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February 24, 2019
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GoTrendier raises $3.5 million to take on Spanish-language fashion marketplaces

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Thanks to environmentally conscious young buyers, throwaway culture is dying not only in the U.S., but also in Latin America — and startups are poised to jump in with services to help people recycle used clothing.

GoTrendier, a peer-to-peer fashion marketplace operative in Mexico and Colombia, has raised $3.5 million USD to do just that. And investors are eyeing the startup as the digital fashion marketplace growth leader in Spanish-speaking countries. 

GoTrendier, founded by Belén Cabido, is a platform that lets users buy and sell secondhand clothing. Cabido tells me that the new capital will enable GoTrendier to expand deeper into Mexico and Colombia, and launch in a new country: Chile. 

GoTrendier enables users to buy and sell used items through the GoTrendier site and app. The platform categorizes users as either salespeople or buyers. Salespeople create their own stores by uploading photos of garments along with a description and sale price. Buyers browse the platform for deals and once a buyer bites, the seller is given a prepaid shipping label. 

Sound familiar? Businesses like Poshmark and GoTrendier have no actual inventory, which allows the companies to take on less of a risk by having smaller overhead costs. In turn, the company acts as more of a social community for fashion exchanges.

In order to make money, Poshmark takes a flat commission of $2.95 for sales under $15. For anything more than that, the seller keeps 80 percent of their sale and Poshmark takes a 20 percent commission. Poshmark also owes its success to the socially connected shopping experience it created and the audience building features available to sellers — as detailed in this Harvard Business School study. GoTrendier has a similar commission pricing strategy, taking 20 percent off plus an additional nine pesos (about 48 cents in U.S. currency) for all purchases. The service also takes advantage of social media and sharing features to help connect and engage its fashion-loving community. 

But these companies are also largely venture-backed. In the case of GoTrendier, the round gave shareholder entry to Ataria, a Peruvian fund that invests in early-stage tech companies with high earning potential. Existing investors Banco Sabadell and IGNIA reinforced their position, along with Barcelona-based investors Antai Venture Builder, Bonsai Venture Capital and Pedralbes Partners.

GoTrendier amassed a user base of 1.3 million buyers and sellers throughout its four years of existence. The service operates in Mexico and Colombia, and will use its newest capital to launch in Chile — another market Cabido says is experiencing high demand for a secondhand fashion buying and selling service.

Online marketplace companies are growing in Latin America as smartphone adoption and digital banking services multiply in the region. But international expansion has proven to be an issue. Enjoei, a similar fashion marketplace that owns the market share in Brazil, had a botched attempt at expanding to Argentina due to Portugese-Spanish language barriers and eventually determined that Brazil was a large enough market in which to build its business — thus carving out an opportunity for companies like GoTrendier that offer the same services to dominate the surrounding Spanish-speaking markets in Latin America.

Many have remarked that Latin America’s tech scene is filled with copycats — or companies that emulate the business models of American or European startups and bring the same service to their home market. In order to secure bigger foreign investment checks, founders from growing tech regions like Latin America certainly must invent proprietary technologies. Yet there’s still value — and capital — in so-called copycat businesses. Why? Because the users are there and in some cases it’s just easier to start up.

According to investor Sergio Pérez of Sabadell Venture Capital, “The volume of the market for buying and selling second-hand clothes in the world was 360 million transactions in 2017 and is expected to reach 400 million in 2022.” A 2018 report from ThredUp also claimed that the size of the global secondhand market is set to hit $41 billion by 2022. The “throwaway” culture is disappearing thanks to environmentally conscious millennial buyers. As designer Stella McCartney famously said, “The future of fashion is circular – it will be restorative and regenerative by design and the clothes we love never end up as waste.” By buying on GoTrendier, the company claims its users have been able to save USD $12 million and have avoided more than 1,000 tons of CO2 emissions.

