PETALING JAYA: Fresh from securing US$1 million (RM3.87 million) in a pre-series A round last month, social commerce enabler Avana is building up momentum to test the Indonesian market for its next phase of growth. Avana transforms social media from a promotional platform to a transactional platform by bridging product discovery purchases and closes the loop between digital marketing and trade for both online and offline sales channels. By subscribing to Avana’s packages of RM399 or RM699 a year, SMEs can sell on web, social media, mobile and tablet and manage customers, orders, and process payment.
Avana CEO Luqman Adris, 35, said its foray into Indonesia began in November 2017. He noted that the number of SMEs and Facebook users in Indonesia is 10 times more of Malaysia’s. “It (Indonesia) is a test market for us at this moment. If you go all in to Indonesia, you need a lot of capital and US$1 million is not enough. It’s a huge market,” he told SunBiz. Prior to this, the start-up has decided not to push its business in Singapore as the e-commerce scene there is crowded and competitive, while the market size there is relatively small compared with other countries in the region. Currently, the majority of Avana’s business is from Malaysia. Luqman said it is looking to raise US$10 million in its next round of funding in 2019 for its regional market expansion. He said Avana aspires to be a global company in five years, growing from Malaysia to the regional scene and subsequently the global stage. “The challenge is growing our team or human capital. We’re on fast growth and we need to get people to adapt to fast change and perform,” said Luqman, adding that the start-up has 22 staff in Malaysia and eight in Indonesia, and is hiring more talent.
A former aerospace engineer and digital agency entrepreneur, Luqman formed the start-up under The Future Commerce Sdn Bhd in June 2016 after he noticed that many SMEs and micro-SMEs could not afford to pay some RM30,000-RM50,000 for a good e-commerce platform. He said these SMEs often promote their business through Facebook and Instagram and would sell their products elsewhere, where most processes are manual. Avana COO Soh Yien Yee, 30, who previously worked in social media management and marketing, echoed the issues with small sellers. “These sellers usually don’t last long. They do all things manually, from sourcing, modeling, taking orders, shipping orders and COD (cash on delivery). It’s not easy to grow the business. They often hit a roadblock and when they start working full time or when they get married, they give up,” said Soh. Avana, which has 25,000 merchants currently, allows sellers to reduce drop rates across multiple sales channels and manage the purchase intent, transactions and inventory within a single dashboard. Sellers are equipped with tools to manage their complete sales cycle, including payment, shipping and inventory management. Last month, Awana raised US$1 million in a pre-series A round led by Gobi Partners, Cradle Seed Ventures (CSV) and TH Capital. Luqman revealed that it is also in talks with one Indonesian investor. In its seed round, Avana raised US$500,000 from CSV and Captii Ventures in June 2016.