Southeast Asia’s Start-ups Need to Pluck the Low-Lying Fruit
ServisHero CEO on how he was inspired by a tree
The seed of a start-up was planted when, after returning to sweltering Malaysia a year ago, Karl Loo needed to have his air conditioner repaired. When he called his aunt for a recommendation, she told him to go look at a tree, where he might find a sign advertising an air-conditioner repairman.
“It’s 2015, and my auntie told me to go look at a tree. Everyone has a smartphone in Malaysia…and I’m running around looking at trees to find out how to get an aircon repairperson,” Loo says.
The result of that flora-based search is ServisHero, a one-year-old Kuala Lumpur-based mobile marketplace Loo co-founded to ferret out local services, from plumbing and pest control to fitness training and small-business accounting. 97 percent of businesses in Malaysia are SMEs, according to Loo. And when people need information, they are likely to go to Google. If 90 percent of those small merchants have no idea how to run a Google AdWords campaign, it means that 90 percent of that 97 percent are invisible.
“We would democratize access to digital marketing to a population that didn’t know how to manage a Google ad words campaign,” Loo says.
Enter the ServisHero app. Users search for their desired services on their phone, answer a couple of questions, pin their location on the map, and the information is sent to service providers that match their requirements. The company earns by charging service providers a fee for every quote sent to clients.
“We want to disrupt the classifieds business,” Loo said in his talk at a May event hosted by Kickstart Ventures, a Philippine-based corporate venture capital firm. ServisHero has raised more than $2.7 million in funding from investors, including Golden Gate Ventures, Cradle Seed Ventures, and YTL Corporation.
Loo began his career as an information-technology lawyer in Auckland, New Zealand, where he grew up. He practiced law for three years, with his most high-profile job coming with the launch of the iPhone in New Zealand, making sure that compliance labels were all correct, and drawing up the terms and conditions. Loo realized this wasn’t his kind of work. Loo left his job at the law firm – despite his partner’s advice that he was making the biggest mistake of his life – and booked a one-way ticket to China, from where he would move on to the United States, South Africa, and, eventually, back to his homeland, Malaysia.
Here are three lessons from Loo’s talk:
1. Define your purpose
Loo saw there was a big opportunity to change the lives of small service providers who were still advertising on trees and fences. He says, “There is a real person that put that sign up there. How desperate do you have to be as a small- and medium-sized enterprise to go around every tree in the neighborhood?”
He felt that, as a Malaysian who had the privilege of getting an overseas education and the benefit of working globally with different entrepreneurs, it was his duty to do something to uplift the income levels of millions of people.
They launched the app barely 11 months ago, and now ServisHero employs 50 people across three countries, is operational in five cities in Southeast Asia, and has created 500 new jobs in the economy through the app.
“You have to have a vision of a future that is so different from what you are experiencing right now,” Loo says.
2. Do crazy things to get noticed
When ServisHero was starting, the app had to gain traction among smartphone users in Malaysia. Loo and his team had to convince people to download the app, and they had to do it at low cost. The first idea that came to mind was they would wait in front of the Ikea furniture store, and when people came out with trolleys they would come up to them and say: “Hey, so [it looks like] you just moved into a new home. You probably need some cleaning or renovation work, we have this app if you want to download it.” Loo says it worked for a time, until Ikea found out and they had to leave.
The next idea they had was to bring dog treats to the park, offering them to dog-owners who downloaded the app. But that wasn’t enough.
They then decided they needed to access the mobile-savvy, female demographic. So they created a profile on dating app Tinder, saying that they would take out for ice cream whoever downloaded the app. They got several responses, but eventually, they hired an SEM (search engine marketing) manager to get ServisHero noticed on social media.
3. Go where the people are good
“If there is one superpower that I think I have, it’s hiring [people],” he says. “I’m able to get really great people together…I can convince Malaysians who are on $300,000-a-year salaries, with a fancy degree, working in London, to come back home and work for a purpose.”
When ServisHero expanded to Thailand, Loo says it took them just two weeks to set everything up.
“My expansion thesis is based on where I find good people,” he says. When you invest time in finding people who are good at what they do and who are driven to work towards a common goal that is when a start-up is able to grow and succeed.