Zilingo: Anatomy of an Almost-Unicorn


Charting Zilingo’s meteoric growth from pre-seed to global titan 

When Ankiti Bose and Dhruv Kapoor first met at a house party in Bengaluru in 2015, they had no idea that they were starting down the path to building one of the most talked-about companies in the retail and fashion space. 

Bose, fresh from a visit to Thailand’s Chatuchak market, had seen a ripe opportunity in digitizing a vast offline marketplace, giving merchants better access to consumers. In addition, the platform would plug the holes in one of the world’s most unsustainable industries, reducing inefficiencies and waste by increasing transparency in the supply chain.

“The fashion industry is one of the largest industries in the world. It’s 5% of the global GDP; everybody needs clothes. Yet, it is one of the most inefficient, undigitized, horribly polluting, unsustainable industries,” says Bose. 

As an analyst with international venture investor Sequoia Capital at the time, Bose was struck by the potential of a solution for clothing SMEs in Southeast Asia (SEA). At the house party, she spoke about it with Kapoor, who was a backend engineer at a mobile gaming company at the time. Within a few months, the first iteration of Zilingo’s platform was born. 

Zilingo has gone far and beyond the initial concept of providing digital tools for merchants. With over 30 different services available to merchants on the platform, including tools for sourcing, accessing raw materials, and financing, it’s evolved from simple sales tracking and inventory management, to an integrated suite of solutions built to cater to a small merchant’s every conceivable need. The consumer-facing side of the platform, ‘Zilingo Shopping,’ is still a focus, but choosing to hone in on the merchant-side proved to be strategic in more ways than one.

In February 2019, Zilingo raised a US$226 million Series D led by Sequoia Capital India, valuing it at what sources close to the company say is around $970 million (Fortune). That said, Bose has made it clear that in her view, the ‘unicorn’ label is, perhaps, overrated. The company isn’t making a profit yet, but the B2B solutions bring in 80% of Zilingo’s revenue, setting it on a clear path to profitability. 

Zilingo’s growth from two people working a side hustle to almost 900 employees spread across 13 offices globally hasn’t come without hard work, risk-taking, and a healthy dose of right-place-right-time. It now serves over 75,000 merchants and 6,000 factories across 17 different countries. 

“I think a huge part of our story has been serendipity,” says Bose. “We found ourselves in places like Thailand, Jakarta, and Bangladesh, and really spent time staying with merchants, observing them, and doing things for them with the intention of helping them do better and not get left behind. And a lot of those decisions have been the right ones, propelling the company forward.”

First Steps

Dhruv Kapoor, Zilingo’s Co-founder and CTO, has played a pivotal role–largely behind the scenes–in building the tech stack and managing a tech team that now numbers almost 150. His passion for technology has been a constant since his college days, where his thesis project was a hardware-software system that simulated a solar panel. After graduating, Kapoor began working at Yahoo India. 

“I was part of the localization team, which would power Yahoo’s infrastructure for managing all of its 70 or 80 languages, and that experience came in handy when we started Zilingo,” he says.  

Meanwhile, Bose had joined Sequoia Capital India after a stint at McKinsey & Co. As an analyst, she was exposed to dozens of early-stage founders, some of whom were tackling the SEA market. This experience and knowledge would later help guide Zilingo’s development. 

“Both of us, in terms of our DNA, were the kind of people who would already be spending some of our weekends or some of our late nights researching things, reading up, writing code,” says Kapoor. 

Once Bose approached him with the idea for Zilingo, their curiosity and work ethic converged toward a new mutual objective. Within a month, it became clear that they had a massive opportunity on their hands, and they committed to running the company full-time.

“We hadn’t even known each other for a year. Sometimes when things feel right, there is merit in taking the plunge,” she says. Taking risks, constantly innovating, and staying three steps ahead of the competition soon began to define Zilingo’s strategic approach. 

Building a colossus 

Digitizing a vast offline market is an enormous undertaking. In 2019, the ten ASEAN member countries, in addition to Japan, Korea, India, China, Australia, and New Zealand, accounted for $405 billion in textile exports–more than half the global total (McKinsey & Co.). Separately, the considerable number of small garment merchants across the region is part of an informal economy that employs 70 to 90% of the working population in most Asian countries (International Labour Organization). 

