In our last article, we introduced several FinTech startups that have a significant positive social impact. FundPark is a great example as it bridges the financing needs of the underserved Small and Medium Enterprises (“SMEs”). Paywatch, another great example, offers an affordable financing option for employees with regular salary income through its Earned Wage Access (“EWA”) platform. On the sustainability front, Seneca ESG provides a comprehensive platform for corporations to collect, analyze, and report their Environment, Social, and Governance (“ESG”) data.
Our Managing Partner Edward Shen recently sat down with Anson Suen, co-founder and CEO of FundPark, and talked about their vision and mission, how they help e-commerce SMEs realize the growth potential, the innovative nature of their proprietary risk management model, and the positive social impact.
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Introduction of FundPark
Edward: Hi Anson, good to see you. Can you give us a brief introduction of FundPark?
Anson: FundPark is on a mission to unlock the growth potential of SMEs by providing accessible, efficient financial services underpinned by cutting-edge technology and data analytics. Our primary focus is on digital SMEs. We empower our clients to make the most of their operational data, offering them relevant financial services and providing support customized to their unique needs.
As you know, we're witnessing a significant upswing in online business activity stemming from two key trends: traditional businesses transitioning from brick-and-mortar to digital platforms, and the emergence of new enterprises establishing an online presence from the outset.
At FundPark, we provide robust support to companies in navigating their transformation from offline to online. Simultaneously, we help entrepreneurial ventures looking to build their digital businesses from the ground up. By doing so, we contribute to a more vibrant and dynamic online commercial landscape.
Edward: What inspired you to start FundPark and what is your vision for the company?
Anson: While still at university, my co-founder and I launched our entrepreneurial journey as one of the first e-commerce sellers in Hong Kong. Capitalizing on the increasing demand for smartphone accessories, we sold high-quality, competitively-priced products on platforms like eBay and Groupon, leading to substantial business growth.
However, when we tried to scale up, we hit a stumbling block – traditional banks were unfamiliar with the digital landscape and hesitant to underwrite loans for SMEs. Like many other SMEs, despite having a solid credit profile and robust business model, and their overall significant contribution to the economy, a significant funding gap exists.
Following graduation, I joined HSBC Commercial Bank, where I gained valuable insights into commercial banking operations and their interactions with large corporates. It was apparent that a large segment of SMEs was underbanked and underserved.
Faced with this challenge, I decided, that this would be an opportunity to create a solution to bridge that gap. This experience and realization served as the inspiration behind the founding of FundPark.
Edward: What is FundPark’s business model and value proposition?
Anson: One of the most significant challenges faced by SMEs is securing funding to support their working capital, whether they are transitioning their business model or embarking on their online journey.
Our goal at FundPark is to expand our financial solutions to a broad spectrum of e-commerce SMEs. To achieve this, we rely on diverse funding sources, which include banks, family offices, and other financial institutions. Of course these partners not only provide the necessary funding, but they also receive a return on their investment. We then allocate this capital to SMEs, a sector vital to the economy, contributing significantly to GDP growth and employment.
FundPark operates as a data-driven technology platform, offering scalable business models that provide financial solutions to e-commerce SMEs. We pride ourselves on our robust risk management strategy, serving as a bridge that addresses the funding gap between SMEs in need of funds and providers of such funds.
Since our platform went live in 2017, our focus has been primarily on e-commerce for two reasons. Firstly, e-commerce is a vast market. In fact, in 2022, the Gross Merchandise Value (“GMV”) for cross-border e-commerce in China hit a staggering CNY 2.11 trillion or US$297 billion. Secondly, FundPark is passionate about harnessing the power of data analytics, and the e-commerce industry provides an optimal match with its visible and readily available data.
Edward: How is FundPark regulated?
Anson: FundPark’s operational branch in Hong Kong is a licensed money lender, adhering strictly to the Money Lender Ordinance in our handling procedures of Know Your Customer (“KYC”) and Anti-Money Laundering (“AML”). We are proud to uphold the same high standards as traditional banks in this regard. This commitment is rooted in my experience working with HSBC, where I became familiar with rigorous KYC/AML standards. Upholding these standards is integral to our aim of building a sustainable business.
