Vietnamese ecommerce company Loship, which differentiates itself through its one-hour delivery promise, wants to become one of Vietnam’s earliest unicorns.
One of the fastest growing economies in Southeast Asia, and nicknamed as the region’s Silicon Valley, Vietnam has undergone vast transformation in the past decade that has brought it into the global eye.
The Vietnamese Internet economy is thriving, climbing higher up the ranks of the world’s top startup ecosystems, driving rapid digitalization, and dominated by sizable Internet companies, including Lazada, Shopee, Tiki, and Sendo.
At the same time, the country is still playing catch up with its Southeast Asian neighbors, with ecommerce and delivery still in its early innings in Vietnam.
“I think [Vietnam’s] internet economy started earlier than the rest of Southeast Asia, [but it] struggled a lot to find the right supporters for startups and entrepreneurs. That’s why, for the last 20 years, we haven’t had any new big company,” Trung Hoang Nguyen, Co-founder and CEO of Loship, tells Jumpstart.
Loship is a Vietnam-based ecommerce startup offering one-hour delivery of a wide range of products and services, including food and groceries, ride-hailing, medicine, and even laundry services.
As Vietnam’s startup economy powers up amidst a surge in Internet adoption and digitalization, Loship, Nguyen says, has big plans for the future.
Switching gears at Loship
In its earlier iteration, Loship was started as Lozi in 2012, a food reviewing app that also allowed peer-to-peer buying and selling. About five years later, Loship was founded by Nguyen and the company’s general manager Son Minh Tran as an ecommerce delivery company, focusing on on-demand deliveries in one hour.
The company operates in HCMC, Hanoi, Da Nang, Can Tho, and Bien Hoa cities in Vietnam. Loship’s backers include South Korean VC firm Smilegate Investment, Singapore-based Golden Gate Ventures, Skype co-founder Jaan Tallinn’s MetaPlanet Holdings, and Singapore family office Vulpes Investment Management.
For Nguyen, Loship is positioned at the cusp of the ecommerce opportunity in Vietnam. The country added the most number of digital consumers in 2020 compared to any other Southeast Asian country. Forecast to grow to US$52 billion in five years, its internet economy is expected to be greater than that of Singapore, the Philippines, and Malaysia by 2025. By then, it will also be vying with Thailand for the spot of the second biggest Southeast Asian internet economy.
At the same time, while food delivery companies in Vietnam can expect to perform well post-COVID, ecommerce is trying to match growth rates reflected in other Southeast Asian countries.
“Our model is actually not something new, there are a few companies on the global scale that try [to fulfill deliveries quickly],” Nguyen says, pointing towards China’s JD, and India’s Dunzo. “The key thing for us is how we can leverage local know-how to become number one in the customer’s mind for instant delivery.”
From superapp to unicorn
Superapps have grown to become a predominant trend in Asia. Apps from Grab, GoTo, One97 Communications, Alibaba, Tencent, and Kakao evolved over time to become a one-stop-shop for online services. These could be food delivery, payments, ecommerce, utilities, or even insurance.
This is exactly the kind of service that Nguyen hopes Loship will bring to Vietnam through it’s promise of one-hour delivery.
“If you look at food delivery, you see a lot of competition. If you look at ecommerce, you see a lot of competition. But if you step back, there is no one who clearly claims that they are number one in terms of one-hour delivery. We want to be at the top of the customer’s mind, where if you need something instantly you think of Loship,” Nguyen says.
The company faces stiff competition, however. Vietnam has a thriving ecosystem of ecommerce companies, dominated by Lazada, Shopee, Sendo, and Tiki. While Loship has erstwhile been able to find a footing in the B2B segment, it’s in B2C that it will have to face up to some of the biggest names across Southeast Asia. Nguyen expects Loship’s record as a homegrown company, and its penetration in Tier-II cities to work to its advantage in this area.
Further, Nguyen also expects to see consolidation in the market over the next three years. He sees Loship emerging on the winning side of the bargain, making some important M&As, and continuing to compete with other regional players.
Ultimately, Nguyen says, there’s a lot of talent in the Vietnamese market, but “no inspiration yet.” The startup ecosystem is in its tweens, the Internet industry is yet to mature, and ecommerce is growing at half the pace of its Southeast Asian counterparts.
At the same time, however, the country recently announced its first unicorn, VNG, in a recent win for its ecosystem. Loship, Nguyen says, is aiming to be the next.
Header image courtesy of Loship
