SGGP Investment & Finance had a discussion with Nguyen Hoang Anh, one of the founders of Abivin to further understand the operation of this startup.
JOURNALIST: - What is the challenge Abivin is facing in bringing new solutions in logistics to clients?
NGUYEN HOANG ANH: - Abivin vRoute is the new solution which utilizes the 4.0 technology such as optimal algorithm, artificial intelligence, machine learning and big data to optimize the process of supply chain and help save about 30% logistics cost for enterprises. Since our first launch in 2015, we are still facing difficulties in gaining the trust of clients, as it is a new technology product.
The first barrier comes from people’s perception. Logistics is currently a traditional business operating mainly on experiences and manual calculations which are not effective, waste time, waste labor and involve a complicated process. Hence, to resolve these issues, we need to apply new technologies.
However, it is not easy to change the perception, mindset and habits of people, especially when the change impacts jobs, income and benefits of several groups of people. Not everyone in supply-chain companies support the application of new technology. To resolve this issue, Abivin as well as other hi-tech solution supplying companies have worked closely with leaders of enterprises to gradually change the perception and thinking of the people involved to solve related problems.
The second challenge is the complexity of operating process of logistic companies. Different companies have different working processes, different conditions and different business code of conduct. The responsibility of Abivin is to digitalize all these processes, apply smart algorithm and other new technologies to optimize the automation and the operating process to help enterprises save costs.
We have developed new technology to resolve the arising issues of different companies, make our product more outstanding and gain the trust of demanding clients.
The third challenge is data quality. To apply successfully the big data solution like Abivin vRoute, good data quality is very important. Most traditional logistic companies do not have much data or do not save the data or have low quality data. It takes Abivin a certain period of time in the beginning to support clients to rebuild the data in order to apply new technology.
However, this is also a chance for us to work closely with enterprises to understand deeply the many arising practical difficulties of clients, and to allow them to turn to us first whenever they face any technology problems.
- Have recent solutions helped Abivin in gaining client trust and be successful in searching for long term investors?
- After participating in the Shark Tank Television Series, and winning prizes at TechFest 2018 and Startup World Cup 2019, we have received much attention from enterprises as well as investment funds and individual investors. Over the last few months, the number of domestic and international companies who have shown an interest in investing in us has surged significantly.
This interest indicates the success of our startup. This also motivates us to work harder every day to develop our Abivin vRoute product to meet the demands of clients.
Besides several contracts with big corporations like P&G, A.O. Smith and Friesland Campina, we also have some agreements with other companies, such as Tan Cang Sai Gon Port, Vietnam International and Highland Coffee.
- Abivin has shown ambition by entering the international market since winning the prize of Startup World Cup 2019. What is the progress now?
- To be able to enter the international market, a startup needs to prepare many things.
Firstly, the products of a startup must be good and must have already succeeded in the domestic market. Startups need to do market research to understand the culture and economic character of the country that the startup targets. The startup also has to well prepare for issues related to legal frameworks, technology infrastructure, transportation system and working habits of people.
In the short term, Abivin will focus on the ASEAN region. We will test our products in some markets like Myanmar, Malaysia, Indonesia and Thailand first. We will also target to reach some other markets in Asia, including Korea and Japan.
Currently, the main source of our income is the fee which is calculated based on the number of users. ASEAN is the potential market with about 80mn commercial vehicles (20mn trucks and 60mn motorbikes). Over the last few months, we have studied several markets to understand the economy, the culture and the legal system to further approach various markets quickly.
- The prominent question that most people want to ask a startup is when will it make profit. So, after 4 years of operation, how is Abivin’s profitability?
- In my opinion, the time for startups to get profit is dependent on the business model and sector that the startup is operating in. We are a B2B company (Business to Business), hence, it takes more time to gain the trust of demanding institutional clients than other businesses.
We are lucky to get huge support from the Government and Ministry of Science and Technology to implement the project 844 to support the national startup. Four years is not a long period for a startup.
We are proud of what we have gained over such a short period of time. We take these achievements as motivation to develop our products better via the Abivin vRoute.
- In your opinion, what should the government do to support the development of startups like Abivin?
- Most startups will appreciate a lot of support from the government in reaching out to more capital for the development of startup products, the same as other countries are providing where there is a big movement for startups and introduction of new technologies.
The government should create more favorable conditions and policies for startups to attract foreign investments. The government should create an environment for startups to apply new technology in Vietnam. The government should also establish some startup support centers inside the Country’s Science Centers at the earliest to support activities of new and established startups.
- Thank you very much.