Commerce.Asia invests in 'Malaysia's hidden gem' BizApp rural social commerce platform
By Kiran Kaur Sidhu February 18, 2020
- Investment of 7-figure sum to overcome disparity between urban & rural entrepreneurs
- Commerce.Asia ecosystem now has a database of over 8 million SMEs across 7 countries
When announcing Commerce.Asia Venture Sdn Bhd’s latest strategic investment in Bizapp on February 17, Malaysia’s largest rural social commerce platform, Ganesh Kumar Bangah had only praises to sing about the latter calling it “Malaysia’s hidden gem”. In his speech, the founder and executive chairman of Commerce.Asia, who also successfully listed his previous startup, MOL Global on the Nadsaq in 2014, pointed out that BizApp had yet to receive external investment prior to this partnership, and its success was still relatively unknown to the corporate sector.
BizApp was launched in 2017 when founders Hasnol Mizam Hashim and Mohd Taib Pardi recognised the need for a systematic, technological solution to serve agent-based businesses in Malaysia. It was a problem they were facing themselves in 2016 as social sellers.
With the majority of Bumiputeras, especially in the non-urban population, selling through the agent business model, BizApp currently has over 200,000 agents with a gross merchandise volume (GMV) of over US$144.7 million (RM600 million) transacted in 2019. Complemented with Commerce.Asia’s e-commerce ecosystem (see infographic below), this social commerce platform is expected to bridge the urban-rural entrepreneurial divide in Malaysia.
Being among the world’s most active social media users, it is no surprise that social media platforms have become shopping venues as well, contributing to the increasing popularity of the agent system as a business model in Malaysia, which in turn has led to the mushrooming of stockists, basic agents and dropship agents. This new supply-to-business-to-customer (S2B2C) model gives unparalleled accessibility to the social media savvy, improving the efficacy of ads for businesses and streamlining the buying process for customers.
The Minister of Entrepreneur Development and Cooperatives (MEDAC), Mohd Redzuan Yusof said in his officiating speech: “This strategic investment between Commerce.Asia and BizApp is one that I take particular interest in as it is aligned with the current era of digitalisation. The use of technology and digital economy adoption in businesses complemented with the boom of social commerce will create a more effective business and operational management system. This will lead to improving product quality and reduce dependence on labour.”
Although the sum of investment into BizApp was kept under wraps, Ganesh confirmed that it amounts to a "7-figure sum". Combined with BizApp, the Commerce.Asia ecosystem will have a database of more than 8 million SMEs across 7 countries with 61,000 active sellers that transacted a GMV of US$361 million (RM1.5 billion) in 2019. To date, Commerce.Asia has invested US$4.8 million (RM20 million) across ten startups.
Ganesh shared that there are plans to grow BizApp beyond Malaysian borders by 2021, especially since a promising partner has been identified with the help of MEDAC. “We believe that through this strategic investment, Commerce.Asia and BizApp can leverage on each other’s platforms to encourage the rural communities to partake in social commerce. Leveraging on our experience, we will expand the BizApp business model across Southeast Asia, enabling us to leverage on the fast growing Southeast Asian e-commerce industry.”
Adding on to that, Hasnol Mizam Hashim, founder of BizApp said: “Our current users are mainly from the suburban and rural areas who have successfully grown their businesses online. A huge portion of Malaysians are transacting online via social media channels and the growth has been exponential. The technology-based business tools which are currently the backbone of our system will now be further enhanced with Commerce.Asia’s large ecosystem, enabling users to expand regionally, if not globally.”
According to the Google Temasek e-Conomy SEA 2019 report, the Malaysian e-commerce industry is expected to grow from US$3.3 billion in 2019 to US$11 billion in 2025, while the Southeast Asian e-commerce industry is expected to grow from US$38 billion in 2019 to US$153 billion in 2025. Together, Commerce.Asia and BizApp hope to drive the Malaysian social commerce industry in 2020 by enabling entrepreneurs from rural and suburban communities to contribute to the nation’s Shared Prosperity Vision 2030 and the digital economy alongside urban entrepreneurs.
To mark the strategic investment with Commerce.Asia, BizApp is offering RM100 off their Ultimate Package which is priced at RM499/year. The promotion will be valid until 29 February 2020.