Lai Chang Wen, founder and CEO, Ninja Van. (PHOTO: Yahoo Finance Singapore) ·Yahoo Finance Singapore
SINGAPORE — The road to profitability has been a challenging and murky one for tech-enabled logistics company Ninja Van.
Over the past 10 years, the Alibaba-backed firm has emerged rapidly as a key regional player in the e-commerce logistics sector. It operates across six markets in Southeast Asia, where it has achieved profitability in "certain markets" but not all.
As part of its strategy to improve profitability, the firm launched its business-to-business (B2B) restock and cold chain solutions in April 2024 that promised to increase supply chain efficiency for businesses. With that, the company hoped to achieve better profitability in 12 months.
"Overall, we are getting close to EBITDA positive as a group. The booster and the margins come from B2B and cold chain, where if we integrate our capabilities into our existing fleet, we are just so much more efficient that it's a win-win all around," said founder and chief executive Lai Chang Wen in an interview with Yahoo Finance Singapore.
Several weeks after the announcement, however, the firm said that it would be laying off about 10 per cent of its regional tech team in a cost-optimisation move.
"Cost optimisation has always been an ongoing lever to ensure Ninja Van Group’s sustainable growth," the company said in a statement.
Day zero spirit
For 37-year-old Lai, the company's current challenges are reminiscent of those faced during its inception in 2014, albeit on a larger scale. While he no longer has to drive the delivery vans himself like he did in the early days, Lai believes that it is important to keep that "day zero" spirit.
Founded in 2014 by Lai along with co-founders Shaun Chong, 41, and Boxian Tan, 37, Ninja Van was born out of the pain point that the trio experienced in trying to make deliveries for their online fashion company, Marcella.
The lack of good logistics networks and infrastructure for e-commerce at the time gave the trio a new business idea to pivot to. With the help of friends and family, they purchased a second-hand van to kickstart the venture. Today, Ninja Van has a fleet of over 35,000 vehicles and delivers close to two million parcels a day, on average.
"It's like how we opened our first vans, started our first countries, and scaled up in e-commerce. The same thing applies, which is we don't go in blind, have a good view of which mountain top we want to reach, but we find our own way to do it, and we do it fast.
"There are still a lot of similarities between the culture then and now. The only difference is that now, every night, I sleep at home, but back then, every night, I slept in the office," said Lai.
In the 10 years of helming the company, Lai said that the biggest challenge he faced was in trying to be "very clear-headed" about what worked and didn't work and "sticking to our guns even though the market seemed to be proving us wrong". He was referring to the first five to seven years of Ninja Van's existence, a period when new tech start-ups were booming and many tech-related business models were widely embraced.
"People were saying, 'Why don't you move towards complete ride-sharing models and let your drivers work when they want to, the gig economy, optimise this and that, and use tech to make magic happen?'
"Thankfully, because we were more grounded and ran the operations ourselves, we realised that atoms and bits are not always the same. The physical and the digital world don't always gel together. When you deal with people, it's not just about instructions. There's a human element to it...," said Lai.
Ignore monetary comfort and so on – I think those are secondary. It's the experience and learning which I've had that I think is unparalleled, compared to if I were to stay in the corporate world.Lai Chang Wen, founder and CEO, Ninja Van
Being doubted in such a way from many quarters allowed Lai to learn how to say no, which he said was one of the most important lessons he has learned. However, he added that saying no should be done in a "non-egoistic, non-defensive way" and not just for the sake of it.
"It's easy to say no and this is wrong, but do you come from a position of thoughtfulness, or do you come from a position of intellectual arrogance? That's a fine line to thread," said Lai.
Unparalleled learnings
Given the difficulties of the entrepreneurial path, was it all worth it for Lai? According to Lai, who prior to embarking on starting his own company was a trader at an international bank, the entire experience can be viewed as "the best MBA programme ever".
"A lot of responsibilities, decisions or experiences were thrust unto me regardless of whether I was ready or not, and truth be told, in some of those decision-making and scenarios, I'm sure someone else could've done it better," said Lai.
However, he added that starting his own business had allowed him to "learn quickly and fail quickly", lessons which he considers to be "invaluable".
"Ignore monetary comfort and so on – I think those are secondary. It's the experience and learning which I've had that I think is unparalleled, compared to if I were to stay in the corporate world," he shared.
Additionally, Lai emphasised the importance of being in a learning environment for any aspiring entrepreneurs out there.
"Starting your own business isn't a shortcut to getting all the experience. It could actually be a long, meandering way. We were lucky that despite mistakes along the way, the business developed to a level where one must say there must be certain things we've done right.
"But there are too many times when people say 'I want to just do my own thing because I don't want to report to a boss... That's probably the worst reason why you should start your own business," he added.