Not only would UX design and adoption be challenging given a target audience of users without any experience using business software, but the breadth of the envisioned platform would require a significant tech investment. Early on, Bose and Kapoor discovered that while markets in SEA lacked formal platforms for trading and payments, many merchants were making use of social media to fill the gap. 

“You have this incredible set of businesses, which didn’t really have access to a platform like Zilingo, but they were still used to using smartphones and 4G, and finding workarounds to get things done,” says Kapoor. “It proved to us that there was market opportunity, that there were people out there who were hungry to make things work, even on platforms that were extremely inefficient for them.” 

Observing the ways in which merchants were bending social media to their purposes–such as using image captions to announce sold out products–unearthed another key insight: the importance of consumer-centric UX design when building a solution for small merchants. To make the tech accessible to them, the design had to be as intuitive as Facebook or Instagram, while possessing the functionality of a business product. 

“Because it’s still a business product, it has to hide a lot of the functionality that users can then start to discover and access as they get more and more used to using the product,” says Kapoor. Ideally, he says, the UX designer has to innovate to the point where using the system is almost as easy as posting a photo on Instagram.  

Given the complexity of the product, poor design could have easily led to a high churn rate as users gave up on figuring out the platform. As Kapoor puts it, the company didn’t have a ‘silver bullet’ akin to Google Search that drove consumer adoption and loyalty. However, Zilingo’s trick to engineering stickiness was to focus on expanding the platform to be a one-stop-shop for a small merchant’s every need. 

“When you’re building a platform for businesses, especially when you look at an SME, you have business owners who are very time-crunched because they need to get food on the table at the end of the day for themselves and their employees,” Kapoor says. Thus, the company had to ensure that users weren’t forced to use another website or solution to fulfill an aspect of their business.

Over time, as more services were added, the insights gathered from user patterns created a feedback loop that was both fed to users as a value-add service and used by Zilingo to build new products. 

As soon as the scope of the platform became clear to the co-founders, it became imperative to develop proprietary technology. In the first three months, Kapoor and several engineers worked to build out the initial functions of the platform from scratch, rather than utilizing APIs or relying on other vendors. Taking the time to build its own technology was invaluable when it came time to scale the company. In quick succession, Zilingo rolled out financing tools, expanded to Indonesia and Singapore, and added tools for sourcing from wholesalers and factories. 

In addition to internally building its core technology, which includes logistics and secure payments, Zilingo now helps factories optimize their production lines, and works to connect Asian textile producers with global brands. Some of Zilingo’s value-add services are facilitated by external partners, including human resource management software that has proved indispensable for factories. 

It’s this dedication to building products for the merchant that has positioned Zilingo as an ecommerce enabler, rather than one of the many online shopping platforms currently engaging in price wars across the region.

“We kept adding services we felt our customers really needed–they were struggling, and we kept adding solutions, and the business just completely took off as a result of that,” says Bose. 

Upward mobility

For Bose and Kapoor, Zilingo’s phenomenal growth has naturally driven significant changes in their respective roles as CEO and CTO. Bose says that, in the early days, it was “[all] hands on deck, packing boxes, sometimes grabbing coffee for everybody else”–poles apart from her and Kapoor’s current responsibilities.   

“As the role changes, you evolve as a person, as a founder. I think what’s really important is to still have a startup mindset,” she says. “I was 23 when I started the company, and what makes me completely paranoid is that there’s another 23-year-old somewhere today who will beat us if we don’t keep reinventing and disrupting ourselves.” 

One recent development in Zilingo’s evolution was the acquisition of nCinga, a Sri Lankan startup with proprietary Internet of Things (IoT) and data analytics tech for optimizing factory processes. Its solution fit perfectly into Zilingo’s vision of improving the supply chain–a problem the company had yet to tackle. 

“They had identified this area which was so underinvested–there are very few entrepreneurs going after building software for factories,” says Kapoor. He adds that while some software for factory management exists, it’s usually designed for auto factories, which are significantly larger than most garment producers.

Having worked together on an earlier partnership, the founders of both companies already had an understanding of each other’s work culture, and saw clear synergies in joining forces. Bose recounts that she and nCinga founder Imal Kalutotage decided that they would proceed with the merger based on whether the founders could get along well during a dinner together. Post-merger integration, she says, can really make or break companies more than anything else. 

