Singapore-based Space Matrix, the sixth-largest international design firm in the world by revenue, has acquired Pursuite, one of Asia’s first and largest B2B e-commerce platforms for procuring furniture, fixtures and equipment.
With the move, Space Matrix aims to make planning and executing office designs more seamless, according to the company’s top executive.
The acquisition could indicate a trend for design firms that are looking for a way to sell products and services through the lucrative e-commerce space and reach a larger market through an omnichannel approach, according to an analyst.
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“The annual addressable market size of the workplace design and build industry in Asia alone is more than circa S$15 billion [US$10.8 billion],” said Arsh Chaudhry, CEO of Space Matrix. “However, the process of procuring products and services to build an office is still very archaic and is filled with multiple issues including cost and time unpredictability, quality and consistency of products, price transparency, governance, and even product discovery. Hence, the applicability of a digital procurement platform like Pursuite for the workplace sector is immense.”
A Singapore design project by office-design firm Space Matrix. Photo: Handout alt=A Singapore design project by office-design firm Space Matrix. Photo: Handout>
Space Matrix has 16 offices in Australia, mainland China, Hong Kong, India, the Philippines, Thailand, Singapore and the United States.
“As a design and build company with high procurement volumes, setting up a commerce platform is a natural progression and in line with our plans to be a tech-first firm,” Chaudhry said.
Pursuite, which focuses on the hospitality sector, has operations access across Asia and Europe. Space Matrix will bring more than 1,500 vendors across Singapore, India, China and the rest of Southeast Asia aboard the Pursuite platform.
Space Matrix also sees growth opportunities in the acquisition because it plans to use artificial intelligence and machine learning to mine design data and provide valuable insights for its clients in designing future offices. With US$36.34 million in design fees last year, according to the publication Interior Design, Space Matrix is the sixth-largest international design firm in the world, following five design firms based in mainland China and Hong Kong.
While the design industry has upgraded and improved various points in the design process, Chaudhry said, “procurement and project management have been inadequately addressed”.
“What matters is that the conceived design also can be built as per the intent, and this is what influenced our decision to acquire Pursuite,” he said. “We have plans to further expand our operations in Southeast Asia. The acquisition of Pursuite will enable us to streamline and enhance our capability to deliver projects.”
Arsh Chaudhry, CEO of Space Matrix. Photo: handout alt=Arsh Chaudhry, CEO of Space Matrix. Photo: handout>
Another reason for the acquisition is strong demand for office redesign in Singapore, the rest of Southeast Asia and India, as companies adapt to more flexible working arrangements driven by the Covid-19 pandemic, Chaudhry said. Space Matrix said its annual global revenues have been growing by more than half annually in recent years.
“The procurement process and the associated supply chain in the workplace sector is extremely disjointed, and technology has a significant role to play in solving it,” said Amit Shukla, founder and CEO of Pursuite. “We were trying to address this opportunity as an independent technology service provider. However with Space Matrix and its annual throughput of clients and business across Asia, we have the ability to immediately deploy our technology solutions against a very large total addressable market, and hit the ground running a lot faster.”
Shukla will join Space Matrix as global chief technology officer, responsible for shaping the company’s global technological vision and fostering new skills tied to data, analytics, and machine learning.
A Space Matrix design project for Boston Consulting Group (BCG). Photo: Handout alt=A Space Matrix design project for Boston Consulting Group (BCG). Photo: Handout>
Besides catering to clients, the acquisition could also pave the way for Space Matrix to sell to consumers, according to Sing Tien Foo, professor and director of the Institute of Real Estate and Urban Studies at the National University of Singapore.
“More firms are creating their omnichannel [structure] to sell their products, and e-commerce firms also extend their distribution and fulfilment to consumers by integrating their online platform with physical stores, which some call a ‘phygital’ model,” Sing said.
Terms of the acquisition were not disclosed.
This article originally appeared in the South China Morning Post (SCMP), the most authoritative voice reporting on China and Asia for more than a century. For more SCMP stories, please explore the SCMP app or visit the SCMP’s Facebook and Twitter pages. Copyright © 2022 South China Morning Post Publishers Ltd. All rights reserved.
Copyright (c) 2022. South China Morning Post Publishers Ltd. All rights reserved.
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