1. Startups

Bukalapak's Series G Round Reportedly Reached 5,7 Trillion Rupiah Before Realizing IPO

UBS Group AG and Resorts World participate in new funding

The news regarding Bukalapak's final stage of funding is still rolling. UBS Group AG (Swiss investment bank London branch, UK) and Resorts World (a subsidiary of Genting Berhad, Malaysia) were also involved in the Series G round. This information was first reported by Deal Street Asia. It is projected that for this round, Bukalapak raises funds of more than $400 million or equivalent to 5,7 trillion Rupiah.

This April, before the two investors entered, Bukalapak is estimated to have succeeded in raising funds of up to $234 million or equivalent to 3,3 trillion Rupiah from a number of investors, including Microsoft, GIC, Emtek, Naver, Independent Capitaland BRI Ventures.

We have tried to confirm the news to Bukalapak executives, but related parties are still reluctant to respond. Allegedly this funding round is the last private round before the company conducts an IPO this year.

Menurut Forbes, UBS AG London now has 2,5% of the total shares of Bukalapak, although it could be UBS only proxy for others who do not wish to be named. It is estimated that Bukalapak's market valuation is now at $3,5 billion.

Diversification

It's undeniable, talking about Bukalapak like it or not, you have to compare it with unicorn Another local player who plays in the same segment, namely Tokopedia. Judging from site statistics, as one of the usage matrices, Bukalapak is still quite far from Tokopedia. In Q1 2021, it is known that Tokopedia is at the top of the site visit standings, followed by Shopee and Bukalapak.

Tokopedia's latest valuation is projected to reach $7,5 billion. Not to mention the news merger-her together Gojek This is quite a concern for its competitors. There is some potential combined innovation which can be born of both.

Back to Bukalapak, even though they are both peddling platforms online marketplace, each has a different value proposition. There are several things that we think are superior on Bukapalak's side. The first is related to the partnership program they have. Mitra Bukalapak is one of the pioneers of the partnership program E-commerce with stalls (although currently all platforms too have a similar program).

According to the latest data, since its release in 2016 Mitra Bukalapak has embraced more than 7 million MSMEs in Indonesia. Mitra Bukalapak has also become a separate company unit, which is led by Howard Gani. This program is also considered to play an active role in recruiting merchant out of town tier-1. The company has also launched an expansion merchant in the city tier-1 as a business focus in 2021.

Second, Bukalapak is quite serious about working on the financial line, especially related to investment. Last year Open Joint Investment (BIB) was announced as a subsidiary of Bukalapak that will focus on developing investment services for mutual fund instruments. This is the second business unit after PT Buka Pengadaan Indonesia (BukaPengadaan / B2B Commerce unit). Bukalapak President Teddy Oetomo has an additional position as CEO of BIB.

Having an APERD license, BIB is more flexible in developing mutual fund products according to its target consumers and concocting products together with the Investment Manager (MI) to provide money market mutual fund products (RDPU), fixed income (RDPT), and several other mutual fund products. The company has set a target to acquire 500 new investors from Bukalapak users by 2021.

On one occasion, CEO Rachmat Kaimuddin said, in the 2018-2020 period the company was able to achieve 80% EBITDA growth as a result of efforts to reduce cashburn. Currently, Bukalapak has pocketed 100 million users. Last year Bukalapak also recorded significant growth, especially from the B2C segment through BukaMall with 17% growth every month throughout 2020. As of December 2020, Bukamall transactions grew 3,1 times compared to last year.

Leadership

Bukalapak is also rumored to be unicorn fourth local to explore potential IPO via SPAC. They are starting to explore the potential go public on the IDX (with a small number of shares), then it will continue to be listed on the US stock exchange through the SPAC mechanism. The company is said to be in preliminary talks with several blank check companies and has already started exploring with a number of companies investment bank.

In addition to the pace of business growth, company leadership is something that will be highlighted when a company is on the stock market. Bukalapak has now been "left behind" by its founders [no longer involved in executive positions], namely Achmad Zaky (resigned from his position as CEO in 2020), Nugroho Herucahyono (2020, CTO), and Fajrin Rasyid (2020, President). Succession is done by recruiting Rachmat and promoting Teddy.

Rachmat KaimuddinTeddy Oetomo
PositionBukalapak CEO, BIB CommissionerPresident of Bukalapak, CEO of BIB
Previous company· KB Bukopin (Director of Finance, Commissioner) · Bosowa Semen (Director) · Naring Priate Equity (Vice Director) · Quvan Management (Principal) · Cardig Air Services (Director of Finance) · IFC (Consultant) · BCG (Consultant)· Schroders (Head of Intermediary Business) · Credit Suisse (Director of Equity Research) · Capital Markets (Analyst)

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From their previous work, Rachmat and Teddy have quite qualified experience in the field of financial management and investment. In addition to these two figures, Bukalapak also still has Willix Halim who occupies the position as COO.

In addition to continuing efforts to reduce burn rate, in several statements Bukalapak leaders also revealed their business strategy to pursue profitability -- including by exploring various sectors outside of its core business as a service. E-commerce.

It was also announced that the company was recruiting several strategic positions for a new business unit in a new country. According to speculation circulating, Bukalapak is trying to explore the Philippine market. Regarding this, we have also tried to confirm with Bukalapak, but they chose not to comment.

Platform competition E-commerce continues to taper, but the large share of the Indonesian market still leaves opportunities to be explored. There are still many unresolved issues to be resolved, from logistics to more advanced approaches hyperlocal. The passing of the unicorn going to the stock exchange is considered as a step up class to attract more outside investors to understand the digital approach with the local wisdom it presents.

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