KKR, a global investment firm, and GrowSari, a business to business (B2B) e-commerce platform serving micro, small and medium-sized enterprises (MSMEs) in the Philippines, announced Wednesday the signing of definitive agreements under which KKR will invest $45 million to lead GrowSari’s Series C funding round.

KKR’s investment in GrowSari will support the company’s expansion into more regions across the Philippines and strengthen its financial services capabilities, both parties said in a statement.

“We will be accelerating our presence nationally to more municipalities and cities in the Philippines. Our investments will be focused towards expanding in Visayas and Mindanao this 2022. This will bring us a step closer to our mission of creating a positive socio-economic impact to the lives of more MSME owners and the communities they serve.

“In addition, we are doubling down on our capabilities to improve the overall customer experience and look to expand our ability to provide sari-sari stores access to credit and basic financial services, which is a key pain point for MSMEs who have limited access. The industry, operational and financial expertise and network of KKR will be a great complement to the passion, dedication and strong culture of excellence that GrowSari has built over the years,” said Reymund ‘ER’ Rollan, Chief Executive Officer and Co-Founder of GrowSari.

Founded in 2016, GrowSari is a tech-enabled B2B platform that helps the Philippines’ small physical retail stores, including neighborhood retail shops (sari-sari stores), roadside and market shops (carinderia), and pharmacies, enhance their service levels and access a wider range of products and value-adding services. This allows the stores to provide local communities with more comprehensive offerings, including digital services.

Today, GrowSari is present in 220 municipalities across the regions of Luzon and offers over a hundred types of different services including making bill payments, telco reloads, and wallet top-ups, as well as procurement services for common retail goods and pharmaceutical medicines. Strong tailwinds around digital adoption, proximity shopping, and economic growth in the Philippines have also contributed to a 6.5 times increase in gross merchandise value for GrowSari since 2019 and a 2.5 times increase in revenue over the same period.

“GrowSari is aligned with one of our core technology investment themes in Southeast Asia, which is supporting MSMEs with software and financial services. Reymund and the team at GrowSari are excellent operators who have built an impressive flywheel that is powered by a number of proprietary applications. They have also built a very efficient and repeatable go-to-market motion that is underpinning their impressive growth. We look to leverage our global experience, regional connectivity and flexible capital to help GrowSari achieve its ambitious growth objectives,” said Louis Casey, KKR’s Growth Technology Lead in Southeast Asia.

Prior to KKR’s investment, GrowSari had raised funding from global financial and strategic investors, including Temasek-affiliated Pavilion Capital, Tencent, the International Finance Corporation, the Gongkowei family-controlled JG Summit, Robinsons Retail Holdings Inc., Wavemaker Partners, Saison Capital, and the Investment & Capital Corporation of the Philippines.

According to the statement, the ongoing Series C round is significantly oversubscribed, having drawn keen interest from new and existing investors, and the round’s final composition is currently being finalized.

It is also noted that KKR is making its investment in GrowSari from its Asia next generation technology strategy, and GrowSari is KKR’s latest investment into companies that augment the digital transformation of MSMEs through software and financial technology.

“We are pleased to invest in GrowSari, an innovative company with tremendous potential to digitally transform the operations of Filipino MSMEs, who are crucial contributors to the country’s economy and a pillar of the business community. We are excited to support the GrowSari team to achieve their expansion ambitions,” said Ashish Shastry, Co-Head of Asia Pacific Private Equity and Head of Southeast Asia at KKR.

KKR’s global investments in the sector include KiotViet, a merchant platform for MSMEs in Vietnam, Yayoi, a software developer, distributor, and support service provider for small and medium-sized enterprises (SMEs) in Japan, MYOB, a leading Australian online business management company, NetStars, the operator of Japan’s largest QR code payment gateway, Qonto, a leading European business finance solution for freelances and SMEs in France, Cegid, one of the largest European providers of enterprise software headquartered in France, and Exact Software, a provider of business and accounting software in the Netherlands.

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