Month: January 2020

If you attend any business or tech conference in the Philippines, the most common rallying cry in speaker presentations will almost certainly be “digital transformation.” That is, businesses need to undergo digital transformation or risk getting left behind among their tech and tech-enabled peers.

It’s survival-of-the-fittest in business-speak.

It was first introduced by serial entrepreneur and business strategist Winston Damarillo in 2016 in his first business book, Ready or Not.

While business leaders all want to be at the helm of agile, innovative organizations, the execution of this vision is no easy feat, in part because there are no hard-and-fast rules on digital transformation. What may work for one company re-inventing itself in the digital space may not work for another, and vice-versa.

Each company’s digital transformation, in short, will be unique to itself.

And now, years after the book’s publication, more companies in the Philippines, both big and small, have embraced this challenge as they undergo transformations both in their operations and in their branding.

This new reality is what Damarillo has discussed in the sequel to his best-selling book, now entitled Ready or Not 2020: The 5 Trends Changing the Landscape of Business. 

I picked up the sequel as I saw how companies, especially tech startups in the Philippines, have taken part in this “digital transformation” and how they have succeeded and at times, struggled in this journey. 

The horizontal impact of the latest tech trends 

It’s important to note that Damarillo writes not from the perspective of a writer or even analyst, but from that of a practitioner through-and-through. He has built and scaled multiple tech companies, including three exits, Gluecode (to Intel), Logicblaze (to Iona Technologies) and Webtide (to Intalio).

In Ready or Not 2020, the five trends he documents are e-commerce, the digitization of cash, biometrics, artificial intelligence, and blockchain.

What’s important is that each of these topics is not addressed as a niche phenomenon. Rather than focus on how one hot startup is tackling some fringe part of AI, for example, he discussed how each trend cuts horizontally across all businesses and may affect you no matter what industry you’re in.

Also read: 5 Filipino startups are giving Lazada, Shopee a run for their money, defying expectation

In the Biometrics chapter, Damarillo says that biometrics is no longer the stuff of science fiction, a la Tom Cruise’s Minority Report. He details how biometrics of all types – voice recognition, fingerprint recognition, or retinal scanning – are being used by enterprises to identify, authenticate, and protect their customers.

UnionBank, for instance, allows customers to sign into their mobile app with their faces.

The net impact of such biometrics is enhanced user experience: Customers get to use products with greater convenience, security, and trust. Forward-thinking businesses, from those the size of UnionBank all the way down to your neighborhood MSMEs, can also turn to biometrics to simplify the user journey of their customers.

It’s easy to cast predictions (tech pundits, after all, do it nearly every day) but what’s considerably more difficult is explaining how technology trends will impact your business now, and how business leaders may possibly seize these opportunities for their benefit.

The same applies to the other four trends. Damarillo shows how AI, e-commerce, blockchain, and the digitization of cash are and will continue to impact all enterprises in the Philippines, even though many of these topics may at least initially seem far removed from their own business reality.

Also read: Hack2Hatch: Winston Damarillo and Alvin Gendrano on the Philippine Startup Scene

From this vantage, the book is quite the eye-opener: You come to realize that the buzzwords in headlines can spell the downfall – or hyper-growth – of your company. The onus is on you to determine which. 

Note however that the book, for the most part, just touches on the surface level of these technologies. While it tries to explain each technology in much detail, it’s only an entry point, rather than a thorough narrative of the Philippine businesses’ digital transformation. 

In addition to drawing on his own experiences as the founder of inclusion tech venture builder Talino Venture Labs and Amihan Global Strategies, which is a tech enabler for large enterprises and organizations serving mass markets and constituencies, Damarillo documents how local companies are addressing their own particular challenges in re-inventing themselves. 

It becomes easier to think of how you might lead your own company’s digital transformation when you see how other local companies have done the same, bearing in mind the same constraints you have in the Philippine business climate.

If anything, the reader will only be further enticed to read on how else each technology has grown and flourished in different parts of the world.

As the Philippines could be considered as a young, emerging market, technological advancements and their adoption could also just be in their nascent stages. Ready or Not 2020, then is an exciting invitation, a daring challenge to what’s to come for the next decade.

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Malaysia-based motorcycle e-hailing service, Dego Ride, has resumed its operations on the new year’s day with 700 approved riders, Says reported.

According to New Straits Times, the local on-demand ride startup was the first company to introduce motorcycle taxis in Malaysia.

