Middle East based Wadi.com raises $67 mil­lion

The Pak Banker - - COMPANIES/BOSS -

Wadi, which cur­rently caters to shop­pers in the United Arab Emi­rates (UAE) and Saudi Ara­bia, claims to have more than 500 mer­chants-about 50 of them from In­dia-sell­ing more than 150,000 prod­ucts from over 2,000 brands.

Wadi.com, a Middle East-based on­line retail plat­form co-founded by for­mer Jabong ex­ec­u­tive Pratik Gupta, said it has raised $67 mil­lion in Se­ries A fund­ing. Saudi Ara­bia-based Al Tay­yar Travel Group Hold­ing Co. led the round of fund­ing, the com­pany said in a state­ment on Mon­day. Wadi In­ter­na­tional Gen­eral Trad­ing LLC, which owns Wadi.com, is backed by the Middle East In­ter­net Group, a joint ven­ture be­tween Ger­man In­ter­net firm Rocket In­ter­net SE and South African tele­com ser­vices provider MTN Group Ltd.

Al Tay­yar in­vested about $34 mil­lion and the ex­ist­ing in­vestors put in the rest, said co-founder Ankit Wad­hwa. Wadi was founded by Gupta, for­mer di­rec­tor of op­er­a­tions at Rocket In­ter­net-backed on­line fash­ion store Jabong and for­mer Mckin­sey & Co. ex­ec­u­tives Wad­hwa and Kan­wal Sar­faraz, in March 2015.

The com­pany, which cur­rently caters to shop­pers in the United Arab Emi­rates (UAE) and Saudi Ara­bia, claims to have more than 500 mer­chants-about 50 of them from In­dia-sell­ing more than 150,000 prod­ucts from over 2,000 brands. The com­pany plans to use the funds to pen­e­trate deeper into its ex­ist­ing mar­kets.

"We def­i­nitely have plans to ex­pand. But, if you look at the size of the mar­ket, Saudi is by far the big­gest. We have nei­ther sat­u­rated Saudi nor UAE. The Middle East mar­ket will grow to $40 bil­lion by 2020. We will be ex­pand­ing, but first we will look at suf­fi­ciently scal­ing up in the two coun­tries we are present in. Im­me­di­ate fo­cus is to ex­pand in the present ge­ogra­phies. Th­ese are 80% of the to­tal mar­ket," said Wad­hwa.

The av­er­age ticket sizes in the Middle East are rel­a­tively big, a fac­tor that Wad­hwa be­lieves will help the com­pany be­come prof­itable soon. "Av­er­age or­der value in the Middle East is about Rs.13,000-20,000. This is the holy grail of e-com­merce, that if you have larger or­ders, you tend to hit prof­itabil­ity sooner be­cause op­er­a­tions' cost as a per­cent­age of rev­enue comes down," he said.

"You are sell­ing more in one box to a cus­tomer." Wadi com­petes with lo­cal ri­vals such as Fouq and Rocket In­ter­net­backed Namshi. Apart from Wadi, the Middle East In­ter­net Group has backed home ser­vices plat­form Helpling, real es­tate clas­si­fieds por­tal La­mudi, car clas­si­fieds por­tal Car­mudi and ride hail­ing ser­vices Easy Taxi.

Some of the on­line mar­ket­places in Asia that have won in­vest­ment from Rocket In­ter­net in­clude Daraz ( which op­er­ates in Pak­istan, Bangladesh and Myan­mar) and Shop in Myan­mar. "The fund­ing round for Wadi. com only 10 months af­ter launch is a great proof of trust into our busi­ness," said Eyad Alka­s­sar, chief ex­ec­u­tive at the Middle East In­ter­net Group. Al Tay­yar's sup­port in cargo and lo­gis­tics will make it "the per­fect part­ner" for Wadi. com to con­tinue its ex­pan­sion in the Middle East, he added.

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