US VCs lead $60m round for Indonesia's BukuWarung

The oversubscribed round is being called the largest Series A ever raised by a micro, small and medium-sized enterprises (MSME) services provider globally. It follows several seed and pre-Series A investments, bringing total funding since inception in 2019 to $80 million.

Earlier backers include DST Advisors, GMO Venture Partners, HOF Capital, Soma Capital, VentureSouq, Y Combinator, Rocketship, AC Ventures, East Ventures, Golden Gate Ventures, Jasper Infotech, Quona Capital, Tanglin Venture Partners, Alterra Capital Partners, Flipkart, Grab, Gojek, Rapyd, Xendit, and Zen Rooms.

BukuWarung is also notable for attracting significant attention from high-profile angel investors. Aldi Haryopratomo, former GoPay CEO, and Victor Jacobsson, founder of Klarna, a Swedish fintech start-up worth $31 billion, also participated in the latest round, as did unspecified partners from SoftBank and Trihill Capital. Previous angel backers include individuals affiliated with the likes of WhatsApp, Square, Airbnb, Tinder, and Spotify.

BukuWarung already claims to be a market leader in its category, with 6.5 million MSME merchants registered on its platform across 750 primarily tier-two and tier-three cities in Indonesia. The company has grown the size of its team 5x in the past six months to around 150 people – including talent from Google, Amazon, and Microsoft – but claims to be on a capital efficient trajectory with more than 90% of its funds raised still in the bank.

The core mission statement is to digitize the Indonesian MSME sector – which represents 97% of the domestic workforce – and thereby create a positive socioeconomic impact on the country as a whole. This is hoped to be achieved through payments, accounting, and e-commerce products. Market share in these areas is said to be 90% with around $1.4 billion in annualized payments processed to date and $10 billion in annualized payments projected for 2022.

The plan is to add financial services including lending, savings and insurance to the current offering and build new payments infrastructure that features functions such as a QR code system. There will also be an aggressive expansion of the team, with overall headcount expected to double to about 300 across Indonesia, Singapore, and India, among other locations. In the engineering and product teams specifically, headcount is expected to triple.

“COVID-19 continues to expose the vulnerabilities of Indonesian MSMEs who remain a linchpin of the national economy. We have since seen the ecosystem rally – between stakeholders big and small – to accelerate the MSMEs’ digitization by improving their operational resilience and market reach,” Haryopratomo said in a statement. “From my experience, BukuWarung is not only building on such efforts but also emerged as one of the key actors accelerating this much-needed transformation.”

• Tweet  
• Facebook  
• LinkedIn  
• Google plus  
• Save this article  
• Send to  

• Topics
• Southeast Asia
• Financials
• Technology
• Consumer
• Early-stage
• Indonesia
• Goodwater Capital
• Valar Ventures
• Fintech
• Financial Services
• SME
• e-commerce