Week in Review: It’s becoming more about synergy than small fish eating the big fish
By Karamjit Singh February 10, 2017
- CXA Group raises US$25mil by delivering innovation, digital solutions to Brick & Mortars
- Founder Roseline Koo highlights talent and culture as key ingredients for success
THERE are not too many startups that focus on corporate pain points and it’s because entrepreneurs feel B2C plays are easier to make inroads into. To emphasise this point, a leading entrepreneur in Southeast Asia (SEA) points out that the top internet companies are all B2C plays, Amazon, Apple, Google, eBay, Instagram, Yahoo (during its prime).
And in SEA, he points out that each of the four companies Patrick Grove of Catcha has listed are mainly B2C players.
While that is mostly true, it’s also true that Brick & Mortar companies have real pains that can be solved with innovative digital solutions, and these companies are willing to pay for the solutions.
And here, entrepreneurs should take away some inspiration from Singapore based health tech startup, CXA Group’s just announced US$25 million (RM111 million) Series B funding. For its founder and CEO, Rosaline Koo tells DNA that getting the corporate customer on board, in her case banks and insurers, was not difficult, as they can gain various benefits from CXA’s platform. These benefits included the ability to cross-sell relevant products, lower costs of sales and lowering administrative costs to a fraction of existing paper-based processing.
I am sure many Brick & Mortar companies are willing to listen if startups can offer them similar efficiencies and innovative solutions through their digital platforms.
Of course the startups must have domain knowledge and in Koo, 55, the daughter of an illegal Chinese immigrant who made his way to the US, CXA has a founder who has deep domain knowledge including experience overseeing a 14-country operation for Mercer Marsh Benefits, an employee benefit consultancy and insurance brokerage.
While it the past the sexy story around startups has always been about how they will eat into the business of Brick & Mortar companies, including the claim by Grove that the small fish will eat the big, we are now hearing more about how there is synergy between the two sides.
One recent example is in the telco industry where a report published last month by the GSMA, the association that represents mobile network operators, revealed that there was strong synergy if mobile operators partnered with startups.
Set within the context of emerging markets, the reports lays out that while startups are innovative, they face investment capital and scale challenges.
On the other hand, scale and capital are two things telcos have in abundance – but they face challenges in building sustainable competitive advantage and in keeping up with the scale of innovation.
I am sure the same case can be made in various other verticals as well. It’s up to entrepreneurs to seize the opportunities and as Koo has proven, you don’t have to be below 30 to make a dent in the universe.
And do pay attention to Koo’s belief that talent and culture are the ultimate key ingredients to building a successful company. As a seasoned leader in the corporate world before joining the topsy turvy startup ride, I am sure there is deep logic and insight to her opinion.
Here’s wishing you a restful weekend as you mull over how you can improve on your own company culture and attract talent.