Zilingo - This time in the news for wrong reasons

5 Aug 2022 , 01:06 PM

Zilingo is in the news these days for wrong reasons. The company started as a platform for business and technology in the fashion sector. Ankiti Bose and Dhruv Kapoor launched the Singapore-based firm in 2015. It started by helping small merchants in cities like Bangkok and Jakrata set up an e-commerce presence. It later became a B2B marketplace. The company now has operations around the world in Indonesia, Hong Kong, Thailand, the Philippines, Australia, and the United States.

The company has raised funds from investors including Sequoia Capital India, Temasek, and Burda Principle Investment. It was Valued at US$970 million in 2019.

In spite of these achievements, Zilingo burnt cash fast. According to a report published in Money Control, the company spent $1 million on just one marketing trip for social media influences to Morocco. Its business model was unable to bring in revenues. In order to achieve rapid growth the company started giving subsidies to merchants on its platform. These subsidies meant that instead of earning money on every transaction that was being made on its platform, Zilingo was paying money. These subsidies also resulted in some fake transactions being done by some just to earn these subsidies. Covid restrictions came as an unexpected and unpleasant blow for the company. Funding dried up due to the economic devastation of Covid restrictions.