Omise, a Thailand-based payment enabler, is in the money today after it raised a $2.6 million Series A round to develop its payment gateway system and expand across Asia.
Two-year-old Omise’s funding was led by Indonesian VC SMDV, with participation from existing investor East Ventures. 500 Tuktuks — 500 Startups’ dedicated fund for Thailand — and, interestingly, Thailand-based mobile operator True completed the line-up. (Working with a telco in Southeast Asia often open doors and scaling opportunities with both partners and consumers.)
The timing of the round is noteworthy, coming just a week after 2C2P, a rival in Southeast Asia, nabbed $7 million in fresh funding. Paysby, which is owned by operator DTAC, is yet another competitor in Thailand — there are plenty more across the region. The sheer number of entrepreneurs focused on the problem, indicates just how painful the current system is for retailers, startups and others.
So what is it about Omise that is different from the rest?
Co-founder and COO Donnie Harinsut explained that, in essence, Omise — which is pronounced ‘Oh-Mee-Say’ — is bringing greater simplicity and ease to the existing process, which can certainly be a convoluted and frustrating one. The startup is the only one that is PCI 3.0 compliant in Thailand — which allows it to tokenize cards for one-click payments and ongoing subscriptions — while its onboarding and merchant support are likely to ease some of the pain points for those selling online.
“Most developers don’t accept credit cards because there are so many obstacles… some issues [including minimum deposits to banks and long wait times for payment to be completed] make it super hard for a new merchant to start their online business,” he said.
Omise — which actually started out as an e-commerce platform, before the team decided to focus on the payment gateway that it built for itself — offers a set of APIs and developer resources that can allow new merchants to be online and accepting payment with 24 hours, Harinsut explained.
On the business side, Omise charges 3.65 percent on transactions, with a one dollar fee for up to 60,000 (1 million THB) withdrawn. It offers customizable packages for large partners, and claims to serve a number of large corporates as well as smaller startups and SMEs — it did not disclose the identity of its client roster, however.
For now, Omise is focused on Thailand, where it has a 20-plus team, but it’s next step will be an expansion to Japan, the country of co-founder and CEO Jun Hasegawa, who met Harinsut more than 10 years ago during a homestay trip. The company is in the process of opening a Tokyo office, and is hiring both in Japan and Thailand right now.
Hasegawa told TechCrunch that Omise has struck a deal with “Japan’s biggest credit issuer” and, while the local landscape is vastly different to Southeast Asia, he’s confident that there is “still a payment gap” to be tackled. Even just taking a one percent share of Japan’s online sales market, which he pegs as reaching $600 billion per year by 2020, would make the move worthwhile, he explained.
Southeast Asia is a more obvious target for growth, particularly given that SMDV led this funding round, but Harinsut and Hasegawa would not be drawn on further details — other than that they have “big plans” for Indonesia.
The company, they said, may also expand into offline payments — bringing their solution and more options to point-of-sale and in-store hardware — which might require a fresh funding round in early 2016.
“We want to help Southeast Asia quit using cash and move on to be a cashless society,” Hasegawa said.