As a frontier market, Cambodia’s startup ecosystem lags behind Southeast Asia’s six core markets—Singapore, Indonesia, Malaysia, Vietnam, Philippines, and Thailand. However, the country’s tech scene has shown promising progress in the past few years, particularly in the fintech sector. According to a report conducted by Visa in 2019, one-third of Cambodians expect that digital payments will continue to gain popularity, while 54% say the economy can go fully cashless by 2026.
Fintech startups like Clik are making that transition possible. Founded in 2016 by Matthew Tippetts, Skye Cornell, and Darren Jensen, Clik is a payment aggregator that enables offline merchants and their consumers to perform cashless payments using mobile wallets, as well as debit and credit cards.
“In line with our tagline, ‘safer than cash,’ we have a mission to transform the payment experience, making it safe, simple, seamless, and rewarding, especially from a merchant’s point of view, because there are too many different non-interoperable systems right now. We’re one platform which can accept pretty much any payment,” Clik co-founder and CEO Matthew Tippetts told KrASIA.
Through a strategic partnership with payment authenticator Mypinpad, Clik provides contactless chip-based payments using near-field communication (NFC) technology, giving merchants of any scale the capability to accept payments from various devices. It is also able to collect transaction data and in turn provide valuable insights about consumers to the merchants. Moreover, Clik provides loyalty plans and marketing tools for merchants to use as part of customer acquisition campaigns.
Tippetts, a British citizen, landed in Cambodia ten years ago to build a financial advisory and investment firm. The market is open and Cambodia is an easy place to set up and do business, he said.
“The idea [for Clik] came around four years ago, when I saw a massive gap in terms of what people need for doing payments and what was actually available in the market. But it was too early, because smartphone and 4G network penetration was very low back then,” said Tippetts.
Clik was self-funded at the beginning, and it progressed quite slowly in its first year. “In 2017, we did a feasibility study where we spoke to 1,800 merchants to understand their pain points, and we got a lot of insights that confirmed our assumptions. From there, we started putting together the team and gradually raising funds,” he said.
Ever since the firm received external funding two and a half years ago, Clik began to accelerate quickly. Tippetts said that around 2,600 merchants have signed up with the platform. Clik already has partnership agreements with several financial institutions and large distributors, which altogether could provide Clik access to an additional 56,000 merchants. These include pharmacy company Ucare Pharmacy, convenience store chain Kiwimart, and retailer group Chip Mong Retail.
“We are a merchant-centric platform. We simplify the payment process and we enable them to capture valuable data and insights to help merchants understand their customers better. Therefore, a large portion of the revenue will come from these data-driven services,” Tippetts said.
In early August, Clik announced the completion of USD 3.7 million in a seed funding round led by Openway and Poems Pte Ltd, an investment holding company of Singapore’s Phillip Capital. Clik will use this funding to prepare its commercial launch by the end of this year.
Fintech is progressing, but fundraising remains a major issue
Cambodia’s fintech market has dramatically changed since Clik was founded, Tippetts said. The country has major payment companies such as Wing and Pi Pay that have paved the way for new entrants. “Last year, we did another market survey with around 1,000 merchants, and 56% of them said they were already familiar with digital payments. Four years ago, the number would have been close to zero,” he said.
As of early 2019, fintech was the largest tech category in Cambodia, with around 50 companies jostling for a corner of the business, according to a report by Mekong Strategic Partners and Raintree Development. Digital payments and software-as-a-service (SaaS) for financial institutions are some of the most developed segments. Tippetts said that in many Cambodian cities, more than 85% of transactions are made in cash, so the market is still wide open.
Nonetheless, fundraising was the number one challenge for Clik in its first years of operations. “We’ve been around for a while, we’ve had our challenges and we overcame them. Around three years ago, raising money for a payments company in Cambodia was not easy. Especially because Cambodia at the time wasn’t on the radar screen of institutional investors. There wasn’t a big angel investor community and it took time to develop. But over the years, as the market progressed, investors started to understand and like what we do,” Tippetts said, adding that the government and central bank are also fostering the conversion to digital payments through supportive regulation.
Nevertheless, he doesn’t think that mobile wallets will replace banks in the future. Only around 25% of Cambodia’s population is banked, but major financial institutions have been aggressively urging people to sign up for bank accounts in the past few years.
“In this market, there are 55 institutions that can provide banking services for around 16 million people. When we spoke to merchants, the vast majority of digital payments are card-driven. That is why we chose to be a payment aggregator that can serve both card and mobile wallet payments, and I hope that fintech and banks can work more closely in the future,” said Tippetts.
Recruitment for high-skilled talents is also a challenge. Tippetts said that 85% of Clik’s team consists of local employees, but the firm’s senior levels are mostly filled by experienced professional expatriates. “We’re trying to bring up Cambodians through the ranks as much as possible, therefore, training is crucial for us. When it comes to certain critical roles like CFO or CTO, we certainly need high-qualified people who have around 20 years of experience, so they can transfer their skills to the team,” he continued.
Moving forward, Clik has the aim to become a leading payment app in the country, and it is currently in talks with several partners to achieve its goal. “We expect to be a leading payment app down the line. We are adding strategic partnerships with financial institutions and mobile wallet providers so we can facilitate seamless payment for more merchants and customers,” Tippetts said.
This article is part of KrASIA’s “Startup Stories” series, where the writers of KrASIA speak with founders of tech companies in South and Southeast Asia.