RaRa Received Investment of IDR 19.7 Billion despite Pandemic
Investors choose to wait and see market conditions (wait and see) before investing due to the corona pandemic. However, local logistics startup RaRa received seed funding of US $ 1.2 million or around Rp 19.7 billion.
The investment was led by venture capital from the United States (US) 500 Startups. Singapore-based venture capital firm Angel Central is also involved in this funding round.
RaRa carries a shipping delivery jargon in one day (sameday delivery). The additional capital is planned to be used for business development, operations, and technology in Indonesia.
RaRa Delivery’s founder and CEO Karan Bhardwaj rate, consumers increasingly need fast delivery services. This happens because the e-commerce business is also growing rapidly in Indonesia. He noted the volume of gross sales of goods in Indonesia is predicted to reach US $ 97 billion in 2025.
While the value of logistics transactions is estimated at US $ 5 billion. RaRa sees this condition as an opportunity and develops technology to support fast shipping services.
Karan claims that their technology can increase time slots, capacity, distance and route optimization for thousands of orders only in seconds. To his knowledge, competitors in Indonesia are still focused on the next day delivery service.
RaRa Focuses on Same-day Delivery Service
RaRa carries a same-day delivery service. “That means offering premium services at the lowest cost using our operational models and technologies,” Karan said, quoted by Tech In Asia, yesterday (6/4).
At present, RaRa Delivery has provided services for shipping in e-commerce such as Lazada, Shopee, and Bukalapak. In Indonesia, RaRa competes with Paxel which also offers shipping goods in one day.
This local logistics startup was founded in 2017 by Karan Bhardwaj as CEO and Anil Kumar as a company CTO. Karan previously worked as a regional e-commerce supply chain manager at Unilever.
It was his responsible for creating the company’s end-to-end supply chain. In April 2019, RaRa Delivery received funding from an investor angle or angel round from the GK-Plug and Play Indonesia (GK-PNP) accelerator program.
Founders Zopim Royston Tay and Kwok Yang Bin, Head of Stripe Vidit Agarwal’s Business Development, Unilever Indonesia’s Vice President of Marketing Neelesh Suryavanshee and Unilever’s Vice President for Digital Transformation Vishal Gupta were involved in the investment at the time.
Even So, the Investment Is Predicted to Decrease By 20% Corona Effect
Funding to private companies (private market funding), including startups in Asia, is predicted to fall 20% yearly (year on year / yoy) due to the corona pandemic in the first quarter of 2020. Investors and venture capital choose to wait and see (wait and see) present conditions.
CB Insights noted, private market funding in Asia reached US $ 18 billion and was estimated to reach US $ 20 billion in the first quarter of this year. Compared to the same period in 2019, the value dropped by 20% and the number of agreements dropped by 40%.
The data is based on funding announced since the beginning of this year. Globally, CB Insights noted that private market funding in Asia reached US $ 67 billion and was estimated to reach US $ 77 billion. Its value is down 11.5% compared to the first quarter of 2019.
The investments considered are those significantly affected by the corona pandemic. While startups considered to support government policies to reduce the spread of the coronavirus still have the potential to be funded. Those are the culinary (food and beverage), health, logistics, and telecommunications startups.
Therefore, venture capital chose to wait and see the economic stimulus implemented by the government. Mainly, policies that have a direct impact on the community such as Direct Cash Assistance (BLT).