Pakistan’s electronics-focused eCommerce platform PriceOye.pk has announced completing a seed raise of $7.9 million as it focuses to become a nationwide specialised electronic store with an online as well as an offline presence.
The seed round was led by US-based JAM Fund and joined by investors including Beenext, an early investor in Indonesian decacorn eCommerce platform Tokopedia, DG Daiwa, Mantis VC, HOF Capital, Jet.com’s investor Palm Drive Capital, and Atlas Ventures among others.
Additionally, notable unicorn founders Peter Thiel of PayPal, Immad Akhud of Mercury Bank, and Asif Keshodia of Souq also participated in the round, besides participation from previous investors Fatima Gobi Ventures, SOSV, and Artistic Ventures. This is Peter Thiel’s first investment in Pakistan.
PriceOye calls itself a managed marketplace for electronics, with recommendations based on the consumer’s requirements, helping them make informed purchasing decisions.
“Buying behaviour for consumer electronics is very different from buying other products,” says Adnan Shaffi, co-founder and CEO PriceOye. “When you are buying electronics, there is research involved and it is a planned purchase rather being an impulse purchase.”
“Consequently, people base their purchase decisions on recommendations of salesmen at electronics stores,” he says.
To replicate a similar online experience, PriceOye has also developed a product recommendation engine on the website for product research. PriceOye claims that the product recommendation system has been one of the important drivers of bringing over a million monthly users to its platform.
“The recommendation engine asks a few questions for every category. For instance, for washing machines, it will ask you questions like what is your price range, how many household members do you have and what is your washing frequency. Based on that, the engine recommends an ideal size of washing machine so that your electricity consumption and water wastage is minimum,” Adnan tells Profit.
Based on its unique offering and catering to a niche market, PriceOye plans to become a national franchise for consumer electronics, with an online as well as offline brick-and-mortar presence, just like Best Buy in the US.
The startup makes money by charging a commission under a marketplace model to dealers selling consumer electronics on PriceOye.
Adnan tells Profit that PriceOye is a tech play right now and its technology stack is custom built. Hence the funding will be utilised towards enhancing technology capabilities, as well as towards improving customer experience when it comes to online deliveries.
“Another problem with eCommerce is that customers order a certain product but receive a different one,” Adnan says. PriceOye has hence also introduced an open parcel delivery model under which when a customer receives a product from PriceOye, the customer can open the parcel, check the product and even experience it, before paying for it.
Adnan says that the open parcel deliveries has also contributed significantly towards their growth, which he claims is 500% year-on-year. PriceOye now plans to spend more from the funding on scaling open parcel deliveries.
The balance is going to be used to launch new categories of electronic products on the platform.
Commenting on the investment, Mantis VC founder and partner Alex Pall said, “Within a short period of time, PriceOye has grown exponentially and has cemented its position as the leading national company in online consumer electronics. We are excited to join PriceOye in its mission towards changing the way people shop in Pakistan.”
Seamon Chan, managing partner of Palm Drive Capital, which has backed eCommerce unicorn Jet.com, stated, “It’s always a difficult choice for consumers to spend big amounts of money on high-value products while being unsure about their authenticity. I was inspired by the vision of PriceOye founders Adnan and Adeel of creating transparency and bringing convenience to customers when it comes to shopping for consumer electronics.”