Online booking firm Vntrip.vn repeats story of e-commerce startups

13:58 | 27/08/2018

Similar to startup enterprises, domestic online booking application Vntrip.vn, despite suffering huge losses in the past two years, has been receiving a large number of investments.

online booking firm vntripvn repeats story of e commerce startups
Vntrip.vn has repeatedly received investment from foreign investors. Source: zing.vn

In the past two years, Vntrip.vn recorded accumulated losses of VND100 million ($4,424), while its charter capital as of the end of 2017 was VND137 million ($6,061). However, this may not be important as the firm has been constantly receiving foreign investment.

The booking application has just announced successfully calling for investment from Swiss-based real estate firm IHAG Holding. While the value of the investment was not disclosed, the Swiss investor assessed the firm’s value at $44.2 million.

Previously, Vntrip.vn also received investment from two foreign investors. Accordingly, Hong Kong-based Hendale Capital poured $10 million into the domestic firm. In 2016, when the business was started, Alibaba’s former chief technology officer John Wu also invested $3 million into the platform.

As of current time, Vntrip.vn has built a network with 10,000 hotels across the country and offers many promotions for customers booking at its hotel members to stand out among other online booking websites.

Shouldering losses for future gain is a common thing among startups. Along with Vntrip.vn, leading e-commerce platforms in Vietnam like Tiki, Lazada, and Shopee also reported losses of thousands of billions of VND. However, despite the high losses, e-commerce players continue looking at the market with optimism.

In 2015-2016, Lazada reported losses of VND1 trillion ($44.24 million), increasing its accumulated losses to VND2.7 trillion ($119.4 million) by the end of 2016. In a fiercely competitive market, Lazada’s losses in 2017 alone were VND1 trillion ($44.24 million) and its accumulated losses may be close to VND4 trillion ($176.96 million).

After seven years, Tiki has accumulated nearly VND600 million ($26.548) in losses, including VND308 billion ($13,628) in 2016 and VND284 billion ($12,566) in 2017.

Despite the losses, the platforms still received investments from a large number of investors.

Accordingly, China-based JD.com, Tiki’s biggest shareholder, in early 2018 poured $44 million into the e-commerce platform. In addition, VNG Group also invested VND384 million ($17,000) into Tiki. Japan-based Sumitomo Group holds 30 per cent of Tiki’s shares, and Japan-based Cyber Agent Venture Fund holds 15 per cent.

Lazada, with trillion-VND losses, also received $4 billion from Chinese e-commerce giant Alibaba.

Similar to the e-commerce market, the domestic online booking service market is still in its infancy, and the trend to risk losing money in order to gain a larger market share is forecasted to continue.

Van Anh

Copyright by https://www.vir.com.vn/