Seize COO: ‘Large upside’ in Southeast Asia after first-ever quarterly revenue

Seize reported a revenue of $11 million for the ultimate three months of 2023, in comparison with a $391 million loss in the identical interval a yr earlier. Income for the quarter additionally grew to $653 million, a 30% improve from the identical interval in 2022. 

“Crossing the break-even is a point on the line,” Alex Hungate, Seize’s chief working officer, says. “We’ve got a region where there’s a lot of potential to grow scale, so we just got to keep pushing growth.”

Many tech firms have been forced to tighten their belts lately. Backers and buyers have soured on continuous losses and excessive spending, because of increased rates of interest and a harder macroeconomic atmosphere. 

Seize has by no means made an annual revenue. In 2023, Seize posted a web lack of $485 million, an enormous enchancment from the $1.74 billion loss it reported in 2022. The startup’s shares have misplaced virtually 75% of their worth since their debut in December 2021, when the corporate listed on the Nasdaq through a merger with a particular goal acquisition firm (SPAC).

Seize achieved its first-ever worthwhile quarter on the again of a series of cost-cutting measures for the Southeast Asian tech agency, together with freezes on hiring and salaries for senior managers, and a one-time accounting acquire.

The ride-hailing startup will quickly present whether or not it’s been capable of construct on that momentum within the new yr: Seize will report its earnings for the primary quarter of 2024 on Might 15.

A knowledge science firm

Hungate explains that Seize’s earlier investments are actually beginning to bear fruit, permitting the corporate to reinvest its earnings in its companies to draw new customers and retain present ones. 

Seize is greatest generally known as a ride-hailing and meals supply service, tapping into a military of drivers throughout Southeast Asia to hold passengers and meals from place to position. However Hungate as an alternative sees Seize as an information science firm with sufficient inner data to optimize income development. 

One instance is Seize’s resolution to create its personal mapping resolution, as an alternative of licensing one thing from a third-party supplier (as most different ride-hailing apps do).

Southeast Asian cities are large and messy, with slender streets and roads that aren’t clearly signposted. One other key characteristic of Southeast Asian cities? Procuring malls, which frequently function hubs for residential and business properties along with stores. However drivers can get misplaced in labyrinthine complexes. 

“Fourteen percent of the driver’s time is taken in the last 2% of the journey because they often can’t find the place in the mall where they’re picking up or dropping off,” Hungate says. He claims that higher mapping helped drivers earn 14% extra per hour final yr in comparison with 2022, because the know-how permits the corporate to higher allocate its fleet.

One other space the place Seize takes benefit of knowledge is its budding monetary companies division. Seize gives loans to drivers via its GrabFin service and digibanks. The startup makes use of knowledge akin to driver rankings, security data, and kind of rides accepted when it assesses driver threat. Hungate claims that Seize’s recollection effectivity is increased than conventional banks (although Seize additionally permits drivers to deduct mortgage funds from their earnings).

Seize’s development

Hungate joined Seize after a stint as CEO of Singapore Airport Terminal Providers, a meals and logistics firm recognized for offering in-flight catering companies at Singapore’s Changi Airport. Earlier than that, he led HSBC’s Singapore operations for nearly six years. 

Seize got its start when Anthony Tan and Tan Hooi Ling launched a Malaysian ride-hailing service known as MyTeksi in 2012. The startup rapidly expanded to the Philippines, Singapore, Thailand and Indonesia. It moved headquarters to Singapore in 2013, and renamed itself Seize. 

Ore Huiying—Bloomberg through Getty Photographs

The ride-hailing startup managed to push out Uber in Southeast Asia, making it one of many few markets that saved the U.S. ride-hailing big out. Seize finally acquired Uber’s Southeast Asia property in March 2018; in alternate, Uber took a 27.5% stake in Seize. The startup was additionally backed by Japan’s Softbank, Singapore’s Temasek, and BlackRock.

Seize solely serves Southeast Asian markets, all with totally different ranges of per capita earnings, starting from rich Singapore to comparatively poorer Cambodia. 

That dictates how Seize operates, Hungate says. Many Southeast Asians are underbanked and so lack bank cards not like shoppers within the West. By creating its personal fee system, Seize may remove the usage of money and serve the underbanked inhabitants—whereas additionally tethering prospects to the app.

Regional variations are additionally why Seize is banking on its “superapp” technique. Southeast Asian shoppers favor to do the whole lot on one app–which Hungate credit to restricted capability on low cost smartphones and restricted knowledge bandwidge. 

Hungate says that Seize will proceed to give attention to Southeast Asia. “It’s the third-most populous region in the world, 650 million consumers. Only one in 20 of those 650 million consumers are users of Grab,” he says.

“We think there’s tremendous upside.”