aCommerce gets major investment boost from European backer

Back in the early 2000s, when ecommerce was gaining steam in the UK, Royal Mail ran a series of ads that drove home how its logistics infrastructure enabled all that nifty online shopping. “We are the real network,” the ads boasted. In Southeast Asia, the ecommerce industry is booming, and unsurprisingly, logistics and delivery are at the center of it all.

One of the region’s major players, Thailand-based ecommerce services provider aCommerce, just clinched a deal it hopes will give it a serious leg up in the race. The company announced today that DKSH, a 150-year-old Swiss market expansion services provider focusing on Asia, has made a strategic investment in aCommerce, acquiring a 20 percent stake. The financial terms are not disclosed.

(UPDATE, 23:20: This story has been updated with comments by aCommerce CEO, Paul Srivorakul.)

The deal allows aCommerce to expand its services to offline commerce, using DKSH’s resources and facilities, Paul tells Tech in Asia. “Offline is still 98 percent of retail and with this partnership with DKSH, we will be able to accelerate the offline-to-online shift in a faster and more efficient way than most. We can offer a comprehensive solution for the region, which I don’t think our competitors can,” he says.

See: Southeast Asia’s top 30 tech founders

The startup had been working closely with DKSH prior to the deal, Paul explains. “Our business models are the same: theirs is offline and ours is online,” he says. “DKSH can drive brick-and-mortar brands and we have the online and offline infrastructure to make the transition smooth.”

Online shopping boom in Southeast Asia

At the moment, aCommerce has offices and distribution centers in Thailand, Indonesia, and the Philippines. Its 140 clients include both ecommerce firms and companies whose business includes online shopping, like L’Oreal, Hewlett-Packard, Samsung, Nestle, Lazada, MatahariMall, Line, and more.

Paul says the startup has grown its monthly revenues by 300 percent since January 2015, with revenues from the third to the fourth quarter almost doubling. And in further good news, aCommerce is beginning to break even in Indonesia and Thailand, which are its two largest markets.

DKSH has generated net sales of more than US$10 billion in 2014, and has 165 distribution centers across Asia. “This partnership provides us access to all [of DKSH’s] existing infrastructure in Singapore, Vietnam, and Malaysia – the countries that we plan to further expand into,” Paul says. “It represents over 100 global blue-chip brands whom we can work with to expand into the online market and onboard onto our ecommerce platform. aCommerce’s existing clients will benefit from this as we expand into new markets and provide B2B offline and online distribution through DKSH.”

See: Here’s SingPost’s grand plan to rule ecommerce in Asia

The startup has so far raised about US$20 million in total disclosed funding, from investors like Ardent Capital, CyberAgent Ventures, and Sinar Mas Digital Ventures (SMDV). It raised a regional record-breaker US$10 million series A round in June 2014, led by Inspire Ventures and joined by a number of other investors like NTT Docomo. Then it raised an additional US$5 million in May 2015 from investors including Ardent and Sinar Mas in anticipation of a planned US$30 million series B.

That makes the DKSH deal a bit of a surprise move. Paul says, however, that the sheer benefits in terms of reputation, infrastructure, and networks it has for aCommerce can’t be ignored, and justify postponing a new funding round for another day. “While disappointed to not invest at this point in time, many financial investors congratulated us on the move once they heard who it was,” he says.