Series A Investment in Fundiin, a Buy Now Pay Later startup in Vietnam
Genesia Ventures, Inc. announced that it has invested in the Series A Round of Fundiin from Genesia Venture Fund No. 2 (“GV-2”), a Buy Now Pay Later startup in Vietnam.
Fundiin is a startup founded by Nguyen Anh Cuong (CEO) and Vo Hoang Nam (CTO), who have extensive business experience in finance and IT companies, to develop and provide BNPL (Buy-Now, Pay-Later) services for retail and ecommerce businesses. They provide a friendly payment option for Vietnam’s unbanked middle-class customers. They aim to increase retail and e-commerce sales by up to 30% by providing consumers with BNPL options such as 3-month installments, 30-day payments, and recurring payments.
Fundiin has been working with more than 300 partners and 4,000 stores, including market-leading brands such as The Gioi Di Dong, Dien may Xanh, Unilever, Galaxy and Vuanem. This has led to an increase in the number of users by more than 5 times and total transactions by more than 7 times compared to the last funding round 1 year ago.
About the market of BNPL in Vietnam
- Vietnam’s retail market with Revenue reached a record high of 172B $ in 2020 (source), an annual growth rate of 7% CAGR
- Vietnam’s consumer lending market size was nearly 50B $ (by the end of 2019), and it is expected to experience continuous growth in the near future.
- Only 4.1% of the population has a Credit Card
- Stakeholder 1: Buyers (Consumers)
Facing low financing accessibility and the expensive payment options
Only 4.1% total population has credit cards in VN and most people don’t have the credit scores to apply for it.
Take a long time to register and wait for approval (average 7~10 days)
・Traditional Installment loans: Consumer Finance, Pawnshop
Deadly high interest: 40~70%
Heavy Late Payment Fee (5% of overdue balance)
Take times for the loan application process (1~3 days)
Assets needed for the Pawnshop.
- Stakeholder 2: Merchants (Retailers)
With current traditional limited payment solutions(Cash, Bank Transfer, Debit Card), which causes:
・Low conversion rate
・High return rate
■How it works:
・Users choose Fundiin as a payment method when checking out
・No need to download the app. Users just need to input their phone numbers to receive Fundiin’s SMS with the attached link for instant registration.
・Then users are required to submit their taken ID card photo. At this moment, Fundiin can verify users’ information based on their phone numbers and ID card info, by using its risk model system to score user creditability.
・Users receive approval from Fundiin, then finish checkout with the payment term agreed.
A typical payment term:
1st payment: the first day of purchasing with 1/3 amounts
2nd payment: after 30 days
3rd payment: after 60 days
<Plan> Pay after 30days for a lower ticket size of up to 25$
・Repayment Method: Cash payment in stores (Viettel Post, Convenience Stores), Bank transfer (the biggest portion), ATM, Creditcard
・In case of overdue payment: users will be charged 0.6% of the order value per unpaid installment per week (if the order value is $100, a late fee is $0.6 per late installment per week). Fundiin also caps the total late fee at 25% order value
Purpose and Background of Fundraising
Fundiin will invest in product development and hire talented people to expand its business to Indonesia after the next Series B round.
About the investment
Hoang Thi Kim Dung, Associate, Genesia Ventures
Even in the midst of the current harsh fundraising winter, combined with the not-so-positive news about the macroeconomic situation and major BNPL companies in the world recently, Fundiin was able to raise 5 million USD in a series A round, which was indeed an extremely encouraging thing and needs to be deepened to find important lessons to share with the startup community.
What did Team Fundiin do to convince most of the investors in the previous round, including us, to continue investing in this series A round, besides calling more new investors ? I sat down to reflect and summarize the following 3 things, which really impressed me in more than 1 year of accompanying Team Fundiin from the last Seed round.
1/ Efforts to optimize communication performance with investors:
Before starting the Series A funding round, the Fundiin team compiled a FAQ – with more than 40 pages answering in detail, easy-to-understand questions that Fundiin regularly received from previous investors. This is how Fundiin helps investors who are really interested in an investment opportunity in Fundiin, will take the time to read the FAQ before entering the official meeting with the founding team, and will shorten the interval. communication between them, making the meeting go with much more in-depth questions, and increasing the efficiency of a meeting between the parties. Fundiin is really the case that best illustrates the following blog post of mine on the topic of Fundraising Hacks to help a startup founder reduce the “CPU” used to raise capital.
2/ Efforts to turn KPI Report into the true meaning of “Keep People Inspired”:
Fundiin is one of the startups that I am very impressed with on regularity, discipline, and thoroughness in regularly updating KPI Report to our investors. To the extent that I have shared the Fundiin case in my previous blog Post-Investment: Building trust and optimizing communication through Investor Report. In particular, I still remember in the email sending KPI report last July, besides updating business results, as usual, Cofounder & CEO Cuong also especially shared his perspective regarding the world’s largest BNPL companies such as Klarna decreasing its capitalization from $45 billion to $7 billion. There, he further emphasized the true core value of BNPL that Fundiin strives to bring to customers in the Vietnamese market in the long term. This is an extremely ingenious way of Mr. Cuong to “reassurance” the psychology of his investors while continuing to “inspire” our investors with bravery, acumen, and absolute commitment to bringing value to its customers. The point that after reading that email, GP Tajima-san from our foundation in Japan had to send me a private email, and said that he was very impressively about the founder with his ability to make the right views and decisions that can a harmonious combination of the actual situation, immediate goals and medium – long-term vision.
3/ Customer’s absolute commitment to focus on JTBD to deliver Fundiin’s outstanding value and experience design:
I remember being so impressed with this that, after using Fundiin’s services, I released the following blog dedicated to sharing the topic Jobs To Be Done: Lessons on “Work to be done” of the startup, use Fundiin’s case to write about how this startup effectively understood and solved my JTBD. Currently, besides the initial service of 3 monthly installments, Fundiin has expanded 2 more services, which are 30 days postpaid, and Automatic Recurring Payment. These are all 3 products Buy Now Pay Later, interest-free and free to use for our end consumers. All to focus on JTBD – the desire to effectively manage personal cash flow by splitting and extending expenses without incurring additional costs. That is why, Fundiin has convinced many fastidious consumers, including me, and at the same time attracted many prestigious partners such as Mobile World, Dien May Xanh, Unilever,… joining as its merchants. Since then, the total transaction value has increased by more than 7 times and the number of users has increased by more than 5 times since the seed round about 1 year ago.
Company Name: CHERRY TECHNOLOGY PTE. LTD
Co-founder & CEO: Nguyen Anh Cuong
Establishment: 10, 2020
Headquarters: 68 Circular Road #02-01, Singapore 049422