Founders building companies in Latin America aren’t necessarily as capital-hungry as Silicon Valley-based founders, (where a Series A can now equate to $68 million, apparently). Cabido tells me her company is able to fulfill operations and marketing needs with a lean staff of 30, noting that there’s a lot of natural demand for buying and selling used clothing in these regions, thus creating organic growth for her business. She wasn’t looking to raise capital, but investors had their eye on her. “[Investors] saw the tension of the marketplace, and we demonstrated that GoTrendier’s user base could be bigger and bigger,” she says. With sights set on new markets like Chile and Peru, Cabido decided to move forward and close the round.  

Poshmark, which benefits from indirect and same-side network effects, has raised $153 million to date from investors like Temasek Holdings, GGV and Menlo Ventures. Just like GoTrendier, Poshmark’s Series A was also a $3.5 million round.

Who’s to say that that amount of capital can’t boost a network effects growth model in Latin America too? The users are certainly waiting. 

News Source = techcrunch.com

Alibaba takes an 8% stake in Tencent-backed anime streaming site Bilibili

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Ecommerce giant Alibaba is continuing its push into the world of youth culture after it scooped up an 8 percent stake in anime streaming and game publishing company Bilibili.

According to a securities filing on Thursday, Alibaba’s Taobao marketplace has acquired about 24 million shares in Bilibili, the Shanghai-based firm that has captured 93 million monthly users from hosting licensed anime titles, video games and user-generated content.

The financial gesture is hot on the heels of a partnership announced in December that saw the pair working to monetize Bilibili’s content assets. For one, Alibaba can help Bilibili creators sell merchandise like cosplay costumes and anime toys through Taobao’s online bazaar. Bilibili itself owns an e-store, but Taobao’s command of 700 million monthly users dwarfs its reach. 

“The partnership is great news for ACG content creators,” a Shanghai-based merchant that sells Lolita costumes on Taobao told TechCrunch, referring to the acrynom for “anime, comic and games.” The owner sells through both Taobao and Bilibili, though most sales have come from Taobao.

“We can now leverage Taobao’s gigantic platform and seasoned ecommerce operating capabilities to further help our content creators realize and improve their commercial values, thereby building a more virtuous content community and commercialization-focused ecosystem,” says Bilibili chief executive and chairman Chen Rui in a statement.

Screenshot: Taobao has a dedicated channel for anime, comic and gaming (ACG) items.

What Alibaba gets in return is access to China’s Generation Z. Bilibili claims that 82 percent of its users were born between 1990 and 2009. In a savvy move, Alibaba hooked up its food delivery unit Ele.me with Bilibili in December to tap a demographic of anime-watching and game-playing young people reliant on delivered meals.

Over 1.6 million content creators, including anime, comic and games (ACG) experts, were actively supporting the Taobao app and helping brands on our platform engage with consumers,” said Fan Jiang, vice president of Alibaba and president of Taobao, back in December. “Through deep cooperation with intellectual property holders and content creators, Taobao has experienced the great potential of ACG.”

Investors’ darling

Tencent and Baidu’s iQiyi have also spent big bucks to beef up their respective anime offering, but Bilibili’s flourishing youth community gives it an edge over these deep-pocketed video-streaming heavyweights and to an extent makes it an investors’ darling. The eight-year-old company is notable for being one of the rare companies that count both Alibaba and Tencent — which compete on multiple fronts spanning ecommerce to cloud computing — as their investors. Other companies that won backings from the duo include China’s largest ride-hailing service Didi Chuxing.

Last October, social media and gaming juggernaut Tencent poured nearly $320 million into Bilibili in exchange for a 12.3 percent stake. While Alibaba helps drive revenues to Bilibili’s community of creators and potentially boost their loyalty to the site, Tencent could help it save on licensing fees for games and animes.

“Tencent and Bilibili are two of the major players in the animation industry. By working with Tencent, this will intensively expand our content offering and effectively decrease our content investment in the animation copyright procurement,” Chen of Bilibili said during the company’s Q3 earnings call.

