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BUCHAREST (Romania), November 3 (SeeNews) - Romanian online retailer elefant.ro, owned by Fribourg Capital investment fund, aims to expand significantly in Europe in the next two years and intends to attract a new round of investment in its technological capacity, Fribourg owner Ion Sturza says.
"We aim to reach beyond Romania and Moldova. Bulgaria will be one of our first target markets followed by Hungary and Poland," Sturza, a Moldovan businessman, told SeeNews on the sidelines of a Foreign Investors Summit in Bucharest on Wednesday.
In May, Moldova became the first foreign market to which elefant.ro expanded its business, by establishing a pick-up point and a dedicated website for orders. However, the small impoverished country with a population of 3 million is considered a secondary market for elefant.ro, Sturza added.
The online retailer hopes to expand rapidly in Europe in the next two years by establishing a different distribution model.
"Having hubs and warehouses is old news, the provider must be able to deliver at least in cross-docking mode, our idea is for them to deliver directly, so the merchandise does not have to pass through our warehouse," said Sturza, who was Moldova's prime minister in 1999.
Cross-docking is a practice in logistics of unloading materials from an incoming semi-trailer truck or railroad car and loading these materials directly into outbound trucks, trailers, or rail cars, with little or no storage in between.
In July, elefant.ro announced that Romanian-American Axxess Capital investment fund had become a minority shareholder in the company, following a 5.5 million euro ($6.05 million) capital injection aimed at boosting further the retailer's annual growth rate of over 50%. The company drew several rounds of investment in recent years from funds such as Fribourg Capital (ex-Greenlight Invest), Catalyst Romania and 3TS Capital Partners, which are present shareholders.
Sturza said that Elefant.ro plans to draw new rounds of financing in the next two years for its technological development and to reach its long-term goal to have sales of several hundred million lei. He gave no number for the sales target.
"We already have providers who start shipping directly from their own warehouses from Europe or Asia, as soon as someone clicks on a product and orders it," Sturza, who was also deputy general manager of oil group Rompetrol Moldova, said.
Elefant.ro was founded in 2010 following an investment of about 1.2 million euro from private equity fund Fribourg Capital and is currently the fund's biggest company. It is one of the largest online retailers in Romania, with over 600,000 customers and over 30 delivery points countrywide.
The online retailer posted a turnover of 77 million lei ($19 million/17 million euro) in 2015, up 60.4% year on year, and a loss of 9.7 million lei, 53% higher than in 2014.
When it comes to choosing to invest in an idea, Sturza says he supports entrepreneurs who are open-minded and capable of implementing their ideas.
Fribourg supports non-profit Spherik business accelerator in the city of Cluj, in central-western Romania, which aims to create an ecosystem of value generation by pooling together major stakeholders, from universities to private companies and local administration.
It was founded by Liberty Technology Park (a Fribourg project), Banca Transilvania, Babes Bolyai University and the Technical University, both from Cluj.
Its most recent success is the takeover of Romanian start-up Printivate by Dutch printing services platform 3D Hubs, which was announced on Wednesday. Printivate was one of the first projects included in the Spherik business accelerator in 2014.
Another Fribourg business is Upswing, a SEO and digital marketing services agency from which a very successful start-up emerged, Sturza said.
"SEO Monitor started as a SEO service agency and developed an application that today is selling in almost 40 countries in the world and is being used by over 1,500 clients. It is an example of how a small team of young people can develop an authentic product." In 2016, SEO Monitor received the “Best Innovation in Software” prize at the European Search Awards.
Such talented young people can also be found in Moldova, Sturza said, adding that the IT&C and services industry is starting to develop there too, making Moldova an interesting destination from this point of view. However, as Moldovan investors lack interest for now, a lot of the ideas of young Moldovan entrepreneurs turn into businesses in the Spherik accelerator, said Sturza, who has a fortune of 38-40 million euro according to Top 300 Wealthiest Men in Romania 2015 publication of Romania's Capital magazine.
(1 euro = 4.5040 lei)