The Building Blocks to Secure Angel Investment

Phichith Kunthakcheat talks to Kiripost about how he used his determination to push through hardships to see his digital marketing agency receive the first investment from Cambodian Angel Investors Network.
Phichith Kunthakcheat, 27, managing director of digital marketing agency Zooms Group (Kiripost/Siv Channa)
Phichith Kunthakcheat, 27, managing director of digital marketing agency Zooms Group (Kiripost/Siv Channa)

Phichith Kunthakcheat is the managing director of digital marketing agency, Zooms Group, which received an undisclosed, first-ever investment from Cambodian Angel Investors Network (CAIN) as part of a $5 million investment pie of CiC Capital Partners to expand its operations and digital service platforms.

The 27-year-old managing director told Kiripost about how he learned from his past failures to remain focused, an extraordinary experience to run his current company.

How it all began

When Phichith Kunthakcheat was a university student, he started side-hustle work and an internship. Quick-witted, the second-year graphic design student at Zaman University (now Paragon International University) ventured into freelancing design work.

He started to intern at companies in 2013, when he was in his early 20. Curious and creative, he kept developing his skill sets. The young junior often asked his senior staff to give him more work.

In 2017, Kunthakcheat started to form a small team with three members offering graphic design services. His team quickly grew to more than 10, when he got the confidence to take on big jobs, including event management, printing, and poster design, in addition to his specialized graphic design work.

“At that time, I was a brave young lad who accepted big jobs and hired staff because I could earn some revenue.” However, the good times didn’t last long.

When service offerings were declining, he began to lose money and fell into debt with friends and family. “We failed because we were doing many things at the same time. Nobody helped manage all the workloads.”

Phichith Kunthakcheat (Kiripost/Siv Channa)
Phichith Kunthakcheat (Kiripost/Siv Channa)

“We decided to cut work, reduce staff, eliminate our event management service, and focus on poster design. We failed because we lost our focus.” He advised, “We should not start up with more than one service at the same time.”

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Building long-term client relationships and staying focused

Now he heads Zooms Groups, which he co-founded in 2019 with a few others he has known over the years. “I decided to launch a digital marketing company with a subscription business model (SBM).” Part of the Zooms Group, with more than 400 clients, are Zooms Design and Zooms Digital.

He saw SBM in 2015 as an opportunity. So he delved deeper into it to introduce it in the Cambodian market.

“When SBM-based Zooms Group was introduced in the market, it made prices for customers suitable for long-term relationships.”

Kunthakcheat doesn't expect a one-time order, done, and then gone. He wants to build a sustainable relationship with clients.

Kunthakcheat told Kiripost in an interview at Factory Phnom Penh, a hub and co-working space for startups, that, “Compared with my previous freelancing work, it’s now totally different. Each co-founder has sets of skills and talents to handle challenges and work​, which means working less and earning more.”

He recently moved his office to Factory Phnom Penh to better accommodate his staff.

Among Zooms Group’s clients are global and bold brands, such as BMW, MG, Michelin, Manulife, Marugame Udon, The Asian Kitchen, and Decathlon. Zooms Group’s major clients are also in banking and finance, food and beverages sectors. 40 percent NGOs and 20 percent SMEs are the current client base.

“I’m optimistic that graphic design is in demand in most businesses now as they need high quality and professional work. Because SMEs are growing so fast now.”

Getting invested to scale-up Zooms Group

The CAIN investor chose to invest in his company because he found the service sector and business model promising. “Between late 2020 and early 2021, I was in negotiations with the angel investor, after he found out about my startup pitching at a program he didn’t even attend to.”

Phichith Kunthakcheat (Kiripost/Siv Channa)
Phichith Kunthakcheat (Kiripost/Siv Channa)

There were many steps before pitching an investor. Among them was a concern about how to scale. As for supply requirements, he wanted to make sure the supply chain can respond well when there are competitors.

“Our milestone is to reach out more than that to support marketing such as social management systems, and UX & UI systems. So, we still need more investments,” he said.

The managing director has advice for startup founders. “When choosing an investor, don’t choose an investor in the same sector. It’s better to choose an investor in a different sector for help.”

Going through the pandemic

Before the Covid-19 pandemic hit, there were 20 staff in the first year of the startup journey. “The pandemic hit us so hard, although we cut down the salaried staff, the expense is high compared to income.”

“Although service continued during the pandemic period, the company’s revenue was decreasing dramatically.” He added, “We kept losing money for many months, between $2,000 to $3,000 every month for almost 2 years.”

“Throughout the pandemic, I found a solution to manage the supply chain to scale up to demand. Once the pandemic has faded, it has become one of the successful experiences in which we can maintain revenue margin and expenses.”

The seed capital was contributed by four co-founders. He used this investment fund to continue the business operation despite the loss during the pandemic. “They continued to cash in extra capital when there was a shortage.”

“If I don't have them as the founding team, the situation is uncertain and I can't run at present.”

Although they did not run the daily operations, investing only in financial capital, they had never complained to me. They gave me advice and ideas for improvements.

“Without my co-founders, I would not be able to continue today,” said Kunthakcheat as business is back to a new normal.

Entrepreneurial spirit

He told Kiripost that there were many times he wanted to give up running the business and return to a stable, salaried job because he felt tired.

“I thought that owning a business at this young age was such pressure. I should not have a headache because I still have much time to enjoy it. But because of my previous experiences I have failed, I still push myself to stand up, so I try to motivate myself.”

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