Customers buy online in installments from 100,000 VND, until they have enough 1 gold thread, go to the shop to pick up the goods
The last founder to appear in Shark Tank Vietnam season 5 episode 1 is Hana Ngo, CEO of HanaGold, a jewelry store chain that applies 4.0 technology in management and business.
Hana Ngo said that when she was 5-6 years old, she saw the image of her grandmother, the mother who spends every little bit of money every month to buy accumulated gold at the end of the month. That made her intent on how to make it easier for Vietnamese people to accumulate gold. Therefore, HanaGold was born.
Specifically, at HanaGold, customers can buy accumulated gold online from only 100,000 VND and when they have enough 1 gold coin, they can receive gold directly at HanaGold stores or franchised stores nationwide. Currently, HanaGold has built 3 physical stores. In addition, with the franchise model, investors only need to spend 500,000 VND to own a 4.0 jewelry store.
Coming to Shark Tank Vietnam, Hana Ngo called for an investment of $200,000 for a 10% stake.
In response to the question of Shark Hung and Shark Hung Anh about the constantly fluctuating gold price, Hana Ngo said the gold price will be calculated at the time of purchase. The balance of cash flow when the gold price is different between the time of purchase and delivery of gold is the responsibility of Hana Gold.
This makes Shark Hung concerned about risks. “I bought your gold at the moment, the price is close to 70 million. After 7 months, when I received it, when it reached 100 million, I didn’t have money to buy physical gold to pay you”Shark Hung doubts.
Regarding the business situation, the female founder said that HanaGold was established in 2020. Startup currently has more than 15,000 customers using mobile applications. Of which, about 30% have purchased goods.
Regarding the financial picture, Hana Ngo said that the charter capital of the enterprise is 10 billion dong from 3 shareholders. Hana Ngo currently holds 60% of the shares. The total cost since its establishment in 2020 until now has used up 7 billion VND. In terms of revenue, in 2020 and 2021 alone, the business is “frozen”. Revenue in the first quarter of 2022 ranges from VND 500 million to VND 1 billion.
The model has many potential risks, all 5 “sharks” refuse
In response to questions from Sharks about ensuring responsibility for buyers if they go bankrupt, Hana Ngo said that HanaGold currently has a mechanism for setting up a reserve fund like banks. The problem, she said, is “in trust”.
However, the female founder’s explanation did not receive the agreement of the Sharks. “In the principle of investment, especially financial investment, the mechanism is important. Of course, there must be trust, but trust is believing in the mechanism, ie not cheating, not cheating, not believing. on a particular individual”Shark Hung analyzed.
Shark Hung also added that the up and down gold price will affect the startup’s decision at the time of handing over gold to customers, because then there may be an imbalance with the collected cash flow. Moreover, the method of franchising gold shops adds another intermediary risk when the startup delivers gold to the franchise store and then delivers it to customers, while the money is collected by the startup. Therefore, Shark Hung refused to invest in the startup.
Similar to Shark Hung, Shark Lien and Shark Hung Anh simultaneously withdrew because of the high-risk model. Even Shark Hung Anh has repeatedly emphasized this and advised the startup to review its model.
Meanwhile, Shark Binh affirmed that the 4.0 gold shop franchise model offered by the startup is not feasible. Shark believes that 4.0 or technology is not a magic wand and there are still businesses that cannot be changed. Due to not believing in the successful future of the business model, the “shark” from NextTech quickly withdrew like 3 tankmates.
As someone who focuses on the financial picture, Shark Phu analyzed that the gold-selling startup has been preparing for 2 years, deploying for 3 months, but the revenue is only 1 billion VND is a problem.
That shows that customers do not yet trust the business. “No one knew about me, I forced people to give money first for me to keep, and then I declared ‘I have a secret to balance it, I have a backup’… For example, the State Bank makes a reserve, the bank Commercial goods must be kept by the State Bank to have a backup meaning. But I have a backup in the safe, if I pull out the safe tomorrow, it’s not a backup.” Shark Phu analyzed and also decided not to invest.
It is known that the jewelry store chain HanaGold won the third prize of the Techfest 2021 startup talent competition thanks to its solution to digitize the gold, silver and gems business. However, at this year’s Shark Tank, this startup had to leave empty-handed.
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