SoftBank leads $28m round in Indonesian rural-focused social commerce startup

“It seemed so unfair that a mother in rural Indonesia could buy only one cup of milk with US$1, while that same dollar could buy you two or three cups in Jakarta,” states Steven Wongsoredjo, CEO of Indonesian social commerce platform Super.

He started his company in 2018 in an effort to solve the logistic inefficiencies in the archipelago, which he sees as the cause for the increase in product cost in Indonesia’s rural areas.

To do this, Super has built a network of agents who can directly sell products from manufacturers to customers within their communities. The startup then leverages the services of hyperlocal logistics platforms to deliver the goods to their agents. It decided to focus on FMCG to increase the volume of transactions.

Recently, the startup raised US$28 million in its series B financing round led by SoftBank Ventures Asia.

Existing investors including Amasia, Insignia Ventures Partners, Y-Combinator Continuity Fund, and Steven Pagliuca, co-chairman of Bain Capital and co-owner of the NBA team Boston Celtics, also participated in the round.

With the new funding, Super has raised more than US$36 million to date. It claims to be the most funded social commerce startup in Indonesia.

Steven Wongsoredjo (middle) with Super’s co-founding team / Photo credit: Super

It currently operates in 17 cities across the East Java region, which is the second most populated region in the country, though its digital competitiveness is still far behind Jakarta’s. Wongsoredjo believes that his startup has an advantage over traditional ecommerce players like Tokopedia and Shopee in the rural areas of Indonesia.

Today, Super has thousands of agents who can distribute millions of dollars’ worth of goods per month.

Expanding to the next untapped market

The company will use the new funding to double down on its presence in East Java and expand its operation into other provinces later this year. Interestingly, it plans to move to the eastern part of Indonesia, which still has many digitally illiterate residents.

“All traditional ecommerce companies start their businesses in Jakarta, but when they want to expand to rural areas, it’s a totally different thing. We saw [digital illiteracy] as a barrier to entry. If we can make a product that works in the rural market, it would be hard for [competitors] to copy us,” says Wongsoredjo.

He also explains that in the macro economy, rural areas also have a big potential: The combination of East Java’s and South Sulawesi’s regional GDPs, with both regions located in the eastern part of the country, equals that of Jakarta.

Riding the wave