Germany’s Rocket Internet, which backs fashion e-tailer Jabong and food-ordering firm Foodpanda in India, has launched peer-to-peer classifieds app Sparklist in Pakistan.
Sparklist connects buyers and sellers of used goods through proximity-sensitive listings. The app offers an instant messaging system for price discovery and negotiation.
“Only 4.5 per cent of the population in Pakistan uses smartphones, which alone represents a massive market of nine million users,” said Nalla Karunanithy, global managing director at Sparklist.
“As the adoption of smart technology rapidly grows, Pakistan’s market will become increasingly more competitive and first movers will have a distinct competitive advantage,” he added.
Khizr Imran Tajammul will head Sparklist in Pakistan as MD. Sparklist would compete with players such as Kaymu.pk and OLX for listings of used goods. After Pakistan, Sparklist will launch in other emerging markets.
The online classifieds market in India is dominated by Quikr, backed by Tiger Global, Kinnevik and Steadview Capital, and Naspers-backed OLX. Swedish investment firm Kinnevik is a significant shareholder in Quikr, India’s top general online classifieds firm, and is also a key investor in Rocket Internet.
Founded in 2007 by the Samwer brothers Marc, Oliver and Alexander, Rocket Internet has a sizable direct presence in India. The Indian ventures it has backed include Jabong, FabFurnish, and Foodpanda. Foodpanda operates under Hellofood brand in some markets.
Jabong.com, Rocket’s most serious bet in India, has become the top money-losing initiative for the company in the country. Jabong’s operating loss margin was far wider than Southeast Asian lifestyle e-commerce firm Lazada and Latin American e-commerce marketplace Linio in the first quarter of 2015, making it the top property in terms of operating loss among Rocket Internet’s biggest ventures.
Jabong recently inducted Sanjeev Mohanty, the erstwhile head of apparel brand Benetton India, as CEO.
Mobile commerce and virtual wallet property Paytm, which is run by Noida-headquartered mobile internet firm One97 Communications Ltd, is said to be in initial talks to acquire Jabong. Recent news reports suggest that Foodpanda and FabFurnish are also on the block. Foodpanda has been plagued by suspect orders, lack of automation and over-dependence on Excel sheets. FabFurnish recently pivoted into a full-fledged marketplace.
Rocket Internet’s core model is to replicate successful global internet businesses in emerging markets outside China with rigorous marketing. It brings in industry executives, gives them stakes in its companies and designates them as co-founder, founder or CEO. Most of its portfolio companies operate in multiple regions.
Rocket Internet’s Daraz, an e-tailer that operates in Pakistan, Bangladesh and Myanmar, recently raised $55 million led by the UK government’s development finance institution, CDC Group.
Asia Pacific Internet Group, a joint venture between Rocket Internet and Qatar-based telecom company Ooredoo, said recently it will launch one new internet venture in Asia Pacific every quarter.