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June 22, 2022

Investment notes: Desty Series Pre-A

We are thrilled to have invested in Desty's Series Pre-A round

Piruze Sabuncu

June 22, 2022

Investment notes: Desty Series Pre-A

We are thrilled to have invested in Desty's Series Pre-A round

Piruze Sabuncu

We are thrilled to partner up with Desty, Indonesia’s leading full stack merchant enablement platform, to bring sellers online and operate seamlessly across Southeast Asia’s burgeoning yet fragmented e-commerce space.

We are excited to team up with existing supporters, including East Ventures, Jungle Ventures, 5Y capital among others on Desty’s mission to unlock economic opportunities for millions of small businesses in Indonesia and beyond.

We were well aware of Indonesia’s rapid e-commerce growth and its potential, and had been on the lookout for teams that had the vision and skills to build mission-critical products for merchants to succeed in this nascent space. With more merchants in this region eager to embrace e-commerce, it was obvious that the current solutions were inadequate to meet their needs.

When we met Desty’s co-founders Mulyono Xu and Bill Wang and learnt what they had built, we were not only impressed with the traction they had in such a short time, but also the talent they were able to attract across geographies to advance Desty’s mission. Pak Muly and Bill have worked together on various occasions, helping Alibaba scale in various emerging countries including Indonesia and Brazil, and through so gained first-hand understanding of emerging markets’ merchant needs. Furthermore, the Founders have the right access and insights to think about the second and third levels of value drivers - from consolidation of payments, access to the right inventories, to other operational components which critically define merchants’ success in e-commerce .

It is common in the evolution of a country's e-commerce journey for new online brands to own more direct relationships with their customers as they mature, and we think Southeast Asia’s e-commerce space has now arrived at this critical juncture. We feel privileged to work with the duo who dedicated their previous careers to advancing China, Southeast Asia and other emerging markets’ e-commerce adoption.

Indonesia’s digital commerce space is a wild, wild west

More than 85 million people in Indonesia shopped online in 2021, with more embracing digital commerce during COVID. There are now close to 8 million sellers in Indonesia that are catering to booming demands in digital commerce. 

For a seller, however, navigating Indonesia’s digital commerce landscape is no easy task today.

  • Over the last few years, multiple e-commerce marketplaces and a few dozens of payment methods have popped up to serve this segment, resulting in a highly fragmented e-commerce landscape which is challenging for sellers to juggle all at once
  • Sellers need to manage inventories, supply chain, customer support across these distribution channels, which makes operation increasingly complex. 
  • Merchant and product discovery are suboptimal given the sheer volume of sellers and items on Indonesia’s marketplaces today. It is not uncommon to find “SKU arbitrages” on the same marketplaces.

Indonesia is also incredibly communal, spending on average 4 hours on social media and using social commerce to “discover” brands, especially in categories such as Beauty, Baby and Fashion. Prevalent social networks including Instagram and TikTok, however, focus on building native integrations to global merchant enablers, leaving local sellers underserved on their needs to engage and own their customers and communities.

For these reasons, merchants in the region look to unbundle from marketplaces and build their ‘brand.com’. However, many “off-the-shelf” online merchant enablement solutions today lack customisation or localisation to cater for Indonesian merchants and social sellers, calling for a region-native player to more effectively solve their pain points.

Creating the one “Destynation” for all of Indonesia’s online merchant needs

Muly and Bill, who spent much of their professional careers living and breathing this e-commerce problem at Alibaba are quick to act on this. Over the last 2 years, the Desty team has created a suite of merchant enablement products to help sellers navigate the nascent yet evolving digital commerce space:

  • Desty page offers a simple ‘link in bio’ for creators or merchants to convert traffic from major social networks in Indonesia
  • Potential customers can then be guided to a simple, no-code digital storefront powered by Desty Store to complete their purchases. 
  • Merchants are further powered by Desty’s omnichannel solution, which includes inventory management system, suite of payment gateways, and seamless distribution to all prevalent e-commerce marketplaces.

Off the back of its scalable merchant solution infrastructure, Desty’s team rolled out its Desty Menu to enable F&B merchants to capture post-COVID recovery demand, and has seen great successes in helping the likes of Bakmi GM, Old Changkee to cater to their digital-savvy customers with simplified F&B order and payment experience. Desty’s suite of full stack, merchant enablement tools, is quickly adopted by close to 1 million merchants signed up in less than 2 years.

The Desty team is just in the early innings of their mission to make digital commerce available and accessible for everyone. If you share their passion for the cause, check out their open positions here.