Ula, an Indonesia based micro-retail e-commerce platform, announced today it has raised a US$20 million Series A funding round, co-led by Quona Capital and B Capital Group.
Existing investors Lightspeed India and Sequoia India also participated.
This follows a US$10.5 million seed funding in June 2020.
As per a press note, the fresh investment allows Ula to grow its geographical footprint, expand its suite of products and services and move into new retail categories.
Since launching in January 2020 with teams in Indonesia, India and Singapore, Ula provides micro retailers with the necessary tools and technologies that assist in digitalising their supply chain, inventory and working capital management. It claims to have grown to serve over 20,000 stores, primarily in East Java.
“Small stores are deeply integrated into the economic and cultural fabric of Indonesia. They are micro-entrepreneurs with highly cost-efficient operations compared to their modern retail counterparts,” said Nipun Mehra, Co-founder and CEO of Ula.
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“However, their small scale, limited upstream product availability, high prices, poor service and limited working capital makes them the most vulnerable segment of the retail value chain. These problems aren’t restricted to one category — FMCG and other consumables, apparel, electronics, etc. all encounter common problems,” he added.
In many emerging markets, traditional in-store retail accounts for nearly 80 per cent of the total retail market. Within Indonesia, the market size is estimated to be upwards of US$200 billion, growing at over US$15 billion annually.
These small retailers operate with an up to 10 per cent cost advantage over modern retailers often employ family members and operate out of their homes. They also have insights into local consumer behaviours which could be leveraged to their advantage.
However, inefficient product sourcing, limited access to affordable technology solutions, and a high cost of available working capital hurt their ability to compete and grow.
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Ula seeks to solve these issues by assisting in procurement and providing logistics solutions for micro retailers, thereby allowing them to carry less inventory and freeing up capital.
“Ula is transforming the entire retail value chain with its retailer-first approach, empowering the small retailer by offering them a wide range of products, competitive prices and doorstep delivery,” said Ganesh Rengaswamy, Managing Partner at Quona Capital.
“Indonesia’s retail spend is expected to surpass US$0.5 trillion over the next four years, driven by millions of small retail stores. Ula is at the forefront of transforming Indonesia’s SME supply chain by democratizing access to merchandise and driving financial inclusion through technology,” said Kabir Narang, Founding General Partner at B Capital Group.
Ula is currently setting up tech teams in Indonesia, India and Singapore and also hiring across key roles in category management, analytics, credit as well as city P&L leaders in Indonesia.
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Image Credit: Ula
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