Singapore, Mar 16 (ANI): When Indian-born Anurag Avula and co-founders Lim Yen Ti and Kris Chen left global payments giant PayPal, they were budding entrepreneurs taking a huge leap into the unknown on a personal conviction that they can make a difference in the e-commerce world.
While at PayPal, they realised that smaller retail companies especially in emerging markets were keen to go online and launch digital stores but simply did not have the tools or capabilities. Neither did they have a clue where to start.
Starting Shopmatic was not an overnight decision but something they had thought through based on their collective experience at PayPal. They were confident there was a significant opportunity in this area and were eager to build a sustainable business.
Avula, CEO of Shopmatic, who spent most of his corporate life working with customers in markets like India, Africa, the Middle East, and Africa, was quite certain that with his and his co-founder's knowledge and experience, they could leverage their capabilities and provide solutions for people in those countries.
Thus, Shopmatic was born in December 2014 in Singapore, with the mission to help millions of small businesses and aspiring e-commerce entrepreneurs overcome the fear of the complexity and the technology required to put their businesses online.
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Shopmatic provides a turnkey solution to small and medium-sized enterprises (SMEs) wishing to set-up an online store. This includes setting up the store-front, payment gateway, shipping and logistics, sales management and customer support. Customers can sell through a variety of channels including social media platforms like Facebook and Instagram. They also provided customers with the ability to sell across multiple marketplaces like Amazon, eBay, Lazada, Rakuten, Zalora and other local marketplaces.
They decided on India as their launch country. It is not a surprising choice as there are about 50 million SMEs and mom and pop shops that are largely offline and where many of such retailers didn't have the capability nor did they understand e-commerce, tech, and data.
What also validated their decision was the explosive growth in the use of digital platforms and devices in India. Based on Statista, digital payments jumped from about USD 41 billion in 2017 and is expected to reach USD 81 billion in 2020. In the same period, Internet penetration rose from 300 million to 564 million. According to research form techARC, smartphone usage, led by more affordable phones made by Samsung and China's Xiaomi, expanded by 15 percent every year since 2018 and is expected to reach 500 million users in 2020.
On top of this, only one out of five internet users have transacted commerce online. This is a relatively low figure which means there is plenty of room for growth.
Avula revealed on the Jay Kim Show podcast in an interview reported by TechInAsia that they chose to start in India knowing it was a difficult market and if they got India right, the rest of the markets would be a lot easier for them to work in.
After spending a year and a half setting up the company and building the tech backend, the Shopmatic team spent 6 months understanding and exploring the Indian market by visiting over 25 small towns and cities. They finally launched in India in January 2016.
Six months after launching in India, they expanded to Singapore and Hong Kong.
As of last year, the company has raised USD 7.15 million in Series A funding led by ACP, a Singapore-based Venture Capital firm and SPRING Singapore which is a statutory board under Singapore's Ministry of Trade and Industry. They are in talks to raise another USD30 million in Series B and based on news reports are more than halfway to that mark.
They currently employ over 40 people with offices in 4 cities - Singapore, Hong Kong, Malaysia and India, and claim to have customers in over 13 countries including Sri Lanka, Philippines, Indonesia, Brazil, Malaysia, UAE, and Singapore. 85 per cent of customers are from India and 10 per cent from Singapore. As of October 2019, Shopmatic had over 250,000 customers and set to double that by the second quarter of 2020.
In the four years since launch, they have grown revenues from around USD 200,000 to USD 3.7 million. They have reported to be profitable since November 2019.
In February this year, CIMB Bank of Malaysia announced a tie-up with Shopmatic to help Malaysian SMEs build and scale businesses in the e-commerce space. CIMB's SME proposition provides a complete suite of financing and business solutions to its customers.
This is after a similarly successful partnership with UOB Bank of Singapore which offers its SME clients a cloud-based digital business solution.
"This partnership with Shopmatic aims to help SMEs take advantage of global online business opportunities," CIMB Group's CEO of Group Commercial Banking Victor Lee Meng Teck said.
"This further cements CIMB's SME Partners proposition as an ideal and easy-to-use support ecosystem for SMEs just starting out, or those looking to scale-up," Victor added.