10/02/2026
Business News

Vara has raised $4.8M from investors like Go Ventures and others to digitize Indonesian SMEs’ payrolls

  • July 15, 2021
  • 0

On the off chance that you follow startup news from Indonesia, you realize that the country’s estimated 60 million small businesses are a hot target for tech companies.

Share:
Vara has raised $4.8M from investors like Go Ventures and others to digitize Indonesian SMEs’ payrolls

On the off chance that you follow startup news from Indonesia, you realize that the country’s estimated 60 million small businesses are a hot target for tech companies. BukuKas and BukuWarung, for example, both as of late raised large rounds to fuel their race to digitize SMEs’ operations. Established in November 2020, Vara is focused specifically on making staff management easier for small businesses and their workers, replacing the notebooks or spreadsheets many depended on to monitor payroll with an app called Bukugaji.

The company announced today it has raised $4.8 million in seed funding from Go Ventures, RTP Global, AlphaJWC, Sequoia Capital India’s Surge, FEBE Ventures and Taurus Ventures. Established by Vidush Mahansaria and Abhinav Karale, who met while studying at the Wharton School at the University of Pennsylvania, Vara is part of the Surge accelerator program’s fifth partner of startups. It says in excess of 100,000 small businesses are already using Bukugaji.

The app has features to track attendance, calculate salaries and laborer loans and disburse payroll. Mahansaria told TechCrunch that Bukugaji is aimed at companies that have less than 30 employees. Many of them are in retail, food and beverage or labor-heavy service sectors like construction and transportation. Bukugaji has features for specific representative segments, as operational staff who usually work in shifts, or permanent staff whose paychecks are fixed throughout a specific time span.

“Prior to downloading and onboarding on Bukugaji, the vast majority of our users used notebooks to mark attendance and track payroll,” Mahansaria said. “A small segment used the notes features on their phones or simple Excel sheets.” Bukugaji is designed to be completely self-service, so businesses can download and start using the app all alone. Its main app is portable just, however the platform also has a web version.

The businesses Bukugaji serves often have workers who are unbanked, meaning they don’t have access to a bank account or traditional financial services. Vara’s founders say many of them live paycheck to paycheck and this means they sometimes have to take out loans from their employers.

“Employees often request cash advances from their employers toward the month’s end, when they need the cash the most because sometimes they can’t make ends meet,” said Mahansaria. “This has two outcomes: first, it ties up working capital for the business. Second, it makes the worker increasingly reliant on the business to address crisis issues. It’s hard to break out of this cycle given the current restricted accessibility to formal financial infrastructure for this market segment.”

Earned wage access (EWA) platforms are focused on solving this issue by giving employees on-demand access to wages, instead of having to wait for their paycheck. EWA companies are gaining traction around the world, including Wagely and GajiGesa in Indonesia. Vara doesn’t have immediate plans to add an EWA feature to Bukugaji, yet it is something the company is thinking about as part of the value-additive services it will incorporate into the platform.

“Owning start to finish payroll and attendance gives us an information edge that is unparalleled for this labor segment,” Mahansaria said, noting that the data can enable companies to add things like benefits that their employees usually don’t have access to, and in turn give workers a digitally-checked work history.

In the near future, Bukugaji will add efficient features like automated allowances and extra time, dashboard shortcuts, reminders and customizable reports. It also plans to allow employers to disburse salaries straightforwardly through the platform. Over the more extended term, Bukugaji will offer data analytics to companies and their workers. For example, employees can also see how their earnings have changed over the long haul. Employers, meanwhile can spot trends in attendance and salary.

However Vara may eventually expand into markets, Mahansaria said it is right now “razor-focused on Indonesia,” where SMEs account for about 60% of the country’s gross domestic item and utilize the vast majority of its labor force.

Leave a Reply

Your email address will not be published. Required fields are marked *