Ula E-commerce Earns Initial Funding of IDR 148 Billion from Sequoia
Business to Business or B2B multi-category startup e-commerce marketplace, Ula managed to get an initial funding of US $ 10.5 million or IDR 148 billion from Sequoia and Lightspeed investors from India. Ula is a startup company from East Java which has only been around for only 5 months.
The funding was also attended by other investors such as Saison Capital, SMDV, Quona Capital, Alter Global, and several prominent angel investors. The funding will be used by Ula to develop its services for MSMEs in Indonesia.
The new startup, which was established in January 2020, provides a marketplace service for SMEs to obtain a choice of products at more affordable prices. Ula also provides venture capital services to MSME owners to increase their overall income.
Ula Provides Convenience Solutions for MSMEs
Ula itself offers products, home delivery services, and payment options for traditional retailers. Ula Co-Founder Derry Sakti said, MSMEs, in general, have costs of 8 to 10% more efficient than modern retail stores.
Because, most of them are tax-exempt businesses, employ families, or mostly operate in their own homes. “However, they cannot compete due to lack of access to good procurement and limited business capital,” Derry said in a press release on Thursday (11/6).
He gave an example, a grocery shop was forced to buy goods from 50 different sources each week even in large quantities. This was done so that they get a better price even though their needs are not that big.
Through its platform, MSMEs can get daily business needs, delivery, and also payment options in the future. That way, SMEs can store a little stock without worrying about running out of goods by ordering every day the items needed.
SMEs Contribute a lot to the Economy
Ula assesses that traditional retail accounts for almost 80% of the retail market; also employs millions of Indonesians. India’s Sequoia Capital Managing Director, Abheek Anand added, “However, 70% -80% of retailers in Indonesia are not competitive due to inefficiencies in the supply chain, inventory, and working capital management.”
For this reason, former employees of Amazon, Flipkart, Lazada, P&G, and Booking.com united and founded Ula. The company uses scientific data to provide working capital loans to retailers.
In the midst of the COVID-19 pandemic, Ula focused on providing daily necessities, including groceries. With teams spread across Indonesia, India, and Singapore, Ula claims its business has grown 10x since five months ago.
With the implementation of Large Scale Social Restrictions (PSBB), shipping to homes or shops is an important factor to be able to keep shopping without having to go to a crowded market.
For now, Ula is still in the trial mode so that it only serves retailers in East Java. However, next year Ula intends to expand services on the island of Java, especially for clothing and electronics retailers.
Users are Increasing because of the Pandemic
Until now, according to him, Ula’s business has grown more than 10 times. Covid-19 pandemic increased Ula’s service users. An increase in the number of MSME stores that carry out transactions in Ula.
Because users prefer freight forwarding services to reduce physical interaction when implementing Large Scale Social Restrictions (PSBB).
“With Indonesian SMEs opening up to technological advancements, the marketplace platform can make it easier for them to run their businesses,” Managing Director of Sequoia Capital (India) Singapore Abheek Anand said in a press release. That was the reason that made his party interested in providing funding to Ula.
At present, the company prioritizes its business in the most basic sectors, such as FMCG and groceries which are the main needs in the traditional supply chain situation which is constrained.