Carousell acquires rival Duriana to fend off Shopee

Carousell’s founding team. Photo credit: Carousell.

When Carousell’s founders thought about building the app, they just wanted an easy way for people to buy and sell their stuff on the internet. Today Carousell has come a long way.

It has just solidified its position as a leading peer-to-peer mobile marketplace – along with Garena’s Shopee – in Southeast Asia by acquiring Duriana, a rival based in Malaysia. The value of the deal was not disclosed.

This is Carousell’s third acquisition in less than six months, the firm says in a statement today. The startup bought Singaporean used car marketplace and dealership tool Caarly in October and personal safety app Watch Over Me in September, but the latter was more of an acqui-hire.

Duriana is no ordinary deal, states Carousell. It bolsters its listings in Malaysia, which number 5 million, and gives it a “significant boost” in the Philippines.

In an email response to Tech in Asia, Carousell co-founder and CEO Siu Rui Quek says Duriana’s listings in the Philippines have reached over 1 million to date, and its transactions in the country are pegged at 500,000. Total listings across all markets stand at 2 million.

A quick check on App Annie however shows Duriana ranks only 173 in the shopping category on Google Play in the Philippines, while Carousell ranks number 5 and Shopee number 2. Most smartphones sold in the archipelago run on Android.

Carousell, on the other hand, counts over 57 million listings and over 23 million items sold as of 2016 in 19 major cities across 7 countries. In the Philippines, it enjoyed an 80 percent quarter-on-quarter growth in transactions last quarter, but Siu Rui refused to reveal the base figure.

With the purchase, Carousell effectively gains an additional 600,000 registered users on its platform, of whom a third are active on a monthly basis.

“This acquisition accelerates our international growth,” he stresses.

Tough competition

The deal certainly helps amid a fierce battle with Shopee, which appears to be more popular in major Southeast Asian markets and has vast resources from Tencent-backed Garena. The two though may have different strategies on how to make money – Carousell has set its sights on premium listings, while Shopee looks more like an ecommerce player that takes a commission out of transactions.

Siu Rui shares that Carousell has started migrating Duriana users onto its own marketplace. “Users will be informed of the steps to move to Carousell and will have up to 15th January 2017 to do so. Duriana will cease operations soon after.”

Carousell is backed by Rakuten Ventures and Sequoia, alternately leading its seed to series B rounds. Other investors include Golden Gate Ventures, 500 Startups, and Darius Cheung.

Updated at 3:30pm on Jan 5 to include Siu Rui’s comments.