E-COMMERCE solutions firm Shopmatic has made its second acquisition of the year, with its purchase of a startup that allows merchants to manage their business in several online marketplaces through a single platform.
The acquisition of a 100 per cent stake in CombineSell was financed through cash and a share swap, Shopmatic's co-founder and CEO Anurag Avula told The Business Times (BT).
CombineSell's seed investors, which include angel investor Koh Boon Hwee, branding and communications firm Louken Group, and startup incubator Spaze Ventures, were bought out with cash. Its founders Loh June Yong, Amanda Ho and Gerald Lam were bought out with shares in Shopmatic Holding, the holding company of the operating entities. Mr Avula declined to reveal the value of the deal.
Singapore-based Shopmatic helps individuals and small firms to kickstart an e-commerce business, from setting up a website to managing cross-border transactions and customer engagement across different social media platforms.
The company now has over 250,000 merchants on its platform – up from about 30,000 on Apr 1 – and is on track to double that by March next year. It is now in talks to raise S$40 million by year-end for its Series B round, after snapping up S$10.2 million in funds in April. To date, it has raised S$20 million from a host of investors, including Seeds Capital and investment firm August One.
In March, Shopmatic announced that it has bought a 50.1 per cent stake in Octopus Retail Management as it pursues an omnichannel retail strategy. Octopus specialises in cloud-based omnichannel management software for brick-and-mortar stores.
The latest acquisition of CombineSell will help fill a gap in Shopmatic's business management solutions for sellers, Mr Avula told BT. Previously, the firm had to work with third-party providers to connect its proprietary dashboard with online marketplaces. But even then, all sellers could do was publish listings.
With CombineSell's software, merchants will be able to publish listings, answer customer queries, manage customer relationships and more, all from a single platform. The platform will be integrated into Shopmatic's dashboard within the next 60 days.
Since its launch in June 2017, about 8,000 merchants in Singapore and Malaysia have used CombineSell. The software allows for over 30 e-commerce channel integrations, including with Lazada, Amazon, Carousell, Redmart and accounting software Xero.
South-east Asia is currently in the spotlight for Shopmatic, which has established a strong presence in India, said Mr Avula.
It will soon launch in Malaysia with a leading bank as a strategic partner. This partnership will be similar to Shopmatic's tie-up with United Overseas Bank (UOB) in Singapore, where UOB integrated Shopmatic's solutions into its suite of cloud-based business solutions. Shopmatic will also look at providing working capital loans to merchants with its Malaysia partner.
In the following three months, the firm will launch in the Philippines. Roll-outs in Indonesia and Thailand will come by the early part of the second quarter in 2020.
Following the launch of its transaction-pricing model, Shopmatic recorded a quarter-on-quarter 174 per cent growth in revenue and a 160 per cent hike in transactions during the April-to-June quarter.
The model is aimed at attracting business owners that are new to operating online businesses and are hesitant to start one. Instead of having them commit to a subscription from the get-go, Shopmatic charges 3 per cent for every successful transaction, plus a S$1 hosting fee at the end of every 12 months.