India SaaS adopts ‘Act East policy’ as firms find Southeast Asia lucrative

The report also predicts that Indian SaaS companies will collectively reach $35 billion in Annual Recurring Revenue (ARR) and capture 8% of the global SaaS market in the next five years. 

As SaaS firms increasingly find the product market fit with customers in India, the industry is now looking at the neighbouring regions particularly Southeast Asia for further scale-up. The size of the SaaS market in Southeast Asia is projected to be $3.4 billion in 2027, with a Compound Annual growth Rate (CAGR) of 10.73% from 2023-2027 making it lucrative for Indian companies.

Mint spoke to industry leaders in the SaaS space to understand the opportunities Southeast Asia has to offer and the companies’ strategy to gain market dominance in the region. 

India SaaS firms’ GTM strategy

“The success of Southeast Asian businesses in a wide range of industries from eCommerce to platform solutions and fintech have inspired a generation of local organisations to establish themselves as digital native businesses, which creates a strong demand for cloud solutions,” Praval Singh, VP – Marketing & Customer Experience at Zoho Corp said.

“Each market is unique, and therefore product localisation is a priority. We focus on ensuring all our offerings are fully operational in the main languages used in the region. Most of Zoho’s top products like Zoho CRM, Zoho Workplace, Zoho Mail, etc., include support for the main Southeast Asian languages like Malay, Vietnamese, Chinese, Thai, Filipino, Bahasa, Khmer, Lao, and Burmese,” he adds.

The Indian SaaS heavyweight Zoho Corp has long championed the idea of “transnational localism” which it defines as a growth approach where the firm expands by establishing local roots while staying globally connected. The firm currently has a local office in Singapore and Jakarta. 

Kapil Makhija, CEO of supply-chain based SaaS tech platform Unicommerce says, “we have enhanced our SaaS platform to address some of the most complicated processes including returns management and managing exchange workflows among others and this wealth of experience and learning directly translates into an advantage for us as we further expand into SEA.”

Unicommerce has local offices in four countries of Southeast Asia which includes Singapore, Indonesia, Philippines, and Malaysia. 

Also read: India’s SaaS industry bets on rural talent for further scale-up

Southeast Asia’s tryst with India SaaS

SaaS leaders say the response in the Southeast Asian countries for Indian tech offerings has been highly positive and enthusiastic. 

“We are working with 20 companies in SEA. In a short span, we have achieved an annual run rate of 4 mn transactions (as of April ‘23) which reaffirms our belief in the immense potential of the region,” Kapil adds.

Sparsh Gupta, CEO of Wingify says the company’s flagship VWO, a digital tech optimisation platform is witnessing solid response in the region. 

“SEA contributes to around 14% of VWO’s overall business but this has been growing really fast. Since January 2021, VWO’s revenue from SEA has increased by almost 41%. So while VWO’s business has grown overall across regions, the rate at which SEA has grown for us is much higher,” he adds.

Hiring trends and further expansions

“We are bullish on hiring local talent and I think each market has its unique challenges. Hiring talent in Singapore is extremely expensive and it’s competitive considering the high demand for SaaS talent. While hiring in the Philippines and Indonesia, we have to look deeper to find candidates with a detailed understanding of the SaaS ecosystem,” Unicommerce’s Kapil Makhija says. 

SaaS players who are currently on a mission to gain a foothold in the thriving Southeast Asian market also find greater potential in other geographies. 

“Just like Southeast Asia, the Middle East region has been undergoing significant digital transformation, countries like the United Arab Emirates, Saudi Arabia, Qatar, and Bahrain have been actively investing in diversifying their economies and promoting innovation-driven sectors,” Makhija adds.

The Middle-eastern countries too have been implementing policies and initiatives to promote digital transformation, smart cities and knowledge-based economies.

Wingify on the other hand is selectively hiring in the SEA region and eyes APAC and Latin America as the regions embrace digital transformation, anticipating a remarkable surge in demand for AB testing across various industries. 

Updated: 12 Jun 2023, 05:11 PM IST