Vietnam’s fast-growing tech startup Lozi, which operates a C2C e-commerce portal as well as its own fleet for on-demand delivery LoShip, said it has secured eight-digit funding (in USD) led by Smilegate Investment from South Korea, supporting its expansion across the country to become a one-stop solution for Vietnamese consumers’ one-hour-delivery-needs.
Other investors participating in the round include: DTNI, Ascendo Ventures (South Korea), JC Capital (US) and local accelerator Vietnam Silicon Valley, among others. DTNI also participated in an earlier round that Lozi raised in January this year.
Trung Nguyen, CEO and co-founder of Lozi, said the startup aims to become the fastest growing intra-city e-commerce platform in Vietnam, and new funding will give a boost to its focus on one-hour delivery services.
Founded in 2013, Lozi was originally an app for people to find food, beverage, and coffee shops, targeting primarily Generation Z and millennial users. In 2015, it transformed into a social C2C e-commerce network. The company said it serves 2 million users.
In 2015, Lozi received its first investment from Vietnam Silicon Valley, and then later closed a seven-digit funding round with early-stage investor Golden Gate Ventures and Japanese-owned Internet media company DesignOne Japan Inc.
Since 2018, Lozi has also offered one-hour delivery for multiple areas, such as hyperlocal C2C e-commerce, food delivery, grocery delivery, on-demand laundry service. It is available in four Vietnamese cities—Hanoi, Ho Chi Minh City, Da Nang and Can Tho. As an intra-city e-commerce platform, the startup aims to provide faster delivery to consumers by having its own on-demand drivers (called LoShip drivers), who make pickups directly from local merchants.
Kim Kyoung-Hwan, vice president of one of Smilegate Investment Fund’s investment divisions, credited Lozi’s hybrid business model that combines e-commerce with on-demand delivery while operating its own logistics team. This eliminates the need for warehouses. “Lozi enables local retail offline sellers who have no proper ability to expand into online business to enjoy online-offline multi-business,” he said.
With the fresh funds, Lozi now has a target to triple the number of its daily transactions in the next 12 months, aiming for an annual revenue of USD 31 million by 2020. In all, the company aims to provide 20 services on its platform. Lozi is also planning to launch a new feature called Lo-xe to enter Vietnam’s competitive ride-hailing market.
Lozi must compete fiercely with regional giants Grab and Gojek (localized as GoViet) in Vietnam, though neither regional firm has rolled out comparable concierge services in the country. Other notable platforms that provide similar services is Now.vn, which is part of SEA Group, as well as the aspiring startup HeyU.
The investment signals continued interest from South Korean investors in Vietnamese tech companies. According to Cento Ventures’ report on Vietnam’s tech investments, South Korean VCs took the throne among the most active investors in the first half of 2019, having participated in almost 30% of the deals in the country.
