🧵 Reweaving Indo's textile market with Wifkain
Digitizing procurement and supply chain for Indonesian textile manufacturers and SMEs
Wrapping Up with Sara Sofyan, Co-Founder & CEO of Wifkain
Hi, Sofia here 👋! I’m so excited to kick off my first Founder Feature with Sara Sofyan, Co-Founder and CEO of Wifkain. Sara is a banker turned founder, having spent close to 5 years at HSBC before making the switch to B2C ecommerce and retail. After witnessing some of the gaps in the Indonesian textile supply market firsthand, she and her friends decided to tackle the problem head-on.
Pain Points:
The Indonesian textile market remains opaque and low tech. The industry relies on conventional, offline means, resulting in disintermediation in multiple areas of the retail value chain. For factories, for example, they produce their textiles in hindsight, based on what is previously bought and not necessarily what is needed, resulting in operational inefficiencies and production waste. For the retail side, it is difficult for them to reach out to factories to directly communicate these supply needs and find these merchants from their lack of a digital presence.
Other than gaps in communication, there are also gaps in pricing (from lack of transparency) and quantity (factories produce in bulk while SMEs, which are most industry players in Indonesia, procure textiles in small quantities).
Market Size:
We are currently focusing our efforts on Indonesia as it is a market we know quite well. It is faster for us to penetrate, we have locked in relationships with key merchants here, and Indonesia is the textile hub of SEA after all. We value the domestic textile market size at $16B. In a few years, we may look into regional expansion, such as to markets like Vietnam and Thailand, by partnering up with strong logistics cross-border arms.
Product:
Wifkain is a B2B textile platform that looks to provide a streamlined, procurement process for Indonesian textile manufacturers and SMEs. We aim to meet wholesaling needs on both sides through our digital platform that provides convenience, faster SLAs (service-level agreement), and realized cost efficiencies in the Indonesian textile market. Moving forward, we plan to expand our services to a full-time inventory database and management system, and we envision becoming an end-to-end supply chain platform, focusing additionally on fulfilling merchant-side needs.
Team:
I have with me two cofounders focused on operations and tech and around 25 people in our team in total, mostly focused on sales and operations. Our journey to Wifkain, however, was not a straightforward one. My cofounders and I actually started with a B2C platform two years ago, but it was difficult to scale, and the market was already quite competitive. Customers were getting used to a certain level of speed, thanks to bigger marketplaces, and our merchants were having a hard time keeping up with these demands. It was only after we decided to launch our own white-label fast fashion brand on our platform did we see the pain points merchants regularly encountered on the supply chain side. It was then that we decided to pivot the model and target a different part of the retail value chain.
Latest Breakthrough:
The value-added services from our new partnerships is significant to our core business. For example, we recently closed an exclusive partnership with Investree (top P2P lending firm in Indonesia which disburses 30M USD monthly) to provide invoice financing options to our buyers; this provided not only a level of transparency for Investree (as it could be seen that money being lent by Investree would be used for fabric procurement and operational purposes) but also opportunities for us both to cross-sell. Moving forward, we look to add more services to customers, such as a warehouse management system (WMS) for merchants that would allow for real-time inventory management and more automation in order-processing.
Recent Shortcoming:
I think we focused too much on the customer in the beginning and not the merchant. We realize that we could’ve created Wifkain earlier if we’d realized sooner that streamlining operations would make it more efficient for everyone involved in the supply chain.
Founder Wisdom:
If you find a good problem that you want to solve, just jump in and try it out! It is a change from corporate, where the path is very set, but you can’t know if something’s going to work until you try. I think sometimes we look very short term, like if we try something and it fails people think ‘okay that’s it, I should go back to banking’, but most of the time that’s just the journey and the opportunity to open up another door (like my initial B2C platform).
What 3 founders should we know about?
Dima Djani, Founder and CEO of Alami: Alami is a sharia-based P2P fintech company in Indonesia targeted towards financing SMEs. It is growing fast and has just recently closed its Series A.
Fajar Budiprasetyo (Co-Founder & CTO) and Johan Antlov (CGO) of Happy Fresh: HappyFresh is a SEA-based online grocery application that allows users to shop groceries from their favorite local stores. While HappyFresh is a later stage company, its approach to localization and agility even now is to be admired.
