East Ventures Leads Pre-Series A Funding of “Practical” Supply Chain SaaS Startup

Practical (formerly PTS.sc), a data-driven supply chain solution provider startup for brand D2C (Direct to Consumer), announced the acquisition of pre-series A funding at an undisclosed amount. This round is led by East Ventures with the participation of the Triputra Group.

Practically will use the funds raised to improve its technology, build a team, and improve product offerings to provide better services to clients.

This startup was founded in 2017 by Adrian Gilrandy with two colleagues, Dipta Imanto and Mohamad Fahrul. Dipta has a background in strategic management and operations while working at Triputra Group, where he met Dipta Imanto, who has experience in improving operations in various industries, from manufacturing, logistics, to agriculture. Later, the two of them founded Practical with Fahrul, a creative industry entrepreneur and also supports several local shoe brands.

All three are aware that many local MSME brands are still having difficulties in managing a sustainable business in developing their business. Therefore, the solutions built by Practical focus on providing assistance to brand owners in managing day-to-day operations with the help of technology.

Presented solution

Practical Platform have full visibility of all supply chain processes, so that production planning and inventory control processes can be optimized and cost effective. The solutions presented consist of procurement and production activities, allowing brands to take advantage of Practical's wide network of suppliers to create and develop their products.

Furthermore, logistics services and fulfillment that offers operational efficiencies through automated systems and reliable partners; an order management system for brands to enter the right sales channels based on accurate data and demand predictions; and, access to working capital financing that assists brand development.

“Managing business operations and managing procurement, logistics, and store management in addition to designing and marketing good products can be a big problem for brand MSME D2C. This is where we are present by providing seamless operational management services," said Practical Co-founder Dipta Imanto in an official statement, Tuesday (14/12).

It is predicted that by 2025, Indonesia's D2C market in fashion, food and personal care as well as furniture and household appliances will grow to a total of $36.120 billion per year. This bright prospect is reflected in Practical's performance. It is claimed, currently Practical's monthly income is growing more than 12 times YOY ​​in 2021 with an estimated CAGR of up to 24x and 31% CMGR based on an eight-month period from January to September 2021.

“As a single point of contact, we allow brand D2C to focus more on their core competencies, which ultimately helps brand to achieve much higher income with efficient utilization of working capital. In the near future, we anticipate revenue growth of up to 6x,” added Practical Co-founder Adrian Gilrandy.

Willson Cuaca, Co-Founder and Managing Partner of East Ventures said, “We invested in Practical with the belief that their product offerings will be able to help the D2C MSME brand to grow and thrive. Based on their performance so far, we can see that Practical products do indeed solve the main problems of their customers. We are excited about Practical's development as they continue to grow.”

Up to now, Practical has been trusted by more than 100 customer brand, and has more than 1.000 partners beg and manufacturing. Some of his clients include Brodo, NAH Project, Visval, Elhaus, Roughneck 1991, JakCloth.co.id, Kintakun, Pyopp, Rose All Day Cosmetics, and many more. Every month, Practical is able to handle more than 300.000 shipments of goods and more than 20.000 items of products produced through supplier and manufacturing partners.

SaaS Solution

D2C is a business model that carries out the sales process without the help of intermediaries. Simply put, a businessman who produces goods, packages, and sends them directly to consumers without the intervention of other parties or third parties. These intermediaries vary, they can be resellers, dropshippers, to retail stores such as minimarkets.

Without the help of these intermediaries, business people can directly market their products to the networks they already have, such as websites, social media, to physical stores. However, this business model has drawbacks because businesses have to manage their own supply lines, need long preparations, and have to face consumers directly.

This is where a role like Practical comes in, actually not only Practical who plays in this segment, there is also Sirclo who provides solutions end-to-end e-commerce enabler for brands with a larger scale of business.

According to the data in the report MSME Empowerment Report 2021 published DSInnovateThere are several basic problems currently experienced by MSME actors in Indonesia, including: lack of working capital, shortage of raw materials, procurement processes, accounting miscalculations, difficulties in marketing products, and transaction processing.

To overcome these problems, 83% of MSME actors claim to use services from digital startups. From this hypothesis, the founders are passionate about presenting a variety of products with different value propositions. Currently there are dozens of startups that present various types of SaaS in this segment.