“This has been a true test of whether we can grow fast and sometimes take inorganic paths to growth, and deal with a team with a different culture, background, and demographic than us,” Bose says. “So far, it’s been a very enriching experience.” 

nCinga’s team of around 40 people has now been fully integrated into Zilingo. The company is still based out of Sri Lanka, but Bose and Kapoor are encouraging knowledge-sharing through development team transfers from Bangalore to Colombo to work on what has affectionately been dubbed the ‘n-factory initiative.’

In 2019, Zilingo also capitalized on the market of U.S.-headquartered brands looking to relocate garment production to a SEA country like Cambodia or Bangladesh, where exports would be unaffected by the escalating U.S.-China trade war. Acting as a liaison between these brands and Zilingo’s local partners allowed the company to quickly scale outside the Asia-Pacific region. 

In October last year, Zilingo announced a planned $100 million investment into the U.S., to be put toward digitizing the sourcing process, as well as hiring sales and product staff to fill the two U.S. locations–in New York and Los Angeles–opened in Summer 2019. Zilingo’s U.S. expansion is part of a sweeping growth strategy that also includes plans for capturing new markets such as Australia and the Middle East. 

Fair and transparent

Back when we started, there was one thing common to our vision and mission that still stays true today, which was that we wanted to be very much merchant-focused,” says Kapoor. 

However, an unexpected benefit of the platform is the company’s ability to put user data toward countering some of the most pervasive problems in the textile industry, such as child labor and unsafe working conditions. 

“As we started spending more and more time in the industry, it was also becoming very obvious to us just how exploitative the industry was,” says Bose. “As we started expanding our B2B services in 2016 and 2017, it was very obvious that one of the key things to solve for, besides providing commerce tools, was along the lines of responsible manufacturing and sustainability.” 

To put these objectives into motion, Zilingo implemented high standards for partner factories, checking everything from business registrations to labor certifications. As the relationship deepens, Zilingo will also conduct in-person visits. Certain metrics–unexplained jumps in volume, for example–also indicate whether a factory is engaging in activities like illegal or underpaid labor. In addition, the company is in the process of developing a ‘true Zilingo standard’ for any factories looking to subscribe to the platform. 

Bose has also been a vocal advocate for equality in the workplace and in leadership. Zilingo recently launched the SheWorkz initiative, which offers microcredit and mentorship to  female entrepreneurs to get them back into the workforce. 

“I have seen my mom having to give up work because she had to take care of me as a child, and the household, and she has more degrees than me and my dad put together,” says Bose. “Not only is it unfair to her, but it’s also unfair to the household and the economy.” 

The key problem in SEA, she believes, is a lack of female and mentors role models in leadership positions. Her advice to aspiring female entrepreneurs is tied to the fact that in today’s world, it is still harder for women to achieve the same recognition and outcomes as men.

“We sometimes hold ourselves back because of how guilty society makes us feel for choosing our ambitions and choosing our aspirations,” she said. “It’s important to be really, really good at what you do because the world is unfortunately still quite sexist, but it’s also important to not hold back on your ambition.” 

Engineering the future of fashion

Beyond new targets for Zilingo’s tech stack (of which there are plenty, including democratizing access to shipping by onboarding small-scale local logistics businesses), Zilingo’s thematic focus on transparency in the supply chain will be a key focus of their growth strategy for the remainder of the year.

McKinsey’s 2020 State of Fashion Report highlighted sustainability as one of ten key themes for the fashion industry this year. The report also found that textile production creates 6% of global greenhouse gas emissions, and is responsible for one-fifth of waterway pollution resulting from the use of industrial dyes and detergents. 

Information about the fashion industry’s wasteful ways has entered into the mainstream over the past several years, with an increasing amount of public discourse centered around shunning fast fashion and making better choices as consumers. Going forward in 2020, Zilingo is poised at the forefront of trying to solve this issue. 

“We’re a small player in a really big industry that is ripe for change,” says Bose. “I think we’re going to really stay focused on making the supply chain fair, transparent, and as sustainable as possible. We’re making baby steps, but hopefully we’ll start running and leaping towards that.”  

Nayantara is Jumpstart’s Editorial Associate.

Photo by Parker Burchfield on Unsplash


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Nayantara Bhat
Nayantara is Jumpstart's Digital Editor.


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