Office supplies

Ardent Capital, a venture capital firm that invests in early-stage technology companies in Southeast Asia, has announced the launch of today, with a funding of US$2.5 million.

Established only in February 2015, the 37-strong team manages a B2B platform that carries products from merchants in office supplies, electronics, cleaning, pantry and services, which Bizzy’s CEO and Co-founder Peter Goldsworthy believes is sorely lacking in Indonesia’s B2B e-commerce space.

“I was constantly frustrated with ordering supplies and services. In particular, I felt the entire process of sourcing, approval and shipping could easily be improved upon,” Goldsworthy says.

Through market research, Bizzy discovered that many distributors and principal brands were having difficulties reaching and servicing their direct B2B customers.

Also Read: SB-ISAT Fund: It’s difficult to find worthy Indonesian startups

Bizzy helps merchants make the shift to online and meet the logistical demands of B2B business customers, by integrating multiple shipments from multiple vendors, known as ‘crossdocking’, through the fulfillment centre of partner aCommerce.

According to the CEO, the company has seen a growth of over 300 per cent over the past three months and now serves 45 businesses from five customer segments of SMBs, retailers, government departments, educational institutions and hospitality organisations.

Besides fulfilling an important need, its growth can also be attributed to the paucity of competitors in the marketplace. “Very few businesses target the business consumer in the region. Bhinneka and Office Mate target the electronics and stationary side, but neither go end-to-end in terms of the goods and services that businesses need,” he claims.

Indonesia needs to play catch-up

This announcement is a welcome news for Indonesia’s developing B2B e-commerce markets, which is trailing far behind other countries in the region.

Numbers from the last two years reveal that China’s B2B e-commerce market is poised to be the largest in the world, with an estimated value of US$2.1 trillion by 2020. In South Korea, 91 per cent of online transactions are B2B, and in Thailand, it take up an estimated 38 per centThe B2B market share of 9.87 per cent (study from 2013) of all e-commerce transactions in Indonesia is meagre by comparison.

“In Indonesia, this type of e-commerce is in its infancy, so the opportunity is huge. Just 11 percent of all startup endeavours in Indonesia are dedicated to B2B,” said Adrian Vanzyl, CEO of investor Ardent Capital.

Also Read: Ardent Capital’s WhatsNew expands into Indonesia as MOXY

So why is Indonesia lagging? A research paper in 2014 suggested that Indonesia still fell short of e-readiness because of several factors, which would include lack of policies and regulatory controls on software protection and business development and ICT innovation, lack of high-speed fibre optic infrastructure, as well as inadequate governmental support towards boosting SME development in digital economy.

With more millennials entering the B2B marketplace, the tide could soon see a shift. In a Google-and Millward Brown Digital-partnered B2B marketplace report this year, data showed that between 2012 and 2014, the number of those doing B2B research increased 70 per cent in the 18 to 34 year old age group. It also highlighted that by 2014 this millennial age group was also accounting for 46 percent of B2B purchasing decisions.

Also Read:5 growth hacking tools for B2B marketers

“Millennials are now the key decision-makers for company sourcing. This changing of the guard means they expect the same information available for personal purchases when they search for business solutions. Bizzy addresses that need,” Goldsworthy added.

On his future plans for the company, he said that he hopes to explore other revenue models such as marketplace commissions for on-demand business services. The co-founder is also looking to expand Bizzy into other markets in Southeast Asia such as Thailand.

Disclaimer: Ardent Capital is an investor in Optimatic Pte Ltd, the parent company of e27.

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