Deal focus: HappyFresh prepares shopping list

The seemingly unending traffic congestion in many Southeast Asian cities is a well-known, but temporary, aggravation for travelers. For local residents it is a permanent frustration, complicating every aspect of daily life, including the simple but vital task of grocery shopping.

Jakarta-based HappyFresh plans to bring the region's consumers relief, with the help of a new Series B round led by Samena Capital and supported by existing investors Vertex Ventures and Sinar Mas Digital Ventures (SMDV). The company will use the capital to build its platform among both suppliers and end consumers.

Crucial to HappyFresh's plans is the expansion and deepening of its partnerships with existing food retailers. Like many online grocery start-ups, HappyFresh partners with these companies to procure the items ordered.

"Large supermarkets and hypermarkets are important players in the grocery retail landscape and they will continue to do well and dominate in this region," says Markus Bihler, the company's founder and CEO. "Many are integrating online delivery service into their business model to make it even easier for tech-savvy, time-crunched consumers."

HappyFresh counts itself as one of the most successful grocery start-ups in terms of its retail partners, with a network of over 1,000 stores. While many of these are hypermarkets and other giant retailers, the company sees bigger openings in small and medium-size enterprises (SMEs), which often lack the resources, expertise or time to set up online offerings of their own.

The current round builds on HappyFresh's experience with its investors Vertex and SMDV, which led the company's $12 million Series A round. Financial details of the funding have not been disclosed, but Bihler confirmed that it was larger than the Series A.

Samena and the other new investors are expected to play a major role in HappyFresh's expansion beyond their financial support. The company hopes to take advantage of their networks to connect with entrepreneurs and policymakers in order to open further growth opportunities.

Along with the new capital comes a geographic refocusing, with HappyFresh shuttering its operations in Taiwan and the Philippines in favor of its core markets of Indonesia, Malaysia and Thailand. While Bihler says another expansion beyond these markets is part of the long-term plan, he believes this move was necessary in order to keep the company from becoming overconfident thanks to its quick growth and consequently risk spreading itself too thin.

"We're very fortunate to have grown into our current size in such a short time while continuously improving our product offering, service proposition and customer experience," says Bihler. "The new round of funding will enable HappyFresh to continue its focus on building a sustainably profitable company. To that aim, the company will concentrate on its three primary markets."

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• Topics
• Southeast Asia
• Early-stage
• Technology
• Consumer
• Samena Capital
• Vertex Management (II)
• Sinar Mas Digital Ventures
• Indonesia
• TMT