With its signature blue and yellow driver’s uniform, the company was founded by CEO Nabil Feisal Bamadhaj in 2015. Dego Ride then officially launched its services in November 2016 with around 5,000 registered riders at the time.

Just shortly after the operation, the bike-hailing service was banned by previous government Barisan Nasional, stating safety concerns. The impose lasted until last year when Pakatan Harapan, who initially disagreed with the concept, decided to proceed with a six-month trial for motorcycle hailing operations starting January 2020.

With the ban being lifted, the company intends to “provide a solution to the current first and last-mile disconnect from the nearest public transportation systems for those living in the Klang Valley, Shah Alam, and Putrajaya.” In March, Dego Ride stated that it will expand its services into other regions and states.

Also Read: Malaysian youth minister to bring gojek into his country

According to The Star, Dego Ride is looking to widen its coverage by expanding its service to other regions and states in March.

Dego Ride also will address the gender riders’ concern by assigning male and female riders to passengers of their own gender, as Bamadhaj said women make up a high number of passengers who want to use the bike-hailing service.

As of now, there are 100 female riders who have registered, with less than 50 approved. During the launch ceremony of the Dego Ride app and its headquarters in Taman Melawati, Bamadhaj urged for women to register as rider to answer the demand.

After facing backlash from the public for his decision in welcoming gojek, Youth and Sports Minister Syed Saddiq Syed Abdul Rahman commended Dego Ride’s efforts in creating more job opportunities for youths.

“It was a bad decision to ban Dego Ride. It did not only affect job opportunities but also the investment made by Nabil (Feisal Bamadhaj) to realise a local startup,” the minister was quoted saying.

Also Read: Malaysia approves motorbike-based ride-hailing services

Saddiq also added that the company would make a good platform for youths on the hunt for jobs or part-time employment as it can help them earn US$366 to US$854 monthly.

To become an eligible Dego Ride’s rider, one needs to be at least 18 years of age with a full B2 motorcycle and free from any criminal records. Applicants must also own motorcycles above 150cc with no modified bikes.

Passengers can now book Dego Ride’s services using their app. Currently, the service is only available for journeys of less than 10 km radius from the passengers’ current location.

Prices for rides start at US$0.75 for the first 3 km ride and US$0.24 for every subsequent kilometre.

With the new regulations, ride-hailing giant Grab has also started recruiting riders for their motorcycle e-hailing service GrabBike.

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Image Credit: NUR AIN SHAFINAS of fotoBERNAMA

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China-based fintech operator Ant Financial has announced that it has applied for a digital wholesale banking license in Singapore, following the waves of unicorns trying to ahead each other in obtaining the digital banking license form Monetary Authority of Singapore (MAS).

The same week, Tech In Asia reports, also saw gaming startup Razer and ride-hailing company Grab applying for full banking licences.

An Ant Financial spokesperson is quoted saying to South China Morning Post: “In line with our commitment to promoting financial inclusion globally, we have submitted an application to the MAS for a digital wholesale banking license. We look forward to contributing to the development of the digital banking landscape in Singapore.”

Last year in June, the MAS revealed its plan to grant as many as five virtual bank licenses to boost competition and innovation. As for which company will win the bid, MAS is expected to announce the successful applicants by mid-2020.

Two applicants with a capital of S$1.5 billion (US$1.1 billion) will be granted full bank licences, allowing the applicant to provide a range of banking services to retail and non-retail customers.

The three remaining applicants will be granted wholesale licences, requiring a capital of S$100 million (US$74 million), allowing applicants to provide services to small and medium enterprises (SMEs) as well as other non-retail customer segments.

Also Read: Razer Fintech leads consortium for youth-targeted bank as part of digital banking license bid

Earlier last year, Hong Kong presented a similar move by granting licences to companies, including Ant Financial and Tencent to open up its banking industry.

In a report jointly done by Bain & Co, Google and Temasek, Southeast Asia’s digital lending market is predicted to grow from US$23 billion in 2019 to US$110 billion by 2025, representing a 29 per cent compound annual growth rate.

Before Ant Financial, gaming startup Razer Fintech had applied for a digital banking licence on Thursday, stating its mission in targeting underserved youth market with its Razer Youth Bank. On Monday, Grab Holdings and Singapore Telecommunications announced their joint bid that has 60 per cent equity held by Grab.
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Photo by Yeo Khee on Unsplash

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You are a visionary. Eyes set on top of the hill. Seeing your startup as the next big thing. And five years down the line— you have a huge customer base, money flooding in and your startup scaled into a huge organisation.

