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Thai Ecommerce Enabler aCommerce to raise over $200m in 2021 IPO, says CEO

DealStreetAsia: Bangkok-based ecommerce enabler aCommerce is looking to raise over $200 million in an initial public offering (IPO) scheduled for 2021, its group CEO and co-founder Paul Srivorakul told DealStreetAsia.

The startup plans to hit the bourses by the first half of next year.

Founded in June 2013, aCommerce helps brands such as Samsung, L’Oréal, and Unilever sell their products online across Southeast Asia by providing services from web store design, distribution, and marketing to warehousing and delivery.

The startup plans to use part of the IPO proceeds to spruce up its technology platform and develop its enterprise-grade SaaS offering. It will also allocate capital for international expansion.

“We plan to list on a recognised stock exchange and do a fully marketed international offering. We may list on the main board of the Thai SET (Stock Exchange of Thailand), but are still finalising options,” said Srivorakul.

The company, he claims, is growing at around 40-50 per cent year-on-year, and is open to the “inorganic growth route” to strengthen its presence in the international market.

“We have had a number of smaller domestic players contact us and our shareholders more recently,” said Srivorakul.

The company had earlier said its 2018 revenue grew 73 per cent to more than $100 million, and operations in its core market of Thailand had turned profitable. The company is also present in Indonesia, the Philippines, Singapore and Malaysia.

Earlier this year, the company raised $15 million from Singapore-based investor Indies Capital Partners to finance the execution of its’ 2.0 strategy’ to reach group profitability and become cash-flow positive in 2020.

“We are continuing with our aCommerce 2.0 plan announced last year. We have achieved several of those targets such as breakeven, but we obviously want to drive towards healthy long-run margins. We have made some great hires to help us with the plan,” said Srivorakul.

To date, aCommerce is understood to have raised a total of $119 million. Apart from Indies Capital, its backers include KKR’s Emerald Media, Australia-based Blue Sky Ventures, DKSH, Inspire Ventures, Indonesia’s Sinarmas and NTT Docomo.

As consumer spending shifts online, brands are also prioritising online commerce over offline, which in turn is sprucing up demand for digital infrastructure in the region, said Srivorakul. (Source: DealStreetAsia)

Successful execution has cemented the company’s position as an industry leader that is driving the development of Southeast Asia’s Ecommerce ecosystem. The company also strengthens leadership team to drive long-term growth and provides key operational updates

One year after its implementation, leading brand Ecommerce enabler aCommerce announced an update on its “aCommerce 2.0” strategic plan, the impact of the COVID-19 pandemic on its business, and key personnel appointments. Highlights include:

  • Group profitability achieved ahead of schedule through efficient cost management and realizing operating leverage off strong revenue growth;

  • Achieved an increase of over 120% in average revenue per client since Q1 2019 by remaining focused on portfolio of core clients, including Samsung, Unilever, Nestlé, L’Oréal, Philips, Adidas and Mars;

  • Supported enormous demand for online distribution through direct-to-customer channels as the COVID-19 pandemic accelerated the migration of consumer spending to online platforms; and

  • Deepened its senior management team with the addition of proven executives who will help lead “aCommerce 2.0” into its next phase of growth.

Update on “aCommerce 2.0” and path to profitability

The Company’s successful execution of its “aCommerce 2.0” plan over the past 12 months cemented its position as an industry leader that will continue to help develop Southeast Asia’s Ecommerce ecosystem for decades to come.

As part of the plan, aCommerce has strategically invested in its core brand Ecommerce technology & services, driven protocols, enhanced its end-to-end Ecommerce platform, outsourced non-core operations, and scaled back less economical contracts and business areas.

As a result, the Company has far exceeded all internal targets of its “aCommerce 2.0” strategy, including achieving group profitability ahead of schedule.

Key elements of the plan include ensuring the Company:

  • Prioritizes and enhances end-to-end Ecommerce solutions for enterprise brand clients to build and strengthens long-term relationships;

  • Focuses on aCommerce’s existing core markets;

  • Transitions away from providing piecemeal or single service solutions to clients that are commoditized and where other service provider partners are already in place; and

  • Achieves group profitability in 2020 by growing profitable core brand Ecommerce end-to-end business and streamlining operations.

