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HSBC Asset Management, the investment arm of Britain’s HSBC Group, has led a $4 million seed round in Singaporean customer data and risk assessment startup Bizbaz, the two said on Friday.
Founded in June 2019, Bizbaaz provides proprietary customer data and risk management solutions to banks, insurance companies and fintech startups. The startup attracted about 20 people with backgrounds in behavioral science, health technology, AI and data.
“The problem we’re trying to solve is enabling whether it’s a financial institution, fintech company or any type of B2C company trying to find or onboard new customers,” said CEO and co-founder Hayek Hakobian. of BizBuzz, in an interview with TechCrunch.
In many Asian countries, up to 80% of the local population does not have credit bureau information and scores to help banks and companies understand their financial situation and effectively write their creditors. Bizbaaz is trying to solve this problem by finding alternative ways to build the credit profile of individuals.
A number of companies in Asia are taking a similar approach today, checking people’s social media profiles and telco records. Hakobian said such research requires a high degree of accuracy and some industry practices raise privacy concerns.
By contrast, BizBaz looks at existing data attributes, including social media profiles and the apps people have installed on their smartphones – and use frequently. It can also assess a person’s personality and risk tolerance by talking to them for about 45 seconds without a smartphone, Hakobian said.
Analyzing individuals’ appetites through their multiple digital footprints, the startup can limit false positives and identify people trying to cheat the system.
“Of course, false positives cannot be 0% because in theory you cannot eliminate all cases, but we do our best technologically to eliminate or reduce this possibility before training our data systems. The test, during the test and when you get to the actual deployment,” explained Hakobian.
Bizbaz has different templates based on countries and industries. He also developed solutions that incorporate the customer’s data rather than using one offering for all of his customers.
The development team at Bizbaz operates primarily from Israel, the data team is based in India, and the sales, business development and product teams operate from Israel, Singapore, Vietnam and Malaysia.
The investment from HSBC, which typically doesn’t support early-stage startups, is interesting for BizBaz. Hakobian said the startup’s suite of solutions — and the backing of New Jersey-based VC firm SOSV — helped seal the deal.
“In SAN, the middle class is expected to more than double between now and 2030, reaching 334 million people. Financial services can expand just as quickly, if not faster. Our investments in Bizbaaz provide compelling exposure to this market shift in the region and other emerging economies. Remy Bourette, head of venture investments at HSBC Asset Management, said in a prepared statement: “It supports the development of the technology, which overcomes the main barriers faced by on-boarding customers without prior financial records.”
The startup is in talks to deploy its solutions across HSBC divisions in Asia and Europe, he said, adding that Hakobian will have the ability to operate autonomously and bring on other partners as well as clients such as new banks and insurance companies.
Bizbaaz plans to spend 20–30% of the hot fund on the service as it has generated sales through word of mouth and referrals so far. The startup aims to improve its website presence, hire more data and software developers as well as data and behavioral analysts, and devote some resources to product development, Hakobian told TechCrush.
Paul Redburn, senior consultant at BizBath, said the startup has seen positive revenue growth every month.
The all-equity round was led by Southeast Asian venture capital firm Vynn Capital and new angel investors, along with ongoing investments from SOSV and existing angel investors. Before the final round, Bizbaaz raised $300,000 in an angel round.
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