Zilingo gets $17M Series B funding led by Sequoia, Burda Investments
Southeast Asia-focussed Zilingo sets its sights on a stronger foothold in Indonesia, other markets with third round of funding.
Singapore-based fashion and lifestyle marketplace Zilingo today announced it has raised $17 million led by Sequoia Capital India and Burda Principal Investments. The company aims to use these funds to strengthen its reach in Southeast Asian markets, particularly Indonesia.
Others that joined the funding round include Tim Draper, Founder of DFJ, along with the family office of Manik Arora, the Founder of IDG Ventures India. Venturra Capital, Beenext, SIG and Wavemaker also participated in the funding round.
This is Zilingo’s third round of funding. The company had raised $8 million last year, and $2 million in 2015. With the latest fund raising, Zilingo has raised $27 million.
Indonesia focus
With the latest fund infusion, Zilingo will look to expand its supply base and strengthen its position in Indonesia.
“Currently, there hardly are any fashion and lifestyle marketplaces in Indonesia. we are doing well in Indonesia and want to gain market share quickly,” says Ankiti Bose, Co-founder and CEO, Zilingo.
A vacation to Bangkok led to the idea of Zilingo, which was founded in late 2015. Ankiti saw there were several small and medium-sized enterprises in the region that offered great products but lacked proper marketing. Shailendra Singh, Managing Director, Sequoia Capital (India) Singapore Pvt Ltd says,
"It seems only yesterday that Zilingo started with a seed round from Sequoia India and most of the team based out of the Sequoia incubation space in Bangalore. It is terrific to see how they have progressed towards building the leading fashion and lifestyle e-commerce company in SE Asia. We are thrilled to continue to partner with Ankiti, Dhruv and their young, high energy team."
Growing market
Albert Shyy, Principal at Burda, says his team was impressed with Zilingo’s growth and focus on strong unit economics. Zilingo’s strong belief that there was a massive opportunity for a fashion marketplace in the region also impressed him.
When YourStory first spoke to Zilingo in 2015, it had 1,500 merchants in Thailand and Singapore primarily focussed on selling clothes, accessories, bags, shoes and beauty products. Today, it has over 5,000 merchants, seller hubs in Thailand, Indonesia, Hong Kong, South Korea, Vietnam and Cambodia, and ships to eight countries.
The team charges sellers a commission of 10-15 percent on each successful transaction. Zilingo also offers sellers features like payments, marketing, order management, inventory, cataloging, and pricing — complete with analytics and intelligence - free of charge. They are, however, charged for per-order fulfilment. The average order size on the platform is around $40 at present.
Zilingo has tied up with over 12 logistics partners – including DHL, NinjaVans, and Indonesia’s largest logistics player JNE. The company claims to have 10x revenue growth with a team size of 95.
Focus on Southeast Asia
When Zilingo first started out, it had a presence in Bengaluru but around September last year, decided to exclusively focus on the Southeast Asian market. Bengaluru remains the company’s technology nerve centre and Co-founder and CTO Dhruv Kapoor operates from here.
Working with a diverse team, Ankiti says:
“We have people from 10 nationalities in our teams and we serve three very different markets and work in three time zones. It’s a lot of great learning and the whole vibe in the company is that of a fun, young multicultural hotpot.”
Ankiti adds that for Southeast and East Asia account for a lion’s share when it comes to manufacturing of fashion products. Together, the region’s annual fashion and lifestyle exports stand at round $300 billion.
“This is not just going to other parts of Asia, it is also touching Australia, USA and Europe. One of the business units that is doing well for us is cross border. We are signing up manufacturers and merchants in Southeast Asia and shipping their products to the western world,” explains Ankiti.
A fast-developing market
A lucrative market itself, Southeast Asia also presents competitors like Zalora. A large e-commerce fashion platform, Zalora claims to have had over 17 million monthly visits from across the ASEAN region as of end 2014, and had received funding of over $238 million. Last month, the Ayala group acquired 49 percent stake in Zalora.
Other players include Ava in the Philippines, Chon.vn in Vietnam, FatFish-backed Dressabelle, Jungle Ventures-backed Pomelo, YJ Capital-backed VIP Plaza, Blue Bird Group Owner Indra Djokosoetono-backed Maskoolin, 8Wood, and Cloth Inc.
A TechCrunch report states that in Thailand alone, the GMV (gross merchandise value) from sites like Facebook and Instagram for small businesses was $510 million. The report states this accounted for a third of the total e-commerce GMV of Thailand.
Higher per capita income and a spurt in infrastructure in Southeast Asia over the last two years has boosted the space, says Ankiti. She adds that when Zilingo first started, there were hardly any players who looked at API integrations. Today, Zilingo has partners who deliver across different routes with sophisticated APIs and route optimisation technology. Increasing digital payments and deeper internet penetration have also helped the company’s business.
“In the fashion and lifestyle verticals of e-commerce, there are one or two large players in the market. It means there is space for a large fashion and lifestyle marketplace and we’re focussed on being that company. This round, and support from investors, will help us chase that goal easier and faster,” concludes Ankiti.