Fashion marketplace Zilingo nets $17m round led by Sequoia and Burda

Zilingo’s co-founders – CEO Ankiti Bose (L) and CTO Dhruv Kapoor (R). Photo credit: Zilingo.

Singapore-based online fashion marketplace Zilingo has raised US$17 million in a series B funding round co-led by Sequoia Capital India and Burda Principal Investments, the venture capital arm of German publisher Hubert Burda Media.

Existing investors Beenext, Susquehanna International Group (SIG), Venturra Capital, and Wavemaker Partners participated in the round. Two high-profile angels also joined in: Draper Fisher Jurvetson founder Tim Draper, and Manik Arora, founder of IDG Ventures India. The round represents Arora’s first investment in Southeast Asia.

In markets like Indonesia and Thailand, offline media and out-of-home advertising is still a huge part of how you speak to your customer.

Zilingo co-founder and CEO Ankiti Bose tells Tech in Asia that the company – which provides an online marketplace for offline vendors of clothes, jewelry, and related beauty and lifestyle products – will be using some of the funding to double-down on the highly promising Indonesian market, where it launched four months ago. “For us, Indonesia has just started exploding – we really think there’s a lot of supply, a lot of merchants in Indonesia that can benefit [from our platform],” she says. “So the main intention behind raising this round was to consolidate what we’ve done so far, and keep growing.”

Brand-building

Beyond this, the capital will also be invested in brand-building, especially via more traditional marketing efforts rather than simply through online channels. “Especially in markets like Indonesia and Thailand, offline media and out-of-home advertising is still a huge part of how you speak to your customer,” Bose explains. Every single marketing dollar Zilingo has spent so far has gone towards digital marketing such as online ads and social media campaigns – and moving the message to billboards and the sides of buses is not going to be cheap.

Photo credit: Zilingo.

Bose is well aware of this, but the potential growth opportunities opened up by pursuing such a strategy make it worthwhile. “I think there’s a minimum threshold you have to cross in terms of spending,” she says. “But it’s really effective at reaching the not-so-low hanging fruit – the guys who are not on Facebook and Instagram.” In developing economies, you still have to rely on traditional media if you want to go big, she says. “That’s a lot more expensive, but if you do it right what you’re hoping is that a guy sees us on a billboard while he’s driving, so that next time he’s online and sees our name, he clicks on it.”

In vogue

Zilingo isn’t alone in this space. Southeast Asia has spawned its fair share of online fashion startups, several of which have enjoyed significant growth and funding to match. Rocket Internet-affiliated Zalora has been through a few ups-and-downs, but remains a widely recognised player. Indonesia’s Sale Stock last month raised US$27 million from Gobi Partners and Golden Equator in a “series B+” round.

And beyond the fashion segment, there is competition from more broadly focused ecommerce sites such as Lazada, Blibli, Bukalapak, and Tokopedia, which last month raised US$1.1 billion in an Alibaba-led funding round.

Minding the gap

Tenfold revenue growth