Geoffrey See co-founded Shoppa with Van Tran and Sean Ang to help Vietnamese women build micro-enterprises which deliver groceries to customers in underserved parts of Vietnam and Southeast Asia. Geoffrey previously founded a social enterprise that created the largest program for training female entrepreneurs in North Korea.
What common misconceptions are there about doing business as a startup in Vietnam?
We started Shoppa as a community commerce startup partnering women micro entrepreneurs to bring a digital supermarket to underserved parts of Vietnam. Many startups focus on Hanoi and Ho Chi Minh city as their target markets – the two largest cities in Vietnam. But more than 80% of Vietnam’s population live outside of these cities. While micro-entrepreneurs are harder to reach in these areas, they are significantly underserved. We put our product and business teams in provincial cities and towns so they truly understand the environments of our users and the understanding pays off.
What has been your biggest misstep as a founder and how did you recover?
Sticking it out too long when market conditions have changed. Prior to co-founding Shoppa in Vietnam, I ran a social enterprise training women micro-entrepreneurs in North Korea. We were scaling our impact significantly until 2016, when nuclear testing and geopolitical conflict resulted in a 60% drop in funding. I should have pivoted our work faster and earlier, but held on too long believing that the broader situation would turn around, and we would be able to continue to grow our impact. We take this lesson to our community commerce work in Vietnam, running experiments with our users in areas with different characteristics in a 50 kilometer radius from our dark supermarket, and reviewing performance and iterations on a weekly basis.
Why is social commerce more successful in Vietnam than traditional e-commerce?
An amazing statistic is that 70% of the $22 billion e-commerce market in Vietnam is social commerce. I was always amazed when I first came to Vietnam how many people would purchase products off a friend’s Facebook wall. I believe there are two main reasons for this. The first is that 80% of Vietnamese live outside of the core urban centers of Hanoi, Ho Chi Minh city and a few other of the largest cities, where traditional e-commerce has penetrated. Community commerce or social commerce fills this gap in many other parts of Vietnam. The second is that there is a trust deficit in Vietnam. Many of our customers complain about fake or low quality products or poor service – these are problems they solve through their network.
What’s the biggest challenge to raising funds as a startup in Vietnam compared with other Southeast Asia markets?
We had a surprisingly smooth journey for fundraising in Vietnam so far. Our co-founding team has experience building companies before and as such, we were lucky to know many investors and the entrepreneurial ecosystem well. The investor interest in Vietnam has been very strong although this is a recent phenomenon. In 2016 when I co-founded a co-working business in Vietnam, it was definitely a much tougher fundraising environment. The biggest challenge is that few investors have ventured outside of Hanoi or Ho Chi Minh City much and understand the markets and users we serve in these areas. But it is particularly important as more than 80% of Vietnam’s population lives in these areas, so any business that can truly scale in Vietnam needs to find a model that can serve people in cities and towns outside of the largest cities.
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