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Startup Snapask eyes breakeven in 2020 with US$35m fresh funds

Startup Snapask eyes breakeven in 2020 with US$35m fresh funds

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3 -min read
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TUTORING app player Snapask is gunning to be profitable this year, while expanding its content capabilities with US$35 million in fresh firepower, founder and chief executive Timothy Yu told The Business Times in a phone interview. 

On Wednesday, Snapask announced that it has secured US$35 million in fresh funding from investors including Singapore-based venture firm Asia Partners and Intervest from South Korea. 

In total, the five-year-old startup has raised over US$50 million to date. Earlier investors include Indonesia’s Kejora Ventures, US-based SOSV and Chinaccelerator.

“But we always keep in mind that we must be able to fund our operations with our users, and not just our investors. In 2018 and 2019 we were cash-flow positive, and this year, we do expect to be profitable,” Mr Yu said. 

Snapask will tap the latest funding to expand into Vietnam, which Mr Yu sees as a natural extension of its South-east Asia strategy. The Hong Kong-based startup is already present in Taiwan, Japan, South Korea, Australia, New Zealand, Singapore, Malaysia and Thailand. 

In addition, Snapask plans to open its regional headquarters in Singapore this year, while hiring about 100 more staff in content and product development roles. This would mean a doubling of headcount for the startup, which currently has about 100 employees. 

“Singapore is a hub for companies to grow with the equity market. And the government is also very pro-tech, so we can use Singapore as a test bed and controlled environment to test out certain technology,” he said. 

Snapask’s key offering is on-demand tutor matching and one-on-one instant assistance to over three million students, aged between 13 and 17. It has a base of over 350,000 freelance tutors on its platform, Mr Yu said. Users can pay for each query, or tap subscription packages. 

The startup may be an indirect beneficiary of school suspensions following the coronavirus outbreak in Asia. Of the 1.3 million new users Snapask onboarded in the past year, about a third were in the past three months, coinciding with Hong Kong’s suspension of schools, Mr Yu noted. 

Nick Nash, co-founder and managing partner of Asia Partners, cites Snapask as a “clear illustration” of his venture firm’s focus on closing the growth capital gap in South-east Asia. 

“The company has already demonstrated a strong product market fit in Hong Kong, Taiwan and Singapore and is already successfully expanding in emerging markets like Indonesia, Thailand and Malaysia. The company exemplifies our interest in humble ‘Rhinos’, which focused on sustainable growth with a clear path to profitability,” he said. 

Mr Nash, formerly president of gaming and e-commerce firm Sea, has previously said that Asia Partners is looking to back “rhinos” – companies which have good fundamentals – over unicorns, the industry term for startups valued over US$1 billion.