Malaysia-based startup Kaodim today announced it raised a US$4 million series A round of funding led by Venturra Capital. Other participating investors in this round are Beenext, 500 Startups, and East Ventures. The company says it will use this funding to launch in other major cities in Southeast Asia and expand its product offerings to include other services in the home, lifestyle, wellness, education, and business categories, among others.
Kaodim, which means “job done” in Cantonese, is a services marketplace. If you’re in search of, say, a plumber, a cleaner, or a wedding photographer, Kaodim can match you up with a corresponding provider. It’s a model similar to Thumbtack in the US, and it seems to be catching on in Southeast Asia.
When Tech in Asia interviewed Kaodim founders Jeffri Cheong and Choong Fui-Yu after they had raised a seed round in February, Jeffri claimed the site was averaging between 120 to 150 requests a day.
Now, Jeffri won’t reveal a precise figure for the number of daily requests, but says that, “requests have increased significantly [since February] and continue to go up at a rate that keeps us extremely occupied.” The total number of people who have successfully hired a service professional through Kaodim to date is “in the tens of thousands,” the firm claims.
Kaodim has made good on its promise to expand further into Southeast Asia. It has since taken its operations to Singapore and the Philippines, while the team grew from four to 35 people.
Stefan Jung, representing lead investor at Venturra Capital, says he is impressed with the company’s growth across several countries in such a short period of time – all while maintaining a high quality .
“They positioned themselves as the market leader in Southeast Asia,” he says.
In Kaodim’s model, providers are charged each time they send a proposal in response to a request. The fee providers pay for these “hot leads” varies in the range of MYR 3 to MYR 20 (US$1 to US$6), depending on the volume of the project they pitch for. Service seekers use the platform entirely for free.
When Kaodim first launched, it did not immediately start charging service providers, in order to give them a chance to build trust in the platform without risking anything. But once Kaodim found service providers were getting their money’s worth from new jobs, the fee was introduced.
“We’ve been charging service providers for some time now,” Jeffri says.
The site also offers instant on-demand booking for those who need a service provider right away and don’t want to go through a price comparison process. This instant booking feature might be another source of revenue for Kaodim.
More regional expansion
With Indonesia-based Venturra Capital on board as lead investor, it’s safe to assume that expansion into Southeast Asia’s largest market is on the startup’s horizon.
“We are extremely excited about Indonesia,” Jeffri reveals. “It is a challenging market, but we are confident that our new relationship with Venturra Capital will be instrumental in helping us navigate obstacles.”
While it’s confirmed that plans to enter Indonesia are in place, Jeffri can’t say when this will happen just yet.
Neutral third party
Business models like Kaodim’s have been criticized for not being sustainable because there’s little incentive for seekers to continue using the site for follow-on requests once they’ve met a service provider they like offline and exchanged contacts.
Jeffri says they’ve taken this into account when building Kaodim, and after 12 months of operations, have been able to optimize the product.
“We have a healthy rate of users that continue to use Kaodim to hire the same services, or the many other services we provide, because of the convenience, familiarity, and value-add through our customer support system,” he says.
The key value add is customer service, and that Kaodim steps in as a neutral third party to mitigate in the case of a conflict.
“For example, if you were to hire a contractor and had some kind of disagreement with him or her, Kaodim has processes in place to help manage the issue,” Jeffri explains. “Many times, without a third party, the situation could get very ugly, ending up in a stalemate. We are confident that people see the value in this, and continue to return to Kaodim to find new service professionals when they need it.”https://www.techinasia.com/kaodim-raises-4-million-series-a-round