In a bid to shed light on the offline retail market of Southeast Asia, startup Snapcart has raised US$3 million in pre-Series A funding,
“Southeast Asia is a black hole and brands don’t know what is happening,” explains Snapcart CEO Reynazran Royono.
The new funding round comes after Snapcart raised US$1.7 million in January of 2016. Since then Snapcart has expanded from Indonesia to the Philippines.
An Indonesia-based startup that runs a service offering consumers rewards in exchange for scans of their shopping receipts has received US$1.675 million in funding just four months after launching.
New investors in Snapcart, Wavemaker Partners and Singapore Press Holding’s SPH Media Fund, along with existing backers SMDV (Sinar Mas Digital Ventures) and Ardent Capital, launched the funding round – described as “pre-Series A” – as the company started exploring expansion options in Southeast Asia, reports Techcrunch.
Snapcart’s business is two-fold: one one side it allows customers to scan their store receipts in exchange for cashback and rewards; on the other side, information from the receipts is compiled and used to provide clients, such as consulting agencies, with reports and information about consumer spending and shopping habits – valuable, because it is not easy to track offline commerce.
Snapcart CEO and founder Reynazran Royono says the company has scaled faster than initially anticipated, with the funding round being wrapped up a few months ahead of schedule.
He says the new capital will be used to develop more products, including engagement videos and analytical dashboard tools that will enable client brands to view customer behaviour in real time. There are more than 35 Snapcart clients including L’Oreal, Nestle, Procter & Gamble and Unilever.
“The amount of data we’re receiving is humongous,” says Royono, who previously worked as a consultant for Procter & Gamble and Boston Consulting.
So far, Snapcart for Android has clocked 150,000 downloads and has 85,000 monthly active users in Indonesia. An IOS app is about to be released.
TechCrunch.com says Snapcart is expected to push beyond its initial focus on FMCG into other verticals, and the company is looking at other options that could involve small retails.
Snapcart is also investigating regional expansion, adding former Procter & Gamble market research director Mayeth Condicion as chief data officer and co-founder. Condicion is based in Manila, which will be Snapcart’s first international expansion and soon home to its data analytics team. Jakarta will remain its technology hub.
Meanwhile, the company is thinking of a second funding round about the middle of this year so it can push ahead with its expansion plans. Snapcart aims to achieve one million user downloads in less than 12 months.
Snapcart, a mobile app based in Indonesia, announced today (Jan 5) that it has successfully raised US$1,675,000 (S$2,385,000) pre-series A funding.
Among this round’s participants are Wavemaker Partners, SMDV, Ardent Capital and SPH Media Fund – the investment arm of Singapore’s leading media group Singapore Press Holdings.
“I believe we were able to earn the confidence of investors after our early signing with major FMCG brands Nestle and L’Oreal in Indonesia,” said Reynazran Royono, CEO and Founder of Snapcart. “Our pre-launch and launch traction was also amazing with 12,000 app downloads before any marketing campaigns were launched. In a relatively short period we were able to sign more than 35 brands, including brands from Procter & Gamble and Unilever”
According to Snapcart, since its launch on Sept 2, 2015, the number of downloads has grown to over 150,000, with more than 85,000 monthly active users.
However, the company aims to achieve 1 million users downloads in less than a year.
Snapcart will use the capital to develop new products; including engagement video features and analytical dashboard tools. These features will accommodate brands with the platform they need in order to see their consumer behaviours in real-time, as well as to aid brands in formulating their next marketing actions.
The company is also planning an expansion to at least two other markets in Southeast Asia, starting with the Philippines early this year. Snapcart’s iOS version launch will also be taking place at around the same time.
“Our first stage of development was focused on mass data collection and user acquisition, activation, and engagement. Now, with over a thousand receipts received per day, we are looking to perfecting the built-in automation system and upgrading the app. In Indonesia, there are many different formats for receipts, even within the same retail franchise, which makes it harder to be automated. This is the hassle that we want to tackle in the next stage.” CTO of Snapcart, Laith Abu Rakty, said.
“User acquisition is always on the agenda, but now we’re doing it by partnering with FMCG companies and other verticals through a combination of offline activities and online marketing.” added Mr Rey.
Smartphones could give retailers and brands unprecedented insight into consumer spending and behavior just by allowing you to photograph your receipt.
That’s the premise of a new technology startup that launched in Indonesia today. Snapcart is backed by Ardent Capital — the VC firm behind Southeast Asia’s logistics network aCommerceand numerous e-commerce startups — and it aims to turn oft-discarded receipts into data gold mines.
The theory is simple. Physical retailers and brands know little about consumers and their shopping habits beyond survey-based data and estimates from research firms like Nielsen. Yet, the precious information is contained within a small piece of paper that shoppers typically throw away with little regard: the receipt. Snapcart is incentivizing users to take photos of their receipts and upload them into its app in exchange for cashback and rewards.
On paper, it’s a win-win — what consumer doesn’t like free stuff? And what brand or advertisers isn’t willing to pay up (incentives) to get fresh insight into their customers?
The concept isn’t entirely new. Ibotta, a U.S. company backed by over $20 million from investors, provides cash back for access to similar data. Unlike Ibotta, which requires users to photo both their receipt and individual product barcodes for in-store purchases, Snapcart uses artificial intelligence to pull product information right from a receipt, so users take just one photo.
Jakarta-based Snapcart has launched with two prominent, global brands — Nestlé and L’Oréal — but says it is in talks with another 20 or so partners. Founder Reynazran Royono — formerly with Proctor and Gamble and Boston Consulting — told TechCrunch he came up with the idea when reflecting on his experience as a consultant and a spell at e-commerce firm Berniaga.com, now OLX.co.id. Online retailers have access to a treasure trove of shopper data that physical retailers can only dream of, Royono said, and Snapcart aims to help change things.
The main challenge looks to be gaining scale among shoppers — Snapcart claims it has 12,000 pre-launch installs of its app. Snapcart said it will initially work with brands, which it is leveraging for marketing and other opportunities for exposure among consumers, and over time it plans to include physical retailers through in-store integrations. It is first focused on grocery items, because they are daily necessities, but will branch out into other verticals over time, Royono explained.
The company is starting live in Indonesia, Southeast Asia’s biggest country with a population of 250 million and ample opportunity, but Royono said he plans to expand across Southeast Asia towards the end of 2016. Snapcart is currently raising new funding, which he said should give it a good 18 months of runway.
“Snapcart is the most promising big data business in Southeast Asia we’ve seen so far,” Adrian Vanyl, CEO of Ardent Capital, said in a statement. “For brands, it is data they’ve fantasized about, but never had any practical way to actually collect.”