The recent investment in Market Engine means AusPost has now passed on two critical growth opportunities

- September 14, 2015 2 MIN READ

As I have stated many times in the last 12 months, the current opportunities in the ecommerce sector are plentiful. The B2C ecommerce space alone is set to hit $2 trillion this year, and this has enabled startups offering solutions that support the growth of this space to become very valuable commodities.

The downside, however, is that instead of Australian companies jumping on board with cheques to support these companies, we have overseas players coughing up the cash that will eventually find its way back to their bottom line, supporting the economies they are part of instead of ours.

The two most prominent examples that come to mind are the recent undisclosed multimillion-dollar funding round from UK’s Royal Mail into Australian delivery management startup Market Engine and the $50 million round from French company Neopost into ecommerce freight quoting startup Temando.

Founded by Roy Hui and Nathan Ruff, Market Engine is a cloud-based platform that allows companies to have a fully translated online shopfront for countries such as China, without the need for a bricks-and-mortar presence. Market Engine plugs into the world’s largest e-commerce sites including Alibaba’s TMALL and JD and provides real-time reporting, currency conversions and secure transactions, as well as an on-the-ground marketing and customer support team based in China.

Hui, who is also CEO of the company, said Market Engine removes the usual barriers to entry for retailers wanting to get into the Chinese or other Asian markets. The startup helps people access the $580 billion ecommerce market in China – something that Royal Mail is now going reap the benefits of.

Similarly, the reason that Temando, founded by Carl Hartmann, appealed to Neopost is because it fits so nicely into the company’s overarching goal to protect its mailroom solutions business and the technology owned by Temando will help it do that. It allows Neopost to own a stake in an end-to-end mailroom solution – it had everything else except the software part of things at the time of investing, and Temando will be able to help push the company’s PackCity product and white label shipping solutions.

Temando is the the perfect complementary software product to Neopost’s range of mailroom hardware and services. In the same way that Neopost will be able to leverage Temando, Temando will be able to leverage its new relationship with Neopost to grow – in fact, it would be able to accelerate growth at an even faster pace, and at the end of the day, France will benefit financially from it.

The fact that Australia has missed out on these two very significant opportunities in the space is an issue. The opportunities were not identified by companies that should have a stake in the arena like Australia Post is problematic.

Clearly, more work needs to be done to bridge the gap of understanding between Australian corporates and startups. Not only will it benefit the startup, it will also helps the corporate ecosystem diversify. Most importantly, it keeps revenues in Australia, which can be invested back into the local business ecosystem.