Malaysian payments startup Soft Space has raised US$5 million in its series A funding round.
Japanese ecommerce service provider Transcosmos was the sole investor, the startup’s chief strategy officer Chris Leong told Tech in Asia last night.
The firms will collaborate on a customer relationship management (CRM) tool, making use of Transcosmos’ data analytics capabilities and Soft Space’s suite of payments options.
Some features are still under development, but once completed the CRM software will be able to deliver targeted ads and loyalty programs, and let merchants employ chatbots to help handle customer complaints.
Leong gives an example of how this might work:
A restaurant, equipped with Soft Space’s card reader and linked up with its software, can accept a wide range of physical payments with cards, as well as online payments. After the payment has been made, the restaurant owner can send customers a survey and ask them to give a rating. In the case of a bad rating, an automated chat process would commence, trying to find out what went wrong. The owner could send the customer a coupon or discount. If the chatbot is not able to resolve the issue, it’s transferred to a customer care person in Transcosmos’ call center.
Founded in 2012, the startup was one of the early players offering mobile point-of-sale (mPOS) solutions, helping more merchants accept card and digital payments through its card reader and mobile wallet.
Its strongest customer base is in Malaysia and Thailand, Leong says, followed by Indonesia. It has started expanding to Taiwan and is targeting Japan next.
Soft Space works with banks who promote it to their merchant networks. The startup has shipped 180,000 card readers across Asia.
Having more money doesn’t make things go faster.
The Transcosmos deal represents Soft Space’s first institutional round of investment. Before this, it was running on angel funding and a government grant.
“We are profitable,” says Leong, offering his explanation for why the startup has not tapped into venture funding earlier. “Having more money doesn’t make things go faster.”
In an article analyzing how Asian payments startups stack up to Square, Vladislav Solodkiy, who runs fintech-focused VC firm Life.Sreda, praised Soft Space for its frugality.
“The Malaysian Soft Space has the most fanatic team of engineers,” he writes. “Out of all projects known to me, this one has the most lean team – it needed much less investment than any others to reach their goals.”
Among Soft Space’s clients are several banks in the region, like Maybank, Bangkok Bank, and CIMB Niaga, as well as corporate clients like Air Asia.
To accelerate its expansion into Japan, Soft Space signed a memorandum of understanding with Sumitomo Mitsui Card Company at the beginning of the year. This means the startup already has a foot in the door at one of the country’s largest banks.
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