It feels good. 

But the thing is — to get to the top, your startup has to face challenges. Numerous challenges. 

Talking statistically, 90 per cent of the startups fail due to their own mistakes or ignoring the obstacles in their way that becomes a perfect recipe for “self-destruction”. So, for every aspiring entrepreneur, it is important to understand the roadblocks in their way.

This article discusses the same obstacles that startups face. I have listed down the five common ones. But the best part is you’ll also get some tips and real-life experiences to overcome them. 

Rake in the moolah

It’s not rocket science. Every startup needs money at varied stages. You need it to validate your idea, developing the MVP, for the product launch, scaling it, marketing, hire staff and the list goes on. No wonder why there are varied funding stages during the startup lifecycle. 

As per a  report by CB Insights, 29 per cent of the startups fail because they ran out of cash. This makes lack of funds one of the main reasons for failure.

Stéphane Guérin, the founder of a marketing tool DashThis, shares his experience on managing money as a bootstrapped startup.

He says, “The fact that we deliberately avoided venture capital funding made conscious spending not only important but necessary. We decided to spend less by working on one feature at a time, releasing the tool with gradual updates and upgrades, by hiring just as gradually, making sure every employee is needed and a good fit with the team.”  

Paige Arnof-Fenn, CEO of Mavens & Moguls, a branding and marketing firm, warns startups to avoid spending money on trivial things. “I recommend not spending money on things such as fancy brochures, letterhead, business cards, etcetera. Until you know your business is launched, I would say to put your budget into things that help fill your pipeline with customers. Getting your URL and a website up and running is key.”

All these alludes one thing – startups must be highly vigilant in spending their money. 

Also Read: How to improve your startup management

DashThis is one of the fastest-growing companies in Canada while Mavens & Moguls is an established name in the branding industry for more than 18 years. Both the founders suggest managing finance consciously and frugally.  As a startup, you can do that by creating a budget and adhering to it. Planning and estimation of income and expense can help your startup in several ways:

– The budget works as a financial compass that gives you the right direction to allocate the money.

– It helps you review your expected metric with the actual achieved.

– A clear budget helps you determine the funding needs of your startup.

– Enables cutting-off unnecessary and unexpected costs.

Finding the right team

Being new in the market and running on scarce capital comes with several struggles — hiring the right talent is one of them. A survey shows that small business owners looking to hire skilled workers face diverse challenges:

• Candidates lack the skill sets they are seeking (59 per cent).
• Have salary expectations that are too high (45 per cent).
• Prefer to work for a large or midsize brand (29 per cent).
• Want benefits that the company does not provide (26 per cent).

Ketan Kapoor, Co-Founder and CEO at Mercer-Mettl confesses that hiring a talented team was a herculean task for him during the initial years. He says, “Everyone is looking for stability and making good money. You just can‘t expect people to leave their well-paying jobs and settle for low-paying roles to explore innovation and learning. Everyone had their doubts about leaving their comfortable cubicles to work in a garage.”

However, the obstacle is not just finding the operations team but also the right co-founders. You need a balanced team of founders with diversified skills to ensure good growth of your business.

• Utilise your network to hire

One of the things that Ketan did during his initial years was he utilised his network to hire the right team. He approached his acquaintances, friends, relatives, and second-degree LinkedIn connections.

• Go remote

When you find it is hard to get the experienced in-house team, outsourcing the work or hiring a remote team can be useful. Platforms such as Upwork, Freelancer, Fiverr and Toptal make hiring quality freelancers easy. Moreover, it also helps you cut the overhead costs of the in-house team. 

Also read: Why remote working is the future for startups

• Get a balanced team

When it comes to your founding team members, make sure your startup gets the benefits from diversified disciplines: technology, design, and marketing. This is often regarded as a hacker, hipster, and hustler — the dream team.

Scaling (at the right time)

Once startups get momentum as they achieve the market fit its time to scale up. However, it’s not the issue with scaling itself but scaling at the right time. 

Cristian Rennella CEO & CoFounder of oMelhorTrato.com an online platform to compare and purchase financial products says premature scaling was the worst mistake they made.

He explains, “We hired more employees than we could afford. It sounds like a very basic error, but it is not. When you’re growing fast and thousands of new problems pop up every day, you’re not always controlling your economy minute by minute.”

He adds that scaling up was not what they thought. They expected more clients and more revenue but several factors such as delay in payments and drop in sales affected their business direly and were on the verge of bankruptcy. 

