December 12, 2019: We are proud and privileged to work together with SEA Gamer Mall “SEAGM” and True Digital Park “TDPK” to co-organise TDPK: Be your own boss – Meet the experts on growth strategies and scaling in business.
In this event, we are glad to have Tommy Chieng, Co-founder and COO of SEAGM to join us. Tommy has led SEAGM (https://www.seagm.com) to achieve a total of MYR1.2 billion (which is equivalent to USD 280 million) in revenue growth since he joined the company in 2010. Since then, SEAGM has been growing at a Compound Annual Growth Rate (CAGR) of 41.30% from 2010 to November 2019.
In addition, Tommy has launched and spearheaded the Digital Goods and Services Marketplace, KALEOZ (https://www.kaleoz.com). KALEOZ has grown from MYR 1.5 million (equivalent to USD 360,000) to MYR 38 million (equivalent to USD 9 million) since it launched in 2017. That is a 2500% increase in growth. He had also helped to structure and led the growth of SEAGM team from 12 to 140 employees.
Below is a quick summary of what Tommy, COO and Co-founder of SEAGM has shared with us.
Question: SEAGM started in a town called Sitiawan in Malaysia. Over the past 12 years, SEAGM has expanded both in company size as well as having several offices. Right now, you have four different offices in Kuala Lumpur, Thailand, China and Indonesia. So Tommy, when do you think is the right time to set up offices in other cities/countries.
Tommy: Due to the nature of our digital businesses, we focus on the payment gateway. Right now, both our platforms are able to accept 35 different currencies, and we have more than 100 types of payment gateways. We ensure that all the interested customers can make purchases on our platform. Our team in Sitiawan can support backend operation support. The trigger point for us to consider opening oversea-offices is that we need local customer supports. We faced difficulties understanding the Thailand and Indonesia customers as they don’t speak the same language as us, this leads to local customers having trust issues with us.
That is when we start to consider setting oversea offices to support the local customers.
Tips: If you would like to set up a company outside of your home country, make an effort to travel down there personally and hire someone there.
We also took an unorthodox approach – we approached our resellers in Thailand and Indonesia and I have also made the effort to arrange video calls and offer to them to be part of the SEAGM family. Together with the reseller we valued, we have opened and managed the oversea-offices with them.
Salary wise, we do not stop at offering basic package alone, we also allow them to have the opportunity to earn a commission from the sales made from the country that they are working in.
Our strategy is to work with reseller whom we have partnered with and worked before. By doing so, they understand what we do and what are the problems our customers will face as well as the questions they will ask. With this approach, they can help to scale oversea-offices in a short period of time.
Question: When we are scaling a business, cash is a crucial element that we need to have or manage. Is cash an issue for SEAGM when looking to scale its business?
Tommy: We don’t encounter any problem with cash except for the year in 2015 – our revenue jumped more than 100% during that year. What we did was we ask our shareholders for funds and not from external parties. We always reinvest our profits back to our business every year – with a minimum of two-third of our earnings. Also, we always look for ways to minimise losses from foreign exchange.
Tips: Do not seek for external funding if you are able to fund internally. Do remember to reinvest the profits gained into your business as your scaling initiative.
Question: Since 2010, the company has grown about 41.3%, do you think you can achieve the same target next year – as many have forecasted or warned that a recession is coming?
Tommy: To be honest, I am quite optimistic. This is most likely due to the up and coming growth in mobile gaming. Many factors contribute to the increase in mobile gaming, such as mobile phone prices and their capabilities to run 3D games. Secondly, SEAGM is doing international business, not just locally or SEA region alone. We can keep our operation lean while serving our global customers.
Co-founder of BlackStorm Consulting, Shelby Tee and COO and Co-founder of SEA Gamer Mall, Tommy Chieng.
Question: When you are running a business that is doing so well, have you ever thought of seeking for a new initiative such as doing something different from what you are doing right now?
Tommy: Actually, we launched KALEOZ, a C2C marketplace, in 2017, that was something we were unfamiliar with, in terms of running the operations and other systems. Our strategy is based on word of mouth to gain awareness and we have spent zero dollars on advertisement. We do strongly emphasise on free traffic – SEO as free traffic is very important for any online business.
We are going to have some new initiatives which are going to be something different from what we are offering to our gamers now. Our gamers also do other things with their life other than gaming such as eating, travelling and etc. We also noticed that many our users have been following us since 2010 when they were only teenagers back then.
Right now, we are thinking beyond that – other than launching KALEOZ. Without a single cent spent on marketing, we can grow KALEOZ to MYR 38 million (equivalent to USD 9 million) since it first started. It would be best if you can look at the assets that you have and leverage on it.
Tips: After gaining constant growth over the past years, look for other opportunities and leverage on your assets (Eg: customers’ needs/wants; partners; network) and prepare for the next phase of growth.
Question: You have mentioned a few keywords such as eating and travelling. We do know there a few big players over here in SEA that are already offering such initiatives. Do you think you can compete with other big players?
Tommy: I’m not looking for head-on competition with them. In fact, I would love to partner with some of them. Many of our customers still come to us although the items that we’re selling are not cheap (PS: gamers, they are suckers for cheap goods). We always go for the extra miles for our customers.
For our new initiatives, we are thinking of how to add value to all of our gamers in the ecosystem. We do not compete directly with all those big brands. With the trust we built over the past few years with all our stakeholders (gamers, gamer publishers and partners), we will be launching new products targeting at our current stakeholders’ needs rather tapping on a new pool of stakeholders.
Question: How are you going to go into this vertical – are you going to do it by yourself or build a new team?
Tommy: Our headquarter is based in a small town, Sitiawan, Perak – it is not easy to find talents around this area. There are certain areas that we do not have internal capabilities to work on. Hence, we have to take a different approach by starting small and seek for external parties to fill up the internal gaps and identify the actual potential of our new business units. Once we have achieved the desired results that we want, we will bring it to the next level in terms of commitment.
In summary, don’t be afraid to launch something that has already existed in the market. Start the whole process by looking at your current customer – ask yourself what can you provide to them. If something cannot be done within your capability, ask yourself whether if you have the network of people that you can work with to launch this initiative. If it works well in the future, you can spin off your business and consider to do revenue sharing with your partners.
And lastly, congratulation to SEAGM for winning two prestige awards from Nanyang Top International Golden Eagle Award 2019 and Sinchew Digital and Technology Business Excellence Award & International Business Excellence Award!
About SEA Gamer Mall
Founded in 2007 and headquartered in Malaysia, SEA Gamer Mall Sdn Bhd is an established Malaysian digital goods and services e-commerce platform company for global gamers, game developers and publishers.
SEAGM developed a digital goods e-commerce platform (SEAGM.com) and a digital goods marketplace platform (KALEOZ.com) from the ground up to serve to our customers from all around the world.
With four offices worldwide in Malaysia, China, Thailand, and Indonesia, SEA Gamer Mall is the gamer‘s choice for online game digital goods.
About BlackStorm Consulting
BlackStorm Consulting is a boutique growth consultancy firm that specialises in corporate strategy, profit management and investment management. We mainly serve clients in four sectors: FinTech, Gaming, Technology, Media and Telecommunications (TMT), and manufacturing.
Our clients and connections are internationally present and range from small and medium-sized businesses, MNCs, to government agencies.