Mumbai-based Bizongo will use its $22 million Series B funding to ramp up technology, build a stronger tech team, and focus on expansion.
Online marketplace for B2B packaging Bizongo recently raised Series B funding of $22 million led by B Capital, a global tech fund for B2B companies, and International Finance Corporation. Existing investors Accel Partners and IDG Ventures also participated in the funding round.
Bizongo, which, already counts Myntra, Box8, PepperFry and Hindustan Unilever as its clients, will use the fresh funds to standardise the quality of its offerings.
This is the third round of funding raised by the Mumbai-based startup. The company had, in 2015, raised seed funding, followed by a Series A of $3 million led by Accel Partners and IDG Ventures. The company was founded in 2015 by Aniket Deb, Ankit Tomar and Sachin Agrawal, who saw packaging as an integral part of simplifying trade for Indian businesses.
Speaking on the fundraising Aniket says,
“The fund raise will help us focus on three main things - ramping up technology, hiring people with industry expertise, and in expansion. Since we are also focusing on large enterprise players and customers, we want our technology to be enterprise-shaped and focused.”
The team also plans to set up offices in different parts of the country such as Delhi and Bengaluru. Bizongo already has offices in Delhi and Bengaluru, but the focus will now be on creating a strong regional sales and operations setup.
Of the three, while the initial idea was that of Aniket and Sachin, Ankit brought in the technical know-how. The platform provides end-to-end automated, scalable, and easy packaging solutions for various businesses in sectors like FMCG, restaurant and hospitality retail, food and beverage, ecommerce, and industrial logistics.
x says that when they started Bizongo, the team's main focus was to empower businesses using technology. He adds,
“With investment from B-Capital, we look forward to leverage on their expertise in the Southeast Asian markets, which will help us in our journey to scale up. On the other hand, IFC’s interest in the B2B ecommerce space and their deep network in the financial ecosystem will only help us refine our model further.”
Aniket says the company focuses on the $40 billion packaging industry in India, which has few organised players. To gauge industry growth, two years back it was pegged at $17 billion. Packaging is a booming business in India, but practices like quality breaches, large capital cycles, lack of standardisation, and no benchmarking hamper growth.
Bizongo currently lists containers, bags, boxes, and pouches frequently used by the retail, FMCG, food and hospitality, and ecommerce industries, among others. The platform also has several custom packaging and branding options.
Additionally, the company has also forayed in the financing vertical, and offers credit to small and medium enterprises for their working capital needs. The platform already has over 2,500 registered SMEs.
Ruchira Shukla, South Asia Regional Lead for Venture Capital at IFC says in a press release, "Digital enablement of SMEs is a very important strategic goal for IFC. To further this goal, we have invested in several B2B digital platforms in India and other emerging markets. Bizongo helps SME suppliers improve their capacity utilisation and drive up revenues, providing much-needed financial sustainability to this segment.”
Starting with 3,000 businesses as clients, and now touching close to 7,000 of which over 150 are large enterprises, Bizongo claims to have 40x growth. Bizongo has also partnered with TataCliq, Bunge, and Firstcry.
Speaking of why they chose Bizongo, Kabir Narang, Partner and Co-lead for Asia investments, B Capital, says, “Bizongo has an exceptional management team that has combined technology and industry expertise to bring a differentiated solution for leading ecommerce, FMCG, hospitality, and retail companies across India.”
He says B Capital has been actively looking at investment opportunities in leading technology companies across Asia and the US.
“Finding the right solution in India's $40 billion packaging market with over 30,000 vendors is time-consuming. Bizongo makes the process easy by leveraging an in-house design studio, a curated marketplace of over 200 manufacturers, and innovative supply chain technology," he added.
While there is a slew of players in the B2C ecommerce space, there is not much traction in the B2B segment. According to rough industry estimates, B2B ecommerce is a $500 billion market in its early stages in India. There are 4.8 crore SMEs that need bulk supplies, and that's a much bigger opportunity than B2C ecommerce.
“Packaging can influence buying behaviour and companies are looking at innovation in this space. We are excited to see how technology is playing a role in this $40B marketplace in India” said Ranjith Menon, Executive Director, IDG Ventures India Advisors.