蜂買 (BeeCrazy)

» see beecrazy.hk as it lived, on the wayback machine

~ the obit ~

The founder is the part of this story that does not travel. Yeung Ching-wah spent years at TVB playing the man standing behind the man, enough of them that the Hong Kong press gave him a nickname for it. In July 2010 he and two friends put a seven-figure sum of their own money into a website that sold half-price dinners and spa packages, and for a few years it was the coupon site a Cantonese-speaking city actually used. None of that reputation crosses a border. Outside Hong Kong he is a name in a court filing.

The business worked well enough to attract a buyer. In December 2013 an Australian vehicle called iBuy Group bought BeeCrazy along with two other Asian deals sites, at a price reported around twenty one million, and listed itself on the Australian Securities Exchange on the 20th of that month. iBuy later renamed itself Ensogo. BeeCrazy kept its Cantonese front page and its own staff, and became a line on somebody else's consolidated accounts.

On Monday 20 June 2016 the checkout stopped working. Shoppers partway through paying found the page would not complete. Employees who came in that morning were told by their managers that they did not need to come back. There was no wind-down and no notice period for spending what you had already bought. The site simply stopped being able to take money, which is a strange way to die for a business whose whole product was money taken in advance.

~ the rap sheet ~

~ the cracks ~

Group buying is a float. You collect from the buyer today and pay the merchant weeks later, and in the gap you are holding other people's money. That works while volume rises and it turns vicious the moment it stops, because the only way to settle last quarter's merchants is with this quarter's shoppers. Every deals company in the world discovered this between 2013 and 2016.

What made BeeCrazy's version worse was the ownership. A local business that runs out of road tends to slow down first, and somebody notices. A subsidiary of a listed parent runs at full speed right up until a board meeting in another country decides to stop the transfers, and then it stops inside a single day. Ensogo went into a trading halt in Sydney on 21 June and announced it would no longer fund the Hong Kong operation. Kris Marszalek resigned as chief executive the same day.

~ the day it died ~

The Consumer Council took over two hundred complaints and enquiries. The police did the real counting: between 21 June and 31 August, 130 men and 175 women came in to report either a voucher they had paid for and could not redeem or goods they had supplied and would never be paid for, and the total they named was about 7.21 million Hong Kong dollars. Restaurants and travel agents were the worst hit, because those were the deals with the longest gap between the sale and the meal.

Then the ending turned procedural. Ensogo Limited, the Australian parent, filed in the Hong Kong High Court to wind up its own Hong Kong subsidiary, and the master granted the order on 31 August 2016. A company petitioning to liquidate the thing it had bought three years earlier is legally routine and reads as something else entirely to the merchants who were still waiting in line at the police station that same week.

~ what got buried with it ~

A few restaurants kept honoring BeeCrazy vouchers after the company was gone, knowing perfectly well that nobody was going to reimburse them, because the customer standing at the counter had done nothing wrong. The local press went and found them. That is the only warm thing in the whole file.

The wider damage was to the idea of prepaying a website at all. Hong Kong had run three competing deals sites at its peak and none of them survived the decade. What replaced them was buying the thing at the moment you wanted it, from a platform large enough that its collapse was somebody else's systemic problem, which is less fun and much harder to lose your deposit in.

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