Despite the coronavirus downturn and widespread business shutdowns, online retail was one of the sectors that benefited from an increase in demand from consumers who were following social distancing measures and staying at home.
As a result, online shopping which had already been on the uptick prior to the pandemic has boomed. Vietnam’s digital retailers recorded a 20 percent increase in online shopping as of March 2020. The shift was especially notable in key product categories such as food, household items and apparel.
The surge has been a boon for reputable online marketplaces like Sendo – one of the largest home-grown e-commerce players in Vietnam. It is likely that the significant shift from offline to online among Vietnam’s 63.6 million internet users will continue after the lockdown, giving a further boost to e-commerce businesses.
Gaining fundraising momentum
Not letting COVID-19 take away its strong fundraising momentum that saw the startup successfully close an US$61 million Series C round in 2019, Sendo is said to be in the process of raising a Series D round. Already one of Vietnam’s top-funded startups, closing this round will place Sendo among the country’s most valuable technology companies.
With the objective to secure a 9-digit amount, of which a material portion is said to have already been subscribed to by existing and new investors, Sendo is well on track to finish the US$100+ million-dollar round, according to a source close to our editors. The total value of the investment is expected to increase further before the round is closed.
As Vietnam and the country’s e-commerce sector are coming out of the pandemic on top, changing consumer behavior presents new opportunities. With consumer online shopping habits potentially leapfrogging at least one or two years, Sendo finds itself on an accelerated path to profitability.
Since Sendo’s launch in 2012, the startup has been focused on sustainable growth – a mindset that has seen both its cost and operational efficiency improve tremendously year to date. The opportunities presented by the pandemic dovetail with the company’s overall focus on the C2C marketplace model and tier 2 cities, as well as explaining the management’s strategic decision to expand into social e-commerce, building an experience that flows seamlessly from discovery to purchase.
Leveraging e-commerce technology and tapping into the momentum of the sharing economy, Sendo’s C2C marketplace model empowers both the customer, by offering a variety of options, and Vietnam’s SMEs through the connectivity of its trading platform.
Whereas Sendo’s Series C funds were earmarked for investment in AI and machine learning, a substantial portion of the Series D round will be allocated to turbocharging Sendo’s social e-commerce expansion.
The search for the right partner continues?
Sendo’s investment round announcement comes amid the ongoing speculation of its potential merger with Tiki, a rival platform. The unconfirmed merger talks have had the industry’s key players on the edge of their seats for quite some time now.
According to an unnamed source with knowledge of the situation, the key decision ultimately lies in being able to maintain an open platform to realize the full growth potential of Sendo’s marketplace model, along with its various monetization pillars.
As the only major standalone e-commerce incumbent in Vietnam, Sendo’s next move will have a ripple effect on the country’s e-commerce landscape and retail industry as a whole.
The management is cited to be open for extensive partnership and collaboration opportunities with the right strategic partner, to boost overall ecosystem and platform growth going forward.