Traditional retail is not dead, but it is changing. With the right strategies to effectively drive innovation in a rapidly changing marketplace, the growth cycle for both demand and supply will continue to expand.
Kilo — a Vietnam-based tech startup — believes the next generation of retail platforms must not only have the advancing innovation but the willingness to approach and solve existing problems in a different way.
According to Kilo, the retail density in Vietnam is one store for 118 shoppers. The country’s retail market is 20% organized (this consists of established malls and large grocery stores) and 80% small and medium retailers.
“The retail landscape has six different entities: the shoppers, brands, retailers, distributors and wholesalers, lending institutions, and logistics providers. All of these 6 entities interact with one another for exchange of goods and services,” Kartick Narayan, CEO and Founder of Kilo, tells Vietcetera. Ultimately, the vision of Kilo is to connect all six entities under a single platform, within the Kilo ecosystem.
The industry, something as entrenched as the FMCG (Fast-Moving Consumer Goods) distribution, has been doing things the traditional way for the longest time but Kilo is not here to change and cause interference. Kilo’s intention, according to Kartick, is to bring a modern shopping format to traditional retail, not building a better product.
Bringing with him a wealth of experience in e-commerce, serving times at tech giants Amazon, Groupon, Korea's Coupang, and most recently Vietnam’s own Tiki as Chief Business Officer, the first-time start-up founder keeps in mind to never put the cart before the horse and instead focus on doubling down the existing product to make it very solid.
Founded on the principle that technology can affect change in traditional and long-established sectors such as offline retail stores, Kilo is all about addressing customer pain points and solving them at scale.
Finding the right investors
Going into founding a startup, Kartick knew that raising capital is not easy but is not the biggest challenge. For him, it is to build and retain the right culture. With that in mind, he looked for investors that he can collaborate with and can co-own not just the cap table but also the company culture.
Just recently, Kilo bagged an undisclosed seed funding from US-based Goodwater Capital and 500 Fintech, Singapore’s January Capital, 500 Startups Vietnam, and other prominent angel investors in the region — giving Kartick the right partners to rely on in terms of legal and financial help and Kilo having enough runway to go fast and go far. Goodwater Capital recently co-led a $100M+ investment into MoMo Vietnam.
“We just raised a seed round, pretty proud of where we ended up. Fundraising is a small milestone in a long journey. Customer and investor feedback has been positive. I anticipate that we will soon be ready for a Series A,” Kartick said.
Funds raised will go towards expanding the platform’s capabilities to reach more entrepreneurs and consumers, growing the team to further enhance the Kilo ecosystem.
As part of phase one, Kilo is building a marketplace platform to connect wholesalers and distributors with retailers. Giving small and medium-sized store owners a one-stop-shop where they can come in, build a basket, get transparency into pricing, assortment, and availability, without having to take any inventory risk or having to compete with one another.
“A platform like Kilo is an asset-light, n-sided (markets that connect two or more distinct groups of customers) marketplace platform. We are tech data-driven. We do not carry inventory or control the price,” Kartick said.
“We are even more relevant now as it allows the seller side to compete against well-funded competitors. Our mission is to give them tools in order to succeed and build a better business. We do not compete with distributors/wholesalers.”
To create a seamless supply-demand cycle, Kilo takes “convenience orientation” to the core. This means a customer’s general preference for convenient goods and services has a major impact on buying decisions. However, beyond convenience, Kartick and his team are in it for the long haul.
“Convenience aspect is a big draw for potential customers. Disruption should not be the model, the model should be more about taking everybody along in the journey,” Kartick said. “Our goal is to show customers the value of making their lives simpler.”
As for the second phase, the tech startup plans to hire dozens of engineers and product managers to work on ways for sellers to hyper-target features to retailers. Beyond that are a few experimental things the team will work on.
Looking back, Kartick believes doing really tough things will lead you to knowing yourself more. The personal reason he wanted to do a startup is because it’s really, really hard. “I wanted to challenge myself in a big way and so far, it has surpassed my expectations,” Kartick revealed. Adding that the kind of experience that a startup gives, particularly as a startup founder, is something you can’t buy and nobody can do for you, even if it means turning down a lucrative job offer back in the US.
Kilo is still growing and the non-negotiable traits he’s looking for in his staff are, in order of importance, right attitude and resilience. “Context matters. A lot. This is particularly true in a growing market like Vietnam. When you have the right attitude, you can solve pretty much any problem and can go through the ups and downs,” he shared. Startups change, the industry changes a lot, things can go really right, things can go really wrong and having someone in the team who’s resilient to not give up and come together during the ups and downs is really important.