Cristian’s and his team learned from their mistakes and managed to get out by cutting down their resources. He says, “We had to take a step back to keep standing and then keep walking.”

Now, oMelhorTrato.com has more than 21,500, 000 users in South America including Brazil, Argentina, Chile, Perú, Mexico and Colombia. 

• Understand your early revenue

Revenue is considered as the barometer of financial success in business. So when startups initially generate a good amount of revenue, they start spending it or decide to scale up that results in premature scaling. 

Michael A. Jackson, a serial entrepreneur and investor cites: “As an entrepreneur, there’s always the temptation to grow the sales team at the first sign of revenue traction, but there is always the danger that this early traction is coming from the subset of the market that are early adopters and not the actual market itself.“ So scaling up on the basis of revenue might not be a great idea.

• Pivot

Pivoting refers to changing the fundamentals of the business. It can be changing your market or even your product. There are numerous examples of big brands that have excelled by pivoting. Pinterest was a fashion curation and buying platform, Instagram was a check-in app, YouTube was a video dating site and Nokia was a paper mill. 

Planning your business goals

As an entrepreneur you know setting the goals is critical to the success of your business. They pave a road to the growth and sets you in the right direction.

However, in the face-paced startup environment where entrepreneurs have to wear multiple hats, making plans and working towards it gets quite daunting.

Also Read: Success through planning — a wakeup call for “startup snobs”

Grant Hensel, CEO of Nonprofit Megaphone & RoundUp App says, “One of the most vexing challenges for startups is planning and goal setting because the environment in which the company operates can change quickly. Annual plans or even quarterly objectives can become obsolete in a moment, and leaders can’t afford to wait until the next quarter to re-calibrate.” 

James Ker-Reid, founder and CEO of Sales For Startups explains that a major challenge for startups and scale-ups is striking the balance between ambitious goal-setting and creating actionable plans to achieve them. “It’s easy for there to be a huge gulf between a yearly goal and what to do in the next 90 days or quarter. Often we have goals but haven’t got clarity on how we are going to achieve them,” he adds. 

• Make quarterly goals

Planning and working on your quarterly goals is one of the ways to evaluate the progress and understand what’s working for you. James advice to have a short and clear activity cycle that is linked to the quarterly goals which would correlate to the larger yearly goals. 

• The one thing approach

‘The One Thing’ approach was introduced by Garry Kelly and Jay Papasan in their book under the same name. Grant Hensel uses this same approach for setting a clear and fluid goal for their company.

He explains, “Under this strategy, we set goals for the one most important thing to accomplish in 10 years, 5 years, 3 years, 1 year, 3 months, 1 month, this week and today. As market conditions change, we can respond in real-time, changing our goal at for appropriate time frames.” 

Legal challenges

As a startup, you are prone to face legal challenges but the fact is most of the entrepreneurs often overlook it amidst growing their business. CB insight states 8 per cent of the startups failed due to legal issues.

In their Startup Post Mortem report, entrepreneurs confessed that neglecting the legal part resulted in spending a fortune on lawyers and ultimately shutting down the business.

Also read: The biggest legal traps startups fall into

However, it’s not just external factors such as intellectual property or taxation that breeds vexing legal issues. They can occur from within the company too. For instance, employee agreements and commercial relationships between co-founder.

Do not hesitate to hire a lawyer. The upfront fee you pay for it is quite nominal compared to hefty legal fines you pay to save your business from catastrophe. On the other hand, there are numerous legal resources on the internet such as Startup Lawyer, Startup Company Lawyer, Legal River and more. Use them to understand the legal working and apply to your startup. 

There are numerous pitfalls in the journey and startups are ought to face them. However, awareness and careful planning can help you to avoid these obstacles. Even if you are bogged in one of these, remember that there are many startups that made their way out and are running a successful business.

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Editor’s note: e27 aims to foster thought leadership by publishing contributions from the community. Become a thought leader in the community and share your opinions or ideas and earn a byline by submitting a post.

Join our e27 Telegram group, or like the e27 Facebook page.

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China’s Ant Financial applies for a digital banking license in Singapore – e27

China-based fintech operator Ant Financial has announced that it has applied for a digital wholesale banking license in Singapore, following the waves of unicorns trying to ahead each other in obtaining the digital banking license form Monetary Authority of Singapore (MAS), reported e27.

Recently gaming startup Razer and ride-hailing company Grab applying for full banking licenses.

