The deal is Jungle Ventures’ maiden investment in Vietnam, according to an official announcement.
Elsa Chandra, assistant vice president of investment at Traveloka, and Grace Yun Xia, principal at Jungle Ventures, will be joining the board of KiotViet, the company said.
Providing cloud-based POS solutions for Vietnamese small- and medium-sized enterprises (SMEs), KiotViet said it will use the proceeds from the round to accelerate its nationwide expansion, especially in remote areas with lower technological access, as well as expand its serving segments.
It has offered a suite of omni-channel business and management software solutions that include inventory management, cash flow and marketing to over 70,000 customers at a fee of 160,000 dong ($6.9) per month.
The company claims it has gained a growth rate of 250 per cent year-on-year since its inception in 2014.
“Vietnam’s SMEs form a central pillar to the national economy. They comprise over 95 per cent of all enterprises, contribute around 40 per cent to GDP and employ around half of the total workforce,” said Tri Cao, deputy general director of Citigo, the company that develops KiotViet.
“They will continue to play a significant role in Vietnam’s economic development. However, they have faced hurdles towards digitalising tedious operational processes. Our aim is to provide such companies with innovative and intuitive digital solutions to help them digitalize, increase efficiency and tap into new opportunities,” he added.
Jungle Ventures will help with KiotViet’s expansion by advising on its business strategy and the hiring of key personnel. The venture capital firm will also support KiotViet in collaborating with more ecosystem players and explore future regional expansion.
“Vietnam is one of the most exciting markets in Southeast Asia to look at right now. Currently, around 66 per cent of the country’s relatively young population of over 96 million people are connected to the internet and we’re seeing an explosion in tech-focused retail areas such as e-commerce,” said Jungle Ventures’ Grace Yun Xia.
Jungle Ventures has backed a spate of other B2B management platforms in the region, including Deskera, Moglix, Vayana Network, Mobikon and Tradegecko, among others. The firm has secured $225-million commitments for its third Southeast Asia fund and is seeking to extend the hard cap for the vehicle, DealStreetAsia reported earlier.
The investment in KiotViet is made through this third fund.
Meanwhile, KiotViet is the second investment in Vietnam by Traveloka, which earlier announced to have acquired travel startup MyTour.
Vietnamese startups raised a total of nearly $900 million in 2018, most of which came to businesses targeting the consumer market such as e-commerce and fintech companies. In the B2B sector, a major portion of deals were in logistics, with funded startups including Logivan, Ecotruck and Abivin.
Enterprise SaaS firm Base.vn has recently secured an early-stage investment led by Alpha JWC. Meanwhile, we have learnt that SCommerce, the business management unit of new-retail company Seedcom, is in the market to raise a significant funding.