The top level management of Listee, an F&B-focused order management startup that was acquired by Yummy Corp earlier this year, has raised an undisclosed amount of pre-seed capital from Init6 and East Ventures for a newly launched rental startup, Bioma.
Speaking exclusively to Tech in Asia, the company says the funding comes only two months after the launch of its platform in July. It will be used to expand its resources and services.
Bioma describes itself as a product-as-a-service platform that enables customers to rent or subscribe to physical assets such as electronics, furniture, and kitchen appliances.
The startup was founded by former Listee advisor Arlo Erdaka, who currently serves as Bioma’s CEO, as well as Listee co-founders Melvin Juwono (Bioma’s COO), Obed Tandadjaja (CTO), Marcel Christianis (chief growth officer), and Gideon Yuwono (chief product officer).
With Bioma, the team has decided to use a B2B model as its entry point – due to the “lower perceived risks” associated with B2B clients – while also serving the consumer segment, says Erdaka. The CEO has eight years of experience in running a rental business for baby equipment.
Both segments present equally enticing opportunities brought about by what Bioma and its investors see as changing consumer patterns, particularly among the next generation of customers.
“The global trend is gradually moving from the mainstream, buy-and-dispose, linear economy to the sharing economy, and the market opportunities in this sharing economy are sizable and still growing,” says Init6 venture partner Rexi Christopher.
For Bioma, its B2B model currently sees it renting out appliances to cloud kitchens, furniture to property companies, and electronics to offices. Clients renting or subscribing to products on Bioma can improve their cash flow as they will be making monthly payments as opposed to large upfront transactions – something not many businesses are familiar with.
Bioma’s launch sees it enter a space already occupied by a handful of incumbents looking to tap the opportunity in Indonesia’s rental industry. Among them are Raggam and Cumi.
However, Erdaka says that many of the existing players in the market provide pure marketplace platforms that merely connect supply and demand. This model, he explains, has proven to be a “leaky bucket” as renters and lenders would end up transacting directly with each other outside the platform.
While Bioma also employs an asset-light model – with most of its items owned by third parties (brands or individuals) – the company manages all the service operations including cleaning, logistics, and repairs.
By doing that, it helps brands on the supply side jump into the rental space without having to manage anything themselves. At the same time, it gives the demand side more flexible rental options, which in turn leads to efficiency and optimized productivity.
“The subscriber can upgrade their products without the hassle of managing the assets themselves,” says Erdaka. “If the products need to be maintained or replaced, we will manage all that. If it is a quick fix, we will fix it quickly. And if it is a longer fix, we will provide a temporary replacement.”
While this model may entice more customers, it comes with higher risks for Bioma. The company says it tries to mitigate the risks by factoring them into its pricing while also carrying out know-your-customer processes for its potential clients to provide manageable risk levels. It will also plan to engage with insurance companies to explore more solutions.
The company is bullish that it can capitalize on the global consumer trend inclining toward leasing over buying, inspired by overseas counterparts such as Feather (US), Grover (Europe), and RentoMojo (India).
Bioma is also upbeat about the idea of joining these companies in playing a notable part in a push toward a circular economy.
“A lot of global warming effects can be traced down to an individual’s consumption patterns. By having a shift in the consumption pattern, you can contribute to a much more circular economy,” Erdaka says.