For those unaware of KKR, here’s a brief introduction. KKR stands for Kohlberg, Kravis, Roberts & Co, a long-standing global investment firm with total Assets Under Management (AUM) of around US$153 billion (as of Sep 2017). Famed for its 1989 leveraged buyout of RJR Nabisco, which was the largest buyout in history to that point (and captured in the famous book Barbarians at the Gate), as well as the 2007 buyout of TXU, still the largest buyout completed to date by absolute value – many have tried to guess the motive behind their recent move into Southeast Asian e-commerce, on which they led a US$65 million round of investment into ecommerce enabler aCommerce.

Leveraging the Alibaba connection?

Perhaps, fresh off its deal with Alibaba to co-invest into Yiguo’s series C, (a deal dubbed the largest fresh food ecommerce fundraise to date in China) it is looking to leverage its presence in China to grab a piece of the Southeast Asian e-commerce pie. After all, most sellers and products are and will be manufactured in China for the next decade at least.

An aCommerce fulfillment center where riders pickup products to be sent directly to customers. A huge (but worthwhile) investment for any startup, if they want to maintain a close loop in the customer’s experience.

aCommerce started out by adopting a much simpler model, where it excelled in marketing for distributors, managing selling and shipping on top of that. However, as of recent years, many such sellers have become smarter (often hiring from Rocket Internet’s Lazada) and have taken it upon themselves to manage their purchasing, inventory, warehousing and marketing, thus putting a dent on aCommerce’s dreams.

Since then, it is has pivoted and became a seller as well. Its ambition is no less than being at least similar sized to its comparison in China: Baozun with a market cap of US$2.5 billion. The recent fund-raising would hopefully help it fund its inventory and perhaps enable its dream to become of the biggest ecommerce enablers in Southeast Asia. Perhaps if Alibaba felt threatened enough, it may just buy out aCommerce – of which KKR would be glad to?

Bigger ambition to reign in the groceries business in SEA?

It is also known that the owners of aCommerce were knee-deep in Southeast Asia’s online groceries business. Their investments into Happy Fresh have seen their presence (and losses) grow beyond their homebase, Thailand and into Malaysia as well as a few other countries.

Our friends who work within the industry have basically shared that of late, internal targets have been shifting regularly causing distress to management. It is definitely understandable as the industry have become very competitive with the presence of other competitors who rely heavily on discounting (such as HonestBee).

Happy Fresh arranges for riders to go to the nearest grocery store to pick up the customer’s orders, and deliver it to their doorstep. The whole process takes around an hour, but mostly requires advanced booking. Items going out of stock is probably the most common problem.

Even big boys such as Tesco have been more efficient in their online shopping and deliveries business (perhaps due to their part ownership of Lazada in Thailand), raising questions on the concierge shopper model.

However, it largely remains to be seen if the sentiments of consumers will shift toward shopping for groceries online. After all, most customers who use such services were expatriates to begin with, and locals only bought when discounts were offered.

Media companies entering ecommerce space

We saw the reverse before: Alibaba entering the movie space, Amazon launching its original video content, and now major media conglomerates in Southeast Asia are entering the ecommerce space. 

Perhaps, beyond everything else, KKR was just doing what everyone else was doing. It’s investments into aCommerce was done through Emerald Media, that owns many media interests.

Regionally at least, our team at Momentum Works have seen a trend of media companies launching their own ecommerce platforms – from Malaysian billionaire-owned Astro to many more.

Malaysian media conglomerate (Astro) launches its own ecommerce site “GoShop” to enhance their viewers’ tv shopping experience

Many are starting to understand the importance of owning a customer acquisition platform (than just mass media), and are trying to leverage their viewers to shop online instead of doing it on home shopping tv programs. It sounds very feasible at least on paper, since in Southeast Asia at least, television business is not yet a sunset industry.


We at Momentum Works contend that KKR’s move is a calculated one. Seeing the potential of ecommerce in Southeast Asia, and the dominance of mass media such as television and radio, it probably made a wise move (theoretically) investing into an ecommerce enabler. It will not have to take Alibaba head-on (neither does it want to, we think), and gets to build more value for its portfolio of media companies.

Thanks for reading The Low Down, insight and inside knowledge from the team at Momentum Works. If you’d like to get in touch with us about any issues discussed in our blog, please drop us an email at [email protected] and let us know how we can help.

Thanks for reading The Low Down (TLD), the blog by the team at Momentum Works. Got a different perspective or have a burning opinion to share? Let us know at [email protected].


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He has worn many hats in the past - selling advertising space, banking services, and even trading stocks. In 2013, longing for a change of scenery, he joined Rocket Internet’s (now Alibaba’s) Lazada as a online marketer in Bangkok, where he experienced first hand life in a startup. He never looked back since - landing lead roles at Rocket’s EasyTaxi (Singapore), Rocket’s MEIG (Dubai), and Bamilo (Tehran). After that, he launched (and ran) the Thai venture for one of Singapore’s biggest cross-border ecommerce. Last year, Chong put his expertise to work, helping an SGX-listed company relocate to and run operations in Thailand. Nowadays, he’s just chilling by the countryside.