Zilingo and the Rise of B2B Commerce

Zilingo took that early momentum and, perhaps, in part thanks to Sequoia’s connections, went on to raise significant money from Singapore sovereign fund Temasek, Myntra investor Sofina and Germany’s Burda among others. Once those larger Series C and D rounds were announced, it quickly went from existing under-the-radar to being one of Southeast Asia’s deepest-pocketed startups.

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Ace up the sleeve?

Once it became high-profile, Zilingo was tipped to enter the unicorn club with a valuation of $1 billion or more. That ultimately didn’t happen with the Series D but there’s plenty of room to grow. One investor with knowledge of funding deals said Zilingo’s growth is such that a valuation which appears aggressive at the start of discussions can look more favourable at the close of talks.

Valuations come and go but exits are what counts. It increasingly looks like Zilingo’s final destination will be the public markets. A big hint of that came in July when it appointed investment banking group Citi veteran James Perry as its first CFO. Perry helped over 40 companies go public during his 22 year career with Citi.

Enter the money man

Perry’s clients included Alibaba, which he helped on its record $25 billion US IPO and with bond and bank loan financing.
Internal sources said he will be “critical” in taking Zilingo to IPO and, with over $200 million left in the bank according to sources with knowledge of the business, there appears to be plenty of runway.
Enter the money man

The arrival of Perry makes a public listing in Hong Kong or perhaps the US a very possible outcome for Zilingo. But plenty is likely to happen in Southeast Asia’s e-commerce space which could change that direction. Alibaba continues to increase its foothold in the region. It operates Lazada, global marketplace Aliexpress and fintech business through its Ant Financial affiliate, but it is increasingly engaging with governments to open doors and widen opportunities.

If the Chinese firm wants to double-down on merchant services and financing, Zilingo could make a good fit. Multiple industry sources have also suggested that Amazon has recently begun to evaluate M&A opportunities as it looks to expand its e-commerce presence in Southeast Asia beyond Singapore, its sole market since a much anticipated launch in 2017.

Any such moves are likely to be in the general e-commerce space, perhaps not fashion itself, but still, consolidation can impact the wider field of competition, and thus, Zilingo. Opportunity or threat unclear, diversification in recent years has given Zilingo a degree of protection from market moves and a shot at making its name as a breakout company.

That degree of protection, however, is limited. Zilingo may have the money and the high calibre investors, but its plan to put the supply chain on a platform hasn’t been attempted before. And its US market efforts are nascent. How it makes use of the resources it has will probably make all the difference.

Clarification: The copy has been updated to provide further clarity on Zilingo’s Series D funding round.