Thai ecommerce enabler co-founded by ex-Lazadians is profitable and growing

A well-worn path for startups is to raise funding, invest in growth, and worry about profitability at a later time.

But Nuttapon Boonpinon chose the path less traveled. Together with his co-founders, who are former Lazada folks, he aimed at building a profitable business right out of the gate.

Their Thai startup N-Squared eCommerce is one of many enablers helping brands sell on marketplaces like Lazada and Shopee, as well as on social media. The startup offers commercial strategy, inventory procurement, merchandising, digital marketing, order fulfilment, and customer support, among other services.

“The fast-changing industry landscape combined with infrastructure and technology requirements make it challenging for most brands to run ecommerce on their own. That’s where we come in,” says Boonpinon, pointing out that brands are more used to dealing with distributors than end-consumers.

Nuttapon Boonpinon / Photo credit: N-Squared

The team has been around since 2014, but many outside Thailand have probably never heard of them.

Rarely in the news, N-Squared has been quietly and steadily growing its business. It expanded to its first overseas market Malaysia only in mid-2018, then forayed into the Philippines and Singapore early this year.

Here are some stats worthy of attention:

• US$24 million in revenue for 2018, a compound annual growth rate of 246% from 2015
• US$1.2 million net profit
• 1.3 million orders in Thailand
• 60-plus brand partners, mainly in the home and living, health and beauty, appliances, kids and baby care categories

What sets it apart

It’s no easy feat turning a profit in the competitive ecommerce servicing space – even more so if a company is without external funding.

Bootstrapped N-Squared faces off against old-timers with heavy war chests like Anchanto and Acommerce, which offer end-to-end solutions, and a much younger crop that includes Intrepid and Crea, which focus on e-store management and marketing. The Thai startup also competes with a wide range of service providers that marketplaces have onboarded as partners to assist brands in their ecommerce journeys.

All of these players understand the potential. According to a joint report by Google, Temasek, and Bain & Company, Southeast Asia ecommerce “has traced a hyperbolic growth trajectory,” with gross merchandise volume (GMV) jumping seven-fold to US$38 billion in 2019 from US$5.5 billion in 2015. The sector is on track to exceed US$150 billion GMV by 2025 – US$50 billion more than predictions made a year ago.

But Boonpinon believes one key factor sets them apart from most of their rivals, and it has something to do with N-Squared’s origins.

Five years ago, he launched a small trade business called Next Step Asia, selling floor mops on Lazada under the brand name “HomeHuk.” From processing nearly 30 orders in its first month, the venture grew to become a leading online-native home products company in Thailand, with 1 million unique customers to date.

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