|KiotViet provides a cloud-based POS solution for small and medium businesses in Vietnam. Source: dantri.com.vn |
KiotViet and KKR last week announced the signing of agreements under which the latter would participate as the lead investor in the former’s $45-million Series B fundraising round. Other investors partaking in this funding round include Jungle Ventures, Thailand’s Kasikorn Bank, and Cao Viet My.
KiotViet is a leading merchant platform for micro-, small-, and medium-sized enterprises (MSMEs) in Vietnam. The company aims to drive the digital transformation of such enterprises.
Cao Trong Kim Tri, deputy general director of KiotViet, told VIR, “COVID-19 has created many challenges for MSMEs. To support our merchants, KiotViet has developed solutions to help them manage their businesses seamlessly offline and online.
For example, MyKiot gives KiotViet merchants the ability to create their own e-commerce website in just five minutes, and omnichannel management allows merchants to effectively manage sales from multiple channels, including their e-commerce websites, Tiki, Shopee, Lazada, Facebook, and some others.”
With the new funds, KiotViet plans to continue to upgrade the quality of its products and services to transform MSMEs, hire key executives for new services in fintech (KiotFinance, KPay) and business-to-business (B2B) e-commerce (KiotPro), and expand to regional and international markets.
Likewise, SoBanHang, a Vietnamese bookkeeping software for small businesses, has raised $1.5 million in a seed round led by FEBE Ventures, a US-based venture capital firm, and individuals like Kevin P. Ryan, founder of Business Insider. SoBanHang will use the fresh funds to further invest in technology. The company wants to help small businesses thrive on digital platforms with the power of technology and smart data analytics.
Bui Hai Nam, CEO of SoBanHang shared, “During social distancing, small retailers and traders can no longer meet their customers face-to-face, hence going online is the only way to ensure business continuity. It’s a great opportunity for them to expedite digitalisation, expand to modern channels, increase revenues, and gain more operational efficiency.”
However, Nam also added that “the digital transformation is costly and complex – even for large corporations. SoBanHang makes it fast, easy, and effortless for smaller businesses to adopt more modern e-commerce.”
According to Nam, small retailers now understand the vitality of digitalisation and are becoming more open to new technology. As a result, SoBanHang saw a huge wave of newcomers on its platform in the last two months. SoBanHang earlier had spent eight months researching the market build its app the final solution for retailers.
Likewise, Sapo Technology JSC, a multichannel management and sales platform, is also looking to raise about $10-15 million to fund its expansion. Tran Trong Tuyen, CEO of Sapo said, “COVID-19 has changed the way we buy, and therefore, it changes the way businesses operate. The digital transformation is definitely a top priority to meet the urgent needs of both suppliers and consumers.”
Sapo has witnessed stronger investment by SMEs in digital transformation. Especially amid the latest wave of infections, the negative impact on businesses was huge. However, there has been an increase in investment in sale management software on e-commerce platforms, online sale channels, inter- and intra-regional shipping channels, and cashless payment methods, which could be an indicator for SMEs trying to search a long-term orientation to survive the pandemic.
“The demand for digital services has been huge, and the usage of technology has also been increased. We have seen market assisting services, online orders via mobile apps, super-fast shippers, and many more things. This is an opportunity for those who know how to take advantage of it,” Tuyen said.
The shift to online has attracted the attention of overseas investors and funds. Ashish Shastry, co-head of Asia- Pacific Private Equity and head of Southeast Asia at KKR said, “We are excited to invest in KiotViet, an innovative business with terrific growth potential. Our investment marks our sixth in Vietnam and is the first made within KKR’s growth technology strategy in Southeast Asia. This milestone reflects our commitment to providing high-growth technology companies – including those at an earlier stage – with long-term capital and value-added support.”
Meanwhile Olivier Raussin, co-founder and managing partner at FEBE Ventures, told VIR, “Vietnam is a key market for FEBE Ventures. We invest in technology and SMEs are the key segment that we like to address. We are considering more investment in the space. Furthermore, we truly believe in the digitalisation of customer services in the emerging middle class and B2B in the SME segment.”
According to Raussin, SMEs need to sell both online and offline. They could meet the needs of customers with a proper digital strategy and execution, backed by fundamental tools like customer relationship management solutions and customer databases. With this, SMEs could boost their new products and promotions.
Tech startups like KiotViet, SoBanHang, and Sapo could be the ones helping SMEs to address the challenges of the digital transformation. “Businesses must be ready to invest in a methodical, enthusiastic, and carefully calculated manner. It’s not just about bringing all products and services to a digital presence. They must prepare a full presale, sale, and after-sale system that is synchronous and compatible with digital products,” said Tuyen of Sapo.
“It is also worth mentioning that tools such as Sapo’s sales management software are to completely reduce errors, connect sales processes smoothly and professionally, and create a good experience for customers and stable revenues for sellers,” he claimed.