“The agreement will enable us to leverage Tencent’s primary content, particularly in licensing, co-producing and investment in anime as well as publish Tencent’s large portfolio of high-quality mobile games,” Bilibili’s chief financial officer Sam Fan added.

News Source = techcrunch.com

Alibaba’s Ant Financial buys UK currency exchange giant WorldFirst reportedly for around $700M

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Ant Financial, the financial services behemoth affiliated with Chinese e-commerce giant Alibaba, has made its first big move into Europe. It’s acquired London-headquartered payments company WorldFirst in a deal that sources tell us is valued at around $700 million.

(That price would also line up with multiple reports from December claiming the two were in talks for an acquisition of around £550 million, or $717 million at current exchange rates.)

This isn’t your average multi-hundred million dollar acquisition. The deal was confirmed by WorldFirst in a note to customers while Alibaba, which curiously didn’t put out an official press release, acknowledged the acquisition to us through a spokesperson.

Yet despite a relatively under-the-radar outing, the deal has potentially significant consequences. It not only underscores the strong market connections between China and Europe, but also the margin (and thus strategic) pressures that many smaller remittance companies are under in the wake of larger companies like Amazon building its own money-moving services, as well as competition from local players in Asia.

One of a number of globally active money remittance services, 15-year-old WorldFirst lets businesses and consumers move money between countries at prices that are lower than regular banks.

The company claims to have transferred over £70 billion ($90 billion) for customers since 2004, with more than one million transfers made each year. WorldFirst is a player in the competitive remittance market, in which migrant workers send money home to family, who can make transfers online or in person at WorldFirst outlets.

Ant Financial is best known for its Alipay service, which is China’s dominant mobile payment app with over 550 million registered users. Alibaba owns one-third of Ant, which is valued at as much as $150 billion, and it has been pushing to expand its empire outside of China and beyond Asia Pacific, too.

“Alipay and WorldFirst’s capabilities and international footprints are highly complementary,” WorldFirst co-founder and chief executive Jonathan Quin wrote in an internal memo obtained by TechCrunch.

According to Quin, WorldFirst will retain its brand and become a wholly-owned subsidiary of Ant Financial. Many merchants in the UK already accept Alipay, which has expanded to cater for Chinese tourists spending money overseas.

“The tie-up will add WorldFirst’s international online payments and virtual account products to Alipay’s range of technology solutions,” an Ant Financial spokesperson told TechCrunch without disclosing the size of the buyout.

WorldFirst has been financed by private equity investors and, as a private company, it keeps its financial details closely held, but in August 2018 it noted that it had transferred more than $95 billion for some 160,000 customers — businesses and individuals included. A source told us its GMV was around $10 billion a year.

But sources noted that it was under pressure of its own that would have made securing a deal with Ant even more of a priority.

“That whole sector of payments from the West to China sellers for e-commerce is under massive margin pressure from Amazon going direct with its own service, plus new China based entrants PingPong, LianLian and Airwallex,” one executive very close to the remittance space told us. “WorldFirst had recently seen low to declining growth because of this.” Another source said that it had been shopping itself around.

(The Amazon reference is related to Amazon PayCode, a new service it has built with Western Union to let people in markets where Amazon has not launched a local site to pay for goods in local currencies on its platform. The deal was first announced in October last year, and has seen the two companies offering payment alternatives in places like Thailand and Kenya to remove the need to transfer payments in other ways, via Alipay or whatever transfer service a seller or buyer might use.)

The acquisition gives Ant Financial a massive international boost, and for the first time a presence in Europe, but it comes amid some stumbles for the company in its other attempts to expand internationally.

Notably, the company agreed to acquire Nasdaq-listed MoneyGram for $1.2 billion in 2017 after it won a bidding war for the global payment company. Ultimately, however, the deal was blocked by the U.S. government. Bruised by the episode, which set its plans back by a year, Ant went on to raise an enormous $14 billion funding round last summer during which time it presumably kicked off the search for a MoneyGram alternative.

