Raena secures US$1.82M seed funding to help social influencers launch their own brands
Indonesia-based influencer commerce startup Raena has received US$1.82 million in seed funding led by Singapore VC firm Beenext.
Beenos, Strive, and the personal offices of Shailesh Rao, Partner with TPG Growth, and Sanjay Nath, Managing Partner of Blume Ventures, also co-invested.
Raena was founded by CEO Sreejita Deb who previously held roles at Amazon, InMobi and Google. What was started as an influencer marketing platform now helps influencers launch brands and businesses of their own. Despite having little brand recognition in Indonesia, the company said that it has partnered with seven influencers with a total following of 12 million so far.
“The internet ad market is not as robust as in the US or China, so influencers have a ready-made audience, but their opportunity to monetise their audience is very low,” said Deb. “That’s the premise on which I started the company. If influencers want to monetise their audiences, one way is to become their own e-commerce unit.”
The company looks for influencers that have at least 500,000 subscribers on YouTube or Instagram and has had discussions with people who have as many as 6.6 million followers with audience engagement as its most important metric.
Raena said it has come up with internal tools that crawl the last 50 posts made by an influencer on Instagram to see how many of their followers liked or commented on it (in the case of videos, it checks the percentage of people who watched the whole thing). Those with around 2 per cent engagement rate are considered good, with 10 per cent being “top of the class”.
“If someone has a million followers and has a 10 per cent engagement on average, but when you check branded content or a promo she’s done and see the engagement dips to 0.5 per cent, that’s an indication that her audience doesn’t want to hear her talking about brands or beauty,” Deb added. “We look for influencers who have a certain threshold of engagement and influence in different categories.”
What Raena provides are product developments and logistical resources.
The first brand it launched was Moonella and Family, created with the baby and family influencers babymoonella, an Indonesian family with a total audience of more than two million.
The process from conception to product’s launch involve discussion on consumer research with its influencer partners, who are usually presented with about five product concepts. Then Raena will go back to suppliers with feedback and the influencer’s criteria.
After that, products are refined while the influencer polls followers about what they want in the final product, before it goes into production.
The first products launched were Calm and Rescue Balm, that the company said took five weeks to create from conception to launch.
The choice of the products, Deb says, was the result of the company’s observations on the demand among milliennial parents, especially moms, for childcare products that are paraben-, sulphate-free, all-purpose balms.
Raena says in terms of monetisation, they get a cut of sales, without flat fees or minimum guarantees, so the company and its partners share risk more evenly.