Rocket Internet, the Samwer brothers’ e-commerce startup incubator, is today announcing yet more money for one of its portfolio companies. Lazada, an Southeast Asia-based online marketplace akin to Amazon, is picking up a round of strategic funding from Tengelmann, the German retail group. Sources close to the deal tell TechCrunch that it is close to the $20 million mark.
The news comes one day after another Samwer company, the Square clone Payleven, announced a round of funding in the ‘single-digit millions’ from an unnamed investor. For its part, Lazada has been collecting financing at a fast clip: in December 2012, it raised $26 million from Summit Partners. Just one month before that, in November, it raised $40 million from Kinnevik, which is also Rocket shareholder. (No Series A, B, or C crunches here, it appears.)
Like Kinnevik and several others (JP Morgan is another common name on the funding rosters for Rocket Internet), Tengelmann is also a Rocket regular: it invests in Lamoda, Dafiti, Zalando and Zalora, among many others. It also invests in Rocket Internet competitors, too: SumUp, another Square-like mobile payments service that competes with Payleven, is also backed by Tengelmann.
Rocket Internet doesn’t give a lot away about how its companies are performing, or how it plans to use this most recent round of funds, but given that it’s raised some $86 million in the last three months (and there could be more; you never know with the Samwers) it’s clear that it’s doubling down and in a phase of aggressive build-out, after what it describes as a “strong December.”
Taking a cue from Amazon, Lazada has been focusing on building out a platform that smaller merchants and retailers can use as a way of selling and distributing their goods to consumers, complete with billing and fulfilment. Rocket Internet alternately describes this as an “online marketplace” and an “online shopping mall.” It runs businesses Indonesia, Malaysia, Philippines, Thailand and Vietnam, covering a footprint of some 600 million consumers. A lot of Lazada’s efforts are first-moves for these regions — where smaller businesses may not have online channels already; mass consumers are just getting into the groove of buying goods online; and Amazon has yet to make its presence felt.
Lazada does not detail how it plans to use the new funds. It says that it is “investing heavily to provide its customers with world-class services.” That has included introducing a two-day delivery guarantee.
Rocket has been measured in how it brings on purely financial investors as well as strategic partners that might help it with retailing expertise as well as provide a channel for those retailers to distribute their goods. Tengelmann, with 4,000 stores across 15 different countries (including the A&P chain in the U.S.), and annual revenues of over €10 billion, is in the latter category. “We are very excited to join the LAZADA team,” Christian Winter, CEO of Tengelmann Ventures said in a statement. “Their growth trajectory, management team and investor base speak for themselves and we are confident that the company will succeed in the long-run.”
“Having a strategic investor of Tengelmann’s calibre on-board is a huge win for LAZADA,” Maximilian Bittner, Regional CEO of LAZADA, said in a statement. “They are bringing with them significant retail experience which will be of huge benefit as we strive to achieve our ambitious growth targets.”
LAZADA receives more funding as Tengelmann joins investor group
LAZADA, Southeast Asia’s largest online department store, today announced that it has received an eight digit euro investment from German retail group Tengelmann Group (“Tengelmann”). Tengelmann invested in LAZADA’s German holding company in a similar fashion to the recently announced investments by Investment AB Kinnevik, J.P. Morgan Asset Management and Summit Partners. LAZADA will use the funds strategically as it continues to explore new opportunities to further improve customer satisfaction.
The customer experience has always been the main point of focus at LAZADA and the company is investing heavily to provide its customers with world-class services. By recently deploying a new fulfilment system, the company is already today able to guarantee two-day delivery on average across Southeast Asia. In December, LAZADA launched its marketplace platform, which allows offline retailers to leverage LAZADA as a sales channel while still being in control of logistics and operations, to further expand its product assortment and meet customer demand. LAZADA’s more than one million Facebook fans serve as a testament to LAZADA’s success in providing superior services to its customers.
The investment by Tengelmann was received on the back of an exceptionally strong December month. As an eCommerce pioneer in Southeast Asia, LAZADA seeks to educate the market about the benefits and convenience of online shopping and on December 12th the company launched its hugely successful Online Revolution campaign along the lines of Cyber Monday in the USA. By partnering with hundreds of suppliers across the region, the company were able to promote amazing supplier-backed deals to its customers. The company also worked closely with many of the region’s top eCommerce platforms to build excitement and awareness of this successful campaign. In Indonesia, LAZADA partnered with Indonesia’s leading telecom operator, Telkomsel, Yahoo! and several of the largest online portals and forums, making this one of the biggest online events in Indonesian history.
“We are very excited to join the LAZADA team,” Christian Winter, CEO of Tengelmann Ventures said, “their growth trajectory, management team and investor base speak for themselves and we are confident that the company will succeed in the long-run.” Maximilian Bittner, Regional CEO of LAZADA commented: “Having a strategic investor of Tengelmann’s calibre on-board is a huge win for LAZADA. They are bringing with them significant retail experience which will be of huge benefit as we strive to achieve our ambitious growth targets.”
LAZADA (www.lazada.co.id, http://www.lazada.com.my, http://www.lazada.com.ph, http://www.lazada.co.th, http://www.lazada.vn) is Southeast Asia’s fastest growing online department store, with operations in Indonesia, Malaysia, Philippines, Thailand and Vietnam. LAZADA is pioneering eCommerce across some of the fastest growing countries in the world by offering a fast, secure and convenient online shopping experience with a broad product offering in categories ranging from consumer electronics to household goods, toys and sports equipment. LAZADA is always striving to offer its customers the best possible offering – including multiple payment options, free returns and extensive customer service and warranty commitments.
About Tengelmann Group
Tengelmann Group is an international operating retail company whose business interests are spread across a number of different industries. Subsidiaries include OBI, KiK, Kaiser’s Tengelmann, baby-markt.de and Plus Online. TREI Real Estate, as well as the holding company Tengelmann Ventures, which has been investing in promising online start-ups for several years, are also part of the corporate group. The family-owned business was established in 1867 in Mülheim an der Ruhr and is currently managed in fifth generation. Tengelmann Group is operating over 4,000 stores in 15 different countries and employing more than 80,000 people. The group’s annual turnover is totalling EUR 10bn.