27. August 2012–
Berlin-based social commerce platform Ondango has secured a six-figure sum of new funding from early-stage London VC Connect Ventures, marking that firm's first investment in Germany. LMU Entrepreneurship Centre executive director Andy Goldstein also joins as an investor this round.
Ondango, founded by José Matías del Pino, Claudio Bredfeldt and Nicolas Dittberner (above) in 2010 and publicly available since October last year, offers an all-in-one Facebook commerce platform aimed at small- and medium-sized businesses.
Users of the platform can set up shops, hosted on Amazon servers and attached to one or more Facebook pages, and invite customer to buy with the entire transaction able to take place within Facebook. Ondango is compatible with PayPal, credit card and bank transfers, offers a Daily Deals service and various viral marketing tools, and doesn't require customers to accept app requests to make a purchase.
The business model involves several pricing plans, ranging from €9.99 through to €99.99 per month, depending on number of shops and features. So far, the platform is used by about 400 online shop owners mainly in the music, sports and lifestyle market sectors.
Ondango's other investors, in addition to Connect Ventures and Andy Goldstein, are Estag Capital, Tilman Buggenhagen, Mario Brockmann and Alexander Klug.
"We're hungry – we want to be European market leaders"
Ondango will use the new funding to scale the platform and to continue its focus on SMEs. "That's where our strengths are," CEO José Matías del Pino said, adding that Ondango will now be able to make the most of its new investors' "operational know-how" and networks.
While the company's core target is – and remains – Germany, Ondango is also planning to expand in the UK, Benelux, France, Italy, Spain and Turkey. "Our shops are already available in 14 languages and we support all currencies worldwide," del Pino said. "I prefer not to disclose our concrete growth goals for the next year but we're hungry and will execute aggressively to make sure we're European market leaders."
Facebook – a risky reliance?
Ondango's reliance on Facebook does leave the company vulnerable to any changes put in place by that platform. While del Pino recognises platform dependency could be a risk for the company long-term, he's confident a few factors will help cut it back:
"Facebook sees itself as a platform that provides a social graph and other companies can build on top of it," he pointed out – Facebook isn't interested in competing with the likes of Ondango. "It's not their job."
Facebook also has a clear vested interest in third party social commerce platforms succeeding. "If users can also buy products on Facebook, they stay longer there, which is one of their goals. If companies can successfully sell on Facebook, they will be willing to invest more on Facebook ads."
Sounds like a win-win – and not too bad for small business owners and their fans either.