|Founders of Telio |
With the round, which was also participated in by famous venture capital funds like Sequoia India, GGV Capital, and RTP Global, Telio is planning to make strong expansion in 2020, following the success in 2019.
The company’s founder and CEO, Bui Sy Phong, said, “Our mission is to empower the large population of small retailers in Vietnam, who play an important role in our economy and the local neighbourhoods they serve. The inventory supply chain in our country is very fragmented, and these small retailers don’t have a clear view of pricing, quality, and even availability of most products. By providing an easy-to-use central platform, we aim to help mom-and-pop retailers leverage technology to run and grow their businesses more efficiently.”
Currently, Telio connects these small retailers with brands and wholesalers on a centralised platform that delivers more choice, better pricing, and more efficient logistics.
Telio is focusing on consumer goods, starting with fast-moving consumer goods (FMCG). It has around ten warehouses in Hanoi and Ho Chi Minh City, with two new ones to open each month to serve growing demand. Starting with FMCG, Telio addresses a $20 billion market, 85 per cent of which flows through unorganised channels, driven by 250,000 micro-, small-, and medium-sized enterprises (MSMEs).
Vietnam was named one of the two leading pacesetters of Southeast Asia’s Internet economy, alongside Indonesia, in Google’s recent e-Conomy SEA 2019 report. Vietnam’s Internet economy is poised to reach $12 billion in 2019 and the country is emerging as the most digital of all economies in the region, according to the report.
Vietnam’s large retail landscape is still dominated by traditional, fragmented trade channels. Small mom and pop street shops account for over 60 per cent of FMCG sales in urban areas and over 90 per cent in rural Vietnam, according to Kantar.
Mom and pop retailers in Vietnam typically need to call 50 to 80 wholesalers and distributors to place individual orders, which can take up to a week to arrive. Using Telio’s easy-to-use smartphone app, a retailer can find, select, and order products from a wide range of brands and distributors. By aggregating demand, Telio is able to offer better and more transparent pricing. Telio is also building a network of warehouses to ensure next day delivery, which vastly improves a small shop owner’s ability to manage both stock and cash flow.
Telio was founded in November 2018 by an entrepreneurial team with strong experience in tech, retail, logistics, and financial services. CEO Bui SyPhong has over 10 years of experience across telcos and banks in France and Vietnam, and previously founded two startups – a peer-to-peer car rental platform and an e-wallet startup – in Vietnam.
The company has seen a sharp, upward trajectory over the last eight months. Sales are growing by 70 per cent month-on-month and the company now serves over 3,000 retailers in Hanoi and Ho Chi Minh City, providing more than one-third of those retailers’ monthly stock. Retailers are placing an average of seven orders per month on Telio’s platform. This firm has so far got a total funding of $27 million.
The company plans to open in four more cities and onboard 15,000 retailers to the platform by June 2020. Telio, which started the year with just 20 employees, now employs more than 200 and is is expanding focus from FMCG to several new verticals in the next few months.
Telio was one of the 17 companies in the inaugural cohort of Surge, a rapid scale-up programme launched by Sequoia Capital India earlier this year for startups in India and Southeast Asia. Telio has scaled its annual GMV by more than 50 times since joining Surge, and the valuation set in the new round of financing is 10 times higher than the Surge round a few months before.
“Telio has scaled rapidly since joining Surge and we feel privileged to partner with SyPhong and the whole team, whose humility and dedication to serving merchants is very inspiring. The company has the potential to be one of the major tech startups of Vietnam, enabling B2B commerce for millions of mom and pop shops,” said Shailendra Singh, managing director, Sequoia (India) Singapore. “The team is excited to support and partner with Telio for the long term.”