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The SpeakAsia Story: E-commerce Innovation or Fraud?

Zafar Anjum | Jan. 17, 2014
Has SpeakAsia, a Singapore-registered company, taken the concept of e-commerce and social media too far? The company has run afoul of the Indian government, with its assets frozen, officials arrested on charges of fraud and money laundering in India to the tune of US$ 368 million. In an exclusive interview with Computerworld Singapore, the company’s embattled CEO Manoj Kumar Sharma explains what went wrong with his company in India.

The police charge sheet, however, reveals that that during the relevant period in 2010, Manoj Kumar Sharma was holding 90% shares of Speak Asia Online Pte Ltd. (Earlier, the company was known as Haren Technologies Pte. Ltd)

The company's various activities are managed by different organizations (the factoral organization model), which has raised suspicions in the minds of the Indian authorities. For example, Haren Ventures Pte. Ltd, (HVP) managed the ezines parts of the business. Tulsiyat Tek Pvt Ltd. Mumbai was its collection agent in India and La Marca Advisory Pvt Ltd provided content for its training programmes and so on.

The company's earning potential included components such as ezine sales, survey filing, product referrals and sales, and advertising-based surveys[3]. When the company was about to be shut down, Sharma says he was negotiating with some news TV channels to buy them.

"The idea was very simple," says Sharma. "Aggregate the consumer first, understand their need and requirements, and then offer them a choice of brands in the same product category.  The logic was that if SpeakAsia had a confirmed expression of interest for a product from a consumer then it could drive a hard bargain for a better price and commercial terms with the manufacturer directly." The company wanted to sell mobile phones and TV sets, for example, after sourcing them from China (from Hisense) with the SpeakAsia brand.

According to Sharma, the company sold a total number of 26,500 TV sets ( 21000 - 22" LCD and 5,500- 32" LED sets). "These TV's are currently lying in customs incurring huge demurrage costs and facing obsolescence," he says. "The total number of Smart Phones sold were around 48,500. This was our sale in first 10 days. If we were allowed to function, mathematically we would have sold more flat screen TVs than Samsung, LG, and Sony put together. Hisense is one of the largest TV makers."

The company's stated mission is to create the largest community of well-informed consumers, who can collectively leverage their consumer power for mutual benefit.

SpeakAsia started its first operations in India in 2010 and was in phase 1, till June of 2011. It had acquired 1.2 million panellists by then. With tremendous success under its belt, SpeakAsia had laid out ambitious plans for itself for the next 24 months, with the grand aim of enrolling 10 million panellists.

Sharma says that until May 11, 2011, there was not even a single complaint against SpeakAsia or its employees by Panellists or government authorities either with respect to any payment or with respect to its business model.

All went wrong on May 11, 2011 when the company was organising a grand exhibition in Goa called Gen-X Bazzar, where it invited its panellists to see a range of products to be sold through the SpeakAsia network.

 

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