Indonesia-based rural-focussed e-commerce startup Dagangan today announced that it has closed US$6.6 million in its Pre-Series B round led by Sumitomo Mitsui Banking Corporation (SMBC) subsidiary BTPN Syariah Ventura.
It included the participation of existing investor Monk’s Hill Ventures, and Hendra Kwik, CEO of Payfazz, a leading financial services company serving SMEs and unbanked Indonesians.
The funds from this strategic investment will be used by Dagangan to expand into new markets and improve the capabilities of their product and technology development team. Dagangan will also work with financial institutions in banking and fintech to develop new financial services.
Dagangan is an e-commerce platform that provides same-day and next-day delivery for a wide variety of household needs, including basic necessities, fresh and frozen food, and apparel. Their customers are able to conveniently purchase items from multiple channels in one place.
“Our ultimate goal is to build Indonesia’s largest integrated retail and e-commerce marketplace serving the 90,000+ villages where 80 per cent of the nation’s population reside,” said Wilson Yanaprasetya, President and Co-founder of Dagangan.
“To achieve this, we focused on designing a clear path to profitability from day one through a lean organisation structure, consistent growth, and tech-enabled product innovation. Today, every single transaction made on the Dagangan app is profitable; this is extremely rare for an early-stage startup.”
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In addition to Dagangan’s white-label products, the platform also sells items offered by its resellers and third-party partners.
Based in Jogjakarta, Dagangan implements a hub-and-spoke model in its business operations. The company has micro-fulfilment centres (hub) in tier 3-4 cities and rural areas in Indonesia to reduce logistics costs, with the aim to make it efficient and affordable for their customers to access daily necessities. At the same time, it also aims to enable large producers to reach new markets that were previously difficult due to logistical challenges.
This funding follows an US$11.5 million Series A round that Dagangan closed in September 2021. Since then, the company said that it has recorded business growth of up to five times.
Currently, Dagangan has more than 40 hubs across the Special Region of Jogjakarta, Central Java, and West Java, and its products and services reach 15,000 villages in 40 districts.
“We aspire to serve more communities in remote areas and spearhead further growth in Indonesia’s rural economy. The funding from BTPN Syariah Ventura is more than just an investment, but the beginning of a close partnership to build an inclusive digital ecosystem for all Indonesians,” shares Ryan Manafe, CEO and Co-founder of Dagangan.
“They share the same enthusiasm as our team towards improving the lives of people in rural and suburban areas, and have demonstrated a proven track record of growing local micro, small, medium enterprises in rural Indonesia.”
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Image Credit: Dagangan
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