Startup Manufacturing Raw Material Provider Bababos Raises Initial Funding Led by East Ventures

Procurement platform for manufacturing raw materials, Bababos, today (14/03) announced the acquisition of an initial investment led by East Ventures. Without mentioning the nominal, the company plans to use the fresh funds to build a new platform seamless pattern to bridge the manufacturing of small and medium industries (IKM) with quality raw materials from the best suppliers.

Bababos was founded by Fajar Adiwidodo (CEO), Sigit Aryo Tejo (COO), and Hendrik Panca CFO) in Q3 2022. They noticed that the raw material supply chain was still very fragmented, especially for IKM actors. Manufacturing SMIs often face limited access to quality raw materials, less transparent prices, and limited financial support for working capital.

On the other hand, suppliers also often experience difficulties in planning inventory supplies due to scattered demand. Bababos tries to solve this complex problem by providing supply chain solutions end-to-end which is able to properly aggregate demand for raw materials from IKM manufacturers. This is expected to provide significant added value for IKM manufacturers as well as raw material suppliers.

Co-Founder & CEO of Bababos Fajar Adiwidodo said, "Bababos is here to become an integrated procurement platform (one-stop procurement), working with selected and best suppliers to have a positive impact and bring progress to the Indonesian manufacturing industry. We believe this funding will further support our mission of providing fair supply chain access for SMI manufacturers.”

Bababos implements a business model managed-marketplace where the company plays an active role in the transaction process from upstream to downstream, from purchasing raw materials to suppliers to shipping goods to customers. The company also utilizes digital technology to support Bababos' business processes. This allows transaction processing through the Bababos web application to occur more efficiently, quickly and accurately.

There are three main solutions offered, namely the provision of manufacturing raw materials, demand aggregation, and tempo facilities. The company offers efficiency for IKM manufacturers to have to manage various suppliers through integrated shopping solutions (one stop shop) in procuring various production raw materials, ranging from steel and various other metals, to polymers and chemicals.

In terms of monetization, Bababos admits to implementing it margin at a reasonable price, also trying to get the best price by collecting and classifying requests for raw materials from many buyers. The tempo facility itself is a flexible payment to ease the financial burden on manufacturing IKM actors, so that IKM actors can focus on their main business objective, namely producing high quality finished goods.

Since its launch, Bababos has experienced tremendous growth since its launch, recording an average monthly revenue growth of over 100%. Currently, Bababos serves more than 50 IKM manufacturers, with some of them having experienced a 2-3 fold increase in business after partnering with Bababos.

In an official statement, East Ventures Partner Melisa Irene said, "Bababos is a clear evidence of technology-based solutions for conventional industries that are highly fragmented. We believe that Bababos and its solutions will open up many opportunities for SME players, the backbone of the country's economy, in industries that have high potential.”

Focus on SME manufacturing

The development of the manufacturing industry is very crucial to Indonesia's economic progress, currently the manufacturing industry contributes around 20% of Indonesia's GDP. In the manufacturing industry, IKM is the backbone because it has a very important role in fulfilling the production of finished goods in Indonesia.

However, because business size which tend to be smaller, SMEs often do not get the best supply chain facilities and access, especially in the procurement of raw materials. This problem then inspired the founders to develop Bababos, which has a vision of becoming the best raw material fulfillment platform for manufacturing SMEs in Indonesia.

Bababos integrates a modern approach into traditional industries by digitizing all procurement processes and leveraging big data to accurately classify requests based on raw material needs and geographical distribution. This enables faster and more timely delivery from supplier to customer, providing a seamless experience and cost savings.

SMI manufacturers instantly gain access to quality raw materials at competitive prices, while suppliers gain access to aggregate demand through the Bababos platform. This is considered to have a positive impact on supplier production planning and utilization.

In a separate interview, Fajar also revealed, "In the future, Bababos plans to continue to develop its internal system so that it can provide more optimal services to IKM manufacturers and also provide convenience for beg as Bababos' partner. At the moment, customer Bababos can transact and monitor the transaction process digitally through the site Bababoss."

Until now, Bababos is present in Jabodetabek and East Java. In accordance with its mission to help as many IKM manufacturers as possible in terms of fulfilling raw materials, Bababos also hopes to reach more IKM manufacturers soon along with the development of its services.

Apart from Bababos, there are already several players providing similar procurement solutions that focus on building materials including Tokban, Projectand OpenBuilding.