to book a ticket. And now? When was the last time someone called a travel agent to book a flight or hotel room? Behaviors change, but it takes innovation and time.


Wrapping up the day? Check out the most recent headlines here.

1. Singapore fintech/deeptech startup V-Key Signs Deal with Ant Financial

Through V-Key’s technology, Ant Financial will secure all transactions on AliExpress, Alibaba’s global e-commerce marketplace. Ant Financial is among the investor pool in US$12 million investment in V-Key’s Series B funding; one of the largest rounds for a Singapore-based deeptech and fintech company. V-Key has raised over US$16 million till date.

As detailed via press release. Find V-Key’s website here


2. AI startup gets $3m to put banking chatbots into Facebook Messenger

That Singapore-based startup, Active AI, has created a way for banks to offer you a chatbot. The team behind it today announced it has secured US$3 million in funding from IDG Ventures India and Kalaari Capital to persuade more banks around the world to pick up on its chatbots.

Read the rest of the story here


3. Indonesian government taking steps to tackle growth of ecommerce industry

The volume of ecommerce transactions in Indonesia is still relatively small but the government is taking anticipatory steps in the face of e-commerce industry growth as it is developing as a global trade model.

Read the rest of the story here


Welcome back from the weekend, here are the ecommerce headlines you might have missed:

1. Payments startup raises $5M Series A from popular investors

They include Wavemaker Labs, Global Brain, BeeNext, Rebright Partners. The round is led by Accion Frontier Inclusion Fund. Coins has created an alternative banking system to serve people who don’t have access to traditional banking in Southeast Asia and other developing markets.

According to Coins, 5% of the region’s 610 million-strong population is unbanked. 

Read the rest of the story here

2. Alibaba’s share of the worldwide mobile ad market to increase. Why?

Alibaba will report earnings next week, will capture 4.6% of the $194.60 billion global digital ad market; that represents a decrease from 5% in 2015. However, Alibaba’s share of the $108.88 billion global mobile ad market is expected to increase to 10.9% in 2016, up from 8.7% in 2015.

Increased numbers of mobile shoppers using its affiliated Alipay payment app to buy goods and services both online and offline, rural market demand, and cross-border shopping via Tmall Global will also be key sales contributors

Read the rest of the story here

3. DHL opens $104M hub in Singapore

To accommodate the rapid growth of regional volumes fuelled in part by ecommerce, the world’s largest international express services provider launched its new €85 million DHL South Asia Hub in Singapore.

“The exciting thing about ecommerce is that it’s not just the big players, DHL Express CEO Allen said. It’s not just about to Amazon, Alibaba or eBay, because every retailer in the world can put a website up to a global audience. “Every brick and mortar retailer is also getting in on the act and a lot of our big customers our traditional brick-and-mortar retailers.”

Read the rest of the story here

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Catch up with today’s headlines here.

1. YesBoss pivots with the launch of B2B chatbot platform is a B2B conversational platform that connects brands and customers using artificial intelligence (AI) technology. In this early version of the product, offers a dialogue engine that allows brands to operate a chatbot that speaks in a character that suits the brand’s ‘personality’. Read the rest of the story here


2. Malaysia’s Bank Negara issues details of FinTech sandbox framework

The central bank said these innovations should not only improve accessibility of financial services and efficiency but also open up new opportunities for financing or investments in the economy.

the minimum standards and requirements expect applicants to be able to show that a product, service or solution is ready for testing. Read the rest of the story here.


3. Google Flights will now tell you when fares will increase, help you find cheaper tickets

Google flight’s new feature will show you when prices are expected to increase for certain flights, so you can book before the tickets become more expensive. It’s also rolling out other tips that will help you shop for the best priced tickets among other things. In addition, Google Hotels is getting an upgrade, too, also focused on making it easier to find deals. Read the rest of the story here.



Here’s what you need to know before the work day craze sets in.


1. Fintech adoption to increase soon in Thailand

The adoption rate of financial technology among Thais is likely to pick up velocity in the near future, according to a study from PWC. Read the rest of the story here.


2. More than half on online viewing done on mobile devices

Mobile devices, for the first time, now account for more than half of all online viewing, and compares video engagement between iOS versus Android users, according to the second-quarter 2016 Global Video Index from Ooyala. Read the rest of the story here.


3. Criteo to acquire HookLogic for $250m in push for commerce stack

HookLogic’s performance marketing exchange enables these consumer brand manufacturers to bid on sponsored product ads on ecommerce and publisher sites. This is a big move for Criteo as it gives them access to ecommerce advertising inventory. Read the rest of the story here.