MENAP's b2b marketplace Sary takes a significant stake in its Pakistani counterpart Jugnu leading its $22.5M Series A round to build their seamless alliance, enter the Pakistani market, and exchange tech and talent between the teams.
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Pakistan-based E-commerce startup and b2b digital marketplace Jugnu has successfully raised $22.5M in its latest funding round. The Series A round was led by Saudi-HQ'd and MENAP servicing B2B marketplace and digital wholesaler Sary in a continued effort to expand its market reach. The round also recorded participation from key strategic investors including Sarmayacar and Systems Limited.
Jugnu was founded in 2019 by co-founders Sharoon Saleem, Yasir Memon, Syed Khurram Haider, and Ahsan Muhammad Khan. The E-commerce startup drives social and economic empowerment for small businesses across Pakistan, by creating a B2B platform to channel supplies from large suppliers/manufacturers to small and medium enterprises. Fueled by a $75m Series C funding round for a combined $112m in funding to date, Sary’s investment marks its expansion into Pakistan and its second deal this year following its acquisition of Egyptian B2B food and grocery marketplace, Mowarrid, in March. Both deals have brought Sary closer to becoming the gateway to enable frictionless commerce between producers and businesses in MENAP.
As recorded in our E-commerce 2022 Venture Investment Report, Pakistan's E-commerce sector observed a sharp spike in funding over the past year to near the $100M mark for the first time in 2021. This increase in capital investment in the sector came at a general influx of capital where funding in Pakistan recorded a 355% YoY surge across industries, and accumulated a 419% YoY growth in funding backing the E-commerce sector in specific over the past year. Surely, B2B marketplaces including Bazaar which raised the highest funding round of last year, Tazah, Dastgyr, and Tajir Pakistan took the lion's share of funding accounting for more than 70% of all capital invested in the sector. Remarkable funding rounds have also been closed by grocery delivery and Q-commerce propositions to make way for the next generation of online ordering, with sizable investments in GrocerApp and Krave Mart. What is intricately unique about the general inclination of emerging E-commerce ventures in Pakistan is their eagerness to capitalize and support the SME segment of the population, which influenced the rise of FinTech integrated E-commerce propositions like Udhaar App enabling mom and pop stores to digitize their ledgers and boost their turn over rates.
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With a current value of $100bn and 8% year-on-year growth, the Pakistani B2B eCommerce market represents a significant commercial opportunity. Jugnu has already established a rapidly-growing customer base of over 30,000 small and medium-sized enterprises (SMEs) in key cities such as Lahore, Rawalpindi, and Islamabad, and has grown to a team of over one hundred industry veterans and young innovators. “Supply chain fragmentation is a persistent issue across emerging markets, leaving local businesses in a disadvantageous position. Following Sary’s strong growth and success in Saudi Arabia in 2021, Sary’s focus this year has been accelerating our regional consolidation strategy to help bridge efficiency gaps in B2B sales in MENAP.” said Sary’s Co-founder and CEO, Mohammed AlDossary.
The investment and alliance paves way for consolidation in the B2B eCommerce supply chains in MENAP, providing both companies with the ability to leverage diverse expertise and talent transfers across the region.“Pakistan is a strategic market for us as we look to achieve our vision of being the leading B2B e-commerce platform in emerging markets. With its strong traction among customers, rapidly growing sales, and its team’s clear strategic vision, expertise and ambition, Jugnu is an ideal partner to realize Pakistan’s opportunity. Jugnu’s founders are serial entrepreneurs and have strong FMCG backgrounds - they’ve built the B2B SaaS success Salesflo which does $3bn in transactions since the company was founded, demonstrating they know what it takes to launch and develop a successful company in this sector. We believe they will help us add synergy between Pakistan and the GCC, connecting the region and beyond with digital networks and services to make commerce seamless for everyone anywhere in MENAP,” AlDossary added.
The funds from its Series A round will enable Jugnu to expand its team even further, enhance its technology, expand product offerings and extend its geographical footprint in Pakistan. Speaking about Sary’s investment, Co-founder and CEO of Jugnu Sharoon Saleem concluded, “Our new alliance with Sary will be a great boost for Jugnu. We’ve established a foothold in our existing operating cities with a rapidly growing customer base, and Sary will help us accelerate the development of our platform to connect producers and businesses, thereby ensuring SMEs in Pakistan have access to the best, most competitively priced goods at a single tap. Both Sary and Jugnu stand to gain from a MENAP-wide knowledge and talent network, by which employee exchanges will bring our teams closer together, leverage complementary expertise, and build an interdisciplinary skillset needed to create a frictionless B2B eCommerce gateway across the region.”
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