The round marks the venture capital firm’s first investment into the startup.
Alpha JWC Ventures, Convergence Ventures, KIP, MNC, and SMDV also participated in the funding round.
In a press statement, Sale Stock co-founder Lingga Madu said that the new capital injection will be used to “further strengthen our position as the market leader in Indonesia, and to be profitable in the near term.”
The investment is part of Gobi Partners’ US$200 million Meranti ASEAN Growth Fund; the firm announced the first closing of US$50 million today.
Initial limited partners for the fund are MAVCAP, GS Shop, and CKM, and it is looking to invest in 15 or more companies in Southeast Asia.
Known as a relatively media shy company, Sale Stock has never made any public announcement about their fundraising until today. It has been rumoured to raise funding from Ardent Capital, which was merged into Wavemaker Partners in 2016.
Last year, the startup laid off “hundreds” of its employees despite claiming that it has achieved 25 per cent growth within 18 months of operations. In his official statement, Madu stressed the company’s focus in building a sustainable and profitable business.
The startup also partners with messenger app LINE and implements an AR-based “changing room” feature.
It was named as the best Indonesia-based startup to work for by Jobplanet in December 2016.
Sale Stock President Jeffrey Yuwono told e27 at the fund’s launch event about the startup’s expansion plan.
“Our first goal is to become profitable in Indonesia, which we plan to do by next year. And then after that, we’ll think about regional expansion,” he said.
Yuwono also explained that a lot of the company’s revenue came from tier-two and tier-three Indonesian cities such as Makassar, Sorong, and Pekanbaru.
He dubbed customers in the cities as the “underserved middle class”; women in the cities have the means to purchase fashion products, but limited access to retailers.
Cash-on-delivery remains the most popular payments method in the platform. However, Yuwono said that the company is working with Veritrans as their payment gateway partner, and is in talk with Go-Jek for a possible partnership.
Regarding the entrance of Amazon to the Southeast Asian market, Yuwono believes that it help “raise the profile and accelerate e-commerce development in Indonesia.”
“I could see how for marketplaces like Tokopedia and Blibli, they are a bit worried about the competition, but we’re really different from everybody else. We’re really focussed on fashion and building the kind of experience that is very difficult to get from these general companies,” he explained, adding that fashion has always been a ‘weak spot’ for Amazon in the US.
Yon Heong Tung also contributed to this report.
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