An Ant Financial spokesperson is quoted saying to South China Morning Post: “In line with our commitment to promoting financial inclusion globally, we have submitted an application to the MAS for a digital wholesale banking license. We look forward to contributing to the development of the digital banking landscape in Singapore.”

Tesla cuts price for China-made Model 3 vehicles before delivery- Reuters

US electric vehicle maker Tesla Inc cut the starting price for its China-made Model 3 sedans by 16 per cent to US$42,919 after receiving Chinese subsidies for electric vehicles, according to a Reuters report.

Also Read: Startup of the Month, December: Bambooloo by The Nurturing Co.

The reduction, partly thanks to RMB24,750 of subsidies, from an earlier RMB355,800 is among a slew of adjustments Tesla has made to its sales policy in China, including tweaking prices for car accessories and home charging facilities.

Tesla has said it plans to start delivering cars, made at its $2 billion factory in Shanghai, to the public on Jan. 7.

Hong Kong bourse discusses new listings with Ctrip, Netease – Bloomberg

Hong Kong Exchanges & Clearing Ltd. is discussing secondary listings with Chinese technology companies including Ctrip and Netease Inc. after Alibaba raised US$13 billion in its 2019 share offering in the city, Bloomberg cited people with the matter in its report.

Bourse officials have held follow-up talks with the two US-listed firms about the possibility of a secondary share sale, the people said, requesting not to be named because the matter is private. The discussions are preliminary and subject to change, they added.

Malaysian motorcycle ride-hailing startup Dego Ride is back in business – Says

Malaysia-based motorcycle e-hailing service, Dego Ride, has resumed its operations on the new year’s day with 700 approved riders, Says reported.

According to New Straits Times, the local on-demand ride startup was the first company to introduce motorcycle taxis in Malaysia.

With its signature blue and yellow driver’s uniform, the company was founded by CEO Nabil Feisal Bamadhaj in 2015. Dego Ride then officially launched its services in November 2016 with around 5,000 registered riders at the time.

Just shortly after the operation, the bike-hailing service was banned by previous government Barisan Nasional, stating safety concerns. The impose lasted until last year when Pakatan Harapan, who initially disagreed with the concept, decided to proceed with a six-month trial for motorcycle hailing operations starting January 2020.

With the ban being lifted, the company intends to “provide a solution to the current first and last-mile disconnect from the nearest public transportation systems for those living in the Klang Valley, Shah Alam, and Putrajaya.”

In March, Dego Ride stated that it will expand its services into other regions and states.

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Image Credit: Matthew Guay on Unsplash

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Discussion on how Zajil works on the integration of tech and jewellery that is not utilitarian but focuses on the sentimental value of the human experience, using jewellery as a reservoir of the most important messages or moments of our lives.

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This article was first published on nfinitiv.

Image Credit: Sunyu Kim on Unsplash

The post Podcast: A conversation with Waleed Khawaja, Founder Of Zajil appeared first on e27.

Singapore-based digital payment startup Razer Fintech (Razer) announces that it has submitted its application for the Digital Full Bank License, to be issued by the Monetary Authority of Singapore (MAS). For the bid, Razer Fintech will lead a consortium that will launch a digital bank focussing on the underserved youth and millennials segment.

Razer Fintech said it plans to extend its current fintech offerings to digital banking services by building what it claimed to be the world’s first global youth bank, Razer Youth Bank, to be headquartered in Singapore. Razer believes to have an edge with it being synonymous with a lifestyle brand for the youth and millennials.

The digital bank will be led by Razer Fintech who will take up a 60 per cent majority stake, joined by a consortium of strategic partners who will take up the remaining equity interest in Razer Youth Bank:

• Sheng Siong Holdings, the private vehicle of the Lim brothers, Singaporean entrepreneurs behind one of the largest supermarket chains in Singapore
• FWD, the insurance business of the investment group, Pacific Century Group
• LinkSure Global, a privately owned internet companies in Asia that operates WiFi Master Key, with approximately 800 million monthly active users globally and affiliated with ShengPay, a third-party payment company in China
• Insignia Ventures Partners, an early stage Singaporean technology venture fund focussing on Southeast Asia; and
• Carro, Southeast Asia’s wholesale marketplace for vehicles that has operations across Indonesia, Thailand, Malaysia, and Singapore.

