[Updated] June 21st, 2016
In the latest move, the Ensogo CEO has resigned and they have just announced they are shutting down all operations, and lay off all its staff in all marketplaces in Southeast Asia.
Recently this month, news broke that Ensogo has announced a shift in strategy, with up to 50% in layoffs. Obviously, for those of us in the know, this is another smoke and mirror strategy to continue and perpetrate its ongoing scam on an almost global scale.
The Great Ensogo Scam
Ensogo, the e-commerce startup with operations in and around the region, has announced a massive round of layoffs as a move to centralise its operations and stem spiraling losses.
Ensogo Malaysia is actually an amalgam of the following partners-in-crime: MyDeal, Living Social, iBUY Group and Dealmates.
Its 2015 financial records show that the company, which is listed in Australia, recorded a huge loss of 79.8 million AUD (RM235.4 million), significantly larger than its 2014 losses of 67.4 million AUD (RM198.8 million).
Making Losses from the Get-Go
What’s worse, its cash reserves now stand at 17.6 million AUD (RM51.9 million) – at this rate the company will not be sustainable even until the end of the year.
The company has evolved from a group-buying and daily deals website to a more traditional B2C marketplace starting this year, but even that has not stopped Ensogo from bleeding cash. But do not be misled into thinking this is an all-new operating outfit, it is still the same old beleaguered MyDeal Sdn Bhd pulling the scam string in the back.
Shutting Down Operation in Malaysia
News began flowing two weeks ago that the company quietly shut down its Malaysia head office in Kuala Lumpur, and that some merchants were not getting paid despite the site still running and accepting payment transactions. Some of them have even opened a Facebook group to share information. [Editor: It looks like there’s more of them merchants affected by this ongoing scam, with the latest we heard being those from Ensogo Philippines as well as Ensogo Hong Kong not getting paid as well.]
Calls & Emails Go Unanswered
The site’s Facebook page still runs normally (with plenty of negative comments hidden in its posts), while its customer service team responds within a day on Facebook message. Its daily EDMs are also still being sent out.
The only thing is, it’s really not working out well for Ensogo right now. And the modus operandi is elementary, my dear Watsons:
(a) If you’re a new or existing merchant, you would most likely not be receiving any cheques by now.
(b) If you’re a buyer, chances are the heavily discounted brand name item that you paid for would turn out to be a fake.
(c) And if you actually paid a good price for a non-branded item, you would most likely not receive it at all.
In a report by Tech In Asia, the company admitted that some late payments were made to several merchants, and that all outstanding payments will be issued in due course. The reason behind it was due in part of the “centralisation” process, one that took 75% of its Malaysia office – the Malaysia team now stands at just five, from 20 at the start of the year.
New HQ in Singapore Unreachable
This “centralisation” process, where the core business will operate mainly from its Singapore headquarters, also involves another major change in Ensogo’s playbook: charging a 15% fee for all transactions made at the mobile marketplace, and crucially, Ensogo no longer accepts local merchants – all of Ensogo’s merchants will now operate from China and South Korea, and will ship globally.
This 15% fee was introduced to its China merchants in January, while other merchants were charged from April.
Scam Focus Shifted to China & Korea
Ensogo CEO Krzysztof Marszalek recently told Digital News Asia that the new and revised (scam) strategy will allow Ensogo to serve orders to over 50 countries globally, a much larger pool than the previous regional platform, something Marszalek claims will be “a game changer” for Ensogo.
In some ways, that’s proving to be true: “We went from (scamming) 1,000 sellers in Q3 2015 to 13,599 in Q1 2016, while (questionable fake) products on sale went from 77,268 at end-Q4 2015 to 4.27 million at the end of Q1 2016,” Marszalek explained to DNA.
