Bangkok-based startup aCommerce unveiled a strategic plan that could lead to an IPO soon. The company has raised USD 10 million from its existing investors, including KKR & Co. It plans to put these funds toward developing better products and services for its clients, riding on 73% growth in revenue to more than USD 100 million, driven by achieving profitability in its core market, Thailand.
In particular, aCommerce’s business continues to experience rapid growth in and revenue from its core Brand Ecommerce solutions—the source of most of its business today. The company’s revenue grew at a compound annual growth rate of 188% in 2017 and ’18 to exceed USD 90 million by the end of the two-year period.
KrASIA spoke with aCommerce Thailand CEO Phensiri Sathianvongnusar to find out more about the company’s recent partnerships and its future plans.
KrASIA (Kr): aCommerce has just raised an additional USD 10 million from existing investors. Where does this lead the business in terms of the company’s plan for growth going forward? How soon might we see the company go public?
Phensiri Sathianvongnusar (PS): Our company continues to experience rapid growth. We are now positioning our business for long-term sustainable growth and profitability by working with brand clients that show the same commitment to grow online. The new investment will help us focus on growing our core brand e-commerce business and tech to reach group profitability, and will hopefully lead us to an IPO in the next few years.
Kr: Could you tell us more about your recent partnership with Line to help brands utilize social commerce effectively? What does the collaboration mean for aCommerce?
PS: Social commerce is one of the fastest growing online segments. Brands also highly value the direct relationship with consumers on this platform. As Line’s retail solutions partner, we will be able to help our brand clients to reach more consumers and offer a unique shopping experience effectively. We are in discussion with some brands to have their official store on LINE. Unfortunately, we can’t elaborate on that as it’s still in the early stage of development.
Kr: What is unique about the Thai e-commerce market, which is expected to surge to USD 13 billion by 2025? How are aCommerce’s operations in Thailand different from those in other markets?
PS: In Southeast Asia, Thailand is one of the early adopters of e-commerce due to the comparatively strong logistics and payment infrastructure, as well as high mobile and internet penetration. Thai consumers are also early adopters for features like live video streaming and influencer marketing. This quick pace requires us to always be innovative in developing solutions for clients. The partnership with LINE is the best example of this, as Thailand is still one of the messenger company’s biggest markets outside Japan, as the country recorded a significantly higher adoption rate compared to anywhere else in Southeast Asia. The development of our social commerce technology is also mainly spurred by better infrastructure in the country and Thai consumer behavior that shows more inclination and a higher level of trust to shop online via social media channels.
Kr: What differentiates you from your competitors? Who are your major clients in Thailand? How have your services changed over the past few years?
PS: Our regional presence and local expertise have always been the keys that differentiates us from our competitors. We continuously develop our proprietary technology platforms, including marketing and analytics technologies that will help brands sell online in the region. Over the past few years, we have been introducing new products and services including BrandIQ [commerce analytics suite], StockIQ [for supply chain planning], ChatIQ [live chat tool], and the upcoming Social Commerce.
In Thailand, to name a few of our clients, L’Oréal, Unilever, and DSG have been growing their online business with us, including developing their D2C strategy, managing their official stores in marketplaces, and building their social commerce channel.
Moving forward, we are ensuring our business is executed on sustainable economic terms in order to achieve our goal of building a sustainable technology company, as we consider our responsibility to work with brand clients that show the commitment and willingness to invest and grow together. We evaluate all possible risks and adjust accordingly in a gradual fashion, as we believe that e-commerce in Southeast Asia is a marathon, not a sprint.
Kr: What should the market expect from aCommerce’s product development? What happened to the brand market research service ecommerceIQ? Is it still being developed?
PS: As consumers and channels grow over the years, it has become more critical to develop products that will help brands create a seamless shopping experience across multiple channels—both offline and online—which is what has always been a focus at aCommerce. Initially, ecommerceIQ was built to guide clients through the hidden “curves” in the market, especially potential clients, as relevant information about e-commerce in Southeast Asia was scattered, at times nonexistent. With a more mature state of the market and as more information becomes available, we are shifting ecommerceIQ’s focus to support existing aCommerce brand clients with analytics to enable them to sell more effectively online.