While WorldFirst is based out of the UK, the company last year made a key move to expand its US operations when it was announced in August that it would acquire the retail money transfer business of San Francisco-based startup Wyre, which had built the network on blockchain technology but was selling it to focus on the other side of its business, providing currency exchange APIs to larger B2B customers.

It looked like all systems go for WorldFirst to move deeper in the US after that. But then, the company abruptly announced on February 20 that it planned to close the U.S-based business. The move may have been made to prevent a repeat of that scuppered MoneyGram acquisition.

WorldFirst is closing its business in the U.S. in a move widely seen as a precursor to its acquisition by Ant Financial

Outside of the U.S. and China, Ant Financial has aggressively expanded its presence in Asia through a series of investment deals that have seen it put $200 million into Kakao Pay in Korea, and find similar deals in Southeast Asia. The overall strategy appears to be to replicate the success of Alipay in China, where it offers mobile payments and digital financial services that cover loans, banking and wealth management.

In a show of its global ambition, Alipay just this week announced a deal to bring its payment option to U.S. Walgreens stores. A previous partnership with point-of-sale company First Data added Alipay to four million retail partners Stateside, and the company has similar deals in Europe and parts of Asia.

News Source = techcrunch.com

China’s Alipay digital wallet is entering 7,000 Walgreens stores

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China’s payments heavyweights have been following tourists abroad as their home market gets crowded. Ant Financial, Alibaba’s financial affiliate with a said valuation of $100 billion, now sees its virtual wallet Alipay handling transactions at 3,000 Walgreens stores in the U.S. and is eyeing to reach a roster of 7,000 locations by April.

The alliance will make it breezier for Chinese tourists eager to pick up vitamin supplements and cosmetics from the pharmacy giant, doing away the hassle of carrying cash around. There’s also an economic incentive as Alipay and its payments peers typically charge lower foreign transaction fees than credit card firms.

Walgreens products are already available to Chinese shoppers through Alibaba’s Tmall online marketplace, which connects customers to brands. It competes with JD.com to bring high-quality overseas products to the country’s increasingly demanding consumers.

According to a Nielsen report released last year, more than 90 percent Chinese tourists said they would use mobile payment overseas if given the option. Digital payments have become a norm in China’s urban centers and top policymakers are planning to replicate that cashless ubiquity among rural villagers by 2020, announced a set of new guidelines this week.

Ant Financial is continuing its aggression in North America despite a major fiasco last year when the U.S. government killed its $1.2 billion plan to buy money transfer firm MoneyGram, a deal that could boost Ant’s global remittance capability. Within the American borders, Ant has tapped into its partners’ retail networks. By March last year, Alipay was accepting money across 35,000 merchants through its tie-up with local payments processor First Data.

Alipay is currently available at 3,000 Walgreens stores in the U.S. / Photo: Ant Financial

Digital payments are especially popular with first-time outbound tourists, many of whom hail from smaller Chinese cities and may not own international credit cards. According to a recent report published by Ant, the number of people from third-and-fourth-tier cities who used Alipay abroad was up 230 percent during this past Lunar New Year.

“This really highlights how mobile payment is taking root in China’s outbound tourism market,” said Janice Chen, head of the business operation for Alipay’s cross-border unit. Overseas usage from travellers born between 1960 and 1979 similarly saw robust growth last week.

Alipay’s big push into North American also includes its foray into Canada. In one instance, diners in Vancouver, Calgary and Edmonton — destinations that draw a lot of Chinese tourist and students — can now use Alipay to order food and skip restaurant lines. The setup comes from a deal between Ant Financial and Canadian food startup ClickDishes.