Challenges Overcome and Future Expansion Plan
Edward: What challenges has FundPark faced in its journey, and how has FundPark overcome them?
Anson: The pandemic rapidly propelled the transition from offline to online business, leading to a substantial increase in e-commerce transactions. Simultaneously, the pandemic-induced credit crunch posed a challenge as we saw a surge in both business performance and financing needs from e-commerce SMEs, while financial resources struggled to meet the demand. As a response, we are actively fostering relationships with a broader range of sophisticated funding sources. Currently, our network includes commercial banks, investment banks, family offices, and private credit funds, ensuring a steady supply of capital to support the booming needs of our e-commerce SME clients.
Edward: What are FundPark’s plans for expanding its services or operations in the future?
Anson: At FundPark, our commitment extends beyond just providing financial solutions. We go a step further by offering valuable business insights that can foster growth and improve operational efficiency for our clients. These insights, backed by our strong data analytics capabilities, are tailored to support decision-making, define strategy, and to identify potential growth opportunities in the dynamic e-commerce space.
Further, we also plan to continue to innovate and broaden our solution set, to meet the evolving needs of our clients. This, we believe, will help them navigate the financial landscape more effectively, while allowing us to provide more holistic solutions to their unique challenges.
As part of our growth strategy, we envisage expanding our geographic footprint beyond Greater China. While we have made significant strides in serving the cross-border e-commerce SMEs sector in Greater China, our long-term goal is to extend our services to other regions, where we can support underbanked and underserved digital SMEs in different markets. In this way, we hope to fulfill our ambition to reach and support a wider range of businesses and help them thrive in an increasingly digital economy.
Social Impact
Edward: Why is the financing for e-commerce SMEs particularly important in Asia?
Anson: SMEs form the foundation of the global economy, constituting approximately 50 percent of employment and 90 percent of all businesses. SMEs also play a crucial role in the economic landscape of Asia, making significant contributions to GDP, employment, and supporting a substantial portion of the population. Additionally, e-commerce and integration with value chains can greatly empower SMEs, enabling them to effectively compete and achieve growth. The importance of financing for e-commerce SMEs in this region cannot be overstated.
In China, e-commerce constitutes a staggering 45% of the economy, while it represents 20% globally, and 10% in the ASEAN region. The rapid growth of e-commerce, particularly in ASEAN, is fueled by a transformative shift in consumer spending behavior towards online platforms. As this sector expands, the demand for innovative and adaptable financial solutions is increasing substantially.
Therefore, to support this booming industry and the SMEs that power it, traditional lending practices and underwriting methodologies need to be revolutionized. Tailored financial support for e-commerce SMEs isn’t just about fueling growth, it’s about enabling a shift in economic power and fostering sustainable development in the digital age.
Edward: What is your vision for FundPark in the long term, and what kind of impact do you hope to make on the e-commerce SMEs financing landscape?
Anson: FundPark seeks to play a pivotal role in the e-commerce SMEs financing landscape by empowering visionary entrepreneurs and business owners. Our goal is to help them scale up their operations without being hampered by limited working capital. We aim to foster financial inclusion and contribute to economic growth, ultimately leading to an increase in employment opportunities via the expansion of e-commerce SMEs. In essence, FundPark’s impact is not only to fuel business growth but to also stimulate the wider economy by fostering a thriving ecosystem of flourishing e-commerce SMEs.
Edward: Anson, thank you very much for sharing with us the vision and mission of FundPark, what inspired you to found FundPark, the challenges you have overcome, future expansion plan as well as the social impact in this session. In the next session, we will deep dive into the product features, the proprietary underwriting procedures and post-drawdown risk management by leveraging live data which is the key differentiator of FundPark. Speak to you again soon.
QIDS Venture Partners is dedicated to supporting and catalysing the developments in FinTech by sharing with our audience FinTech trends and interesting FinTech business ideas. You may forward this article to other investors who are interested in FinTech as well. If you need more information or would like to arrange a meeting with us, please feel free to contact our Managing Partner Edward Shen via LinkedIn or email.
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