Kresna-backed mall directory website Gotomalls.com is looking to raise a minimum of $5 million in funding from existing and new investors.
Kresna, one of Gotomalls’ larger investors, is expected to do a follow-on investment.
“We will do internal funding rounds as well as external,” Gotomalls’ holding company DominoPOS CEO Bruno Zysman told DEALSTREETASIA.
GoToMalls claims to be the first geo-located online platform in Indonesia that provides comprehensive information on promotions and events in shopping centres. It works by showing users relevant offers and discounts at shopping malls and shopping complexes based on their vicinity. The idea is to help brick-and-mortar shopping malls revive and reinvent themselves in the age of e-commerce.
Its parent company, DominoPOS, started in 2009 as a marketing tech firm that had registered patents all over the world. The Singapore-headquartered company has raised a total of $3 million so far from seed through Series A.
Now, Gotomalls needs to secure funding fast, by year-end if possible, to support its growth and expansion plans. The platform is aiming for 10 million monthly visits. It is currently at four million since its official launch last year.
Raising funds for young startups in Asia is not that easy, despite increasing flow of capital from outside or within the region itself.
“You need to be cash-generating first, it’s difficult otherwise,” said Zysman.
“But now that we are raising very high KPIs (it was our main target to reach KPIs), it’s going to be much easier. Now the VC firms are starting to listen to us, now we can raise more. Until a few months ago it was not possible,” he stated.
Gotomalls is now recording a 90 per cent monthly visit growth in the last two months. It has 385 malls directory across Indonesia with over 6,000 brands and 22,000 stores and merchants.
So, what kind of investors is Gotomalls looking for? Those who can be our business partners at the same time, Zysman replied. That is why Kresna is very strategic, as the group slowly transforms itself into a digital holding company, acquiring and injecting investments into various digital startups.
Gotomalls was Kresna’s first investment into the digital space in 2015. Zysman said that as one of the firm’s more significant backers, Kresna has helped boost partnerships with prominent names in the country such as Grab and Indosat. Gotomalls usually provides exclusive deals or promotions for partners’ loyal users. Currently, it is in discussions with several airlines for possible special offerings based on miles or points held by a flyer.
With Grab, Gotomalls sees opportunities for partnerships in almost all of the ride-hailing app services. Gotomalls users can now launch the Grab app via the platform, which will fill the drop off or pick up points data for them. In the future, there might be more integration with Grab rewards or Grab Express, the app courier service.
“Just to make one thing clear,” Zysman added, “We are not here to compete with e-commerce business, we are actually complementing them. We are not trying to take away their customers.”
His argument is this: people will still be going to malls. Earlier it used to be mainly for shopping goods, now people go mostly for services. In Jakarta, especially, people go to malls to find their favourite hairdressers, restaurants, dental and skin clinics, and coffee places. In the city of shopping centres, people would rather spend two hours inside the air-conditioned buildings waiting for traffic to subside.
“It’s just the place that needs to reinvent themselves, like for example, it can become a place to hang out, to eat, to collect goods (purchased online) and to get discounts (that’s where we are),” Zysman said.
About 25 per cent of malls surface in Singapore’s most famous Orchard Road is now empty, and many malls in American suburban cities have been shut down. In Indonesia, malls are still growing, albeit by one digit instead of two as they used to.
“It’s true that we are starting to see the impact of e-commerce here in Southeast Asia too. But I think they (the malls) just need some creativity. We are here to help them, and there are other good startups too trying to do this. Bottom line: I don’t think malls are going to shut down completely,” he said.
About 90 per cent of worldwide retail spending is still in brick-and-mortar stores, according to eMarketer. Online giant Amazon has made headlines over the course of two years for experimenting with physical grocery and convenience shops. Experts have said that a physical store has benefits, including boosting brand awareness and exposing people to Amazon’s prime subscription service.
In other words, Gotomalls is not just a temporary, bridging type platform to help the world transitions from offline to online, Zysman concluded.
“I believe we have high sustainability in Indonesia, as well as other countries. We see the pain and we are here to solve the pain.”