Alipay’s archrival WeChat Pay has also flexed its muscles overseas. To chase after Chinese tourists, the Tencent-owned wallet recently pushed into Japan through a partnership with chat app Line. In Hong Kong and Malaysia, WeChat has attempted to get a slice of the indigenous payments market by running localized versions of the wallet and luring users with money. During Lunar New Year, WeChat Pay shelled out millions of digital hongbao — red packets filled with cash traditionally handed out during the festive period — to users in these two regions.

News Source = techcrunch.com

BeliMobilGue raises $10M for its used-car sales platform in Indonesia

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BeliMobilGue, a used car sales platform in Indonesia, has fueled up with a $10 million Series round for the race to dominate the automotive market in Southeast Asia’s largest economy.

The company was started in 2017 as a joint venture between Europe’s Frontier Car Group (FCG) and Intudo Ventures, a VC firm focused on Indonesia. BeliMobilGue said today that the capital came from FCG and new investors, which include Tunas Toyota — the authorized dealership for Toyota cars in Indonesia.

It’s worth noting that FCG itself is a venture which, as the name sounds, develops on automotive ventures in emerging (frontier) markets in Latin America, Asia and Africa. Its investors include Naspers/OLX, Balderton Capital, TPG Growth and Partech Ventures.

This Series A round follows a $3.7 million round last year for BeliMobilGue — which means ‘buy my car’ in Indonesia’s Bahasa language.

BeliMobilGue is aimed at making it easy for car owners to sell their vehicle.

The first step is an online price estimation for vehicle. If the owner is happy with the valuation, BeliMobilGue takes the vehicles in and, after a one hour check attended in person by its testers, it arranges a sale to its network of over 1,000 dealers and private buyers. The entire process is targeted at one hour and is free for consumers, BeliMobilGue CEO Rolf Monteiro told TechCrunch.

The company has 30 physical testing points across Jakarta, Indonesia’s capital city, and with this money in the bank it is targeting expansion to Java. By the end of this year, Monteiro forecasts that the number of physical stations will have passed 100.

Another target for this year is ancillary services. BeliMobilGue is focused on enabling dealers, many of whom are often small businesses rather than nationwide chains, to growth with its service so it is offering financial packages financed by a third-party bank.

“The difference between small and large dealerships is their access to capital,” Monteiro explained in an interview. “We are a little bit more comfortable [than a bank] to extend their finance because we’re not just using data, we’re sitting on that dealer relationship.

“Plus we are sitting on cars, so we are financing cars that come from our platform and [if necessary] we can help offload the car for the dealer,” he added.

BeliMobilGue aims to sell vehicles within an hour, that includes a comprehensive inspection that’s carried out by its staff and covers 300 points.

BeliMobilGue is far from alone in going after Indonesia, which is the world’s fourth most populous country and the cornerstone of most digital strategies for the region. An annual report from Google and Temasek forecasts that Indonesia’s online economy will grow to $100 billion by 2025 from $8 billion in 2015. Southeast Asia as a whole is predicted to reach $240 billion, which is telling of the significance of Indonesia.

With that in mind, regional rivals have doubled down on Indonesia.

Carro has raised $78 million to date — including a $60 million Series B last year — while Carsome has $27 million and iCar Asia, from venture builder Catcha, has pulled in $39 million to date.

Each of that trio serves multiple markets across the region, not Indonesia exclusively, which is where Monteiro believes he can find an advantage. While he admitted that BeliMobilGue could have raised more money — it stuck to finding ‘smart money’ over amassing pools of cash, he said — he sees the existance of competition as win-win for the industry.

“Indonesia is a massive market,” he said. “Whether it is us, Carro or Carsome, the competition helps educate the market and it will get us new business. But, as much as I welcome them, I want that dominant position.”

Adding strategic investors like Tunas Toyota is, Monteiro believes another key differentiator.

“An investor like Tunas has 25-30 years of experience, so, for us, this partnership is golden. We’re quite content with the round and how it played out,” he said.

News Source = techcrunch.com

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