From bootstrap to Series A funding, how Brodo does it

BRI Ventures and GDP Ventures announced last week that they are injecting Series A funding into Indonesian shoe brand Brodo. The news caught us in surprise. A pleasant one. Venture capital funding in Indonesian fashion brand is unheard of. A lot of fashion brands are either not big enough to receive venture capital funding or not ready to receive investment.

Yukka Harlanda and Putera Dwi Karunia founded Brodo in 2010. During the first three years of operations, they bootstrapped the brand by reinvesting the profit into the brand’s operations. The brand bagged its first investment in 2013 from angel investors. Even though Brodo can be categorised as a fashion brand, the purpose of the initial investment according to Brodo CEO Yukka Harlanda was to gain more knowledge in finance and operations.

“In 2013, we engaged with angel investors who helped us become more disciplined in financing and in operations, selling our products through consignment, more direct-to-consumer e-commerce,” said Yukka in an interview with TFR.

Brodo champions its locally-made shoes with neat craftsmanship and affordable price tag. Looking at the brand’s catalogue, we can safely conclude that the brand emphasises on the utility while keeping the designs simple and timeless - though there are one or two designs resembling other infamous brand.

According to Yukka, sneakers are the latest category that the brand is trying to tap into. “We want to expand the shoe categories. Sneakers, we believe, are big [in demand]. Then in sports, the only area that offers attractive growth during the pandemic.”

Brodo sneakers are more playful and vibrant than other categories. For instance, the Vantage Sepatokimin Lo sneakers feature red leaves prints on canvas. The fabrics are strategically cut and sewn to balance out different shades of red and the texture of the prints. There was also a collaboration between Brodo and visual artist Popomangun. The high top sneakers feature abstract illustrations in blue, yellow, green and pink.

Since 2019, the pair have explored the possibility of venture funding. One of the most important aspects for the founders is finding investors that align with their mission in empowering local brands. “Frankly speaking, a lot of investors are not interested in [our] made-in-Indonesia story,” said Yukka.

BRI Ventures and GDP Ventures, on the other hand, have been on board with the story since day one. BRI is a good match as the bank focuses on MSMEs. GDP Ventures, owned by Djarum, is one of the best venture builders in the country.

Finding the right investor requires extensive research, communication and, most importantly, patience. “The true great investors, they know when to help, they know when to stop, they know when to shut up, they know when to give opinion, and when they give opinion, it is one of the life-changing opinions for a company.”

For the founders, being selective with investors is the key. “I can say money is everywhere. As long as you have a good business, it’s easy to find the money. But to find a good investor that aligns with your mission, it takes work.” The investment will be channeled into supply chain management, operational excellence and research and development. Marketing and technology will follow later.

Scaling up the brand is not the only agenda. The brand has been building a back-end service called Boleh Dicoba Digital (BDD) for micro to small medium enterprises to scale up and market their products. The platform has released a consulting service, but the founders have ambitious plans ahead.

“We will be [their] growth partner, business partner. We will help brands scale up digitally,” said Yukka. Some of the notable brands in BDD platform include Never Too Lavish, Cotton Ink and Kick Avenue.