Building a startup easily on the cloud
Building a startup on the cloud is gaining traction. However, one of the biggest concerns for any startup today is access to funding. For tech startups, funding is the key ingredient in ensuring they can develop their ideas and start their business.
A successful pitch would guarantee them funding but there also several challenges that follow suit. A tech startup needs to be able to access technologies to start its business. And this would mean investing in these technologies, which can be pricey.
The COVID-19 pandemic has affected the venture capital (VC) investment landscape globally. However, in the Asia Pacific (APAC), it has not dampened the spirits of startups and organizations seeking early-stage funding. GlobalData’s Financial Deals database showed the share of early-stage funding rounds remained at more than 65% which is promising for startups here.
Tech startups rely heavily on the cloud to run their operations. While running a business entirely on the cloud does reduce costs for physical infrastructures, deciding how much to allocate for cloud services requires proper planning. Picking the right cloud vendor that can meet the scalability and changes in the business is key for startups.
As the cloud allows them to be flexible, Amazon Web Services (AWS) offers a suite of cloud-based solutions as well as training, certification, and support for startups and organizations of all sizes to expand their business ideas quickly and effectively.
According to Digbijoy Shukla, Business Development Lead, Startup Business Development ASEAN at AWS, startups can leverage cloud solutions as it enables them to launch faster, experiment more with lower risk and focus on their core value. A key feature of AWS is that it requires zero upfront cost as startups only pay for what they use instead of having to invest in servers upfront.
“The great thing about startups is the ability to start small and learn as you go. So long as you get the foundations right, such as ensuring you are secure by design from the outset, it won’t matter so much if you make the odd misstep along the way, because the consequences will be small,” said Shukla.
The startup journey
Carsome, the largest integrated e-commerce car sales platform in Southeast Asia, started as a simple platform to sell cars. Today, the brand is on its way to being a unicorn in Southeast Asia (SEA) as it continues to innovate the entire used car selling experience.
Fresh out of their acquisition of PT Universal Collection, a Jakarta-based offline car and motorcycle auction company, Carsome continues to see dynamic growth across its Southeast Asian markets. Amid the Covid-19 pandemic, more car users are opting for used cars which have seen an increase in the region.
Carsome also announced that is plans to acquire listings platform, iCarAsia in a transaction worth more than US$200 million.
For Eric Cheng, co-founder and Group CEO of Carsome, startups need to be able to scale fast to adapt to the growing demands and trends of the market. The cloud enables them to do it with minimal disruption. Having started as a car comparison website, Carsome was able to transform its business into an integrated e-commerce platform for selling used cars within six months.
One of the reasons why Carsome was able to adapt quickly was because they were cloud-native and had no legacy infrastructures to worry about. Shukla explained that compared to startups, SMEs and large enterprises need to have a different approach in their cloud transformation journey.
For SMEs, the cloud journey is one of digital transformation, and how operations can be streamlined. Meanwhile, enterprises that have invested in tech before would need to migrate their operations to the cloud and leverage their existing infrastructures. Some enterprises have also invested in technologies that they do not need and are unsure of how to make the most of the services in the cloud.
Today, Carsome has a strong presence in the SEA region and leverages AWS for its platform. While they have been successful, Eric did mention that access to talented and skilled employees in technology is still a concern. Carsome is not the only business experiencing this as the shortage of skilled tech employees continues to be a growing concern in the region.
Thai fashion brand Pomelo entered fashion e-commerce in 2013. Today, the brand is using AI through machine learning to revolutionize the fashion industry in the region as well as enhance the customer experience.
Fintech apps are also growing in demand in this part of the world with more startups emerging in this sector. These include buy-now pay later startups that are leveraging technologies on the cloud to run and scale their business while ensuring they meet all compliance and regulations set by local governments.
With cloud-enabling startups to build their business much faster, the market is only going to get more competitive. As investors realize the potential startups can bring and are eager to invest in them, entrepreneurs should be looking at how they can innovate new ideas to fuel the growing digital economy.