Indonesia: Laku6 secures undisclosed seed funding in round led by Golden Gate VenturesOktober 26, 2015
October 26, 2015 – Indonesia-based used phone ecommerce site Laku6 has secured an undisclosed amount of seed funding, after launching in July 2015, with Singapore-based Golden Gate Ventures leading the investment, followed by several local angel investors.
Launched by co-founders Alvin Yap (CEO) and Heng Shing Kae (CTO), the founding team combines serial entrepreneurship and technical experience. One of the angel investors was Andy Zain, managing director of local VC firm Mountain Kejora.
In an official statement, Golden Gate Ventures founding partner Jeffrey Paine said, “Laku6 is positioned for growth in emerging markets, where increasingly more people are looking to upgrade from their first basic smartphones to something better. Buying pre-owned is an affordable solution; it is a unique and untapped opportunity.”
According to a release, Laku6 claims to analyse more than 10,000 seller posts from online marketplaces daily to benchmark the prices of secondhand smartphones for users. Laku6 claims to have analysed in excess of a million posts in the last 100 days.
Selling ‘certified’ used phones online in Indonesia, this segment is currently an opaque market that lacks information on pricing and phone condition. The service operates on the basis of cash-on-delivery (COD) and a 30-day guarantee on phones sold through the platform.
A TechCrunch piece cites a Gartner report describing smartphone upgraders as driving the upper end of the smartphone market, with a secondary effect on the mobile market due to contributing to a greater volume of phones in circulation. Gartner predicts a global market for refurbished phones to grow to 120 million units by 2017, an increase from 56 million in 2014.
In the report, principal analyst Meike Escherich stated: “This rise in smartphone reuse will impact not only the sales of new units, but also the revenue streams of all those involved in the smartphone supply chain. Stakeholders that are already participating in take-back or trade-in programs need to have a strategy for turning used devices into a positive asset.”
Yap stated: “We’re deeply convinced that Laku6 must exist to make buying and selling used phones a much safer and simpler experience. This new injection of capital empowers us to continue helping our users upgrade their devices at affordable prices.”
With Indonesia’s growing middle class and the increased discretionary income arising from that driving further smartphone proliferation, as well as the vast size of Indonesia’s domestic market, Laku6 is well-positioned to leverage of these factors as it scales up and across Indonesia.
The market conditions of Indonesia, which resemble other destinations like Myanmar, the Philippines and Vietnam, mean that Laku6 can easily scale and translate its business model to these emerging markets. Together with Indonesia, they share a common narrative of a growing middle class, the proliferation of smartphones and increased use of the Internet and social media as channels for purchasing.
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