How GoGoVan On-Demand Logistics Startup Created Hong Kong’s First Billion-Dollar Start-Up?
A 32-year-old high school pick and drop service created Hong Kong’s first billion-dollar start-up. Steven Lam always had an entrepreneurial spirit. He became creative in his teens and raised revenue from on-demand logistics startup. From teaching to fix bikes, selling electronics, serving dogs, and the school dropout, a 32-year-old man, got to progress from the low-income family towards raising more revenues.
The venture gave him the fame and the logistics became Hong Kong’s first billion-dollar startup. It was valued at $1 billion or more. The idea was born spontaneously. The idea came to Lam and his two partners when they were working on the business. One morning when they had to deliver 100, 000 boxes, it was very disorganized. Then, they had to find a solution.
They discovered the ad opportunity while working in a Chinese restaurant in California to support their MBA studies at Berkely. However, bringing it back to their native Hong Kong, they found a significant issue in distributing the boxes throughout the large city. It was the year 2013, and ride-hailing platforms were increasing in number internationally. But, the delivery industry in Hong Kong remained traditional. Lam used radio frequency systems to hire drivers for jobs.
For Lam, Nick Tang, and Reeve Kwan, their traditional methods were inefficient especially because they had to complete the most of their deliveries by 10 a.m. Therefore, they started thinking for a better solution.
Starting with a WhatsApp group:
When looking for a solution, they realized that they should find a practical solution. They thought to bring the trusted drivers on one platform to deliver efficiency. At that time, they had not any intention of disrupting an entire industry as Uber did. They merely wanted to make their business process simpler.
Their idea worked well. Drivers responded to jobs, but due to the limitation of WhatsApp groups, which were limited to 10 participants, it became difficult for them to use first come first served policy.
It solved some of the delivery problems. However, they decided to increase the group which was not possible on Whatsapp at that time. The radio frequency system helped to almost 20 business owners, but they found a more significant issue that drivers were dissatisfied with the radio frequency system. At that point, on-demand logistics platform GoGoVan came in front of people.
On-Demand solutions, The Road to Success:
Lam and his two co-founders had thought the idea, and now it was the time to implement it by hiring the people who could make their idea a reality. So the pooled together 20,000 Hong Kong dollars, hired the office in Hong Kong’s Kowloon district, and got the services of their first two employees that included a technical engineer and a designer.
With a larger platform that was much better in speed than the speed of the radio frequency system, the team quickly showed interest from drivers and other businesses.
How they Raised Funding?
The company faced some problems nine months after starting the business. The company successfully managed one of the funding schemes available in the city at that time: A micro fund of 100,000 Hong Kong dollars ($12,812). Lam told that funding saved their lives from the edge. After nine months of starting the business, they get stability and various channels to raise funds, allowing it to increase their office size three times and expand the business internationally.
In early 2016, GoGoVan received funding from Jack Ma’s Alibaba; then, in mid-2017, it got the unicorn status after the merger with Chinese logistics company 58 Suyun.
As a result, the start-up today boasts a network of 8 million drivers spanning 300 cities and six countries.
Despite the increasing success, Lam told that his time spent watching the pennies in his early years and has been instrumental in reaching those milestones. He managed the business even in limited resources that boosted the revenues. He also did office cleaning in early days on weekends because of the limited resources. It is that mentality of not waiting for someone else to fix the problem instead to fix it yourself.
Steven Lam, co-founder, and CEO of GoGoVan suggested that if you want to achieve business success, wait and take a start. He shared his experience and told that there is no perfect timing to start a business. Most of the people are unaware of that ideal strategy. Therefore, they should not wait for the perfect timing.
Amazon says that he needs 70 percent information to take the decision, not 100 percent. If you wait for 100 percent of the data, it will be too late. Therefore, taking some decision is better than not making a decision. Lam said that what right is to take a start. If you don’t start, you will not get a path to success and will not become capable of reaching towards your goals.
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