Dagangan CEO credits geographical expansion for 44% revenue surge

Photo credit: Dagangan

Dagangan, an Indonesia-based social commerce firm, posted US$59.3 million in revenue for the period between November 2021 and October 2022. This marks a 44.4% year-on-year increase, according to the company.

In an interview with Tech in Asia recently, Dagangan CEO and co-founder Ryan Manafe attributed the company’s growth to its aggressive geographical expansion throughout last year, with a particular focus on penetrating villages.

During the 2022 calendar year, Dagangan’s area coverage reached 20,000 villages across the archipelago, growing more than 2x from the previous year.

That said, the number of monthly active users (MAUs) remained relatively modest. The Indonesian firm recorded 19,000 MAUs in 2022, indicating an average of just one monthly active user per village, Manafe stressed.

Looking ahead in 2023, “we are focusing more on vertical expansion to consolidate MAUs in existing villages” rather than horizontal expansion to gain more area coverage, he added. Dagangan currently has 25,000 MAUs, up 30% from last year’s figure so far.

See also: Indonesia’s social commerce startups double down on rural FMCG space

Founded in 2019 by Manafe and Wilson Yanaprasetya, Dagangan supplies fast-moving consumer goods to rural communities, specifically Tier 3 and Tier 4 areas across Java.

Other players in the social commerce space include Super, Kitabeli, Raena, and Woobiz. Although the industry is getting increasingly competitive, Manafe said there is still a lot of room for growth.

“We have only covered around 25% of the total market in Indonesia. Furthermore, the viability and relevance of our business model make it highly suitable for replication in other countries, such as the Philippines and Vietnam,” added Manafe.

In addition to partnering with big brands such as Unilever, Ajinomoto, and Coca-Cola, Dagangan has private-label products. So far, there are more than 20 local products white-labeled by the ecommerce firm.

According to Tech in Asia‘s database, Dagangan has raised over US$18 million in disclosed funding rounds, including US$6.6 million from BTPN Syariah Ventura and Hendra Kwik, co-founder and CEO of fintech startup Payfazz.