honestbee names Ong Lay Ann CEO; co-founder Jonathan Low quits

GROCERY delivery startup honestbee has appointed Ong Lay Ann, non-executive director of a unit of Singapore Exchange-listed ISDN Holdings, as its new chief executive with effect from July 15.

Meanwhile, chief technology officer Jonathan Low resigned from honestbee on July 11, making him the last of the troubled startup's three co-founders to leave the firm. His last day at the firm is July 31. 

Mr Ong replaces LG scion Brian Koo, who stepped up as interim CEO after the departure of former CEO Joel Sng in May. Mr Ong's appointment was earlier reported by tech portal Vulcan Post on July 26. 

In an interview on Monday, Mr Ong told The Business Times that he is still in the process of evaluating whether he will make an investment in honestbee and what form that may take.

"All the options are on the table; I haven't ruled out either an equity stake or a loan to the business. First, I'm trying to assess what are the pieces honestbee has, what is missing and what I need to do to turn this company around," he said. 

His compensation as CEO will include a mix of cash and equity, with the latter component ensuring "that my interests are aligned with the shareholders", added Mr Ong, who serves as a non-executive director at ISDN Investments, the trading and investment arm of ISDN Holdings.

Mr Ong is also a director at Weststar Group, an investment firm he founded in 2001, and the non-executive chair of Standard & Partners, a global consultancy and financial services company focused on mining.

He was introduced to Mr Koo by a mutual friend in June. Based in the US, Mr Koo is chairman of honestbee and the founding managing partner of honestbee's key backer, Formation Group.

"Brian started talking to me about the challenges he is facing at honestbee. I initially did a high-level review of what I thought were some of the areas that need to be addressed to take the company forward," Mr Ong said.

Mr Koo subsequently invited him to helm honestbee as CEO. Mr Ong took up the opportunity based on honestbee's "strong brand value" and his past experience with distressed companies. 

Mr Ong said that he saved an Australian firm, Perth Precast, from judicial management by acquiring its assets via another entity, Precast Australia. He then listed Precast Australia on the Australian Stock Exchange via a reverse takeover. Mr Ong is now a director at the listed firm, Weststar Industrial.   

But in the case of honestbee, Mr Ong says that he is not a white knight "coming in with a pile of cash". Instead, it will take a "consortium of white knights" to right the course of the company, he said. 

"This is something that requires a fairly sizeable fix, given the size of the organisation... In this situation the funding requirement will be larger, so we'll be open to working with parties to rebuild honestbee and help it achieve its full potential," he said. 

Founded in 2015, Singapore-headquartered honestbee operated a grocery delivery business, alongside food delivery, an on-demand laundry service and a business-to-business logistics service. 

The startup rapidly expanded to seven other markets: Malaysia, Indonesia, Thailand, the Philippines, Japan, Taiwan and Hong Kong. 

But honestbee's woes came to light when media reports in late April said that the startup was facing a cash crunch and looking for suitors. Shortly after, it laid off 10 per cent of its global headcount and announced a series of halts and suspensions in various markets. 

Currently, honestbee has halted operations in Indonesia and Hong Kong, while suspending activities in all other foreign markets. It has also halted food delivery and suspended the laundry business in Singapore. 

In a press statement on Monday, Mr Koo said: "We have confidence that Lay Ann has what it takes to restructure the business, build consumer confidence and employee morale, repair relationships and bring the brand to greater heights." 

Meanwhile, Mr Low said that his decision to leave honestbee was made before Mr Ong's appointment. "I have full confidence that Lay Ann will help honestbee enter its next phase and recover from its recent setbacks," he said in the statement.