Circles.Life to expand into Taiwan, Australia in 2019
Company has secured Series C financing led by Sequoia India; the mobile virtual network operator plans to launch in more than five countries in next 18 months
Singapore
IN A bid to expand into other markets and build on its digital service capabilities, Circles.Life has secured a round of funding led by venture capital player Sequoia India.
The mobile virtual network operator (MVNO) plans to use funds from the Series C round of financing - details on investment size were not disclosed - to launch in more than five countries in the next 18 months.
Two markets have been confirmed for launch in 2019 - Taiwan in Q2 and Australia in Q3.
Circles.Life, which leases network from telco M1, is looking to invest more than S$50 million in each new market. The company has said that it will be the first to launch a fully digital telco product in these markets.
The round of funding also includes a S$25 million investment in the Circles-X platform, which Circles.Life co-founder Abhishek Gupta likens to a telco operating system. The company applies a cloud-based business model, using Circle-X technology, which automates end-to-end telco systems.
Mr Gupta said: "Circles-X allows us to have low operating costs because we build the platform by ourselves, keeping our capital expenditure low."
Circles.Life, which started commercial operations in June 2016, has about 5 per cent of Singapore's mobile subscriber market.
Based on its growth here, the telco intends to replicate its success in new markets. It has brought on senior industry hires such as Ajinkya Mukhopadhyay as its head of business development and international expansion.
He previously held roles as the joint head of Asian telecoms investment banking at UBS and group head of M&A at Australian telco Telstra.
Meanwhile, Waseem Yusaf, previously of Nokia, has joined as head of international launches.
Circles.Life did not reveal which mobile network operator (MNO) it will be partnering in Taiwan and Australia. But one might assume Telstra to be its Australian partner given that Singtel owns Optus, and TPG and Vodafone announced plans for a merger Down Under.
However, Fitch Solutions analyst Kenny Liew feels that this might not be the case. Mr Liew said: "There is definitely a possibility that Circles.Life could be leasing from Optus, or even Vodafone as well, despite there being business conflicts back in Singapore.
"Generally, operators are keen on MVNOs utilising their networks because they generally have spare capacity that they are very willing to convert in return for additional revenue."
Mr Mukhopadhyay said that Australia and Taiwan are similar markets to Singapore from the standpoint of high SIM and smartphone penetration rates, as well as having a high base of postpaid subscribers.
That said, Mr Liew explained: "The telecoms markets in Taiwan and Australia are already highly saturated, so gaining market share means it will have to cannibalise the existing subscribers of other operators."
He expects initial growth in these markets to come from getting prepaid subscribers over to postpaid schemes.
Another analyst BT spoke to felt that the markets Circles.Life are entering are not homogeneous, and the telco might have to put in "quite a lot of effort to customise its offerings to fit these markets".
The analyst also suggested that while Circles.Life aims to be profitable in all markets it operates in, profitability may not be the motive here.
"Its objective could be to do something different, such as attracting attention from MNOs, who may be drawn to its software stack - Circles-X."
On Thursday, Circles.Life also launched a S$20 unlimited data add-on, after saying on Wednesday that its S$20 for 20GB add-on option would not be available from March. The unlimited data add-on is available for both existing and new users.
The company has also partnered insurer HL Assurance to launch the Circles PhoneProtect device insurance plan for S$7 a month. The plan covers screen cracks, liquid damages, and door-to-door replacements.
