Soft Space, a payment provider in Southeast Asia, has closed its $5 million Series A as it looks to expand across the region, and potentially into Japan.
Kuala Lumpur, Malaysia-based Soft Space works with large enterprise customers, typically banks, to offer customized solutions for mobile payment, both at point-of-sale and other parts of the process. Typically these solutions are white-labeled. The startup currently active in its home market, Thailand, Indonesia and Taiwan. This new investment is provided entirely by Transcosmos, a Japanese firm that specializes in business and expansion which works with chat app Line among others.
Beyond providing capital, the deal is strategic for both parties, Soft Space chief strategy officer Chris Leong told TechCrunch. With the backing of Transcosmos and existing partners such as Sumitomo Mitsui Card Corporation — which invested in Square and Stripe to help them expand to Japan — Soft Space is assessing the potential to move into Japan. It is also working closely with Japanese firms that are eying the market in Southeast Asia to help them expand and adapt to local payment behaviors.
“Japanese companies are really coming into Southeast Asia as the next phase of growth,” Leong said.
Indeed, the internet economy in the region is tipped to grow to be worth $200 billion annually within the next decade, according to a report authored by Google. Indonesia, Southeast Asia’s largest economy and highest population, is a particular expansion focus and Leong said that Soft Space “wants to do more” in the country.
The company, which currently has 76 employees across three offices, isn’t going to go crazy on the hiring front, Leong said, but it is looking into acquiring requisite financial licenses across its core markets: Malaysia, Thailand and Indonesia. That would allow it to operate independently, whereas currently it must work with local partners.
Leong added that the company recorded take-home revenues of 27.8 million MYR ($6.5 million) over the last year. While it has reached break-even already, he said that profitability isn’t an immediate focus — instead the priority is scale and development.