Peddlr, conceived and launched in July 2021 during the pandemic, aims to digitalize the inventories and operations of the Philippines’ 1.3 million tiny corner shops — or sari-sari stores, as they’re known — along with the country’s roughly 20 million micro and small enterprises. Founded by two entrepreneurs from the Philippine countryside, the company has raised roughly $5 million in seed and pre-seed funding, counting backers like 500 Global and Nordstar.

This interview has been edited and condensed for clarity.

Can you tell us about Peddlr — how it came about, what it does differently?

Me and [co-founder] Nel come from rural Samar. Our hometown wasn’t a real city — it’s like a pop-up city, like California Disneyland. It’s a plane from Manila to Tacloban, then two to three hours of driving on rough road. Whenever I go back, stores like my favorite pizza place, my favorite shaved iced store — they’re still using manual processes; everything on pen and paper, like it’s been stuck in time for more than 30 years. 

But the sari-sari store is like a hero of the community. Normally, they’re at the bottom level of a block of houses, and all the households go there for their daily groceries. The thing is, these businesses suffer because they don’t track inventory or handle operations properly. They will give customers credit and afterwards, lose track. In the Philippines, there are typhoons, a lot of floods, and that’s a big risk; they don’t have visibility of their cash because they put it all in a notebook or in their minds. They often end up closing. 

How do you overcome the attachment to books and pens? 

Filipinos hear “digitalization” and they think, “oh no, it’s expensive.” Some business owners can also have trust issues with the internet — I guess from scam links and phishing attempts. The thing is that Peddlr works offline, and the basic features are free. So you don’t have to have a strong internet connection; you can download the app, and use it for your inventory and accounting. You can even print receipts by Bluetooth.

During the pandemic, as everyone’s screen time went up, we posted every day in Facebook groups, “who wants a free POS system?” and underneath, maybe 1,000 comments saying “me, me!” And we rolled it out that way. We hired local software designers. Now we have more than 70 staff, 2.1 million downloads. We know that people even use it to monitor their businesses remotely in the Philippines — their retirement businesses — from places like Japan or Dubai. 

How does the app work? 

The app is free to download. Most alternative software is expensive, or complex, or both. Our core product is inventory management; most of these shopkeepers have been doing business for decades without even knowing the peso value of their current inventory. Connected to that, we also have ledgers to monitor cash flow and [invoicing], and have a function to create digital catalogs so the business owners can participate in e-commerce. As for revenue, we are still figuring it out. Our focus now is to really push digitalization, and revenue will be on the later stage of the startup. We’re also planning to roll out financial services in 2023.

Currently, we have around 1 million registered merchants on the platform. 55% of those are sari-sari stores, 30% are small local restaurants, canteens, cafeterias, food stalls, milk-tea shops, and the like; 10% are home-based online sellers, and 5% are other small and micro-type services and businesses.

The funding market is getting chilly — not just in the Philippines, but across Southeast Asia. How might the region, and startups like Peddlr, survive? 

If you ask me how Peddlr is making sure we survive, or even thrive, in tight market conditions, we’re basically ensuring the right business fundamentals are in place. As most seasoned startup founders say: “the best source of funding is your users and customers.”