2020 has been one of the most challenging years so far for the Thai Startup Ecosystem with the Covid-19 outbreak ushering the country into a lockdown that has dire consequences for the economy. As with any crisis, there are opportunities that arise. As the famous saying from Winston Churchill goes, “Never let a good crisis go to waste”. Let’s take a look at some of the Thai Startups turning this crisis into an opportunity to further grow their businesses.
FINNOMENA, a fintech investment and wealth management platform aiming to provide financial independence for the Thai mass population through digital technology through its investment knowledge hub, wealth management products, financial advice and analysis tools. To date, Finnomena has over 120,000 subscribers and has recently reached a milestone of over THB10,000 million in assets under management (AUM) in the midst of a pandemic, capitalizing on a global trend of a new set of retail investors who were sent into a nation-wide lockdown.
FINNOMENA plans to expand its product offerings and aims to increase its assets under management (aum) to more than 90 billion baht by 2023. Fortunately, the team was able to win over the trust of 2 of the leading VCs in the region, Openspace and Gobi Ventures who co-led a $13.5m Series B funding round into Finnomena earlier in the year with current investors; 500 TukTuks, Krungsri Finnovate and BCH Ventures participating in the funding round as well.
Freshket, an online grocery and ingredient e-commerce marketplace simplifying the process of getting fresh produce from farm to table, has raised a $3m Series A led by Openspace with the Private Equity firm ECG, Innospace, Pamitra Wineka and Ivan Sustiawan, co-founders of Indonesion Agri-Tech Startup TaniHub also participating in the round. With this round of fresh new funding, Freshket is aiming to be an enabler for the entire food supply chain, a traditional industry with highly manual and tedious processes.
Freshket’s story is one of grit and perseverance. In the founder’s (Bell, Ponglada) own words
“It was a roller-coaster ride, but ultimately a beautiful experience… We had run out of runway since January this year and to make matters worse, our key client delayed their payment by two months. We had no choice but to use our personal savings and take out a loan in order to extend our runway until the end of March. On March 22nd, the government announced to shut down Bangkok due to the spread of Covid-19. Restaurants had to be temporarily closed and more than 80% of Freshket’s orders were cancelled. To secure revenue and cash, we decided to open the platform for consumers. We planned around it, prepared and rolled it out on March 23rd. The announcement from the government came without any warning so we had to react and pivot fast.. Because of the Covid-19 situation, some Series A investors pulled out of the deal … Finally, our hard work paid off. Openspace invested in Freshket as lead investor and many more investors asked us to expand this round.”
HungryHub is another shining example of the agility of startups to pivot and innovate with speed. As with many other businesses and startups, HungryHub’s core service was severely disrupted by the Covid-19 outbreak. As a booking platform for the fixed-price dining at restaurants, revenues were dramatically reduced as the initial lockdown forced restaurants to close up shop. Fortunately, within weeks, the HungryHub team was able to pivot and help their restaurant partners generate revenue via their new food delivery service, HungryHub@home. Its key differentiation from other incumbents was first and foremost, the fact that they have leading restaurants and chains as their partner and their focus on set menus which brings a higher Average Order Value (AOV), 3-5 times higher than the market. In addition, customers on average orders 6 hours in advance making it much more efficient and easier for restaurants (especially those without significant delivery experience) to manage. Finally, the commission rate for the service stands at 14%-20%, approximately half what other competitors charge.
In terms of Fundraising, HungryHub also closed a Pre-Series A deal with a local Private Equity Fund, further signalling positive momentum and belief in the company.
Further, ChomCHOB, a points exchange platform founded in 2015 which allows users to aggregate their credit card and loyalty points to ChomCHOB points which can be redeemed for various goods, services and even investment. With its high untapped market potential, ChomCHOB recently secured a 50m Baht Series A funding round led by Invent with 500 TukTuks and SIX networks also participating in the round.
The investors see the huge potential for ChomCHOB to alleviate the pain points of many stakeholders in the points ecosystem by increasing liquidity in loyalty schemes, democratizing points to be freely exchangeable between programs.
As with many other startups, ChomCHOB was also impacted by the Covid-19 outbreak. “The pandemic has driven the points exchange as consumers make more purchases online,” Nout Chutisowan, chief executive and co-founder of ChomCHOB said. The company has grown 3-5x since the pandemic outbreak and currently has over 3 million customers and 500,000 merchant partners. Looking forward, ChomCHOB aims to onboard more merchant partners with an eye for overseas expansion.
Last but not least, leading Thai Agri-Tech Startup, Ricult, raised a $2m round co-led by Bualuang Ventures and Krungsri Finnovate. Ricult was founded with the goal to help farmers increase yields, expand access to market, increase revenues and essentially, manage their farms more efficiently and effectively. Banks also benefit from the platform as data can be used to help increase access to loans to farmers, hence there is huge interest from Banks in Ricult. The company has information on over 300,000 farmers, aiming to reach 4 million within the next 3 years.
As we look forward, we hope to see many more Thai startups persevering and thriving through the crisis as the above-mentioned startups had. Just like how the Airbnbs and Ubers of the world were born during the last financial crisis, there will definitely be great companies borned by seizing huge opportunities out of this crisis.