Forget startups. Buy the business running on Excel

Across Southeast Asia, thousands of medium-sized businesses still run on systems from another era.

While they can typically survive on Excel, WhatsApp, and founder instinct, as they grow and become more complex, their operating systems can’t just live in their founder’s head anymore.

Digitalizing these businesses could be the next great investment opportunity in Southeast Asia. These companies often already have product-market fit, solid revenue, and established brand value, whereas launching a startup involves building all that from scratch.

I spent five years in finance before I moved into starting businesses. Now I run the AI behind nutrition platform Foodhak and am building Trackr, a healthcare startup still in stealth, working on clinical-grade recovery technology.

These experiences have given me enough time in both worlds to know how to spot the businesses that need digitalization and what it takes to do that.

The “scissor pattern”

One indicator that a company is ripe for digitalization is what I call the scissor pattern: Sales are growing and the gross margin is solid, but profits are falling.

Why is a business selling more without making more money, especially when the unit economics have remained relatively stable?

Jumbo Group, the Singapore-based seafood restaurant chain famous for chilli crab, is a useful example.

In the six months leading up to March 2026, its revenue grew 7.9% to S$105.1 million (US$82.6 million). Gross margin improved slightly from 65.5% to 65.8%, yet profit attributable to shareholders fell. It dropped more than 22%, from S$7.9 million (US$6.2 million) to S$6.2 million (US$4.9 million).

See also: This VC uses AI to spot startups before the data catches up

Employee costs rose by 14.2% to hit S$35.5 million (US$27.9 million), utilities jumped 21.4%, and other operating expenses increased 10.7%.

Those numbers don’t necessarily make Jumbo an appealing target.

The company says the rise in operating expenses was driven partly by wage adjustments and a higher headcount to staff its recently opened outlets. These branches also drove most of its Singapore revenue growth.

Subtler signals

Taking over and the first 100 days

Day 1 to 30: Find where the money goes

Time to automate