Indonesian consumer goods mall GudangAda secured $25.4 million in a funding round led by Sequoia India and Alpha JWC Ventures, marking the latest investment in Southeast Asian e-commerce as the pandemic pushes business online.
The series A funding comes less than three months after the startup raised US$10.5 million in seed money from Alpha JWC Ventures, Wavemaker Partners, and Pavilion Capital. GudangAda will use the new funds to continue investing in its technology platform, launch new business initiatives, and bolster its team, it said in a statement.
“These are challenging times. But GudangAda is excited and fully prepared to launch a new chapter of growth in our journey, together with our investors, in fulfilling our mission – which is to empower all players in Indonesia’s FMCG value chain with one-stop solutions through the use of technology”, said GudangAda founder and CEO Stevensang
“B2B supply chains in many emerging markets face challenges around working capital limitations, inefficient inventory management, and manual operational processes,” said Abheek Anand, managing director at Sequoia Capital (India) Singapore. “GudangAda is building a digital ecosystem to transform the massive and highly fragmented FMCG market in Indonesia.”
Started just over a year ago, GudangAda connects small mom-and-pop retailers with wholesalers. The platform empowers the FMCG supply chain by bridging a technology gap, enabling traders to become both a seller and buyer in conducting multiple transactions concurrently. This way, business is able to sell products at cheaper rates and expand their reach.
The company claims to have a full market coverage of FMCG wholesalers in Indonesia, and it is now targeting seven to ten percent of the nation’s large retailer base for their next phase of growth.
The limited physical interactions due to the COVID-19 pandemic are pushing wholesalers and retailers to adopt digital solutions putting the FMCG market in Indonesia in a challenging position.
With the rising awareness around the importance of social distancing, GudangAda has also launched several initiatives, including a pilot logistics service to help the merchant network maintain the availability of essential products in the local supply chain.
This service is currently available in Greater Jakarta, Bandung, Semarang, Medan, and Lampung, while the company has expansion plans to cover major cities nationwide within the next few months.
GudangAda assured that its business continues to show growth despite the pandemic. It is maintaining a no lay-off policy and continues to recruit talent.
The startup also said it’s targeting 7% to 10% of the nation’s large retailer base for its next phase of growth. According to a statement, it currently connects over 50,000 large retailers and covers nearly 100% of FMCG wholesalers across 500 cities in Indonesia.