Wong Zi Yang, Co-Founder of Upmesh: Upmesh is a live commerce solution for merchants that look to tap new audiences. It pivoted from its previous business model in 2020 and has since begun to gain exciting traction and attention through angel rounds.
Tech Pulse 🌎
Recap in the West
Silicon Valley is still the next Silicon Valley. Wise's $11bn valuation is a big win. Speaking of wins for London, fintech funding soars. Speaking of fintech in the UK, Revolut valuation soars. Is there a bubble in European tech valuations? Y Combinator wants to help you find the right co-founder. Chill from Didi's IPO fallout spreads to other listings, and is this a sign of things to come? Seems like that answer could be yes: more scrutiny from China of Chinese US-listed companies. Big Asset Management deepens its fintech investments. SoftBank to drop $5bn for LatAm investments. Biden takes aim at monopolies. Warby Parker believes the future of D2C is offline. Netflix gets into video games. Early-stage startups are turning to Wall Street for help. RIP Twitter Fleets. Apple takes a run for your credit card. The US care economy is a $648bn market.
A few funding rounds that were announced this week…
Speaking of digital banks in Europe, challenger bank Bunq bags $228m, which was the largest Series A round for a European fintech company. It passed €1 billion in user deposits earlier this year and expects to break even on a monthly basis in 2021.
Yummy, Venezuela's delivery service and budding superapp, gets $4m in what one investor calls a "contrarian bet" considering the country's fortunes recently - but the company has its eye on regional expansion to Bolivia and Peru this year.
Adobu, maker of pre-fabricated "backyard homes" designed to address the US's affordable housing crisis, gets $20m (Series A) led by Norwest Venture Partners. The company has won accolades for its speed meeting demand and seeks to capitalize on increasing multigenerational living.
Recap in the East
Zomato’s IPO reveals losses and all. ByteDance holds off its IPO for now. If you can't list in the US, why not try Hong Kong? Malaysia finds its first unicorn. Paytm files for India’s largest IPO. Bukalapak’s listing will be Indonesia’s largest. Twitter "fails to comply" with Indian IT laws. A week using China's new "digital yuan". The battle for Malaysia's digital banking licenses. Pakistan's tech ecosystem begins to blossom. Singapore's first SPAC listing begins to take shape. Indian startups break funding record with $10.5bn raised in H1 2021. Softbank maintains its stance on China. Alibaba and Tencent may open up to each other. AirAsia fuels its superapp ambitions after acquiring Gojek’s Thailand business. Huawei pivots with hires and investments to avoid US crackdown.
Some funding rounds for the week…
Flipkart raised $3.6B in what is likely to be a pre-IPO round, and taking its valuation to $37.6B. SoftBank, which sold out when Walmart became majority owner, returns with a new $500m investment.
Indian food delivery-turned-logistics platform Delhivery sees a $100m investment from FedEx as it seeks to improve efficiencies in an industry long marred by middlemen, fraud, and disjointed systems.
OnlinePajak, an Indonesian SaaS platform helping individuals and businesses calculate their taxes, grabs $12m (Series C) from Tencent, Altos Ventures, and Warburg Pincus. The company follows a wave of Indonesian fintech companies sprouting up looking to digitize a society used to fragmented financial services.
What Else We're Following 👀
Golden Gate Ventures celebrates its 10th year anniversary and releases a report detailing historical trends, cultural shifts and predictions in the world of venture in Southeast Asia (Golden Gate Ventures)
How movie theaters are using creator platforms to attract audiences amid a rough comeback for in-person entertainment (LA Times)
Can Singapore’s alt-protein startups grow to become the next Impossible Foods? (The Ken)
"Doing more with less.” Marketing expert Lucy Heskins shares some compelling insights as a SaaS and early-stage startup marketing consultant (TechCrunch)
An interview with Xendit’s Tessa Wijaya on the diversity of Southeast Asia and how there’s no one-size-fits-all approach to digital transformation in the region (Fortune)
Yes, San Francisco is not dead. Tech workers are moving back to the Bay Area (NYT)
Who’s Hiring 👩🏽💼
For this week’s job postings (internships & full-time), please check out our Notion page here!
Hi! 👋 This issue was written by Sofia Cabral, Nick Palermo, and Jeffrey Dong. If you have any feedback or inquiries, feel free to email at jeffrey.dong@insead.edu or comment below.
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