Also Read: A sneak-peek at the state of Malaysia’s fintech ecosystem

The value propositions that Razer Youth Bank aims to deliver are as follows:

• The ability to leverage on Razer’s brand with the global youth and millennial population as audiences to drive adoption
• The understanding of the lifestyle needs of the youths and millennials and the ability to customize relevant products and services
• The technology and fintech expertise with data-driven technology stack to deliver user experiences
• The ecosystem that allows it to collaborate with industry leaders and lifestyle partners to create and deliver bespoke banking solutions to a large underserved demographics; and
• The contribution to Singapore’s continued growth as a global financial centre while embarking on global ambitions.

To do so, Razer has also gathered service providers, product, and technology platform partners to create services and products to Razer Youth Bank such as confidential airline partner, co-working communities JustCo, digital wealth management solutions provider Quantifeed, educational financial content platform Real Vision, multi-asset trading fintech and investment platform Saxo Markets, global travel company SkyScanner, cash management network SoCash, digital lending solutions Turnkey Lender, software-based digital security solution V-Key, and Visa.

Also Read: Here are the 16 most influential fintech personalities in Malaysia

Lee Li Meng, Chief Strategy Officer of Razer Inc. and CEO of Razer Fintech, said: “We hope to be able to contribute to the growth of Singapore as a global financial centre to deliver a new-age and clearly differentiated digital banking proposition for Singaporeans and youth and millennials globally.”

New management appointment

In addition to the announcement on digital banking consortium, Razer also announced the appointment of Edwin Chan as Chief Investment Officer.

His deputy will succeed him in the role of CFO while Tan Chong Neng, who was Senior Vice President, Corporate Controller, appointed CFO.

“These two appointments strengthen our leadership team and leave us well-positioned to continue on our long-term growth trajectory while delivering on our profitability goals,” said Min-Liang Tan, Co-Founder and CEO of Razer.

Also Read: P2P lending fintech Validus closes over US$15.2M Series B funding led by Dutch bank FMO

As Chief Investment Officer, Chan’s new focus will be managing the company’s investment portfolios. This will involve developing both short-term and long-term investment strategies for the company including corporate finance and treasury investments, venture capital investments, and M&A.

As for Tan, who joined the company in 2017, he will bring his over 20 years of experience with stints in Tri-Star Group and Stanley Security Solutions into his new role as CFO.

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Image Credit: Razer

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Kiren Tanna, Co-founder of ZEN Rooms, has announced his resignation from the budget hotel booking startup after a stint of four and half years. He shared his exit in a Twitter post, stating the sentiment of the growth he has witnessed during his tenure.

“From just an idea, ZEN Rooms today is present in 4 countries, growing 4x yoy, best in class CSAT, and a team of more than 500 colleagues!” the statement reads.

Tanna also made remarks of the perfect timing of his decision, highlighting Korean travel group Yanolja’s acquisition earlier this year that made it ZEN Rooms’ current biggest shareholder.

Tanna added that the other co-founder Nathan Boublil will take over fully as CEO while Sean Lee from Yanolja will be Chief Strategy Officer. Lee has been in ZEN Rooms’s Board member since 2018.

Also Read: Korea’s Yanolja invests in ZEN Rooms; competition in budget-hotel space to intensify in SEA

The statement ends with Tanna stating his desire to take a break before resuming his work in the region’s startup community.

“I am advising a few founding teams and completing a few angel investments and looking forward to connecting with and supporting more great entrepreneurs. I also hope to sharpen my guitar and bahasa skill,” he said.

Before founding ZEN Rooms Asia alongside Boublil, Tanna had a stint as CEO in Rocket Internet APAC, and had held CEO position in Foodpanda.

In October 2019, ZEN Rooms received an undisclosed sum in investment from Yanolja, a travel group in South Korea. Hong Kong- and Korea-based Access Ventures has joined as a co-investor in this round.

Also Read: Our hyper-local approach sets us apart from competitors: Amit Saberwal of RedDoorz

Yanolja has acquired stakes from one of ZEN’s early investors and signed a strategic alliance with the Singapore-headquartered company. With this, ZEN’s early investor Asia Internet Holdings (a joint venture of Rocket Internet and Ooredoo Telecom), has exited while other early backers RedBadge Pacific and SBI Korea will remain as investors.

Yanolja, backed by Booking Holdings and GIC, was the lead strategic investor in the company’s US$15M funding round in 2018.

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Picture Credit: ZEN Rooms

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Vietnam’s burgeoning IT sector is showing no signs of slowing down and continues to generate strong revenue for local and foreign players alike.

