Editor’s note: This story was updated on July 26 to correct the valuation sought by the company.
Thailand-based fashion e-commerce startup Pomelo is targeting to close a $50-million Series C round by the third quarter of this year, two industry executives aware of the development told DealStreetAsia.
The e-commerce startup, they said, had been in talks with potential investors in recent months to raise the financing round.
One executive said that the Thai company was seeking to raise funding at a valuation of $200-240 million or 3-4x its current gross merchandise value (GMV).
The second executive confirmed this, saying the valuation, which is higher than the industry average of 1-1.5x GMV, is causing some reluctance among potential investors.
Pomelo declined to comment for this story.
Pomelo competes with Sequoia-backed near-unicorn Zilingo, Indonesia-based Sorabel (formerly Sale Stock) and Southeast Asian e-commerce giants Shopee, Lazada and Tokopedia.
The Bangkok-based startup last raised $19 million in a Series B round in November 2017 led by Chinese e-commerce firm JD.com and Provident Capital. The round was also joined by Thai retail conglomerate Central Group, Start Today Ventures and Lombard Investments.
Other notable investors on Pomelo’s cap table include Jungle Ventures, 500 Startups, Hong Leong Bank and InnoVen Capital.
Pomelo’s ambitious growth plans
Launched in 2013, Pomelo is an omnichannel fashion brand co-founded by David Jou, Casey Liang and Win Thanapisitikul. All three were also co-founders of Lazada Thailand. According to Pomelo, the startup aims to provide fashion that’s on-trend, online and on-the-go.
In June, Pomelo opened a brick-and-mortar store in Singapore, its first outside Thailand where it operates eight stores and over 45 pickup locations.
Pomelo operates an online to offline (O2O) concept relying on a network of pickup points for shoppers to collect the items bought via its app. Shoppers may try them on at these pickup points and return them at a zero charge if they decide not to buy them.
In an earlier interaction with DealStreetAsia, David Jou, CEO of Pomelo, had said: “People absolutely love not having to worry about returns. As long as you’re able to place a pickup location within five minutes of where that person works or lives, you’re hooked. It’s low risk and you can try on as many products as you want. You don’t pay upfront, you only keep what you like. And the whole experience takes just 15 minutes.”
Jou added that about 55 per cent of all of Pomelo’s transactions go through its pickup locations, with an increasing number of e-commerce and brick-and-mortar customers switching to its model of shopping.
Moving forward, Pomelo plans to enter Jakarta, Kuala Lumpur and Manila and roll out “hundreds” of pickup locations across these cities. It is also actively hiring and foresees its headcount expanding from 500 to 700 by the end of this year.
Pomelo has offices in Bangkok, Singapore, Jakarta as well as Shanghai, where part of its tech team is based.