Why ShopBack focused on expanding to different markets first

This article is from an episode on Asia VC Cast, a podcast hosted by Daniel Song. This is heavily revised from the original show transcript. For the full interview, go here.

Joel Leong is a co-founder at ShopBack. He leads merchant partnerships at the company and is responsible for driving deals. He holds a bachelor’s degree in social sciences from the National University of Singapore (NUS), and worked at ecommerce player Zalora and Singapore’s Economic Development Board (EDB) prior to building ShopBack.

In this interview, Leong talked about having a customer-oriented mindset, deciding between geographical and product expansion, and hiring talent.

Tell us about your background and how you started ShopBack.

There was this program at NUS where we went to Shanghai for one year to study and work at a startup at the same time. That experience opened my eyes. I realized that you don’t have to just work for a big entity, and that startups are actually an interesting and a viable alternative.

When I came back to Singapore and graduated, I worked at EDB. I left after six or seven months because it wasn’t really for me. I then joined Zalora, which was just starting at that time, trying to grow the ecommerce space in Southeast Asia.

After two years, my co-founders at ShopBack and I saw that the cashback model in Europe was doing well in the form of Ebates. It was a very successful business and got acquired by Japanese internet firm Rakuten for a billion dollars. There’s also a similar model in China called Fanli. So we thought, “Why is nobody doing that in Southeast Asia?” We planned to adopt it from a merchant perspective, left our jobs, and started ShopBack.

What did you learn going from corporate to startup? And any takeaways from your time at Zalora?

The hardest part was leaving EDB to join Zalora. At that time, startups were not common and people weren’t confident about online shopping. So the hardest part was jumping from something that’s structured to ground zero.

The main lesson I learned from Zalora is problem solving. The startup was trying to replicate the ASOS model here in Southeast Asia, but what happens if the environment is different? How do you thrive in a dynamic environment with less structure? How can you solve the problem?

There were a lot of problems that businesses in the West do not face (e.g. trying to get people get used to online shopping and trust credit card payments). It’s very interesting how Zalora was trying to bring a model tested in the developed world to the developing world.

How do you make sure your team at ShopBack maintains a customer-oriented mindset?

A customer-oriented mindset is very important. It’s very easy for someone who’s operating an ecommerce platform to forget about the humans behind every data point. If you think you’re losing just 0.1 percent, it’s actually a group of humans that you’re losing.