By Jerry Teng

Co-founder Derek Low launched a luxury bubble hotel in northeast Bali in 2019. The venture had 100% occupancy rate until COVID forced its shutdown. To make ends meet, Low began selling homemade cakes. He soon realized that there lacks an easy to use e-commerce tool that can be set up quickly to take orders. Most home-based businesses like him were taking orders via WhatsApp and Instagram. This made selling very inefficient and caused various problems for operators such as tracking orders.

This problem exists beyond home-based businesses: over 200 million businesses use messaging apps as the primary ordering system.

Low noticed that the main reason that merchants don't have an online store is the complexity and time required to set one up. Those barriers bar businesses from having a presence online even though it boosts credibility and sales.

Thus, Low and his co-founder Zhicong Lim sought to create an ecommerce website platform that non-tech-savvy business owners can use.

Cococart's approach to a no-code site builder isn't groundbreaking.

There have been plenty of other companies in the space. Shopify made it popular. Then came WebFlow and tens of other platforms. They all started with the desktop. Soon after, the mobile wave came.

A recent example of a startup tackling the mobile-first web creation market is Universe. They raised $30 million in Series B led by Google Ventures to expand their renowned drag-and-drop website builder called GRID.

So what makes Cococart different?

In e-commerce SaaS, companies either allow customers to fully customize the layout or limit the options to one or few designs. The former allows for greater creativity and flexibility to needs while the latter sacrifices optionality for simplicity.

Shopify, Web Flow, and even Universe all prioritized the former. They offer endless themes to choose from.

Cococart went with the latter. Going into the platform, you are immediately presented with a series of questions. The layout is very similar to that of a Typeform. After completing the questions, your store is finished. Just grab your URL and you are ready to sell.

We tried it for ourselves and it was indeed extremely easy. It only took us 90 seconds to go through the 6 steps needed to create a store.

Co-founder Derek Low built the product with the intention of solving his problem in mind. He wanted to be able to create a storefront quickly. Shopify certainly offers more features, but for small business owners and street vendors, those extra features could be unnecessary.

Is Cococart unique? Not necessarily. But it is built to exact needs of their customers - a simple solution to receive orders - and that may be all that's needed for this company to succeed.

Derek Low founded an online marketplace for people to monetize their skills and a hotel before founding Cococart.

Zhicong Lim interned at Figma (Figma's first intern) and Dropbox before joining Essential as a product engineer. He rose to PM in a year and was responsible for managing 12 apps from vision to completion across two countries. Essential was a phone company founded by Andy Rubin, the father of Android.

Both Low and Lim graduated from UC Berkeley with a degree in Electrical Engineering and Computer Science. Having two technical co-founders accelerates the speed of their product development. Cococart's fast launch since Derek identified the problem speaks to their exceptional coding skills.

Both co-founders also have roots in Southeast Asia. The co-founders' familiarity with the local landscape and technical skills make them well equipped to to tackle this problem.

Cococart had a staggering 30x user growth in 2021.

To date, there are over 30,000 merchants using its service. Those merchants have collectively earned over $50 million using Cococart's platform.

Cococart is also profitable. For an infant venture backed B2B SaaS company to be profitable is certainly impressive.

The free cash that have been given out in the past two years as a result of near zero interest rate have drove many companies to prioritize growth over free cash flow.

Now those same companies are facing a runway shortage and valuation crunch during this recession.

Cococart's profitable business model enables it to invest its free cash flow in more aggressive marketing campaigns.

At a time where macroeconomic conditions are unfavorable and most companies are scaling back spending on marketing, having a lot of cash on hand will fuel their growth past this recession and the years to come.

If Cococart makes it so easy to create an ecommerce store from scratch, what prevents competitors from doing the same thing?

Data migration.

Even though it doesn't take time to start, but once you have sold items using the platform, it becomes very painful to migrate your storefront to another site builder. That's why businesses would rather comply with increasing subscription charges than switching their systems. The data migration is more troubling than setting it up.

The first to market will enjoy long customer lifetime value and imprint their brand. For example, we have seen many tried to dethrone Shopify as the go to platform for online stores, yet Shopify still has the largest market share.

As Cococart grows, they will most definitely attract competition. Competitors will imitate and market at their customers. By then, the switching cost will be high for customers, further increasing the stickiness of Cococart's platform.

Geography.

Cococart is built from the ground up with Southeast Asia in mind. Their #1 customer are vendors who are making food from their home or from small kitchens.

Is that market big enough? A walk around any street in those countries will tell you. Every corner there is either a restaurant or a stand. The food service industry is indispensable to those economies. Shopify and others are not building solutions with the restaurant owners from countries like Indonesia and Singapore in mind.

Cococart started with food vendors. However, their platform is integrable with almost any business. Currently, its being used to sell art, crafts, toys, and digital content.

Low and Lim are going after a market that have been neglected by Western companies and so far, they are crushing it.

Cococart is currently hiring a Senior Javascript Engineer (remote anywhere).

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