Hanoi and Ho Chi Minh City, in particular, have developed an extraordinary IT ecosystem and seeing a mushroom growth of startups. Meanwhile, there has been considerable growth in the influx of foreign investment as well.

The southern province of Binh Doung has just recently licensed the Internet Service Supply Project of Japan’s NTT Group with a registered capital of US$171 million.

In many ways, this demonstrates how much promise IT truly holds in the country.

According to the e-Conomy Southeast Asia report of 2019, the growth rate of Vietnam’s internet economy is 40 per cent, making it a leader in this sector alongside Indonesia in Southeast Asia.

It’s no secret that the nation’s IT industry is ripe with opportunities. However, one question that many investors and entrepreneurs alike would be asking is which of the subsectors has the highest potential of turning a big profit.

So using the latest data, I have shortlisted four most lucrative niches of IT in Vietnam.

Ecommerce

Statista’s Digital Market Outlook (DMO) study states that nearly 50 million internet users in Vietnam bought consumer goods online in 2018. Although this data is from a year ago, recent stats are no different as the trend has shifted further towards eCommerce.

Surprisingly, travel purchases dominate this sector with e-travel being worth US$3.5 billion. Among consumer goods; electronics and fashion items were mostly purchased followed by food and furniture.

Also read: What is the state of Vietnam’s e-commerce industry?

Customers in the country prefer popular Southeast Asian platforms like Shopee and Lazada for most of their internet shopping while domestic firms like Sendo and Tiki also maintain a significant share in the market.

Around 70 per cent of Vietnam’s ecommerce sales are conducted in Hanoi and Ho Chi Minh City. However, rural internet connectively has greatly improved in recent years and this has created a great opportunity for eCommerce platforms to target the country’s biggest population.

With such vast potential, an industry complementary to eCommerce is already emerging in Vietnam.

Affiliate marketers are acting as a bridge between consumers and online retailers. And companies themselves are teaming up with different online influencers for coupon marketing to drive more customers towards their brands.

At the same time, eCommerce platforms targeting different niches are popping up across the country.

AI

While Vietnam is far from being the hub of AI in Southeast Asia, the potential of this technology is strong in the country. Applications of AI like the Internet of Things (IoT) and Machine Learning in areas such as healthcare, manufacturing, e-commerce, and agriculture can reap extraordinary benefits for all stakeholders involved.

Even with a lack of infrastructure, large databases and resources –companies are implementing AI projects.

Vietnamese telecommunications company Viettel uses AI in thwarting attacks by cybercriminals and assist business with their IT security. Examples such as this exist across the IT industry.

Likewise, International tech companies that create AI technologies are also exploring Vietnam but due to lack of highly trained resources, the progress on this end has been rather slow.

However, 2020 will be a big year for automation and like every other facet of IT –it’s expected that ventures related to Artificial Intelligence will gain important ground in the Southeast Asian country.

Fintech

Fintech remains a pillar of Vietnam’s entire digital economics landscape. And with the current efforts to accelerate its growth, the industry is expected to reach the US$7.8 billion in revenue in the coming year.

Also read: How Vietnam is accelerating fintech growth

The country’s emerging middle class coupled with affordable internet access has created an environment where fintech is thriving. Around 120 companies currently offer services like digital payments, insurance, and risk management.

Vietnam’s fintech has managed to create headlines across the world with startups like Momo being featured among the top fintech firms and Money Lover ranking first in financial management apps.

Going forward, blockchain and cryptocurrency will play a key role in this sector. Companies like Kyber Network and TomoChain are already leading the way in making the crypto transaction easier.

As the world, in general, comes around to cryptos, blockchain will become an integral part of Vietnam’s fintech ecosystem.

SaaS

A SaaS company KiotViet recently raised the US $6 million in Series A funding. In 2018, a startup named Base was able to gain the US$1.3 million in pre-Series A funding round for its regional expansion.

It’s quite clear that investors see potential in this sub-sector and they’ve every reason to think this way. SaaS plays a significant role in the Vietnamese cloud service market which is expected to reach US$291 million.

Cloud is a cost-efficient option for small businesses that do not possess the resources to install advanced hardware and software. However, large enterprises have also taken a liking to this technology.

With the recent commercial boom in the country, there’s a growing need for data storage in the country and this has created a significant SaaS-based B2B market.

The expanding economy of Vietnam will drive further growth in the SaaS sector, creating space for more startups and small businesses to provide third-party software solutions.

