Ula Receives 1,24 Trillion Rupiah Series B Funding, Immediately Releases Paylater Products for Warung
Followed by Jeff Bezos' VC "Bezos Expeditions", Northstar Group, AC Ventures, Citius, and a number of investors in the previous round
Ula managed to raise $87 million in series B funding (approximately 1,24 trillion Rupiah) led by Prosus Ventures, Tencent, and B-Capital. This round was also followed by the participation of Bezos Expeditions, VC created by Amazon founder Jeff Bezos; along with other leading investors, namely Northstar Group, AC Ventures, and Citius.
Investor Ula Past ones, such as Lightspeed India, Sequoia Capital India, Quona Capital, and Alter Global, are participating again in this round. On this occasion, Ula also announced that AC Ventures Founding Partner Pandu Sjahrir was appointed as the company's advisor.
This funding was announced eight months after series A pendanaan funding in early January. Collectively, the company has raised $117,5 million in funding in the 20 months since its founding.
The company will use the funding to expand its geographic and team coverage area, to realize its vision of empowering the traditional retail industry in Indonesia. These include releasing new categories, service development paylater, development of new technologies, logistics infrastructure, and local supply chains.
Co-founder & Chief Commercial Officer Ula Derry Sakti said that this BNPL solution was presented because Ula already has 70 thousand stalls that transact through platformInstead, the database is a provision for conducting credit scoring before disbursing loans.
It claims the company has grown 230 times, offering more than 6 thousand products. The majority of Ula users come from tier two to four cities that still lack access to resources and logistics infrastructure.
As is known, traditional retailers have limitations in accessing banking products, even though they are very dependent on daily income, this makes payment options paylater to beg has tremendous benefits for stalls.
“With Ula, they no longer have to worry about purchasing goods, product availability, or even payment, which will give them more time to focus on other more important things. Seeing firsthand the impact that Ula has given to customers' lives certainly moves our team to move forward," he said in an official statement, Monday (4/10).
Co-founder & Chief Operating Officer Ula Riky Tenggara added, “Solving the complexities of supply chain problems in Indonesia is a very challenging and impactful endeavor. As a company built from a community, we cannot underestimate the importance of providing services that our customers can always rely on, especially services that can make a real difference to their lives.”
Ula investors, AC Ventures and Northstar, also made a statement. They stated that they have the same mission regarding the importance of empowering Indonesian MSMEs through technology. This is because MSMEs contribute more than 60% of Indonesia's GDP and become the backbone of the country's economy.
"Ula provides a more efficient procurement and operational system, and ultimately opens access to credit that is needed to expand the MSME business scale," said AC Ventures Managing Partner Adrian Li.
The Ula app allows shop owners to order a wide variety of products and have them delivered directly to their stores. With a simple concept, Ula tries to focus on customer needs rather than adding unnecessary features, to ensure the best experience. The app is claimed to be lighter, suitable for low connection environments and the most basic devices, and ensures it doesn't take up too much space on their phones.
The potential for digitizing stalls
The service solution solves a very fundamental issue. Based on the results of research entitled The Future of Southeast Asia's Digital Financial Services, at least 92 million adults in Indonesia have not been touched by banking financial services (unbankable) – making it difficult for them to access transactional digital services directly. This number is very large, even greater than the total population of countries in Southeast Asia except the Philippines.
Warung is the most outreaching business system – the place where micro-economy across Indonesia revolves. According to 2016 Economic Census data released by BPS, of the 26,4 million units of Micro, Small and Medium Enterprises (UMK), 46,38% fall into the category of "Big and Retail Trade, Repair and Maintenance of Cars and Motorcycles. “ – the stall goes in there. This number is also the largest among other types of businesses in Indonesia.
In an interview with DailySocial.id, Co-Founder Ula Nipun Mehra explained his analysis of why his startup is steadily expanding into this sector. According to him, traditional retail such as warung is the main pillar of the Indonesian economy. "This is backbone of the consumption economy, while simultaneously employing millions of people. Traditional retailers belong to cost-effective and have in-depth knowledge of the local market. However, this sector is the most vulnerable part of value chain because they usually work individually on a small scale," he said.
The diversification that is trying to be presented is the efficiency of resources and capital by presenting a system doorstep (direct delivery of products) which is cost effective. In addition to connecting retailers with stock providers of FMCG products, they will also expand product coverage in the fashion category.