EME was the first investor into rural eCommerce platform, Ezay, just three months ago. Today, Ezay has raised its second round of USD 200K in order to continue the rapid expansion of its retailer and wholesaler network.
Ezay connects rural mom’n’pop retailers to wholesalers via its platform and provides same day delivery. This is a sea change for these shopkeepers, of which more than 90% are women. Previously they would have to leave the shop to travel to town or convince their spouse to do the same, but with Ezay they receive deliveries to their store and get a wider selection and better prices of products. Starting just three months ago from zero, Ezay has over 1,600 retailers to-date.
Leading this round is Seiji Kurokoshi, the impact investor who pioneered upside social impact bonds for single mothers, and who has a background in direct to consumer (D2C) models. The overwhelming majority of Ezay’s customers are women entrepreneurs and Ezay’s model includes many D2C elements. As such, EME and Ezay are both thrilled to have Seiji’s expertise in both the social and commercial aspects of serving Myanmar’s shopkeepers. This is particularly relevant as Ezay is currently working in partnership with leading Myanmar MFIs to offer finance to these shopkeepers - 75% of which have had no access to finance in the past.
In Myanmar, only around 25% of people have any sort of formal financial services. Ezay is helping provide access to the most rural users and in turn plans to reach out further into communities via these shops in the future. Ezay’s founder and CEO, Kyaw Min Swe, said “I’m pleased to be able to bring people into Ezay that understand and want to support our journey. We’re growing very quickly and having further expertise to aid our growth will help us reach our goals of serving 8,000 retailers by the end of 2020. The current concerns about hygiene and health are also leading to an increase in the need for our services, so we want to ensure we’re there for our customers during these times”.
Seiji said, “I wanted to invest in Ezay as soon as I met the founder, Kyaw Min Swe. His drive to help Myanmar rural communities and his ability to make it happen both struck me immediately. When I looked at the amazing traction that Ezay has had in just three months, my mind was made up. I’m very pleased to be able to support this great company and its mission to improve the lives of rural Myanmar women”.
EME is joining the round and continues to work closely with Ezay as the company expands in geography and services. Ezay was the seventh company to enter EME’s portfolio of eight companies. It is the second company in the portfolio to receive outside investment, following Joosk Studio which raised funds from Nest Tech VN earlier this year. La Woon Yan, EME’s Senior Investment Analyst said, “we couldn’t be happier with the amazing progress that Ezay has made since our investment just a few short months ago. During these turbulent times, it’s especially important for us to support great founders and great missions and Ezay is directly helping with keeping shops stocked and reducing the need for women to travel.”.
Seiji Kurokoshi’s company, Digi Search and Advertising, helps companies to adopt direct to consumer (D2C) models in Japan. He also has COEBI Incubation Office, a AAA incubation centre where he supports and invests in social entrepreneurs. Upside SIBs, mentioned above, are a public private partnership where repayment is made through increased tax revenues.
Above: Nang Mo (4th from left) and Soe Lin Myat (3rd from right) with members of the EME Myanmar team
EME has made its largest investment to-date, investing alongside United Managers Japan Inc. for a combined USD 750,000 into Kyarlay, Myanmar’s leading baby products ecommerce and delivery provider. Kyarlay was co-founded by husband and wife Soe Lin Myat and Nang Mo while expecting their first child. Frustrated with poor choice and availability of well-priced and high-quality baby products, they saw an opportunity in helping make parenting in Yangon safer and more convenient.
Both Soe Lin Myat and Nang Mo previously worked for the tech giant Garena and have been able to apply leading technology to Kyarlay, while maintaining an approach tailored to the Myanmar market. Their stores are open seven days a week and double as fulfilment centres, making Kyarlay the only company able to provide safe and efficient delivery within just a few hours.
Kyarlay has also created a strong community among young Myanmar parents, including with their app and website which include videos and content from Myanmar’s leading paediatricians and obstetricians. By creating a community around their business, Kyarlay is able to continuously learn more about their customers. It’s due to this community that Kyarlay recently started to develop their own branded products for the Myanmar market – meaning they’re able to offer quality items for a lower price to their customers.
EME Director, Hitoshi Ikeya said, “We’ve been watching Kyarlay for a while and we’re so pleased we’re able to support them, especially during this volatile time when others might shy away from new investments. Soe Lin Myat and Nang Mo have proven their ability to develop a leading business and EME is thrilled to join them in their journey. We’ll be helping to bring new and exciting products to market, but right now we’ll be helping to ensure that Kyarlay has everything it needs to help parents stay home and stay healthy.”
Kyarlay marks EME’s eighth investment in Myanmar since launching in October 2018. EME is a VC based in Myanmar and providing significant post-investment support to its portfolio companies to help them scale. EME is backed by private investors as well as the Dutch Good Growth Fund and seeks to contribute to Myanmar’s sustainable economic development by supporting great entrepreneurs who can change markets and deliver true value to consumers and businesses alike.
**Q&A with Nang Mo, Co-founder of Kyarlay**
Why did you start this business?
As a parent you always need certain items, diapers for instance, and you often forget them. In Yangon, forgetting something as simple as milk powder can easily mean a one hour round trip back to the store. We experienced this frustration and saw that we had the skills to address it. We realised that there was a large market of parents just like us and that this market was growing. We each applied our core skills and started Kyarlay, adding the app and 4-hours delivery late last year.
What makes Kyarlay different from regular bricks and mortar baby stores?
Our community-driven approach really helps us to be closer to our customers. We’re able to share with them and in return learn more about their challenges. It’s this community approach that drives our business, whether it's later opening hours so parents can visit one of our shops after work, or competitions and promotion within our app that helps parents engage with one another. We launched our 4-hour delivery because we realised that parents need items on the same day and our community and customer focus helped us to understand that.
Why did you choose EME as investors?
When Kyarlay started, there wasn’t an institutional investor in the Myanmar market that would invest in this type of business. With EME, they’re here in our market and understand our model and approach. While many VCs might think having bricks and mortar stores is a barrier to scale, EME have supported this approach from the start and understand its importance in this market. We’re looking forward to having people close by that we can brainstorm with and depend on.
What’s your vision for Kyarlay and how will EME help you to reach it?
We’ve recently launched our second store and we plan to open lots more in order to serve the whole of Yangon with our 4-hour delivery. As we build our store and delivery network, we’re really looking forward to being able to provide additional products – such as the private brand products we’re producing now. Once we can serve the whole of Yangon with competitively priced high-quality products then we’ll start branching out further. Our plans will require constant adjustment and a lot of operational savvy, so we’re very happy that EME can be nearby to help us with this physical and digital growth.