New internet-enabled businesses are making an appearance in frontier Myanmar, which is witnessing a telecom boom period with operators putting their might on expanding network infrastructure to meet the growing demand for data services.
While e-commerce and consumer internet startups are yet to scale, they are slowly heading towards the “transactional” phase and launching new models borrowing from successful regional ideas but adapting them to the local market.
Consider these developments: In the new office in Mingalar Taung Nyunt township of local content creator Myanmar Online Creations (MOC), an employee at Onlyinburma.com, targeted to be a destination point for locals, and Langyaung.com, a local business directory, is busy uploading content for the sites.
The company has got five apps running since its launch late last year and it is already looking to roll out a few more to touch 10 apps by the end of 2017. MOC, led by Win Ohn, also the CEO and president of Canada-based MediaNation, aims to bring new dotcom technology in Myanmar language.
Meanwhile, in mid-August, an online wedding gift service platform named MingalarLetPhwet.com was launched to address the issue of unwanted and repetitive wedding gifts. The site has brought together suppliers of over 5,000 wedding gift related products while it is free to use for customers.
In July, Swiss media group Ringier and Myanmar-based Information Matrix Co Ltd joined hands for their ventures, marry.com.mm (based on popular Vietnamese model marry.vn) and parenting platform kalay.com.mm. Revenue model for these engines are built around wedding fairs and workshops.
The market also saw the launch of Flair Eyes, which allows local photographers to upload photos and video clips for use through a subscription or per piece basis.
Ecosystem enablers
The development of such business oriented platforms indicate the improved contribution from different stakeholders in the ecosystem in Myanmar since the military ceded power in 2011.
The expansion of the telecom market, since the approval of foreign telecom operators, Telenor and Ooredoo, has by May 2016 reached a coverage of 43.72 million compared to the country’s total population of 54 million. Also compare the current SIM card cost K1500 ($1.3) to the previaling rates of a staggering K4000,000 ($3,412) in 2006.
Apart from the favourable macro indicators, the region is also beginning to see action surrounding funding of startups. Ride hailing platforms like Uber and Grab’s announcement of $100 million investment in Myanmar has captured the attention of investors.
Recent startup funding developments include freelancing platform Chate Sat and comic application White Merak raising a six-digit investment each. JobNet.com.mm, a job website under the umbrella of MMOne Online Co Ltd, also raised a seven digit investment this year. Prior to that, their sister company, ShweProperty.com raised a six digit sum from some institutional investors.
Other significant updates from the startup world include MyPlay’s acquisition by ASX-listed iSentric and Malaysian movie streaming company iflix establishing presence in Myanmar.
Sumit Jasoria, MD, shop.com.mm feels, “the mindset has changed after global players came in. Local investors are also looking at the right team.”
Ohn says, what is currently hurting e-commerce adoption and growth is lack of universal gateway. However, online retailers and users have seemingly found a way around it by relying on cash on delivery option. “It is a ‘a very creative way and a grassroot step as we evolve into e-commerce shopping and buying. I forsee a lot of solutions addressing the universal online banking credit card payment solution,” said Ohn.
Meanwhile, a lot of payment solutions are appearing to address the issue of online payments such as Wave Money, a financial service provider of Telenor and Yoma Bank; Ooredoo’s mobile wallet M-Pitesan and 1-Stop, a partnership between Singapore-based payment service 2C2P and Myanma Awba.
Popular retail platforms like Rocket Internet’s shop.com.mm is experimenting with offering more discounts on usage of card payments. “The idea is to create an ecosystem which helps consumers to also try cards,” said Sumit Jasoria, managing director of shop.com.mm, which has been in Myanmar for three years.
He argues that 70 per cent of businesses in neighboring Asian countries are still using cash on delivery while the number for Myanmar is just higher, making about 90 per cent. “I think it is catching up, soon it will change for sure,” said Jasoria.
Internet models, local twist
Jes Kaliebe Petersen, CEO of Phandeeyar a leading Innovation Lab in Myanmar, says, the next wave of startups will be targeting a much broader audience, people present outside the city, and the new generation of smart phone users. The majority of those residing outside large cities in Myanmar use data only for Facebook and Viber.
“The business that will emerge as the leaders in the area (online business platforms) are those who manage to handle the logistics and payments issues in a reliable manner and get people not just to buy on Facebook but also from their own apps,” said Petersen.
A recent survey by MyanZen – the winner of Telenor Myanmar’s first accelerate program that allows social sellers to effectively sell on social network – shows that there are over 3,500 Facebook stalls involved in online shopping business in Myanmar.
While the emergence of new business ideas are keeping up, Ohn says, it is encouraging to see a lot of companies like them starting to build the platforms and grow the awareness of the general public.
Business ideas, that are successful in neighbouring countries, find favour in Myanmar.
“We will always encourage the people in our accelerator to look at what’s going on elsewhere and use that as an inspiration for what can be done in Myanmar,” said Petersen.
Shop.com.mm is also starting to replicate models of Daraz’ work in other countries and introducing fashion related products from Korea and Thailand on their platform after evaluating the consumer preference in Myanmar.