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Marketing is as fundamental to a business as its product or services. We might not realise it but a lot of products that we know today became popularly known because of their marketing campaigns.

Take the fidget spinner as an example. Do you ever wonder why it became so popular even though it was first designed for people struggling with psychological stress, anxiety and other neurological disorders such as ADHD and Autism?

It was due to the amazingly crafted marketing campaign that made it look like fun and something that everyone could play with.

Marketing can make or break your business

This is just one example of how marketing can make a product spread like a wildfire among an audience. But, you can’t just make anything up and expect it to become an instant hit overnight.

Customers today are much smarter than they were a decade ago and understand the difference between clickbait and real value. A lot of marketers start cooking up fancy campaigns for different channels without even realising the value that a product adds to a customer’s life. Moreover, there are different segments of customers in the market with their individual needs and demands.

The same product could have a different meaning for a student and a professional. And quintessentially, if you are targeting both of them, your marketing campaigns must be able to speak to them individually.

The problem with today’s campaigns is that when customers look at it, they feel like it’s addressed to the masses, instead of them.

The point is if brands don’t care enough to speak to the needs of an individual customer, why customers should be interested in their product or services. And then the quality of your product or service doesn’t even come into consideration.

Also Read: How AI can benefit marketers in 2019

Marketing in today’s world has the potential to make or break your business, which is why successful campaigns are designed based on data. Data forms the foundation of a business’s marketing strategy. This means that marketers must dive down deep into it and form strategies that appeal to an individual segment of customers.

However, with the advancement of technology, there’s a lot that marketers can do without having to fuss over the tiresome processes.

AI and marketing

Artificial intelligence and machine learning are on an expansion spree across the world. Every other industry and organization is taking measures to implement AI in different areas. And marketing is no exception to it.

Statistics suggest that the beginning of 2020 will see more than 50 per cent of marketers adopt AI or ML in some form. Marketers are using AI for more than a few reasons, but most importantly to carve a niche for themselves in the market.

The cutthroat competition is here to stay in the market and AI is the key for marketers to differentiate themselves from their competitors. One of the biggest factors that must be taken into consideration for standing out in the market is personalisation.

While everyone is vying for the top spot out there, it is those who utilise personalisation, make it big.

The reality is that everyone is trying to guess what the customers want and the way that they want it using different methods. While some are using their intuition, others rely on traditional practices.

AI, on the other hand, can be the difference between spending endless time analyzing customer demands and smoothly eliminating all the guesswork with concrete data.

As 2020 draws upon us, it will only be a matter of time before everyone starts seeing the benefits of AI in designing successful campaigns.

After all, it does dive into several data points all at once, providing real-time insights and recommendations along with automating several key processes at once. It removes the need for any mundane task and leaves humans to more essential jobs of strategising and planning.

Greater engagement

There are several ways in which AI is powering greater engagement for people. First marketers can utilise the historical data to analyse which of their campaigns worked and which didn’t.

Based upon the nature of the customer, the market timing, and other relevant factors, businesses can enhance their strategies for sales and boost customer engagement by many folds.

This enables the marketer to understand the segment of customers who are likely to engage with communication on a particular channel or medium. Similarly, based on the previous buying patterns of the customer, the target channels for further campaigns can be determined with ease.

Also read: Why AI will be critical to brand strategy

Consider, for example, the ML-powered bots used by organisations such as Sephora and Levi’s. These bots ask the customer questions about their products that determine factors around their immediate needs and future preferences.

In contrast to a retail salesman, these bots do the perfect jobs by handling a significant amount of traffic adequately and answering some of the basic questions of the customer effortlessly.

The era of personalisation

If businesses have to emerge as huge successes, they have to pay attention to personalization, no matter what. AI can help marketers personalise their campaigns when it comes to ads on different platforms, suggesting recommendations and others.

It also provides them with content that is relevant to each customer along with the appropriate timing, when most customers are active on a particular Java platform.

Similarly, personalised recommendations are becoming an instant hit these days. Take Amazon for an example. It studies the customer’s browsing history, past purchases along with other factors to suggest those products, they’d like to buy in advance.

All this keeps a peek into how AI can help businesses understand customer behavioural insights and capitalise on them.

The scope of AI in marketing is endless. Businesses can accomplish a lot without having to invest in many human resources, with one self-sufficient AI.

And since every other brand is using it out there to entice and engage the customers, not capitalising on the cutting edge technology will only leave you far behind in the market race.

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