Small to medium-sized enterprises contribute 60% of Indonesia’s gross domestic product. But companies in the D2C space still struggle to compete against bigger brands. Praktis wants to put them on a more level playing field.
The startup, which handles everything from raw material purchases to order fulfillment for D2C brands and suppliers, announced today it has raised $20 million in Series A funding. The round was led by East Ventures (Growth fund), with participation from Triputra Group and SMDV.
Praktis co-founder and chief executive officer Adrian Gilrandy told TechCrunch that even though 60% of Indonesia’s GDP comes from SMEs, many experience difficulties while scaling up their business operations. These include finding reliable suppliers, getting fair pricing, the cost of labor and high exposure to fixed costs.
Through its platform, Praktis’ customers are able to manage this business operations, including raw material purchases, production, fulfillment and logistics. Gilrandy said Praktis also aggregates purchasing and processing for economies of scale. This leaves D2C brands free to focus on other parts of their business, including brand building and marketing.
The startup plans to scale up by growing alongside the D2C brands it serves. Gilrandy said its ecosystem can easily be applied to other verticals — for example, it started in fashion before moving on to the beauty industry. Praktis claimed 12x growth year-on-year from 2020 to 2021 as the COVID-19 pandemic accelerated adoption of its services, and 4x growth year-on-year from 2021 to 2022.
Praktis will use its new funding for technology development for both brands and suppliers, building its team and expanding its end-to-end supply chain ecosystem.
The startup also announced today it has appointed Leonard Pontoh as its chief financial officer. Pontoh is also joining its board of directors.
In a statement, East Ventures co-founder and managing partner Willson Cuaca said, “We are thrilled to double down our investment to Praktis as they strive to empower D2C brands in Indonesia and hit profitability much faster than we expected.”
Comment