SoBanHang Secures $ 1.5 Million To Help Small Vietnamese Stores Sell Online For The First Time – TechCrunch
A few months ago, brothers Hai Nam Bui and Hai Long Bui were developing an accounting application for small retailers in Vietnam. Called SoBanHang (or “sales book”), it would help businesses that typically rely on paper ledgers to digitize their transactions, such as Khatabook in India and BukuKas and BukuWarung in Indonesia. Then a new COVID-19 epidemic hit Vietnam. The companies SoBanHang worked with, which are often family-owned and have fewer than five employees, struggled to cope. The team ran a hackathon and came up with a new product that allows retailers to set up online stores and manage orders. Since launching three months ago, SoBanHang’s “hyper-local ecommerce enabler” has recruited nearly 20,000 merchants, many of whom are selling online for the first time.
The company today announced that it has raised $ 1.5 million in seed funding, with the participation of investors such as FEBE Ventures, Class 5 and Kevin P. Ryan, founder of companies like Gilt Groupe, Business Insider and MongoDB.
Prior to launching SoBanHang, Hai Nam Bui founded Datamart Solutions, a data analytics and automation platform, and held leadership roles at Lazada. Hai Long Bui also spent several years managing Lazada, before taking on the roles of director of analytics and technology at Landers Superstore, a Filipino supermarket chain.
The idea for SoBanHang sprang up when Hai Nam Bui visited a grocery store wearing a Lazada t-shirt. The owners of the store saw the shirt and asked him how they could start selling online. So he helped them set up an account on Shoppe and start uploading photos and product descriptions.
“After setting everything up, they got their first order and asked, ‘How do I ship the product? “” Hai told TechCrunch. “I said that a third-party logistics provider would come and collect the goods. And then they asked about the money. They did not understand the process and they did not feel comfortable giving goods to third party logistics providers.
Since the majority of e-commerce orders in Vietnam are paid for by cash on delivery, store owners have had questions about payment as well. Hai explained that the customer would hand the money over to the runner, who would then give it to Shoppe and, in turn, Shopee would deposit it in the store owner’s digital wallet.
“And they asked ‘where’s the wallet? How can I withdraw money from a bank account if I don’t have a bank account? ‘ It was an a-ha moment, when I realized that a lot of e-commerce platforms are still not accessible to around 90% of retailers in Vietnam, ”Hai said. “The systems are still far too complex for them. “
Hai and his brothers started working on a digital accounting app to help businesses digitize their operations, but when the epidemic and bottlenecks hit, it became imperative to help them start selling online immediately. According to SoBanHang research, there are approximately 16 million micro-enterprise “nano” in Vietnam. Many are very local, serving customers within a few kilometers. In fact, companies in SoBanHang often make their own deliveries on foot.
“This was our second a-ha moment on retailers, meaning they sell to customers in their neighborhood. Buyers and sellers are in fact within walking distance. When they connect with the buyers, they can complete this order transaction, and then the retailers themselves deliver the good and collect the money at the customer’s door, ”Hai said. This eliminates the need for SoBanHang to have complex logistics or payment systems, or for merchants to use third-party delivery apps that charge high commission fees.
Many SoBanHang customers previously handled most of their transactions on paper and did not have a point-of-sale system or laptop. The app is therefore the first time they have digitized their transactions. SoBanHang can be used for all kinds of retailers, but during the COVID-19 outbreak it was adopted the most by food and convenience stores.
Retailers are small enough that their customers can just send them orders, but SoBanHang makes the process easier and allows them to sell more. Having an online storefront also helps prepare retailers for further COVID-19 outbreaks and maintain relationships with their customers.
For example, SoBanHang has a strategic partnership with Viettel, the largest telecommunications company in Vietnam. This allows them to offer discounted SMS to businesses so that customers can see special offers even if they haven’t installed SoBanHang’s app and don’t receive its push notifications. For example, if a grocery store wants to sell its stock of fresh fish, it can text buyers.
After the lockdown restrictions were lifted, Hai said SoBanHang can help small retailers continue to compete with bigger players like supermarket and convenience store chains. Their advantage is that “they have a great relationship with their customers, they know them well and they sit and wait for their customers to come. We want to turn this relationship into a new sales strategy for them.
Going forward, SoBanHang plans to continue working on its original plans for the accounting application. Like other accounting apps, it plans to add financial services, like working capital loans that can be disbursed even without a digital wallet or bank account. But for the near future, the startup will continue to help small retailers sell online for the first time.