Big plans for KL-based GlassesGroupGlobal after Series A
By Goh Thean Eu August 13, 2015
- Eyeing Indonesia and 10 new European markets over next 2yrs
- Revenue growing by double-digits every month, it claims
AFTER securing US$3 million in Series A funding recently, online eyewear retailer GlassesGroupGlobal is now eyeing other markets in South-East Asia and Europe.
The Kuala Lumpur-based company, established in 2013, currently has a presence in 14 countries, including its home base of Malaysia and South-East Asian neighbours the Philippines, Singapore and Thailand.
It has also spread out to Australia, Austria, Denmark, Germany, Hong Kong, the Netherlands, New Zealand, Sweden, Taiwan and the United Kingdom.
According to founder and chief executive officer Christopher Strauch, one of the company's immediate aims is to penetrate the Indonesian market.
“Indonesia is like one of our final missing pieces of the puzzle in our South-East Asia game plan over the near-term,” he told Digital News Asia (DNA) in Kuala Lumpur recently.
The company is also hoping to gain more ground in Europe and by the end of 2016, expects to be in 16 European countries, up from the current six.
For Strauch, the aggressive expansion plan is not just about widening GlassesGroupGlobal’s reach, but about disrupting the global eyewear market -- which he said was worth about US$100 billion in revenue. [Correction: Strauch said the size of the market is US$100 billion, instead of US$10 billion stated initially]
“Expansion is a big topic for us ... . We see our business as a global opportunity.
“In the long term, we hope to be present globally in all the core markets. We think that Asia Pacific will be the largest consumer market globally, followed by Europe,” said Strauch, who was formerly the managing director of Zalora and the ex-chief executive officer of Rocket Internet UK.
The need for an Indonesian play
GlassesGroupGlobal’s US$3-million Series A funding was led by Caixa Capital and Nova Founders Capital, as well as angel investors such as Skype cofounder Toivos Annus.
This investment would be used to fuel the startup’s market expansion, invest more in its team, and to build local presences.
Strauch (pic above) said GlassesGroupGlobal aims to have customised strategies and campaigns for each individual market.
Prior to its Series A, the company – using the US$1.5 million in seed funding it had – had to scale its business with limited resources.
Most of the countries GlassesGroupGlobal penetrated in the early days have one thing in common: A sizeable number of English-speaking consumers.
This meant that it was able to serve a larger group, and also reduced the need to set up dedicated teams for particular markets.
This helped the young startup keep down the costs, but with the recognition that this was not the best way to serve individual markets because, at the end of the day, every market is different in some way.
“We tried to be as centralised as possible, and to build Malaysia as the hub for the entire region so that we could go to more markets to benefit from the scale, while keeping costs flat,” Strauch.
This is also one of the reasons why it did not tackle Indonesia in its early days.
“Indonesia [has] huge potential, but it is not an easy market if you are not present there,” he said. “It is a challenging market.”
With the new funds, one of the company’s immediate plans will be to develop the necessary infrastructure to enter Indonesia. This includes local payment options and basic billing.
Revenue and profitability
Strauch was tight-lipped about the company’s financial performance, but claimed it is recording annual revenue in the “millions of US dollars,” and that revenue has been growing by double-digits month-on-month.
“We are very quiet about our numbers, but we have seen incredible growth since we started,” he declared.
“We are still at the very early stage of what this market can be. Generally, if you look at the [global eyewear] industry, it is at least a US$100-billion market.
“If you look at it from a vertical point of view, you would say it is a niche market – but this is a very big niche market, and it is a market that is growing significantly,” he added.
One growth driver is the fact that eyewear is no longer merely an optical aid, but is becoming a fashion statement, he noted.
In terms of GlassesGroupGlobal’s profitability, Strauch said that it is a “question of choice.”
“Profitability is always a big question in e-commerce. Overall, the industry is very profitable. This is one of the reasons we got into this industry.
“Why are there five optical shops in one mall? That’s because the margins are great and the items are high-value.
“If you look at this market, it is easier to achieve profitability than in other verticals,” he argued.
However, Strauch admitted that it would be hard for GlassesGroupGlobal’s accounts to have black ink at this point in time.
“We have to invest in infrastructure, people and so forth, to scale up. But if you look at six to 12 months down the line, profitability for us will become a question of choice.
“I could say ‘I will stop expanding into new markets and stop investing in existing markets to build scale,’ and the company can then be profitable.
“But the market is too attractive. There is so much potential in these markets and it will be a shame if we stopped there,” he said.
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