Ula, an Indonesia-based wholesale ecommerce marketplace, announced that it has raised US$10.5 million in a seed funding round led by Sequoia India and Lightspeed India.
SMDV, Quona Capital, Saison Capital, and Alter Global, along with several angel investors also participated in the round.
Launched in January this year, Ula offers products, a doorstep delivery service, and pay-later options for small retailers to help them store less inventory. The company – which was founded by former employees of Amazon, Flipkart, Lazada, P&G, and Booking.com – also uses data science to give retailers working capital credit.
Currently in private beta mode, Ula only serves East Java but plans to expand across the island and across categories such as apparel and electronics over the next year, according to a statement.
Amid Covid-19, the company is focused on supplying daily needs such as fast-moving consumer goods and staples. With teams spread across Indonesia, India, and Singapore, it claims that the business has grown 10x since launching.
According to Ula, traditional retail contributes to nearly 80% of the retail market and employs millions of Indonesians.
“A typical store has an 8% to 10% cost advantage over modern retailers, given that they are usually tax exempt, employ their own family, and operate out of their homes,” said Ula co-founder Derry Sakti.
However, 70% to 80% of retailers in the archipelago aren’t competitive, as they are plagued by inefficiencies in supply chain, inventory, and working capital management, said Abheek Anand, managing director at Sequoia Capital India.
Some big players in Indonesia’s ecommerce space include Sea’s Shopee, SoftBank-backed Tokopedia, 500 Startups-backed Bukalapak, and Alibaba’s Lazada, among others.