Daraz, an online retailer in Asian frontier markets, has secured EUR50 million (USD55.7m) in its first major financing round. The investment comes from the CDC Group – the UK Government’s Development Finance Institution (DFI) focused on supporting and developing businesses in Africa and South Asia – as well as Daraz’s existing investor Asia Pacific Internet Group (APACIG).
Daraz is already the leading e-commerce platform in Pakistan, Bangladesh and Myanmar (operating as shop.com.mm). The company started in Pakistan in 2012 as an online fashion business, but since then has expanded its business model to a general marketplace for quality brands within electronics, home appliances, fashion and many other categories. The funding will be used to continue to grow the business in existing markets and for expansion into other frontier markets in Asia.
"Taking the e-commerce business model into these exciting markets is a fascinating journey. Although internet penetration is still relatively low, the market is developing fast and its potential is immense," says Bjarke Mikkelsen, CEO of Daraz. "By making Daraz a success, we are not only building a great business, but also creating jobs and infrastructure in the countries we operate in – that’s what makes it so exciting."
Daraz is part of the APACIG, one of the fastest growing internet platforms in the Asia-Pacific region, currently uniting 14 e-commerce companies in 15 countries.
"The markets where Daraz is active are inspiring for entrepreneurs. We are looking forward to supporting Daraz in its ambition to become the number one shopping destination in Asian frontier markets," said Hanno Stegmann, CEO of APACIG.
"Daraz is rapidly building an online trading infrastructure across a number of South Asia’s most challenging frontier markets. CDC’s investment will enable the company to continue its impressive growth. We expect our investment to help Daraz create several thousand direct and indirect jobs over the next 5 years, and play an important role in the professionalization and development of local retail sectors, logistics networks and technology industries," said David Osborne, CDC’s Investment Director.