YC alum Dropee, a B2B wholesale platform from Malaysia, receives $7 million in Series A – Techdoxx

Deepak Gupta
Deepak Gupta January 20, 2022
Updated 2022/01/20 at 4:02 AM

Another SME-focused startup in Southeast Asia has announced a funding round. dropee, a Malaysia-based B2B wholesale platform that also offers financial services such as working capital loans to SMEs, said today that it has closed a Series A round totaling $7 million. THE Y Combinator alum raised $3 million in equity and $4 million in debt, led by investor Vynn Capital. Other participants included HCL Capital, Resolution Venture and LKF Capital, along with recurring investors Brama One Ventures.

Operating in Malaysia, Singapore and Indonesia, Dropee plans to launch new financing products for wholesalers and retailers over the next 12 months, working with strategic partners including regional banks and non-bank financial institutions. It has already raised a total of $8.7 million.

Launched 5 years ago, Dropee primarily focuses on fast-moving food and beverage and consumer goods. The startup says it is used by more than 80,000 SMEs, mostly small retail stores, to buy wholesale inventory through its marketplace, and it now totals more than $100 million in annual transaction value. Its marketplace is integrated with a SaaS e-commerce platform that automates payment collection, tracks orders and sales, and manages offline to online orders.

Lennise Ng, Dropee’s CEO, said the startup was created because she and one of her co-founders came “from family businesses that have been involved in the B2B commerce of fast-moving consumer goods for more than two generations.” This gave them an up-close look at the inefficiencies in the wholesale trade space across Southeast Asia. Dropee was created to make the process more efficient.

For example, the platform makes product recommendations through its intelligent AI-powered catalog: each B2B consumer sees a personalized selection of best-selling products, companion products, and campaigns based on their business needs. SMEs can also place orders directly from their wholesale market or from a designated sales agent, allowing wholesalers real-time transparency and allowing orders to be processed faster.

Dropee began offering financial products in November 2020, including up to 60-day credit financing for invoices and supply chain. “It can be challenging for traditional wholesalers to extend longer credit terms to SMEs, especially during the pandemic,” Ng said. She added that credit financing for retailers helps increase the number of out-of-stock purchases. To assess credit quality and loan terms, Dropee uses several variables captured through its platform, including an SME’s transaction data for lifetime value per business network.

The new funding round will be used to expand Dropee’s supply chain funding, with plans to work with more brands and wholesalers across Southeast Asia to extend credit term payments for small and medium-sized retailers.

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