Rocket’s ecommerce site for ‘frontier markets’ gets $55M funding

Rocket Internet’s Daraz started out in Pakistan as a fashion ecommerce business before changing into a general online store (Photo by Farrukh)

Rocket Internet’s ecommerce store Daraz revealed today that it has secured EUR 50 million (US$55 million) in its first ever funding round. It operates in Pakistan, Bangladesh, and Myanmar – three markets where ecommerce is at very early stages, which is the kind of unformed landscape that Rocket likes to blast into.

The US$55 million comes from the UK government’s CDC Group, which is focused on supporting and developing businesses in Africa and South Asia, as well as Rocket spin-off Asia Pacific Internet Group (APACIG), which is technically Daraz’s parent company. The cash will be used to grow the business in existing markets and for expansion into other nations in Asia where ecommerce is only just taking off.

“Although internet penetration is still relatively low, the market is developing fast and its potential is immense,” says Bjarke Mikkelsen, CEO of Daraz, in today’s statement.

Daraz runs separately from Lazada, Rocket’s estore for more mature markets such as Singapore and Thailand.

Growing from Pakistan

Daraz started in Pakistan in 2012 where it focused on fashion items before evolving into a broader, Amazon-style store. Towards the end of 2014, it launched in Myanmar (where it’s known as Shop.com.mm) and Bangladesh. The store is “the Amazon of the frontier markets in Asia,” said Koen Thijssen, co-CEO of APACIG, when we talked to him last year.

Thijssen describes Rocket’s ecommerce entry into Pakistan as an example of getting in at the ground floor, way before other companies would even begin to consider the market as a viable option.