As the economic climate continues to intensify, the environment for startups looking to evolve their business and flourish is becoming increasingly challenging.
For the latest edition of StartUp Sessions, we spoke to Asad Jumabhoy, co-founder and CEO of utu, a startup from Singapore looking to evolve the travel shopping sector after recently raising $33 million in funding to boost global expansion.
PE: Firstly, are you able to tell us more about your Startup and the role you play in the payments industry?
Asad Jumabhoy: utu is focused on driving additional value for tourists who shop tax-free. We do not handle the VAT refund process, but we are building a fintech layer above the VAT refund infrastructure that squeezes out additional value for shops, shoppers and VAT Refund Operators (VROs).
We do this by increasing the value of VAT refund amounts when tourists choose to receive their VAT refund in the form of rewards like hotel points, airmiles (post-travel) and shopping vouchers (during travel) with our partner stores. The key to unlocking our ecosystem is to sign up with a free Visa issued utu Tax Free Card.
PE: Can you detail some of the challenges in gaining funding and building momentum during a tough economic climate?
AJ: We had raised a small round of funding several months before the pandemic hit which we used to keep our staff employed. Coming out of the pandemic, people often ask ‘revenge travel is back, you guys must be doing great’. Not true.
To go through something like Covid, having barely launched in the market and having to come through a major refinance of the company was one of the most difficult things to do – it was a question of survival. We are indeed blessed that we saw a synergistic fit with Standard Chartered Ventures’ (SCV) CardsPal, and SCV believed in our long-term strategy. We are now primed for growth and look forward to bringing a slew of new products to market in the coming weeks and months.
PE: In terms of your roadmap, what are your goals for the future and how do you plan on reaching them?
AJ: Over the next few months, we will be realizing our three strategic product pillars going forward, utu Miles, utu Privileges and a new local points proposition. With utu Miles we have managed to increase the amount we upsize VAT refunds from 25% to 40%. So, when you choose to receive, say a €100 VAT refund from Global Blue to your Visa issued utu Tax Free Card, our rewards engine will convert that into €140 worth of air miles or hotel points. We will also be introducing features such as status match and new features to our membership tiers.
utu Privileges adds value to all stakeholders in the ecosystem by incentivizing tourists to bring VAT refund money that is leaving the shop and the country back to make a second spend by offering up to double the VAT refund to be received as a voucher to shop again. We are not looking to replace the VAT refund operator but rather, grow the pie for everyone involved.
Finally, with our recent acquisition of CardsPal, we will be updating the app to provide a seamless, scalable local rewards experience.
PE: As your company grows, can you tell us some of the key challenges and how have you evolved to meet them?
AJ: I think the product suite and strategy post-fundraise for utu is now stronger than ever. The journey to get here, however, has been a series of twists and turns. From starting out as a disruptor, and now to innovating atop the VAT refund infrastructure and breaking new ground with industry-first products, we have had to learn to be flexible.
PE: Can you tell us more about some of the challenges involved in hiring and acquiring as a startup?
Aj: Going through an M&A as a young company was a very interesting experience. I had done it as a career professional in larger organizations but the challenges facing the combination of two startups is a different proposition entirely.
What I’ve started to lean into more, at this stage of the company, is solving human issues. Many of the staff at utu are relatively young in their careers and one of my biggest roles is to help guide them through career-defining events, such as an acquisition and merging of teams. It has not always been easy, but it can be incredibly rewarding.
