The new funding was led by Qiming Venture Partners, Bertelsmann, IDG Capital “and other Fortune 500 companies from the U.S. and Asia,” the startup said.
Club Factory has raised about $220 million to date and has more than 70 million users. The online retailer sells fashion, beauty, electronic accessories and lifestyle products and is headquartered in Hangzhou, Zhejiang, China.
About 40 million users live in India, and the analytics firm App Annie says Club Factory is now the third-largest eCommerce platform in India, ahead of Indian eCommerce company Snapdeal based in New Delhi.
“At the same time, we have also pioneered to strengthen the ‘store-within-platform’ concept in India’s eCommerce industry, allowing direct contact between buyers and sellers through our application,” Vincent Lou, co-founder and chief executive of Club Factory, told reporters in a statement.
Club Factory encourages merchants to offer lower prices and expand offerings by incentivizing sellers — in part — by waiving commission fees.
The firm says the number of sellers on its site has increased 10 times since April 2019. Club Factory is also planning to double its 5,000 sellers in India by year-end.
“We have changed the status of the Indian eCommerce industry that monopolized information of buyers and sellers, allowing SMEs to own their customers and run their businesses better,” Lou told the news outlet. “All this, combined with our strategy to reduce the transaction costs of buyers and sellers and allow more local players to enter the ecosystem, has worked very well for us in India.”
Under the acquisition, Kaola will merge with Alibaba’s Tmall Global while still operating independently to create a massive cross-border eCommerce business. At the end of last year, Tmall Global held a 31.7 percent share of the market, while Kaola had about 24.5 percent, much larger than rivals JD Worldwide (11.5 percent) and Amazon (6 percent).