On Tuesday, August 23, the Malaysian digital payment company Starbox Group rose more than 1,000% on the first day of its US IPO, reaching a maximum of US$46.21 and closing at US$15.4, an increase of 285%. The company’s offering price is $4.
Founded in 2019 and headquartered in Kuala Lumpur, Malaysia, Starbox provides a local payment app for cash rebates. The company builds a business ecosystem of cash rebates, digital advertising and payment solutions, and develops internal data management systems for effective marketing targeting micro, small and medium businesses that lack bandwidth. Its business model is to connect retail merchants with retail shoppers through its subsidiary in Malaysia, facilitate transactions through cash rebates offered by retail merchants, provide digital advertising services to advertisers, and provide payment solutions services to merchants. Almost all of the company’s current operations are located in Malaysia.
The company plans to use 60% of the raised funds to expand its business to other countries in Southeast Asia. According to the prospectus, the Southeast Asian market has broad prospects. The compound annual growth rate of the cash rebate and coupon market, e-commerce and digital advertising industry in the next five years will reach 23%, 20%, and 9.3% respectively, and the industry scale will be 70% by 2026. billion, $234.5 billion, and $15.9 billion.
Cashback is the foundation of the commerce ecosystem that Starbucks is building, with the company partnering with retailers who register as “merchants” on its GETBATS website and app to offer cashback on their products or services, attracting shoppers to sign up as members to earn Cash back on shopping. As the number of members grows and the sales of existing merchants increase, more retailers are willing to cooperate with the company, forming a virtuous circle.
In terms of operating data, the company has achieved a leap. The number of members has increased from 66,000 in fiscal year 2020 to 510,000 in fiscal year 2021, an increase of nearly 7 times, and further increased to 610,000 in the first half of fiscal year 2022. During the same period, the number of merchants increased by more than 50%, and the latest data was 799. In terms of the number of transactions facilitated, there were less than 2,000 transactions in fiscal year 2020, an explosive growth of nearly 300,000 transactions in fiscal year 2021, and nearly 200,000 transactions in the first half of fiscal year 2022.
With the rapid development of the industry, the company’s business has achieved good results. Revenue increased nearly 20-fold from $154,000 in fiscal 2020 to $3.166 million in fiscal 2021. Net profit went from a loss of $210,000 to a profit of $1.45 million, with a net profit margin of 46%. In the first half of this year, it still maintained a rapid growth momentum, with revenue and net profit of US$2.92 million and US$1.26 million respectively.