The peer-to-peer (P2P) marketplace concept has shown it has some strong legs in Southeast Asia. Startups like Carousell, Shopee, Tokopedia, and more are taking advantage of widespread smartphone usage and internet connectivity to open the door to ecommerce for thousands of individual buyers and sellers.
Swapit from Hong Kong threw its mobile gauntlet in the fight this year, and now it’s armed with some seed funding, it announced today. The startup has raised an undisclosed amount by Aria Ventures, a division of Hong Kong-based Aria Group.
Co-founder and CEO Patrick Kosiol is a veteran founder with a decade of experience. His previous ventures include visual media production company Slate Takes and data analytics services startup TreeCrunch. “As someone who has raised funding before, I know it’s time to raise money when you do not need it yet,” he tells Tech in Asia. “So while we already had sufficient funds, we were in the position of taking our time and selecting the right investor for us, with the right conditions.”
The startup will put the funding toward further development of its tech, solidify its presence in its home market of Hong Kong, and expand to new markets. Patrick does not reveal the funding amount, but says that the full amount is immediately available to the startup, and it will all be used for growing the company. “I have been brought up with the mindset of not incurring debt,” he says. “Thus, for over a decade in the mobile app industry, I have always applied that principle and am making sure to spend wisely and only within the capabilities of our business.”
Buying and selling locally
Swapit is described as a hyper-local mobile marketplace connecting buyers and sellers by location. Its expansion plans in the region would bring it head to head with a lot of the startups mentioned above. Patrick claims Swapit thinks of expansion in terms of cities in Asia-Pacific, rather than countries, as the app is meant for densely populated areas. The startup has identified about two dozen such cities, but Patrick won’t specify which ones take precedence.
Swapit is currently focused solely on Hong Kong, where it’s been gaining traction. Patrick says the company has seen 100 percent growth in traders month-on-month during the last quarter, and its gross merchandise volume (GMV) is at US$1.6 million, growing 50 percent month-on-month. “With the just-announced funding, we are looking at accelerating that significantly,” he says. He adds that Swapit doesn’t shy away from publicizing its metrics and growth, which can be seen on its app and its website.
Swapit has been accepted in accelerator programs like SoftLayer Catalyst, Microsoft BizSpark, and Facebook’s FbStart. It was also part of Tech in Asia’s Road to Tech in Asia Tokyo 2015 tour. The Facebook connection is especially interesting since it’s this exact space the social network could seek to take with its potential P2P marketplace features. Like Swapit’s competitors, Patrick isn’t too worried about that for now.
“Inherently, there are some challenges Facebook still needs to overcome when P2P trading can be done with a joy on their platform,” he says. “We believe our proactive buyer outreach combined with location information of items, sellers, and buyers, is unique and will be very hard for a social platform like Facebook to integrate without jeopardizing their core user experience.”
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