HONG KONG-- It seems like a humble business in a relatively small and crowded market, yet Honestbee, a grocery delivery service based in Singapore, has managed to attract funding from some of world's most successful technology investors.
The online start-up company has raised $15 million in funding led by Formation 8, an Asian-focused investment firm based in Silicon Valley, and including investors such as Steve Chen, one of the co-founders of YouTube; Gideon Yu, a former chief financial officer at Facebook; and Owen T. Van Natta, formerly of Amazon.com.
This is the first round of outside funding for Honestbee, which has been operating in Singapore since July, and is about to launch in Hong Kong and has longer term plans to expand into other Asian markets, including Taiwan.
The business model is simple. Customers place orders online for groceries, and one of the company's "bees" will deliver the items within an hour. A 60 Hong Kong dollar ($7.7) fee is levied on delivery orders of less than HK$250.
The bees are trained to handpick produce and good cuts of meat or fish for the presumably demanding and well-heeled customers able to afford the cost of a delivery, not to mention the product. In Hong Kong, Honestbee is partnering with several high-end food partners, including Great and Anything But Salad.
Honestbee joins other competitors in the Asian online grocery market, including RedMart, in counting on the maxim that time equals money for busy Asians, known for having some of the world's longest working hours.
"In this fast-paced city, we aim to bring quality products to our customers at their convenience with the best service so they can spend more time on what matters most to them," said Honestbee co-founder and CEO Joel Sng in announcing its Hong Kong launch.
While initially operating in only two neighborhoods on Hong Kong island, the company has already hired 40-50 "bees" -- mainly freelancers such as college students or housewives.
Formation 8 said it sees great potential in Asian on-demand markets, which it thinks will play a significant role in evolution of future retail commerce in the region. "Given the increasing population density across all the key cities in Asia due to job and wealth creation, this is the right time and opportunity," said Formation 8 founder's Brian Koo. "Consumers now demand higher levels of access to convenience. With Honestbee's superior partnership network and its strong focus on building a world-class technology company, they will be well-positioned to quickly own this market."
Honestbee said it will announce new partners and expand their services to Taiwan and other parts of Asia by June 2016.