“Our ‘aCommerce 2.0’ plan enabled us to hone our focus to approximately 160 of our most valuable clients, significantly increasing our profitability and enabling us to grow our average revenue per client by over 120% since the first quarter of 2019.

We are especially pleased to deliver strong like-for-like organic revenue growth of over 40% year-on-year from our existing long-term clients. We achieved this by both increasing volumes and average order values. Our average order value is growing at a rate of 15% year-on-year and currently stands at almost US$38. This, combined with our disciplined cost and working capital management, has enabled the Company to get close to cash flow positive. We are starting to look at long term shareholder options for the future,” said Piers Bennett, Co-Founder and Group CFO.

Impact of COVID-19

The outbreak of the pandemic in early 2020 presented unprecedented challenges for businesses across the globe, fundamentally changing corporate operations and consumer behavior. The pandemic is accelerating the migration of consumer spending to online platforms and is encouraging a more rapid digital transformation within companies themselves. Brands are fully embracing and prioritizing omni-channel Ecommerce over traditional offline distribution channels.

This is a transformative time for the provision of all services digitally and Ecommerce in particular. As an Ecommerce enabler, aCommerce, with its integrated technology capabilities and ability to provide end-to-end data to brand partners, has managed to successfully navigate this new landscape and accelerate its “aCommerce 2.0” strategic plan.

“We have seen a very rapid and material change to our business resulting from COVID-19.

Certain segments, such as consumer staples and healthcare, are seeing year-on-year growth rates well into the triple digits, however non-discretionary luxury & fashion and consumer electronics segments are also seeing year-on-year growth of up to 40% as brands look to rapidly prioritize online distribution in the face of declining traditional offline.

We have also seen an increased share of sales volumes from direct-to-customer channels like social platforms, B2B, as well as company branded web-stores, or “”, which we operate – currently as much as 50% of sales, from around 20% to 30% a year ago. The decisive actions we took last year have yielded higher levels of operating leverage from our incremental revenues, which has rapidly brought forward our group profitability target,” said Paul Srivorakul, Co-Founder and Group CEO.

Key personnel appointments

The Company also announced several additions to the leadership team as it positions aCommerce for its next phase of growth:

  • Mr. Luca Altomare has been appointed Group Chief Operating Officer (“COO”). In this role, Luca will be responsible for managing aCommerce country heads and driving operational excellence. He will play an integral role in driving economically sustainable growth and long-term margin growth. He previously served as SVP of distribution for Southeast Asia at Li & Fung Group and worked at specialist consulting firm Value Partners. Luca will report to Paul Srivorakul.

  • Mr. Peter Kopitz, who is a Co-Founder and former COO, has been appointed Group Chief Commercial Officer (“CCO”). In this new role, Peter will leverage his extensive network and relationships across the region with brands and key channel partners.

  • Ms. Phensiri Sathianvongnusar has been appointed Chief Business Officer (“CBO”). Phensiri has been instrumental in growing aCommerce’s Thailand business and driving operational and commercial initiatives across the region. She will be retaining her role as CEO of Thailand in addition to her new responsibilities and work with Luca to drive best practices across the Group.

  • Mr. Graeme Kingshott has been appointed Group Finance Director. Graeme has served as a CFO and Finance Director for companies around the world. Reporting to Co-Founder and CFO Mr. Piers Bennett, Graeme will assist in maintaining aCommerce’s global best-in-class working capital management and will ensure compliance with the most robust standards of protocols and reporting.

“We are delighted to welcome a seasoned senior business executive like Luca and I look forward to working with him to achieve our goal of becoming the leading high growth and cash flow generative brand Ecommerce enabler in the region. The new appointments of Peter, Phensiri and Graeme are indicative of our ability to recruit, retain and develop a strong leadership team.

We have assembled a top-flight management team to continue the strong execution of ‘aCommerce 2.0’ and take us to the next level, creating lasting value for our partners, clients and employees,” concluded Mr. Srivorakul.
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